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<SEC-DOCUMENT>0000950103-03-001455.txt : 20030630
<SEC-HEADER>0000950103-03-001455.hdr.sgml : 20030630
<ACCEPTANCE-DATETIME>20030630125311
ACCESSION NUMBER:		0000950103-03-001455
CONFORMED SUBMISSION TYPE:	20-F
PUBLIC DOCUMENT COUNT:		7
CONFORMED PERIOD OF REPORT:	20021231
FILED AS OF DATE:		20030630

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			MILLICOM INTERNATIONAL CELLULAR SA
		CENTRAL INDEX KEY:			0000912958
		STANDARD INDUSTRIAL CLASSIFICATION:	RADIO TELEPHONE COMMUNICATIONS [4812]
		IRS NUMBER:				000000000
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		20-F
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-22828
		FILM NUMBER:		03763347

	BUSINESS ADDRESS:	
		STREET 1:		75 ROUTE DE LONGWY
		STREET 2:		BOX 23 BERTRANGE
		CITY:			GRAND DUCHY OF LUXEN
		STATE:			N4
		ZIP:			L8080
		BUSINESS PHONE:		3524571451
</SEC-HEADER>
<DOCUMENT>
<TYPE>20-F
<SEQUENCE>1
<FILENAME>jun2703_mill20f.txt
<TEXT>
================================================================================


                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                    FORM 20-F


                ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

         For the fiscal year ended                   Commission file
            December 31, 2002                         number 0-22828

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

                      MILLICOM INTERNATIONAL CELLULAR S.A.
             (Exact name of Registrant as specified in its charter)

                            GRAND-DUCHY OF LUXEMBOURG
                 (Jurisdiction of incorporation or organization)

     75 Route de Longwy, Box 23, L-8080 Bertrange, Grand-Duchy of Luxembourg
                    (Address of principal executive offices)


        Securities registered pursuant to Section 12(b) of the Act: None

           Securities registered pursuant to Section 12(g) of the Act:

          Common Shares, par value $2.00 each, as of December 31, 2002
                                (Title of Class)

    Securities for which there is a reporting obligation pursuant to Section
                             15(d) of the Act: None

    Indicate the number of shares outstanding of each of the Issuer's classes
 of capital or common stock as of the close of the period covered by the annual
                                    report:

Common Shares with a par value of $2.00 each: 48,853,425 as of December 31, 2002
- --------------------------------------------------------------------------------

     Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

                            Yes X           N
                               ---            ---

     Indicate by check mark which financial statement item the Registrant has
elected to follow:

                            Item 17         Item 18 X
                                ---             -----


================================================================================



<PAGE>


                                Table of Contents

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


                                                                            Page
                                                                            ----


FORWARD-LOOKING STATEMENTS.....................................................2

CERTAIN TERMS..................................................................2

PART I.........................................................................4
     ITEM 1.      IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS........4
     ITEM 2.      OFFER STATISTICS AND EXPECTED TIMETABLE......................4
     ITEM 3.      KEY INFORMATION..............................................4
     ITEM 4.      INFORMATION ON THE COMPANY..................................12
     ITEM 5.      OPERATING AND FINANCIAL REVIEW AND PROSPECTS................43
     ITEM 6.      DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES..................55
     ITEM 7.      MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS...........58
     ITEM 8.      FINANCIAL INFORMATION.......................................62
     ITEM 9.      THE OFFER AND LISTING.......................................62
     ITEM 10.     ADDITIONAL INFORMATION......................................63
     ITEM 11.     QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK...69
     ITEM 12.     DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES......73

PART II.......................................................................73
     ITEM 13.     DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES.............73
     ITEM 14.     MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY
                    HOLDERS AND USE OF PROCEEDS...................73
     ITEM 15.     CONTROLS AND PROCEDURES.....................................73
     ITEM 16.     [RESERVED]..................................................74

PART III......................................................................74
     ITEM 17.     FINANCIAL STATEMENTS........................................74
     ITEM 18.     FINANCIAL STATEMENTS........................................74
     ITEM 19.     EXHIBITS....................................................74

SIGNATURES....................................................................75


<PAGE>


                           FORWARD-LOOKING STATEMENTS

     Certain of the statements made in this document may be considered to be
"forward-looking statements" as that term is defined in the U.S. Private
Securities Litigation Reform Act of 1995, such as statements that include the
words "expect", "estimate", "believe", "project", "anticipate", "should",
"intend", "probability", "risk", "may", "target", "goal", "objective" and
similar expressions or variations on such expressions. These statements appear
in a number of places throughout the document including, but not exclusively,
"Information on the Company", and "Operating and Financial Review and
Prospects". These statements concern, among other things, trends affecting the
Company's financial condition or results of operations, capital expenditure
plans, the potential for growth and competition in areas of the Company's
business and the supervision and regulation of the telecommunications' markets.
Such forward-looking statements are not guarantees of future performance and
involve risks and uncertainties; actual results may differ materially as a
result of various factors.

     These factors include, but are not limited to:

     o    general economic conditions, government and regulatory policies and
          business conditions in the markets served by the Company and its
          affiliates;

     o    telecommunications usage levels, including traffic and customer
          growth;

     o    competitive forces, including pricing pressures, technological
          developments and the ability of the Company to retain market share in
          the face of competition from existing and new market entrants;

     o    regulatory developments and changes, including with respect to the
          level of tariffs, the terms of interconnection, customer access and
          international settlement arrangements, and the outcome of litigation
          related to regulation;

     o    the success of business, operating and financing initiatives, the
          level and timing of the growth and profitability of new initiatives,
          start-up costs associated with entering new markets, costs of handsets
          and other equipment, the successful deployment of new systems and
          applications to support new initiatives, and local conditions; and

     o    the availability, terms and use of capital, the impact of regulatory
          and competitive developments on capital outlays, the ability to
          achieve cost savings and realize productivity improvements, and the
          success of the Company's investments, ventures and alliances.

     Readers are cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date hereof. Millicom International
Cellular S.A. undertakes no obligation to release publicly the result of any
revisions to these forward-looking statements which may be made to reflect
events or circumstances after the date hereof, including, without limitation,
changes in Millicom International Cellular S.A.'s business or acquisition
strategy or planned capital expenditures, or to reflect the occurrence of
unanticipated events.


                                  CERTAIN TERMS

     Unless the context otherwise requires, the term "MIC" refers only to
Millicom International Cellular S.A., a stock corporation organized under the
laws of the Grand-Duchy of Luxembourg, and the terms the "Company", "we", "us"
or `our" refers to MIC and its subsidiaries, joint ventures and affiliates. The
term "MIC Cellular" refers to the operations of the Company, excluding those of
Tele2 AB (formerly named NetCom AB). Unless the context otherwise requires, when
used herein with respect to a licensed area, "persons", "population" and "pops"
are interchangeable and refer to the aggregate number of persons located in such
licensed area and "equity pops" refers to the number of such persons in a
licensed area multiplied by the Company's ownership interest in the licenses for
such licensed area. The term "Proportional Subscribers" refers to the Company's
share of the total subscribers in an operation. Persons, population and pops
data for 2002 have been extracted from the `CIA - The World Factbook' for 2002
for countries where the license area covers the entire country and have been
estimated by management for countries where the license area is less than the
entire country. Unless otherwise indicated, all financial data and


                                       2
<PAGE>


discussions thereon in this annual report are based upon financial statements
prepared in accordance with International Financial Reporting Standards ("IFRS")
and subscriber figures represent the total number of cellular subscribers of
systems in which the Company has an ownership interest.

     As a foreign private issuer, the Company is exempt from the proxy rules of
Section 14 under the Securities Act of 1934, as amended (the "Exchange Act"),
and the reporting requirements of Section 16 under the Exchange Act.




                                       3
<PAGE>



                                     PART I

ITEM 1.  IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS

     Not applicable.

ITEM 2.  OFFER STATISTICS AND EXPECTED TIMETABLE

     Not applicable.

ITEM 3.  KEY INFORMATION

Selected Financial Information

     The Company reports under International Financial Reporting Standards
("IFRS"). The following tables present comparative information under IFRS and
U.S. generally accepted accounting principles ("U.S. GAAP"). The principal
differences between the accounting policies applied by the Company under IFRS
and U.S. GAAP are discussed in Note 30 of the "Notes to the Consolidated Annual
Accounts".

     The following table sets-forth summary financial data of the Company as of
and for the years ended December 31, 2002, 2001, 2000, 1999 and 1998. The data
are based upon the Company's audited consolidated balance sheets as of December
31, 2002, 2001, 2000, 1999 and 1998 and audited consolidated statements of
profit and loss for the years then ended. The following information is qualified
in its entirety by, and should be read in conjunction with, such statements.

     Unless otherwise indicated all financial data and discussions therein in
this document are based upon financial statements prepared in accordance with
IFRS.


                                               SELECTED FINANCIAL DATA
<TABLE>

                         (Prepared under International Financial Reporting Standards) (1) (2)
                           (In thousands of U.S. dollars, except ratios and per share data)

                                                                       Year Ended December 31,
                                                      ------------------------------------------------------------
                                                       2002         2001          2000         1999          1998
                                                      -------      -------      -------       -------      -------
<S>                                                   <C>          <C>          <C>           <C>          <C>
Profit and Loss Statement Data:                                                           (restated)    (restated)
Revenues......................................        605,186      644,570      570,840       552,401      458,978
Operating profit .............................        122,313       92,786      (53,378)       (8,610)     120,835
(Loss) gain from investment securities........       (299,963)     (15,931)     665,262       144,296       73,899
(Loss) profit for the year from continuing
   operations (3).............................       (507,162)    (138,020)     408,468       (32,857)      50,347
(Loss) profit for the year....................       (385,143)    (138,053)     355,388       (42,303)      38,144
Basic (loss) earnings from continuing
   operations per common share................        $(31.08)      $(8.46)      $25.10        $(2.03)       $3.10
Basic (loss) earnings per common share........        $(23.60)      $(8.46)      $21.84        $(2.61)       $2.34
Average number of shares in basic computation
   (4)........................................         16,318       16,314       16,273        16,215       16,217
Diluted (loss) earnings from continuing
   operations per common share................        $(31.08)      $(8.46)      $24.76        $(2.03)       $3.09
Diluted (loss) earnings per common share......        $(23.60)      $(8.46)      $21.54        $(2.61)       $2.35
Average number of shares in diluted
   computation (4)............................         16,318       16,314       16,500        16,215       16,313
Dividends per share...........................          $nil         $nil         $nil          $nil         $nil
</TABLE>


                                                          4

<PAGE>


<TABLE>
                                                                         As of December 31,
                                                     ---------------------------------------------------------------
                                                        2002         2001          2000         1999          1998
                                                     ---------    ---------     ---------    ---------     ---------
<S>                                                   <C>          <C>          <C>           <C>          <C>
Balance Sheet Data:                                                                       (restated)    (restated)
Tangible assets, net.........................          458,933      512,236       577,501      499,579       489,371
Licenses, net................................           84,471      164,541       201,124      173,681       188,863
Investment in securities (5).................          321,926      676,829       816,211      407,978       281,457
Investments in associated companies..........            1,013       52,858             -      139,963         5,020
Total assets.................................        1,203,119    1,870,930     2,112,228    1,639,461     1,563,147
Current liabilities..........................          375,862      469,191       651,034      357,045       383,160
Non-current liabilities......................        1,098,783    1,322,583     1,112,331      983,292       946,154
Minority interest............................           23,733       10,262         7,672        4,295         2,531
Shareholders' equity ........................        (295,259)       68,894       341,191      294,829       231,302
</TABLE>

<TABLE>

                                          (Prepared under U.S. GAAP) (6)(7)
                           (In thousands of U.S. dollars, except ratios and per share data)

                                                                      Year Ended December 31,
                                                     ---------------------------------------------------------------
                                                        2002         2001          2000         1999          1998
                                                     ---------    ---------     ---------    ---------     ---------
<S>                                                    <C>          <C>           <C>          <C>           <C>
Profit and Loss Statement Data:                                (restated)    (restated)   (restated)    (restated)
Revenues.....................................          415,864      419,542       369,908      257,097       228,888
Operating (loss) profit......................         (33,848)       12,875      (26,373)       15,405       (1,284)
(Loss) gain from investment securities.......        (299,963)     (15,931)       665,262      144,296        73,899
   Profit (loss) for the year from continuing
   operations (3)............................        (330,357)    (126,180)       420,817     (15,697)      (10,516)
(Loss) profit for the year...................        (328,820)    (174,766)       370,573     (27,549)      (17,259)
  Basic (loss) earnings per common share from
   continuing operations.....................         $(20.24)      $(7.73)        $25.86      $(0.97)       $(0.65)
Basic (loss) earnings per common share.......         $(20.15)     $(10.71)        $22.77      $(1.70)       $(1.06)
            Average number of shares in basic
   computation (4)...........................           16,318       16,314        16,273       16,215        16,217
     Diluted (loss) earnings per common share
   from continuing operations................         $(20.24)      $(7.73)        $25.50      $(0.97)       $(0.65)
Diluted (loss) earnings per common share.....         $(20.15)     $(10.71)        $22.46      $(1.70)       $(1.06)
          Average number of shares in diluted
   computation (4)...........................           16,318       16,314        16,500       16,215        16,217

<CAPTION>

                                                                           As of December 31,
                                                     ---------------------------------------------------------------
                                                       2002         2001          2000         1999          1998
                                                     ---------    ---------     ---------    ---------     ---------
<S>                                                    <C>          <C>           <C>          <C>           <C>
Balance Sheet Data:                                            (restated)    (restated)   (restated)    (restated)
Tangible assets, net.........................          286,372      376,676       399,585      293,960       251,869
Licenses, net................................           20,407      137,910       173,921       92,261       116,190
Investment in securities (5).................          321,905      675,865       816,456      408,213       261,514
Investments in associated companies..........          111,622      131,616        77,130      136,483        54,469
Total assets.................................        1,123,194    1,724,439     1,902,814    1,314,816     1,229,147
Current liabilities..........................          329,055      339,311       485,706      193,681       194,274
Non-current liabilities......................        1,067,508    1,302,088     1,137,637      905,444       877,259
Minority interest............................           23,733       10,262         7,672        4,295         2,531
Shareholders' equity........................         (297,102)       72,778       271,799      211,396       155,083
</TABLE>


                                                          5
<PAGE>


(1)  The figures for 1998 and 1999, prepared under International Financial
     Reporting Standards, have been restated to reflect retrospective
     application of IFRS 38.

(2)  See Note 30 of the "Notes to the Consolidated Annual Accounts" for certain
     reconciliations between IFRS and U.S. GAAP.

(3)  Under IFRS, the MIC Systems and FORA group of companies have been reported
     as discontinuing operations in the consolidated financial statements. Under
     US GAAP, the MIC Systems group of companies, Liberty Broadband Limited
     (formerly Tele 2 (UK)) in the United Kingdom and Celcaribe S.A. in Colombia
     have been reported as discontinuing operations.

(4)  The average number of shares disclosed above has been adjusted for each
     year presented to reflect the reverse share split in February 2003 whereby
     three existing shares of a par value of $2 each were exchanged for one new
     share with a par value of $6 each. The average number of shares, which is
     calculated on a weighted average basis, does not include shares held by the
     Company that have no voting, dividend or other rights while held by their
     current holders (7,423,767 shares at December 31, 2002).

(5)  For the years ended December 31, 1999 to 2001, an amount of $5,027,000 has
     been reclassified from other non-current assets to investment in
     securities. This amount corresponds to the Company's investment in Great
     Universal.

(6)  The U.S. GAAP figures for 1998 to 2001 have been restated to reflect the
     correction of certain errors as described in Note 30 to the consolidated
     financial statements. The reconciliation between the previously reported
     net income (loss) and shareholders' equity under U.S. GAAP as of, and for
     the years ended December 31, 2001 and 2000 and the corresponding restated
     amounts is presented in Note 30. The U.S. GAAP figures for 1999 and 1998
     have been adjusted to reflect the correct application of the equity method
     of accounting of MIC's joint ventures under U.S. GAAP (see Item 16 in Note
     30). Other restatement items, as described in Note 30, only refer to 2001
     and 2000.

(7)  As described in Note 30 of the consolidated financial statements, under
     U.S. GAAP, the Company should consolidate its investment in Great Universal
     and Modern Holdings. The U.S. GAAP revenues and operating profit (loss) for
     each of the years presented in the table above do not include the effect of
     the consolidation. However, the effects of the consolidation on MIC's
     reported revenues and operating profit (loss) for each of the years ended
     December 31, 2002, 2001 and 2000 are disclosed in Note 30.

Risk Factors

   General Risks

     We have a history of losses and expect to incur losses in the future, and
we may be unable to achieve profitability. We experienced a net loss for each of
the years from 1998 to 2002, after excluding gains from investment securities.
For the year ended December 31, 2002 we incurred a net loss of $385,143,000. For
the year ended December 31, 2001 we made net losses of $138,053,000. For the
year ended December 31, 2000 we made net profits of $355,388,000. During 1999
and 1998, we made net losses of $42,303,000 and net profits of $38,144,000
respectively.

     We are not assured of achieving or maintaining profitability in the future,
nor are we sure that we will always have sufficient resources to make payments
on our indebtedness. Future performance will depend, in particular, on our
ability to generate demand and revenue for our services, to maintain existing
subscribers and customers and to attract new subscribers and customers. Costs in
connection with the acquisition of future licenses and the costs incurred in
order to commence and develop operations of cellular and related telecom systems
will also affect revenues and profitability. See "Operating and Financial Review
and Prospects."

     We have substantial outstanding debt, significant debt service obligations
and capital requirements and we are subject to restrictions on the withdrawal of
funds. As of December 31, 2002, we had total consolidated outstanding debt and
other financing of approximately $1,228,575,000. Of this amount, $967,557,000
represents MIC's indebtedness and $261,018,000 is our consolidated share of the
indebtedness of our ventures. Corporate


                                       6
<PAGE>

guarantees, cash deposits and standby letters of credit issued at the request of
and guaranteed by us secure liabilities of $189,395,000.

     In June 1996, we issued $962,000,000 principal amount of our 13 1/2% Senior
Subordinated Discount Notes, or our "Old Notes". The Old Notes were issued at
52.075% of their principal amount and the purchase discount on the Old Notes
accreted at a rate of 13 1/2% compounded semiannually from issuance until June
1, 2001. The net cash proceeds from the issuance of the Old Notes after
deducting discount and estimated expenses were approximately $483,433,000. The
Old Notes began accruing cash interest on June 1, 2001 and thereafter cash
interest continues to accrue until maturity on June 1, 2006 at a rate of 13 1/2%
per annum, payable semiannually in arrears on June 1 and December 1, commencing
December 1, 2001.

     In May 2003, we completed a successful exchange offer and consent
solicitation for approximately 85% of the Old Notes and issued approximately
$562 million of 11% Senior Notes (the "11% Notes") and approximately $64 million
of 2% Senior Convertible PIK (payment in kind) Notes due 2006 (the "2% Notes")
in exchange for approximately $781 million in principal amount of Old Notes. We
refer to the 11% Notes and the 2% Notes together as our "New Notes". Following
the completion of the exchange offer, (after additional repurchases by us and
related cancellations of Old Notes with a face value of $44 million in 2002),
there remained outstanding Old Notes with a face value of $137,080,000. We refer
to our Old Notes and our New Notes together as our "Notes".

     The Old Notes are redeemable at our option, in whole or in part, at any
time at redemption prices starting at 106.75% of the principal amount in year
2001 and decreasing to 100.00% in year 2004 plus accrued and unpaid interest at
the date of redemption. The New Notes are redeemable at our option, in whole or
in part, at any time prior to June 1, 2004 at a redemption price of 102.25% of
the principal amount then outstanding and at June 1, 2004 and thereafter at a
price of 100% of the principal amount then outstanding, in each case plus
accrued and unpaid interest at the date of redemption. In addition, with respect
to the 11% Notes, on each of June 1, 2004, December 1, 2004, June 1, 2005 and
December 1, 2005 we are required to redeem $17,5000,000 in principal amount of
11% Notes due to an amortization schedule set forth in the indenture governing
the 11% Notes.

     Upon the occurrence of a change of control triggering event, which is
defined in the indenture related to the Notes as a rating decline and change of
ownership, holders of the Notes may require us to purchase all or a portion of
the Notes at a purchase price of 101% of the stated principal amount of the
Notes, plus accrued and unpaid interest, if any, on the Notes to the date of
purchase.

     Under our indentures relating to the Notes we may not incur indebtedness
unless the `debt coverage ratio' would be less than 7 to 1. The debt coverage
ratio is the ratio of the consolidated principal amount of debt outstanding to
four times operating income. As at December 31, 2002 the ratio was 1.2 to 1. If
we cease to meet the debt coverage ratio requirement, it may incur debt under
several `debt baskets' as set forth in the indentures. External sources of
funding are expected to continue to play an important role in our financing. To
the extent we may not incur indebtedness we may not be able to repay our
existing obligations when they become due.

     Interest and principal payment obligations on such debt impose substantial
debt service obligations on us. In addition, we (including certain ventures in
which we have interests) are subject to certain covenants and restrictions that
pledge certain assets and restrict, among other things, the payment of
dividends, the disposition of assets and the use of borrowed funds and require
the maintenance of certain financial ratios. Furthermore, if, upon the
occurrence of a change of control triggering event, holders of the Notes require
us to purchase the Notes at a purchase price of 101% of the accreted value or
the stated principal amount of the Notes, as the case may be, we may not be able
to meet the obligations, which may cause lenders to accelerate their debt. Our
ability to meet our obligations will be dependent upon our future performance
and operating cash flows, which will be subject to prevailing economic
conditions and to financial business and other factors beyond our control. In
addition, we may have to sell certain assets to meet our obligations. There is a
risk that the value realized by these sales may be at lower than book value or
that lender consent for these sales may be required and that such consent may
not be obtained on acceptable terms or at all. Furthermore, we have pledged a
portion of our Tele2 AB shares to our creditors. As a result of the above and
other factors, our cash position may fluctuate significantly and there is a risk
that future cash flows generated will be insufficient to repay all our existing
debt


                                       7
<PAGE>

obligations as they become due. See "Operating and Financial Review and
Prospects--Liquidity and Capital Resources."

     Our ability to receive funds from, and to exercise management control over
our ventures is often dependent upon the consent of other participants who are
not under our control. Disagreements or unfavorable terms in the relevant
agreements could adversely affect our operations. As of December 31, 2002, we
participated in 17 cellular ventures in 16 countries. In February 2003, the
Company completed the divestment of its operation in Colombia, thereby reducing
its participation to 16 cellular ventures in 15 countries. Our participation in
each venture differs from market to market and we do not have a controlling
interest in some operations. Sometimes, our ability to withdraw funds, including
dividends, from our participation in, and to exercise management control over,
ventures and investments therein, depends on receiving the consent of the other
participants. While the precise terms of the arrangements vary, our operations
may be affected if disagreements develop with venture partners. See "Information
on the Company--Overall Business Strategy--Maximize Operating
Effectiveness--Retain Operational and Financial Control."

     We rely upon dividends and other payments from our ventures to generate the
funds necessary to meet our obligations. The ventures are legally distinct from
us and have no obligation to pay amounts due with respect to our obligations, or
to make funds available for such payments. Our ventures do not guarantee our
obligations. The ability of our ventures to make such payments to us will be
subject to, among other things, the availability of funds, the agreement of the
venture partner(s), the terms of each venture's indebtedness and applicable
local laws. The majority of our operations have entered into financing
facilities, some of which are guaranteed by us, which prohibit or restrict the
payment of dividends by those ventures to the Company. Claims of creditors of
our ventures, including trade creditors, will generally have priority over our
claims and the holders of our indebtedness. At December 31, 2002, the total debt
and other financing of the Company and each of the ventures, combining 100% of
each venture's debt, was $1,289,893,000. See "Information on the
Company--Financing of the Company's Business."

     We may face de-listing of our common stock. In January 2003 we faced a
de-listing of our common stock from the Nasdaq National Market due to the low
level of our stock price and our consolidated negative shareholders' equity. The
then imminent de-listing was averted following a reverse stock split in February
2003. We cannot make assurances that the value of our common stock will remain
stable and that we will not face de-listing again in the future.

     The terms of our loan agreements could prevent us from selling certain
assets, incurring debt or receiving dividends from our ventures. The financing
arranged through Toronto-Dominion Securities imposes constraints on the sale of
pledged Tele2 AB shares. The number of shares pledged under the new financing
agreement is adjusted on a monthly basis based upon the Tele2 class B shares'
market value. Tele2 shares pledged are not available for sale to offset any
operating losses or to meet our interest or principal payment obligations. As of
December 31, 2002, the new financing arrangement was collaterized by 6,184,293
of our Tele2 class B shares. The Notes also impose additional restrictions on
the incurrence of debt, the disposal of assets and the payment of dividends by
ventures.

     Certain insiders own significant amounts of our shares, giving them a
substantial amount of management control. Kinnevik, together with our
management, the estate of Jan H. Stenbeck, our former Chairman who passed away
in August 2002, and both the 1980 and 1985 Stenbeck Trusts, beneficially own a
significant percentage of the outstanding shares of MIC Common Stock. The estate
of Mr. Stenbeck is currently in probate in both Luxembourg and Sweden. Three
members of our Board of Directors are independent, consequently, this group of
insiders, acting together, can exercise control over our management and affairs,
including:

     o    the composition of our Board of Directors and through it, any
          determination with respect to our business direction and policies,
          including the appointment and removal of officers,

     o    the allocation of business opportunities that may be suitable for us,

     o    any determinations with respect to mergers, acquisitions or other
          business combinations,


                                       8
<PAGE>


     o    our acquisition or disposition of assets,

     o    our financing,

     o    incurrence of debt, pledge of our assets and the use of proceeds from
          any debt financing.

     There can be no assurance that the decisions of Kinnevik will be in the
best interests of the Company or its shareholders. See "Major Shareholders and
Related Party Transactions."

     Due to insufficient equity in MIC, there is a risk the Company may be
dissolved. Under Luxembourg company law, all companies must have losses less
than half their subscribed share capital. If this is not the case, the
shareholders must vote as to whether or not to dissolve the company. As of
December 31, 2002, MIC has losses equal to more than half its subscribed share
capital. At the Annual General Meeting held on May 27, 2003, the shareholders
elected to continue operations for the coming 12 months.

     U.S. investors will be subject to special tax rules if we are considered to
be a passive foreign investment company. Special U.S. tax rules apply to U.S.
taxpayers who own stock in a "Passive Foreign Investment Company" (a "PFIC") or
in a "Foreign Personal Holding Company" (a "FPHC"). There can be no assurance
that we presently are not, or will not become, a PFIC. Our status under the PFIC
rules for each year depends upon our income and assets from time to time during
that year. Our substantial investment in associated companies' securities and
other "passive assets", and the decline in the value of our stock, result in a
risk that we are a PFIC or could become a PFIC in the future. If we were
determined to be a PFIC, then shareholders who are U.S. persons under U.S. tax
laws would be subject to special unfavorable tax rules. See "Additional
Information--Taxation--United States Investors."

     We have investments whose value may fluctuate over time. As at December 31,
2002, the Company recorded the market value of its investment in Tele2 AB at
$265,571,000 (2001: $659,440,000, 2000: $800,070,000). The value of this
investment is subject to market fluctuations and may continue to fall.

     Potential dilution of existing shareholders following Old Note exchange. As
part of the Old Note exchange completed in May 2003, holders who exchanged Old
Notes received 2% Senior Convertible PIK (payment in kind) Notes due 2006. These
2% Notes are convertible at any time into MIC common stock at a conversion price
of $10.75. At maturity, the Company has the option to pay all, or a portion of,
the then outstanding principal amount of the 2% Notes in cash or in shares of
MIC common stock. At the date of the exchange, 2% Notes with a value of
$63,714,000 were issued. If they had been exchanged on that date, MIC would have
issued 5,926,800 new shares with rounding balances settled through cash
payments.

   Risks Related to Our Cellular Telephone Operations

     We face intense competition in the cellular telephone operator market. The
cellular systems in which we have interests face competition from the landline
telephone networks and other cellular telephone operators in the markets in
which they operate.

     We expect that other cellular telephone operators will obtain licenses in
some markets, including markets where we do not currently have a licensed
cellular telephone competitor. Moreover, additional licenses may be awarded in
markets where we already face competition from other communications technologies
that are being or may be developed and/or perfected in the future. The cellular
telephone systems in each market compete for customers principally on the basis
of services offered, quality of service, coverage area and price. Some of our
competitors have substantially greater capital resources than we do. Price
competition can be significant.

     In addition, new competitors, such as cable companies that are able to
leverage their existing networks, may enter the telecommunications markets. The
level of competition is influenced by the continuous and swift technological
advances that characterize the industry, the regulatory developments that affect
competition and alliances between market participants.

                                       9
<PAGE>


     The cellular telephone operations market is heavily regulated. The
licensing, construction, ownership and operation of cellular telephone systems,
and the grant, maintenance and renewal of cellular telephone licenses and radio
frequency allocations, are regulated by governmental entities in the markets
that we service. In addition, such matters and certain other aspects of cellular
telephone system operations, including rates charged to customers and the resale
of cellular telephone service, may be subject to public utility regulation in
the relevant market. Changes in the regulation of our activities, such as
increased or decreased regulation affecting prices, the terms of interconnect
arrangements with land-line telephone networks or requirements for increased
capital investments, could materially adversely affect us.

     We face substantial competition for obtaining and funding new telephone
licenses. We are continually seeking additional cellular telephone licenses in
new markets, primarily in developing countries. In each new market we face
competition for licenses from major international telecommunications entities as
well as from local competitors. While we have not typically paid significant
amounts for cellular licenses, the competition for the granting of the licenses
is increasingly intense. As such, we anticipate that we may have to pay
substantial license fees in certain new markets. There can be no assurance that
we will be successful in obtaining any new cellular telephone licenses, or if
licenses are awarded that they can be obtained on terms acceptable to us. If we
obtain further licenses, we may need to seek future funding through additional
borrowings or equity offerings and there can be no assurance that such funding
will be obtained on satisfactory terms or at all.

     Our markets are characterized by rapid technological change, which could
render our products obsolete and cause us to make substantial expenditures to
replace our products. Fixed network and other system equipment used in the
cellular telephone industry has a limited life and must be replaced because of
damage or as a result of ordinary wear and tear. As new technologies develop,
for example third-generation systems, equipment may need to be replaced or
upgraded or a cellular telephone system may need to be rebuilt in whole or in
part, at substantial cost, to remain competitive.

     In some of our markets, our licenses and frequency allocations are subject
to ongoing review, which may result in modification or early termination. The
continued existence and terms of cellular telephone licenses and frequency
allocations are subject to ongoing review and, in some cases, to modification or
early termination. Some licenses that we had in the past, for example those in
Costa Rica and Bombay have been cancelled. While we would not normally expect
any of our cellular telephone companies to be required to cease operations at
the end of the term of its license or permit, there can be no assurance that
licenses will be renewed at all, or on equivalent or satisfactory economic
terms. Upon termination, the license and the assets of the cellular telephone
company associated with the system may revert to the government or local
telecommunications agency, in some cases without any, or adequate, compensatory
payment being made to us.

     The current concerns about the actual or perceived health risks relating to
cellular phone handsets, as well as the attendant publicity or possible
resultant litigation, may have a negative effect on the market price of our
shares, our financial position or the results of our operations. There have been
concerns about the potential negative effect of electromagnetic emissions from
handsets on the health of mobile telephone users. There is also some concern
that the use of mobile telephone handsets may interfere with the operation of
certain electronic equipment, including automobile braking and steering systems.
The actual or perceived risk of mobile communications devices, or press reports
about these risks, or any related litigation, could adversely affect us by
reducing our subscriber growth rate, subscriber base or average use per
subscriber, and could have a negative impact on the market price of our shares.
Any such litigation could also have a materially adverse effect on our financial
position and results of operations.

   Country Risks

     We operate in some markets that are considered politically unstable, which
could negatively affect our operations. As of December 31, 2002, we had
interests in cellular telephone licenses in 16 countries around the world and
are subject to government regulation in each market. The governments of the 16
countries differ widely with respect to structure, constitution and stability,
and some of these countries lack mature legal and regulatory systems. To the
extent that our operations depend on governmental approval and regulatory
decisions, the operations may be adversely affected by changes in the political
structure or government


                                       10
<PAGE>


representatives in each of the markets in which we operate. Recent political and
economic changes have resulted in political and regulatory uncertainty in
certain countries in which we operate. No assurance can be given that factors
such as these will not have a material adverse effect on our operations in
particular countries.

     We operate in a number of jurisdictions, any of which could effect changes
to their laws that could unfavorably affect our financial status. We hold
interests in our cellular telephone companies through our subsidiaries and
affiliates in various jurisdictions in and outside Luxembourg. There can be no
assurance that the laws or administrative practices relating to taxation
(including the current position as to withholding taxes on dividends from the
ventures, and tax concessions in certain operations), foreign exchange or
otherwise in these jurisdictions will not change. Any such change could have a
material adverse effect on our financial affairs and on our ability to receive
funds from the ventures.

     Most of our ventures receive revenue that is denominated in the local
currency. In the future, any of the countries in which these ventures are
located could impose foreign exchange controls, which could restrict our ability
to receive funds from the ventures. Most of the cellular telephone systems in
which we have interests receive substantially all of their revenues in the
currency of the markets in which they operate. We expect to derive substantially
all of our revenues through funds generated by the ventures and, therefore, we
will rely on the ability of the ventures to transfer funds to us. Although there
are currently no foreign exchange controls in many of the countries in which our
cellular telephone companies operate which would significantly restrict the
ability of these ventures to pay interest and dividends and repay loans by
exporting cash, instruments of credit or securities in foreign currencies, in
some countries it may be difficult to convert large amounts of local currency
into foreign currency because of limited foreign exchange markets. The practical
effect of this is likely to be time delays in accumulating significant amounts
of foreign currency. In addition, a few countries in which we operate restrict
the export of cash in local currencies. There can be no assurance that
additional foreign exchange control restrictions will not be introduced in the
future or that our ability to receive funds from the ventures will not
subsequently be restricted.

     Currency fluctuations could reduce the amount of profit and assets that we
are able to report. Exchange rates for currencies of the countries in which our
ventures operate may fluctuate in relation to the U.S. dollar, and such
fluctuations may have a material adverse effect on our earnings or assets when
translating foreign currency into U.S. dollars. A relevant example for the
Company during 2002 was the devaluation of the guarani in Paraguay. In the years
ended December 31, 2002, 2001 and 2000, we suffered exchange losses of
$23,483,000, $17,313,000 and $23,015,000, respectively. To the extent that our
ventures distribute dividends in local currencies in the future, the amount of
U.S. dollars we will receive will be affected by fluctuations of exchange rates
for such currencies against the U.S. dollar. For each venture that reports in a
currency other than the U.S. dollar, a decrease in the value of that currency
against the U.S. dollar would reduce our profits while also reducing both our
assets and liabilities.

     Potential inflation in local economies may affect some customers' ability
to pay for our ventures' services, and it may also adversely affect the
stability of the cellular operations market in those areas. Our operations are
dependent upon the economies of the markets in which we have interests. These
markets are in countries with economies in various stages of development or
structural reform, some of which are subject to rapid fluctuations in terms of
consumer prices, employment levels, gross domestic product and interest and
foreign exchange rates. We may be subject to such fluctuation in the local
economies and to the effect of such fluctuations on the ability of customers to
pay for our ventures' services. In addition, these fluctuations may affect the
ability of the market to support our existing cellular telephone interests or
any growth in cellular telephone operations.

   The Ability of Investors to Enforce Civil Liabilities Under U.S. Securities
Laws May Be Limited

     MIC is incorporated under the laws of the Grand-Duchy of Luxembourg.
Substantially all of its directors and executive officers are residents of
Luxembourg or other countries other than the United States. All or a substantial
portion of our assets, and of the assets of such persons are located outside the
United States. As a result, it may not be possible for investors in MIC's shares
to effect service of process within the United States upon such persons or MIC
or to enforce in U.S. courts or outside the United States judgments obtained
against such persons outside the United States. In addition, it may be difficult
for investors to enforce, in original


                                       11
<PAGE>


actions brought in courts in jurisdictions located outside the United States,
liabilities predicated upon the civil liability provisions of the U.S.
securities laws. We have been advised by our Luxembourg counsel, Linklaters
Loesch, that the United States and Luxembourg do not have a treaty providing for
reciprocal recognition and enforcement of judgments in civil and commercial
matters. Therefore, a final judgment for the payment of money rendered by a
federal or state court in the United States based on civil liability, whether or
not predicated solely upon United States federal securities laws, would not be
enforceable in Luxembourg. However, if the party in whose favor such final
judgment is rendered brings a new suit in a competent court in Luxembourg, the
party may submit the final judgment that has been rendered in the United States
to a Luxembourg court for the purpose of recognition by such court and
enforcement in Luxembourg. A judgment by a federal or state court of the United
States against us will be regarded by a Luxembourg court only as evidence of the
outcome of the dispute to which such judgment relates, and a Luxembourg court
may choose to rehear the dispute ab intitio.

ITEM 4.  INFORMATION ON THE COMPANY

The Company

     In 2002, we continued to expand our position as a leading developer and
operator of cellular telephone services in the world's emerging markets, and
made notable progress as an investor in valuable telecommunications' assets. Our
operations grew significantly: proportional subscribers, excluding divested
operations, increased by 25% and the number of gross subscribers increased by
28%.

     We have evolved from being a purely cellular operator in emerging markets,
to being a company that owns a portfolio of high-value telecom assets.

     As at December 31, 2002, we had interests in 17 cellular systems in 16
countries, primarily in emerging markets in Asia, Latin America and Africa. We
establish an early presence in most of our markets and seek to be amongst the
first in a market to secure a cellular telephone license. As a result, we are
one of the leading cellular operators in the majority of our markets. In
addition, we provide high-speed wireless data services in five countries and
also, as of December 31, 2002, had a 6.8% interest in Tele2 AB, a leading
alternative pan-European telecommunications company offering fixed and mobile
telephony, data-network and Internet services to approximately 17 million people
in 22 countries.

     Our cellular license areas as of December 31, 2002, covered an estimated
391 million persons. Based on our percentage ownership in our operations, we
have approximately 301 million cellular equity pops. These figures do not
include subscribers in which we have an indirect ownership through our holding
in Tele2 AB.

     We have consistently achieved significant revenue and subscriber growth.
Since 1997, we have grown our proportional cellular subscriber base, excluding
divested operations and El Salvador, at a compound annual growth rate of over
55%. We have increased revenues at a compound annual growth rate of 11%. In 2002
compared to 2001, excluding divested operations and El Salvador, our total
cellular subscribers increased by 28% to 4,252,037 subscribers, while revenues
increased by 3% to $573,730,000.

     We have organized around three strategic operating entities with continued
financial and capital control at the parent level. These operating entities are
Sanbao Telecom (Asia), MIC Latin America and MIC Africa.

Recent Developments

     In January 2002, MIC announced the award of a nationwide license to provide
GSM wireless telephony in the Lao People's Democratic Republic. In April 2003,
MIC announced it had launched GSM services.

     In April 2002, MIC announced it had obtained all the GSM licenses required
under the terms of the sale of FORA Telecom to Tele2 AB and would, therefore,
receive an additional $30 million payment as specified in the agreement.

     In October 2002, Paktel, MIC's second cellular operation in Pakistan, was
granted a modification to its license and was awarded a GSM 900 spectrum.


                                       12
<PAGE>


     MIC completed the disposal of Multinational Automated Clearing House S.A.
("Mach"), the world's largest GSM clearing-house in November 2002, realizing a
gain of $87,655,000.

     In December 2002, MIC concluded the divestment of Extelcom, its business in
the Philippines, realizing a loss of $35,988,000.

     In 2002, MIC purchased 386,350 of its ordinary shares with a par value of
$2 each.

     As of December 31, 2002, MIC had total consolidated debt of approximately
$1,228,575,000 which required substantial free cash flows to finance the
interest. In addition, there was the risk that the cash flows generated would be
insufficient to repay all of the existing debt obligations as they became due.
Reflecting the risks involved with our leverage, the market price of the Old
Notes had traded significantly below par value. In order to reduce the extent of
our payments, on January 21, 2003, MIC made an exchange offer and consent
solicitation to bondholders of the Old Notes. On May 8, 2003, MIC announced the
closing of this offer with the tendering of approximately 85% of the Old Notes.
Under the terms of this exchange, holders of the Old Notes received $720 of our
newly issued 11% Senior Notes due 2006 and $81.70 of our newly issued 2% Senior
Convertible PIK Notes due 2006 per $1,000 of Old Notes. In addition, in
consideration for consenting to certain amendments to the indenture under which
the Old Notes were issued, eligible holders who consented to amendments of the
indentures of the Old Notes received $50.00 in cash for each $1,000 in principal
amount of Old Notes they tendered. Following the successful completion of the
exchange offer, MIC has significantly reduced its overall level of indebtedness
and interest burden, improved it's near-term liquidity position and created
greater ongoing financial and operating flexibility. For example, our interest
obligation under the Old Notes was $129,870,000 each year, while our interest
obligation under the New Notes is $81,624,000 each year. For a more detailed
description of the exchange offer and its terms, see "Item 10. Additional
Information - Material Contracts."

     In February 2003, an Extraordinary General Meeting approved a reverse stock
split of MIC's issued shares, exchanging three existing shares of a par value of
$2 each for one new share with a par value of $6.

     In February 2003, MIC completed the disposal of Celcaribe S.A., its
cellular operation in Colombia for consideration of $9,876,000, realizing a gain
of $1,819,000.

     Although it is not part of management's long-term strategy to sell Tele2 AB
shares, from time to time shares have been sold to help subsidize operations and
capital improvements. In the period from January 1, 2003, to June 20, 2003, the
Company has sold 1,044,129 class B shares for proceeds of approximately $34
million, reducing its investment in Tele2 AB to 6.1%.

History

     Millicom International Cellular S.A. ("MIC"), a stock corporation organized
under the laws of the Grand-Duchy of Luxembourg, was established in December
1990 by two of the cellular industry's early pioneers, Kinnevik and Millicom
Incorporated, a Delaware corporation ("Mil-Inc"), to hold certain of their
cellular interests in 12 countries. As of December 31, 2002, Kinnevik owned
approximately 36% of the existing share capital of MIC.

     Kinnevik is a diversified Swedish investment holding company with principal
activities in telecommunications, forestry and packaging materials. In 1988,
Kinnevik was awarded a nationwide GSM license for Sweden, which formed the basis
for Comviq GSM AB ("Comviq GSM"). Kinnevik also had an interest in a Norwegian
GSM license and was the controlling stockholder of Kinnevik Telecommunications
International S.A., an international telephone and data communications service
provider in Sweden.

     Mil-Inc was formed in 1979 to pursue opportunities in the nascent American
mobile telephone industry. In 1982, the U.S. Federal Communications Commission
(the "FCC") awarded Mil-Inc one of only three developmental licenses for
cellular telephony. Also in 1982, Mil-Inc founded, with Racal Electronics Plc, a
joint venture that evolved into Vodafone Group Plc, now the largest cellular
telephone operator in the world. The interest in this joint venture was sold to
finance Mil-Inc's further development. Mil-Inc, after initially pursuing

                                       13
<page>


U.S. cellular opportunities, decided in 1992 to concentrate on non-U.S. markets,
in which licenses generally could be obtained, at that time, without the cost of
acquiring interests in licenses awarded by the FCC lottery system.

     From early 1983, Kinnevik and Mil-Inc began jointly applying for cellular
telephone licenses internationally. The first successful joint application
resulted in the award of a cellular license for Hong Kong in 1983. In 1990,
after approximately seven years of co-operation, 12 successful license bids and
the establishment of cellular operations in a number of markets, Kinnevik and
Mil-Inc agreed to form MIC for the purposes of managing the development of these
operations and pursuing new licenses. At the date of formation, the common stock
of MIC was owned approximately 49% by Kinnevik and 46% by Mil-Inc. MIC
subsequently disposed of the joint venture in Hong Kong to fund its continuing
development. See "Directors, Senior Management and Employees."

     MIC's principal executive office is located at 75 Route de Longwy, Box 23,
L-8080 Bertrange, Grand-Duchy of Luxembourg, and its telephone number is + 352
27 759 101.

The Merger

     In 1993, it was determined that a merger of Mil-Inc and MIC could
accomplish goals sought by both companies.

     Pursuant to an Agreement and Plan of Merger and Reorganization (the "Merger
Agreement"), dated September 21, 1993, as amended, between MIC, MIC-USA Inc
("MIC-USA"), a wholly owned subsidiary of MIC, and Mil-Inc, Mil-Inc was merged
(the "Merger") with and into MIC-USA on December 31, 1993 (the "Effective
Date"). The outstanding shares of Mil-Inc common stock were exchanged for
approximately 46.5% of the common stock of MIC (the "MIC Common Stock"), par
value $2.00 per share (exclusive of the additional merger shares described
below). Kinnevik held the remaining 53.5% of MIC Common Stock.

     As a result, on December 31, 1993 (the "Effective Date"), the holders of
Mil-Inc common stock received approximately 1.287 shares of MIC Common Stock,
par value $2 each, for each share of Mil-Inc common stock held (an aggregate of
approximately 19,915,328 shares of MIC Common Stock, par value $2 each). In
addition, they were granted the non-transferable contingent right to receive a
maximum of approximately an additional 0.112 share of MIC Common Stock, par
value $2 each, for each share of Mil-Inc common stock held (an aggregate of
approximately 1,731,768 shares of MIC Common Stock, par value $2 each), subject
to adjustment. These additional shares were due to be distributed to Mil-Inc
stockholders in two installments:

     (a)  an interim installment, if any, approximately forty days following the
          Effective Date of the Merger, based upon an audit of certain assets
          and liabilities of Mil-Inc as of the Effective Date, and

     (b)  a final installment, if any, as soon as practicable or on the second
          anniversary of the Effective Date, based upon the payment after the
          Effective Date of certain tax liabilities of Mil-Inc.

     As of February 10, 1994, MIC had distributed an aggregate of 923,721 shares
of MIC Common Stock, par value $2 each, to former Mil-Inc stockholders as
additional merger shares per the distribution agreement (a) above. In October
2001, MIC completed the final distribution of its shares, amounting to 374,521
shares, par value $2 each.

     Immediately prior to the Merger, substantially all of the operations other
than the cellular telephone operations and certain related liabilities of
Mil-Inc were transferred to Great Universal Inc. ("GU"), a Delaware corporation
at that date an indirect wholly owned subsidiary of MIC. Both MIC and GU have
separate management, and transactions between GU, both MIC and our affiliates
are subject to certain restrictions as described below.

     Following the Effective Date, MIC contributed to the capital of GU an
aggregate of 211,864 shares of MIC Common Stock, par value $2 each, calculated
at the time of issuance as having an aggregate value of $5,027,473.


                                       14
<PAGE>


   Merger Warrants

     Immediately prior to the Merger, Mil-Inc stockholders received from MIC-USA
warrants to purchase from MIC-USA 100% of the shares (3,867,287 shares) of GU
Common Stock for a purchase price equal to $1.30 per share (the "Warrants"). The
purpose of the warrant distribution was to afford Mil-Inc stockholders the
opportunity to participate in the future prospects of such non-cellular
businesses and to reduce or eliminate the Company's interests in such businesses
in the event the Warrants are exercised. The Warrants are not transferable
except in certain limited circumstances. They became exercisable on January 1,
1999 and expire six months after the registration of GU on a public market in
the United States, unless extended under certain circumstances (the "Warrant
Expiration Date").

     On December 31, 1993, GU and the Company entered into an agreement pursuant
to which, as an inducement to the Company to contribute MIC Common Stock to GU,
as described above, GU granted to MIC-USA an option (the "Put Option") to
require GU to purchase from MIC-USA the shares of GU Common Stock not acquired
by exercise of the Warrants. Additionally, the Company granted to GU the option
(the "Call Option") to purchase from MIC-USA the GU Common Stock. The purchase
price for the GU Common Stock upon exercise of either the Put Option or the Call
Option is an amount equal to the difference between the aggregate exercise price
of such Warrants ($5,027,473) and the actual aggregate exercise price of the
Warrants exercised prior to their expiration. The Put Option and the Call Option
are exercisable as to all, but not less than all, of the remaining GU Common
Stock for a period of twenty days commencing on the day following the Warrant
Expiration Date. GU may pay the purchase price for the GU Common Stock by
delivering to MIC-USA that number of the shares of MIC Common Stock which in the
aggregate equals the purchase price, based upon the last sale price of the MIC
Common Stock as quoted on the NASDAQ Stock Market on the Warrant Expiration
Date.

     If all of the Warrants are exercised or all of the shares of GU common
stock not acquired by exercise of the Warrants are repurchased by GU, the
Company would have no further ownership interest in GU. Certain of the Company's
management and shareholders, who became holders of Warrants as part of the
Merger, may become shareholders of GU or may participate in the management of GU
if they choose to exercise the Warrants. From December 30, 1993, the date the
Warrants were issued, until the Warrant Expiration Date, the Company will not
consummate a transaction with GU or any of GU's affiliates which involves the
sum of $1,000,000 or more unless the Company and GU shall have received an
opinion from an independent investment banker that such transaction is on terms
at least as favorable as those that can be obtained from an unrelated third
party. In the event that the Warrants are not exercised prior to the Warrant
Expiration Date, management will evaluate other plans to dispose of GU upon the
expiration of the Warrants.

     In June 1999, GU affected a reorganization of GU and its subsidiaries, in
which GU was merged with and into Great Universal LLC and operations were
spun-off into two separate businesses, being Great Universal Inc. and Modern
Holdings (formerly known as XSource Corporation). Great Universal Inc. holds the
subsidiaries in teleservices, television and media and specialized electronics
industries, and Modern Holdings holds the subsidiaries in the integrated network
services industries. Great Universal LLC holds 100% of common shares in Great
Universal Inc. and 53% of common shares in Modern Holdings. Following this
reorganization and pursuant to the Warrant agreement, each warrant now entitles
the holder to purchase one share of Great Universal Inc. common stock and 2.0721
shares of Modern Holdings common stock at an exercise price of $1.30 per
Warrant, subject to adjustment. Following this reorganization, the rights and
obligations of MIC-USA arising from the Warrants agreement and the Put Option
and the Call Option agreement referred to above were assigned to Great Universal
LLC. Under the terms of the Merger, Great Universal LLC continues to indemnify
MIC against certain contingent liabilities.

     On December 31, 1999, MIC-USA transferred its 100% ownership, and related
rights, in GU to Great Universal LLC 1999 Trust. At present, registration
statements relating to the shares of Great Universal Inc. and Modern Holdings
underlying the Warrants have not yet been filed with the U.S. Securities and
Exchange Commission.


                                      15
<PAGE>


     GU is contingently liable for any liabilities in respect of the
representations and warranties made by Mil-Inc to the Company under the Merger
Agreement and in respect of any United States federal, state and local income
tax in excess of $13,544,000 which may be payable by Mil-Inc for 1993 and prior
years. Up to September 30, 1995, $5,000,000 of any liability under this
indemnification was covered through a Guarantee Agreement dated January 1994
between the Company and Kinnevik (the "Kinnevik Guarantee"). As of September 30,
1995 the Kinnevik Guarantee ceased to be in effect pursuant to its own terms, as
GU then exceeded the minimum net equity threshold set forth in such guarantee.
See "Major Shareholders and Related Party Transactions."

Business

     Millicom International Cellular S.A. is a leading international operator of
cellular telephony services. The Group operates primarily in emerging markets
where the basic telephone service is often inadequate and where economic
development and change are creating new demand for communication services. MIC
has sought to establish an early presence in markets with little or no cellular
service by applying for cellular licenses, primarily through joint ventures with
prominent local business partners.

     MIC's portfolio of assets currently comprises 16 cellular operations in 15
countries in Asia, Latin America and Africa, covering a population under license
of approximately 382 million people. In addition, MIC provides high-speed
wireless data services in five countries and currently has a 6.1% interest in
Tele2 AB, the leading alternative pan-European telecommunications company
offering fixed and mobile telephony, data network and Internet services to over
17 million customers in 22 countries.

Introduction

     The following table shows certain information for each of MIC's cellular
systems as at December 31, 2002. See "Information on the Company - Operations
and Investments" for a more detailed description of each such venture.

<TABLE>

                                             Estimated     Number of                                                    Total
                                             Population   Subscribers   Approximate                     Start-Up      Number of
                     Method of                   of          as of       Change in                        Date         Licenses
       Market      Consolidation             Area under  December 31,   Subscribers                        of          Granted
                         (6)      Ownership License (1)    2002 (4)       in 2002     System (2)       Operations      For Area
                     -----------  --------- -----------  ------------   -----------   ----------       ----------     ---------
<S>                     <C>       <C>       <C>    <C>   <C>            <C>           <C>              <C>            <C>
Sanbao Telecom                   (percent)  (millions)                  (percent)
 Cambodia...........      JV        58.4%        12.8           325,264     63%                GSM       March 1997        10
 Lao People's
    Democratic
    Republic........      JV        78.0%         5.8                 -     N/a                GSM       April 2003         4
 Mauritius..........      JV        50.0%         1.2            97,137     10%                GSM         May 1989         2
 Pakistan - Pakcom..       S        61.3%       147.7           344,702     42%          TDMA/AMPS    December 1990         4
 Pakistan - Paktel..       S        98.9%         -             218,536     43%          TDMA/AMPS    November 1990         4
 Sri Lanka .........       S        99.9%        19.6           266,372     54%           GSM/TACS        June 1989         4
 Vietnam (5)......8)       S        40.0%        81.1           686,663     37%                GSM        July 1995         8
 MIC Latin America
 Bolivia ...........       S        100.0%        8.4           410,887     18%          TDMA/AMPS    November 1991         5
 Colombia (Northern
    Region) (3).....       S        95.4%         8.3           249,126     29%          TDMA/AMPS        September
                                                                                                               1994         2
 El Salvador........      INV       70.0%         6.4                 -      -           TDMA/AMPS     January 1993         3
 Guatemala .........      JV        55.0%        13.3           467,620     31%          TDMA/AMPS     October 1990         4
 Honduras...........      JV        50.0%         6.6           326,508     37%          CDMA/AMPS        September         1
                                                                                                               1996
 Paraguay ..........       S        96.0%         5.9           550,109     -3%          TDMA/AMPS      August 1992         5
 MIC Africa
 Ghana .............       S        100.0%       20.2            52,060     46%           GSM/TACS         May 1992         5
 Senegal ...........       S        75.0%        10.6            97,804     12%                GSM       April 1999         2
 Sierra Leone ......       S        70.0%         5.6            13,411     89%                GSM         May 2001         6
 Tanzania ..........      JV        57.0%        37.2           145,838      8%           GSM/TACS S  eptember 1994         5

                                            ----------------------------
 Grand Total........                            390.7         4,252,037
                                            ============================
</TABLE>


                                      16
<PAGE>


- ---------------------------------------
(1)  For countries where the license area covers the entire country, population
     figures have been extracted from CIA-The World Factbook.
(2)  "AMPS," Advanced Mobile Phone System, is the analogue standard developed
     for and used in North America and is used widely throughout the world.
     "TACS," Total Access Communications System, was initially the standard for
     the United Kingdom and is now used primarily in other Commonwealth
     countries. "GSM," Global System for Mobile Communications, is the digital
     standard developed for Europe. "TDMA", Time Division Multiple Access, is
     the system most widely used in North and South America.
(3)  Operation sold in February 2003.
(4)  Proportional subscribers as at December 31, 2002 were 3,021,873.
(5)  Comvik International (Vietnam) AB ("CIV"), a 80% owned subsidiary of the
     Company, and Vietnam Mobile Services Co have entered into a revenue sharing
     agreement to operate a national cellular GSM system in Vietnam
     ("Mobifone"). This revenue sharing agreement, which has a ten-year term
     from July 1, 1995, provides that CIV will be entitled to receive 50% of
     Mobifone's net revenues. In October 2000, the revenue sharing agreement was
     amended and stated that MIC would continue to receive 50% of net revenue in
     years six through ten of the contract agreement, up from the 40% as per the
     original agreement.
(6)  JV = Joint Ventures. Under IFRS, consolidated using the proportional method
     of accounting which combines the Company's assets, liabilities, income and
     expenses with the Company's share of the assets, liabilities, income and
     expenses of the joint ventures in which the Company has an interest.
     S = Subsidiary. Entities over which the Company has control are fully
     consolidated.
     INV = Investment in securities. As of December 31, 2001, following a
     dispute with the local shareholder, the entity was accounted for under the
     equity method and recorded in the balance sheet under the caption
     "Investments in associated companies". As of December 31, 2002, this
     dispute had still to be settled and as management felt it no longer
     exercised a significant influence in the operation it was considered more
     appropriate to classify its investment as a non-current asset under the
     caption "Investment in securities".
     The Company determines the existence of joint control by reference to the
     joint venture agreements, articles of association, structures and voting
     protocols of the Boards of Directors, as well as the influence the Company
     has over the day-to-day operations of the above ventures.

The Cellular Telephone Industry

   Cellular Telephone Industry Overview

     Cellular Telephone Technology. Cellular telephone systems are capable of
providing high quality, high capacity voice and data communications to and from
vehicle-mounted and hand-held radiotelephones. Cellular telephone systems are
capable of handling thousands of calls at any one time and providing service to
hundreds of thousands of subscribers in any particular area.

     Cellular telephone technology is based upon the division of a given
geographical area into a number of cells and the simultaneous use of radio
channels in non-contiguous cells within the system. Each cell contains a low
power transmitter/receiver at a base station that communicates by radio signal
with cellular telephones in that cell. Each cell is connected by wire-line or
microwave to a central switching point or mobile switching center ("switch")
that controls the routing of calls and which, in turn, is connected to the
public switched telephone network. It is the switch mobility software that
allows cellular telephone users to move freely from cell to cell while
continuing their calls through a process called hand-off.

     Cellular telephone systems generally offer subscribers the features offered
by the most up-to-date wire-line telephone services. Cellular telephone systems
are interconnected with both the wire-line telephone network and other cellular
networks. As a result, subscribers can receive and originate local,
long-distance and international calls from their cellular telephones. Cellular
telephone system operators therefore require an interconnect arrangement with
the local wire-line telephone companies and the terms of such arrangements are
material to the economic viability of the system.


                                      17
<PAGE>


     A cellular telephone system's capacity can be increased in various ways.
Increasing demand may be satisfied, in the first instance, by adding available
channel capacity to cells through the addition of extra transmitters. When all
available channels are used, further growth can be accomplished through a
process known as cell splitting. Cell splitting entails dividing a single cell
into a number of smaller cells, through the construction of additional base
stations, thereby allowing for greater channel reuse and hence increasing the
number of calls that can be handled in a given area.

     The Company uses analog and digital technologies that are widely used
throughout the world. As analog technology has matured, equipment prices have
decreased significantly, enabling the Company to develop its networks in a more
cost-effective manner. GSM is a digital standard for cellular telephone systems
that the majority of European Union countries have adopted as a common standard.
Commercial launch in several European countries commenced in 1992. GSM offers
increased value-added services and enables transmissions to be made in encrypted
form so that conversations cannot easily be intercepted. The GSM system allows
subscribers to use their cellular telephones in any country where the GSM system
has been adopted, providing increased mobility and flexibility. In addition to
Europe, GSM systems are being used in the Middle East, Australia, India, South
Africa, China, Southeast Asia and the Philippines. Advanced Mobile Phone System
("AMPS") is the analog standard developed for and used in North America, and is
used widely throughout the world. Total Access Communication System, or Time
Division Multiple Access ("TDMA"), is the system most widely used in North and
South America and works by dividing a radio frequency into time slots and then
allocating slots to multiple calls. TDMA is one of the world's most widely
deployed digital wireless systems and it provides a natural evolutionary path
for analog AMPS networks, and offers efficient coverage. In the United States, a
number of digital standards have been developed and are being deployed in
existing AMPS networks. Currently, no one technology has been adopted as the
common standard.

     Operating Characteristics. The cellular telephone industry is typically
characterized by high fixed costs and low variable costs. Until technological
limitations on total capacity are approached, additional cellular telephone
system capacity can normally be added in increments that closely match demand
and at less than the proportionate cost of the initial capacity. The industry
has also seen declining equipment prices in real terms. Once revenues exceed
fixed costs, incremental revenues are expected to yield a high incremental
operating profit, giving cellular telephone system operators an incentive to
stimulate and satisfy demand for service in the market. The amount of profit, if
any, under such circumstances is dependent on, among other things, prices and
variable marketing costs, which, in turn, are affected by the amount and extent
of competition. As competition increases in markets, prices have fallen with the
result that revenues and operating profits increase at a lower rate than
subscriber growth. In addition, as penetration rates increase there is a
tendency for a higher proportion of new subscribers to use prepaid cards.
Prepaid subscribers tend to have lower usage than credit subscribers, however,
the operating margin is generally higher than with credit subscribers as the
risk of bad debt is eliminated and there is no subsidizing of handsets.

   Development of the Cellular Telephone Industry

     Cellular Telephony in Developed Countries. The first cellular telephone
systems were introduced in Scandinavia in the early 1980s and experienced modest
growth for the first few years. Over the last 10 years, however, cellular
telephony has grown rapidly. The majority of developed countries now have
cellular telephone service and levels of penetration have increased
substantially in these countries. Worldwide subscribers at the end of February
2003 were approximately 821 million according to The GSM Association.

     Given the rapid growth of cellular telephone subscribers in developed
countries and high levels of penetration, particularly in large urban markets,
the industry is increasingly introducing new technology that will expand
capacity and improve service, including the introduction of digital cellular
telephone systems and the ability to access the Internet from handsets. In
industrialized nations, cellular operators are currently in the process of
introducing so-called `third generation' mobile technology that will permit
always-on faster access to the Internet and voice and data transmissions.

     Cellular Telephony in Developing Countries. While the cellular telephone
industry is well established in the developed world, the cellular telephone
industry in the developing world is still in its infancy. The Company


                                      18
<PAGE>


believes that cellular telephony has the potential to grow rapidly in
developing countries because of the poor quality of the existing wire-line
service, the unsatisfied demand for basic telephone service and the increasing
demand from users who want the convenience of cellular telephones. In some
countries the cellular telephone network provides significantly improved access
to the local and international wire-line network compared with the existing
wire-line service. In addition, developing countries are expected to benefit
both from better technology and lower equipment costs than those at comparable
stages of market development in developed countries.

     Wire-line networks involve extensive outside infrastructure in the form of
buried or overhead-cable networks, while cellular telephone systems require only
minimal construction activities. For developing countries, cellular telephone
systems can represent a faster and more cost-effective method of expanding
telecommunications infrastructure than traditional wire-line networks.

     The Company's operations are in countries whose economies are in various
stages of development or structural reform. Such economies may be subject to
rapid fluctuations in growth that may impact the growth of the Company's
cellular operations. Penetration rates (the number of subscribers per 100
people) can vary significantly from country to country and are substantially
lower in developing countries than in developed countries.

The Company's Activities

   Established in Attractive Markets

     Strong Growth Characteristics. The Company operates its cellular activities
mainly in developing markets which it believes offer long-term growth
characteristics superior to those in more developed markets due to the lower
penetration rates. The economic growth in these markets is characterized by an
expanding need for telecommunications services. In addition, this growth is
often disproportionately shared by the upper and expanding middle-classes. These
demographic groups typically represent the heaviest users of the Company's
cellular services and reside in suburban and urban areas where the Company
initially provides service.

     Favorable Competitive Environment. The Company has focused on markets that
it believes offer a favorable competitive environment. In many of its markets,
the Company was the first operator of cellular services, and as a result
maintains a first-to-market advantage. These factors contribute to the Company's
ability to establish a favorable competitive position within a short period of
time. The Company has found that the introduction of competition into a market
stimulates the overall growth of that market.

     Lower System Costs and Faster Break-even. The Company has established
service in markets that it believes offer compelling potential financial returns
and substantial operational flexibility. The Company has historically obtained
many of its licenses at little or no cost. Further, licenses in the Company's
markets typically require build-out of only the cities where the population
density and usage patterns are likely to support a profitable cellular
operation. The Company also has benefited from lower overall operating costs
(such as rents and personnel related expenses) available in developing markets.
These advantages, combined with the favorable competitive environment, generally
enable the Company to generate positive operating cash flow at relatively low
penetration levels. Historically, the Company's systems have typically generated
positive cellular operating profit before depreciation and amortization within
12 to 18 months of start up.

Overall Business Strategy

     MIC's strategy is to build the leading brand in each market by offering
low-cost services to its customers. This enables MIC to establish
price-leadership, providing a strong base for future growth.

     As a consequence of the rapid growth of its operations, the Company has
given greater operating authority to the management of its regional operations
in order to evolve the Company into a holding company. The operational
separation of the Company's strategic businesses is intended to allow for
greater operational focus and increased financial flexibility.


                                      19
<PAGE>


     The Company's strategic objective is to continue to expand its strong
position as a developer and operator of cellular systems to a broad set of
developing markets. The Company's primary operational objectives are to expand
its overall subscriber base through the rapid development and build out of its
existing systems and obtain new licenses.

   Continue Rapid Growth

     Expand Strong Market Position. The Company seeks to capitalize on its early
market entry and continue its pattern of rapid subscriber growth by adding
capacity and coverage to its existing license areas. This growth in capacity and
coverage improves the overall effectiveness and reach of the network, which in
turn increases market demand for the Company's cellular services. The Company
also seeks to leverage its local brand names by expanding its marketing and
distribution efforts. The Company seeks to stimulate subscriber growth through a
variety of customized pricing plans, reduced costs up front to new subscribers,
increased brand awareness and improved products and services.

     Pursue Attractive New License Opportunities. The Company seeks new
licensing opportunities in geographic areas that it considers possess attractive
market fundamentals. As part of its overall license acquisition strategy, the
Company plans to concentrate much of its efforts on markets that it believes
offer superior growth prospects and in some instances may also represent areas
that are contiguous to markets in which the Company currently operates.

     In seeking new licenses, the Company generally establishes a venture with
one or more prominent local business partners to apply for a cellular telephone
license. The Company considers that the selection of the local partner, the
technical and financial expertise that the Company provides to the license
application and the Company's successful track record as an international
provider of cellular telephone services are the critical factors for a
successful license bid. In most cases, the local partner is instrumental in
obtaining the license and maintaining contact with the local telecommunications
agency, post office (the "PTT"), or relevant government department or otherwise
plays an important role in ensuring the success of the venture company. In some
markets, after the award of the license, the local partner continues to take an
active interest in the management of the venture.

     Licenses are normally sought through a competitive application process in
which the license is awarded on the merits of the application. The Company has
generally avoided cash auctions for cellular telephone licenses, but in some
circumstances it has paid significant license fees to governments. In addition,
in some cases, the Company's ventures pay royalties on revenue or income to
governments, and all of the Company's cellular ventures pay interconnect fees to
PTT's during the license period. The Company anticipates that in the future it
may have to participate in auctions or pay substantial license fees to obtain
interests in certain markets. Although the pursuit of cellular telephone
licenses is usually highly competitive, the Company's venture companies have
been successful in obtaining licenses in preference to other ventures whose
participants have often included companies such as Bell Atlantic Corporation,
British Telecommunications PLC, Vodafone and other major telecommunications
companies.

     Develop Existing Systems. The Company's historical investment approach has
been to set up through a venture an initial system covering the central
population area (usually the capital or largest commercial city), to develop
that system to meet initial demand and then to increase coverage and capacity as
demand develops. Once a cellular telephone license has been awarded, the venture
establishes an initial operating system. In most cases the Company bears a
greater share of funding requirements than its shareholding interest would
require. See "Information on the Company -Financing of the Company's Business."

     This approach, which has been adopted in markets such as Sri Lanka,
Guatemala and Paraguay, provides a basis for expansion with internally generated
funds when bank debt is not possible. In more competitive and well-developed
markets or where the license requires greater start-up coverage such as
Pakistan, a larger initial equity investment has been necessary to construct
larger systems. A larger initial equity investment would also be required if the
Company had to pay a substantial license fee.


                                      20
<PAGE>


     Offer New Services. The Company will continue, wherever possible, to offer
new services to its customers. These include short-message servicing, voice over
Internet protocol and Internet service providers (ISP).

     Maintain Prepaid throughout Company. As of December 31, 2002, the Company
operated a prepaid program in all of its cellular ventures. The advantages to
the Company are twofold. First, prepaid customers produce lower revenue but
eliminate bad debts. Second, prepaid programs have opened up the market for
cellular services to customers who are denied access to normal subscriptions due
to credit constraints. Further significant levels of demand have been created
from business users and those customers who purchase prepaid credits in order to
control their overall telephone costs. The launch of a prepaid system has
enabled the Company to penetrate new market segments with higher rates of
financial returns.

   Maximize Operating Effectiveness

     Leverage Economies of Scale and Synergies. The Company seeks to continue to
benefit from the many synergies inherent in its multi-country operation and
increasing scale in its existing markets. Such synergies include the sharing of
information and experiences about services, technologies and marketing
strategies and the negotiation of supply contracts for network and subscriber
equipment from major equipment vendors. The Company employs best practices and
benchmarking techniques across its systems to continuously develop and improve
their performance. Where the Company has systems in contiguous markets, the
Company seeks to establish inter-country roaming agreements to enable customers
from one market to use their cellular telephones in another market.

     Maintain Strong Regional Management. In 1997, the Company undertook a
restructuring of its corporate operations and moved to a regionalized structure,
with a regional operating company established to manage the Company's operations
in each major region of the world. In 2002, this structure was amended with the
elimination of regional offices and the creation of a central office in
Singapore for operational matters. Reporting directly to the operational central
office, the Company created "Cluster Managers" who were responsible for certain
operations. This structure allows the Company to continue to maintain a high
degree of co-ordination and cooperation between the various regional companies
while providing a degree of regional responsibility that ensures quick and
effective local decision-making. The Company employs a matrix management
structure in which the managers at the individual venture levels report both to
the cluster managers and the operational central office as well as to the
Company's head office, based in Luxembourg on matters relating to financial
reporting and controls, engineering, corporate development and human resources.

     Retain Operational and Financial Control. The Company actively manages its
systems through:

     o    selection and recruitment of local management;

     o    development of system business plans in conjunction with local
          management;

     o    development of the cellular telephone network design and expansion
          plan with local technical management;

     o    standardized weekly and monthly reporting and review and an annual
          budgeting process;

     o    supervision and support by the Company's internal auditors and
          marketing and administrative personnel; and

     o    assignment of Company personnel to the systems.

     The Company seeks to obtain controlling ownership and management positions
in its systems. Where the Company holds less than a majority of the shares in an
operation, due for example to foreign investment restrictions, the Company
manages its operations through the appointment of local management,
stockholders' agreements or similar arrangements, special rights with respect to
board representation or special voting rights. Such provisions provide the
Company with the means to approve or disapprove actions proposed by its
partners.


                                      21
<PAGE>


In some cases the stockholders' agreements contain buyout, arbitration
or other procedures that can be invoked in the event of a fundamental
disagreement among the Company and its partners.

     The day-to-day management of the systems is the responsibility of the local
management. In all of the Company's cellular operations, the general manager and
other key personnel are appointed by the Company or in co-operation with its
partners. In addition, senior management of the systems also typically receive
Company stock options as part of their compensation and incentive packages.

     Manage Emerging Market Risks. The Company's management seeks to minimize
the currency, customer credit, repatriation of capital and political risks that
arise from operating cellular systems in developing markets. To reduce overall
exposure to currency movements, the Company bills subscribers in U.S. dollars in
certain markets and in many others regularly adjusts the local currency
denominated tariffs with changes in U.S. dollar exchange rates. To reduce
customer credit risk, the Company engages in a range of techniques including
pre-billing, credit card billing and the establishment of preset credit limits.
In addition, the Company seeks to utilize advanced anti-fraud software to
prevent and control unauthorized use. To reduce repatriation of capital risk,
before investing capital the Company obtains agreements, if necessary, from the
relevant governments to secure the ability to repatriate capital from local
markets. The Company believes that its broad diversification of cellular
licenses in countries across Asia, Latin America and Africa reduces the risk to
the Company from individual country and currency risks. The Company also selects
partners that are established and highly respected business leaders within their
local markets in order to help anticipate and manage the potential impact of
regulatory and other political changes.

Financing of the Company's Business

     The Company finances its operations at both the operational and parent
entity level.

   Operational Level Financing

     The Company finances its operations on a project-by-project basis. Once a
license is awarded, the Company makes an initial investment in the form of
equity and, in some cases, debt. The system typically is granted between 6 and
12 months to build out its initial cellular telephone network. During this
initial phase, the Company frequently supplements its investment with financing
provided by equipment suppliers for the purchase of network equipment.
Generally, such financing covers a period of 18 months to three years and is
often guaranteed by MIC. The Company seeks to refinance the vendor financing
with longer-term borrowing from commercial banks and international agencies.
Where practicable, the Company endeavors to obtain financing in local currencies
and without guarantees from MIC. However, MIC may guarantee such project
financing for an initial period until certain performance targets are achieved.
As of December 31, 2002, the Company reported total outstanding debt and other
financing of approximately $1,228,575,000. Of this amount $967,557,000
represents corporate level indebtedness and $261,018,000 is the Company's share
of the indebtedness of its ventures. As of December 31, 2002, the total debt and
other financing of the Company and each of the ventures, combining 100% of each
venture's debt, was $1,289,893,000, of which $106,606,000 was guaranteed by MIC.
Agencies such as the International Finance Corporation ("IFC") and Overseas
Private Investment Corporation ("OPIC") have provided such financing, often in
consortia with commercial banks. The Company intends to continue to pursue a
project-by-project approach to funding its systems. If additional investment is
required from the Company, the Company seeks, whenever possible, to fund such
investment through shareholder loans from the Company.

     When establishing its systems, the Company has sought and been granted
government approval, if necessary, to enable it to distribute dividends to the
parent. In addition, although dividends may be subject to withholding taxes, the
Company seeks to use tax-efficient mechanisms to repatriate such dividends to
the parent without paying additional taxes.


                                      22
<PAGE>


   MIC Level Entity Financing

     At the MIC level, the Company has completed two equity offerings in order
to fund its development. In 1994 and 1995, the Company raised approximately
$23,200,000 and $72,100,000, respectively, through the sale of new equity.

     On April 25, 1996, the Group signed a seven-year $200,000,000 Bank Credit
Agreement (the "Original Bank Credit Agreement") arranged by ABN-Amro Bank and
ING Bank. The main part of the facility was used to refinance existing short
term credit facilities at the Company level and for investments in existing and
new operations and for corporate and interest expenses. The financing was
subsequently amended in 1998 and 1999 and secured by a portion of MIC's shares
in Tele2 AB. The loan bore interest starting at LIBOR+1.75% but decreasing to
LIBOR+1% depending on the amount and value of the security put in place. The
facility was subject to the maintenance of various restrictive and financial
covenants such as not exceeding a certain ratio of certain consolidated debt to
earnings before interest, taxation, depreciation and amortization. This facility
was fully repaid on December 14, 2001.

     In June 1996, MIC raised approximately $483,433,000 (after deducting
discount and estimated expenses) through a private offering of Old Notes. The
Old Notes were issued at 52.075% of their principal amount and the purchase
discount on the Old Notes accretes from issuance until June 1, 2001. Cash
interest began to accrue on the Old Notes on June 1, 2001 at a rate of 131/2%
per annum until maturity on June 1, 2006. The Company undertook the offering of
Old Notes to fund the continued construction and expansion of its cellular
systems, working capital requirements and operating expenses. In addition, the
net proceeds of the offering have been used to fund the acquisition and
development of additional licenses or systems and to increase the Company's
ownership in its existing systems. See "Operating and Financial Review and
Prospects--Liquidity and Capital Resources."

     As of December 31, 2002, MIC had total consolidated debt of approximately
$1,228,575,000 which required substantial free cash flows to finance the
interest. In addition, there was the risk that the cash flows generated would be
insufficient to repay all of the existing debt obligations as they became due.
Reflecting the risks involved with our leverage, the market price of the Old
Notes had traded significantly below par value. In order to reduce the extent of
our payments, on January 21, 2003, MIC made an exchange offer and consent
solicitation to bondholders of the Old Notes. On May 8, 2003, MIC announced the
closing of this offer with the tendering of approximately 85% of the Old Notes.
Under the terms of this exchange, holders who tendered their Old Notes received
$720 of our newly issued 11% Senior Notes due 2006 and $81.70 of our newly
issued 2% Senior Convertible PIK Notes due 2006 per $1,000 of Old Notes. In
addition, in consideration for consenting to certain amendments to the indenture
under which the Old Notes were issued, eligible holders who consented to the
amendments of the Old Notes received $50.00 in cash for each $1,000 in principal
amount of Old Notes they tendered. Following the successful completion of the
exchange offer, MIC has significantly reduced its overall level of indebtedness
and interest burden, improved its near-term liquidity position and created
greater ongoing financial and operating flexibility. For example, our interest
obligations under the Old Notes was $129,870,000 each year, while our interest
obligation under the New Notes is $81,624,000 each year. For a more detailed
description of the exchange offer and its terms, see "Additional Information -
Material Contracts."

     In December 2001, the Group entered into an equity swap transaction with
Toronto-Dominion Securities for a maximum facility amount of SEK 1,855 million
(approximately $175 million as of December 31, 2001) to replace the Original
Bank Credit Agreement referred to above. In exchange for the facility, the Group
has pledged Tele2 AB class B shares. The facility bears an annual interest rate
calculated using the current STIBOR rate plus 2% payable on a monthly basis, and
must be fully repaid by November 2004. As of December 31, 2002, $54,638,000 was
outstanding under this facility collateralized by 6,184,293 Tele2 AB class B
shares. This transaction has been accounted for as a borrowing and the related
Tele2 AB class B shares are recorded as pledged securities in non-current assets
under the caption "Investment in securities". See "Operating and Financial
Review and Prospects--Liquidity and Capital Resources."

     A portion of the Company's venture indebtedness is secured by cash deposits
and standby letters of credit issued at the request of, and guaranteed by, the
Company.


                                      23
<PAGE>


Insurance

     The Company believes that it holds sufficient levels of insurance for the
prudent operation of its business.

Operations and Investments

     Millicom International Cellular S.A. is a developer and operator of
cellular telephone systems in emerging markets worldwide. The Company, as at
December 31, 2002, had interests in 17 cellular systems in 16 countries, in
emerging markets in Asia, Latin America and Africa. The Company establishes an
early presence in most of its markets and seeks to be the first in a market to
secure a cellular telephone license. As a result, the Company is one of the
leading cellular operators in the majority of its markets based on market share.
As at December 31, 2002, the Company also provided high-speed wireless services
in five countries. In addition, the Company also had a 6.8% interest in Tele2
AB, the leading alternative pan-European telecommunications company offering
fixed and mobile telephony, data-network and Internet services to approximately
17 million people in 22 countries.

     The Company has certain other related businesses, including an investment
in Tele2 AB. See "Information on the Company - Other Investments."

     Descriptions of the operations of each of the ventures and other related
businesses are provided below. The descriptions have been divided into the
following sub-sections:

          Sanbao Telecom (Asia), the Company's cellular operations in Asia,
     comprising Cambodia, Lao People's Democratic Republic, Mauritius,
     Pakistan, Sri Lanka and Vietnam.

          MIC Latin America, the Company's cellular operations in Latin America,
     comprising Bolivia, Colombia (divested in February 2003), El Salvador,
     Guatemala, Honduras and Paraguay.

          MIC Africa, the Company's cellular operations in Africa, comprises
     Ghana, Senegal, Sierra Leone and Tanzania.

          Other Investments, including the Company's investment in Tele2 AB and
     its high-speed wireless data services in Argentina, El Salvador, Paraguay,
     Peru and Cambodia.


                                      24
<PAGE>


                              SANBAO TELECOM (ASIA)

Background

     Sanbao Telecom comprises the Company's Asian cellular telephone operations
with interests in seven cellular operations in Cambodia, Lao People's Democratic
Republic, Mauritius, Pakistan, Sri Lanka and Vietnam. Sanbao Telecom also
operates an international gateway and a high-speed data business in Cambodia.
Sanbao Telecom's license areas cover approximately 268.2 million people as of
December 31, 2002, with an equity population of approximately 210.7 million.

     Sanbao Telecom operations showed the most significant numerical increase in
subscribers of all regions, adding 582,700 net new subscribers during 2002.
Sanbao Telecom showed the strongest increase in revenue of all regions in 2002,
reporting annualized growth of 14%. Once again the greatest contribution to this
growth came from Vietnam, MIC's largest operation. The increase in proportional
subscribers was also greatest in Sanbao Telecom at 41%: Cambodia's subscriber
base grew by more than 63% on an annualized basis and over 15,000 average
monthly gross additions were recorded in Vietnam during 2002. This was the
result of a sustained strategy of investment in network infrastructure,
provision of innovative services and expanded service offerings. Innovative and
competitively priced value-added services, such as SMS chat, logo downloads and
information services were introduced in most operations to enhance the basic
voice offering and to develop the breadth and depth of the market.

Cambodia

     The Company owns 58.4% of CamGSM Company Limited ("CamGSM"). The remaining
41.6% of CamGSM is owned by a Cambodian company and a private business partner.
On April 20, 1996, CamGSM was awarded, for no charge, a 35-year non-exclusive
license to operate a nationwide GSM cellular system in the Kingdom of Cambodia,
the first such license granted in that country. There have been a total of 10
licenses awarded in Cambodia, of which five are currently in commercial
operation.

     The annual charge on the license payable to the Ministry of Posts &
Telecommunications of Cambodia for the years 1999 to 2001 is 10% of gross
revenue, net of interconnection. This increased to 15% from 2002 onwards.

     Cambodia has a population of 12.8 million and there is currently an
unsatisfied demand for basic telephone service. The operation commenced
commercial service in Phnom Penh in March 1997, and its operations have been
expanded significantly during the last three years to cover five regional
capitals as well as all provinces and major towns. In 2002, coverage was
extended to a further 36 sites. The operation is currently the only operator
with coverage in all provinces and major towns.

     The operation had 325,264 subscribers as of December 31, 2002, an increase
of 63% in the year compared with the 199,916 subscribers as of December 31,
2001. As of December 31, 2002 the above number of total subscribers included
320,424 prepaid subscribers, compared with 188,858 at December 31, 2001.

     In January 2001, Wireless Broadband Services were launched commercially
following successful trials in late 2000. The operation offers subscribers
Internet connections at speeds of up to 1MB/second. The initial service covered
three main areas, Phnom Penh, Siem Reap and Battambang. In 2002 the service was
expanded to cover 3 major regional cities and further coverage expansion is
planned for 2003.

     In November 2000, the Company launched an international gateway, under the
name Royal Telecam International Limited ("Telecam"), facilitating both incoming
and outgoing international traffic. The license is for 25 years from August
1998, with a possibility of extending it for an additional 5 years. The Company
owns 57% of Telecam with the remaining 43% owned by a Cambodian company and a
private business partner. The license fee payable is 51% of gross revenues, net
of interconnection and accounting/settlement rates. As at December 31, 2002,
Telecam had 48,765 incoming users and 16,689 outgoing users.


                                      25
<PAGE>


     In April 2002, Modern Times Group, trading as Royal AsiaOne Limited
("AsiaOne"), was issued a license to operate a broadcast-to-air UHF television
station. AsiaOne is owned 100% by CamGSM. AsiaOne operates the Cambodian
Television Network ("CTN") with the Ministry of Information. AsiaOne owns 95% of
CTN. CTN became operational in March 2003, providing service to 1.5 million
people around Phnom Penh, and has built the first purpose-built modern
television studio in Cambodia.

Lao People's Democratic Republic

     In January 2002, MIC was awarded a 20-year GSM nationwide license to
operate in Lao People's Democratic Republic ("Laos"). The award is for
frequencies for a GSM 900 and GSM 1800 network and MIC is developing its
services in a joint venture with the Ministry of Communications, Transports,
Posts and Construction ("MCTPC"). The Company has a 78% shareholding with the
remainder held by MCTPC. Lao People's Democratic Republic has a population of
5.8 million, with one of the lowest mobile phone penetration rates in the world
(approximately 1% of population using this service). Operations commenced on
April 21, 2003 with coverage in Vientiane, the capital city; and the venture is
currently in the process of rolling out its network to other main urban centers,
having as a priority Luang Prabang and Savanakhet.

     There are currently three other mobile operators in Lao People's Democratic
Republic with a GSM network, two of those started services in 2002, after the
monopoly of the first operator (that currently has 75% market share) expired.
Amongst the four, Millicom, operating under the brand name Tango, is the first
private operator.

     Tango is offering pure prepaid services, matching the lowest prices already
existing in the market for airtime and offering cheaper prices than anyone for
connections.

     The venture is expecting revenue coming from active subscribers and also
from the advantage of being the first venture offering international roaming to
visitors coming from countries other than Thailand.

Mauritius

     The Company has a 50% equity interest in Emtel Limited ("Emtel"). A local
partner, Currimjee Jeewanjee & Co. Ltd., owns the remaining 50% of the share
capital. Emtel's present non-exclusive license, expiring in November 2014, which
allows it to operate a cellular telephone system covering the entire island, was
granted in January 1989 and the company commenced operations in May 1989.

     Competition from the Mauritius government-owned telecommunication's company
commenced during 1996.

     Emtel launched GSM services in November 1999. The TACS network was closed
down in April 2002.

     Emtel pays interconnection charges to Mauritius Telecom and pays license
fees to the Information and Communications Technologies Authority (ICTA)
(Regulatory Authority) based on the number of licenses held and frequencies used
by Emtel. Emtel's pricing structure is subject to the ICTA's prior approval. An
annual technical know-how fee is payable by Emtel to the Company equal to 5% of
Emtel's annual pre-tax profits.

     Mauritian resident companies are generally subject to corporate income tax
on their worldwide income at a rate of 25%. Emtel, however, as the holder of a
development certificate, is taxed at a rate of only 15% on its business profits.
In addition, tax allowances have historically been available to Emtel for
capital investments. Investment income, including interest, continues to be
taxed at 25%.

     Emtel's subscriber base increased 10% in 2002 to 97,137 subscribers as of
December 31, 2002 from 88,416 subscribers as of December 31, 2001. As of
December 31, 2002 the above number of total subscribers included 83,555 prepaid
subscribers, compared with 74,087 at December 31, 2001.


                                      26
<PAGE>


Pakistan - Pakcom

     The Company had at December 31, 2002, a 61.3% equity interest in Pakcom
Limited ("Pakcom"), which has a non-exclusive license granted in early 1990 to
operate a cellular telephone system throughout Pakistan. Commercial service was
launched in December 1990.

     The license is for a 15-year period and is renewable thereafter at the
government's option. The license granted to Pakcom required it to provide
cellular telephone services to the major cities of Islamabad/Rawalpindi, Karachi
and Lahore within 30 days of the grant, failing which the license was revocable.
Pakcom was not able to meet this requirement, although its operations have now
extended coverage to the specified cities.

     During 1998, a license for ISP services was granted to Pakcom. Pakcom was
also awarded licenses to operate digital services (TDMA) in 1999 and Wireless
Data in early 2001.

     Pakcom pays a royalty to the Pakistan Telecommunications Authority at the
rate of 1.5% of gross sales revenues (net of interconnect charges paid to the
Pakistan Telecommunication Company Limited ("PTCL")). This is payable quarterly
in arrears. Regulatory approval is required for Pakcom's tariffs.

     The Company's partners in Pakcom are Grand Canyon Corporation, Arfeen
International and members of the Arfeen family (collectively, "Arfeen"), which
together own 38.7% of the equity. On January 26, 1999, an amended joint venture
agreement was signed.

     There are currently three other cellular telephone operators in Pakistan,
Paktel (also owned by the Company), Pakistan Mobile Communications (Private)
Limited ("PMCL") and Pakistan Telecommunications Mobile Limited ("PTML"), a
subsidiary of PTCL, the local PTT. Although Pakcom and Paktel's original
licenses stipulated that no further licenses would be granted during their term,
complaints lodged by an unsuccessful applicant resulted in a third license to
operate a cellular telephone network being granted to PMCL in 1991. PMCL
launched commercial service in August 1994 in Lahore, and has extended coverage
to Karachi, Islamabad and other locations. During 1998 a fourth license was
awarded to PTML, which launched commercial operations in early 2001.

     In December 2000, the government of Pakistan implemented Calling Party
Pays, which means that the recipient of a phone call will no longer pay for that
call.

     Pakcom implemented the digitalization of its cellular network and launched
TDMA services in Karachi in October 2000. During 2001, digitalization of the
network was expanded. Network capacity was added to accommodate the strong
growth in subscribers. The coverage of the network was also expanded.

     Following the award of a wireless local loop ("WLL") license in 2000,
Pakcom was granted the frequency required to launch high-speed wireless data
services. This network has been built and is being run as a Mobile Virtual
Network Operator on the frequencies by Telecard.

     In Pakcom, growth in prepaid subscribers from 223,519 to 327,325 (an
increase of 46%) has resulted in an overall growth of 42% year-on-year (December
2001 to December 2002), resulting in an absolute increase to 344,702 subscribers
as of December 31, 2002, from 242,608 subs as of December 31, 2001.

Pakistan - Paktel

     In November 2000, MIC announced it had acquired a 98.6% shareholding in
Paktel Limited ("Paktel"). Paktel was granted a license in early 1990 to operate
a cellular telephony system throughout Pakistan. Commercial service was launched
in November 1990. During the course of 2001, MIC increased its shareholding to
98.9% through being the sole subscriber to a capital increase.

     The license is for a 15-year period and is renewable thereafter at the
government's option. The license granted to Paktel required it to provide
cellular telephone services to the major cities of Islamabad/Rawalpindi, Karachi
and Lahore within 30 days of the grant, failing which the license was revocable.
Paktel was not able to meet this requirement, although its operations have now
extended coverage to the specified cities.


                                      27
<PAGE>


     Paktel pays a royalty to the Pakistan Telecommunications Authority at the
rate of 1.5% of gross sales revenues (net of interconnect charges paid to the
PTCL). This is payable quarterly in arrears. Regulatory approval is required for
Paktel's tariffs.

     In April 2001, Paktel commenced to offer prepaid services.

     During 2002, major coverage improvements were achieved. Network capacity
was added to accommodate the strong growth in subscribers.

     In October 2002, Paktel's license was modified and it was awarded GSM 900
spectrum.

     In Paktel, growth in prepaid subscribers from 101,661 to 186,591 (an
increase of 84%) has resulted in an overall growth of 43% year-on-year (December
2001 to December 2002). This has resulted in an absolute increase to 218,536
subscribers as of December 31, 2002, versus 152,928 subscribers as of December
31, 2001.

Sri Lanka

     The Company has a 99.9% equity interest in Celltel Lanka (Private) Limited
("Celltel"), the remaining equity interest is held by four local individuals
holding one share each as at December 31, 2002. Celltel has a non-exclusive
license to operate a cellular telephone system covering the island of Sri Lanka
that expires in 2008. This license was a renewal of Celltel's initial license
that was granted in 1988 and expired in 1995. The present system covers almost
all the major towns in Sri Lanka, including the Greater Colombo area, Kandy,
Galle, Kurunegala and Nuwara Eliya.

     Celltel launched GSM services during 2000 and has 168,251 subscribers on
its GSM network as at December 31, 2002, compared with 82,011 subscribers as at
December 31, 2001.

     An annual license fee is payable to the Telecommunications Regulatory
Commission of Sri Lanka ("TRCSL") and Celltel also pays interconnection fees set
by TRCSL to Sri Lanka Telecom for use of its telecommunications network.
Following a previous similar arrangement with the Board of Investment that ran
from 1988, Celltel had previously obtained a tax-free holiday for seven years
from 1993. In 2000, Celltel was granted Flagship status by the Board of
Investment (BOI) and the tax holiday was further extended by an additional eight
years from 2000. Celltel has the option of applying for a further five-year
extension of the tax holiday.

     Two competitors now associated with Hutchison and Sri Lanka Telecom began
operations in Sri Lanka in 1992 and 1993, respectively. A third competitor,
which is associated with Telekom Malaysia, received a GSM license in 1995 and
has commenced operations.

     Celltel's total subscriber base increased by 54% in 2002 to 266,372
subscribers as of December 31, 2002 from 172,712 subscribers as of December 31,
2001. Included in these numbers are 250,063 prepaid subscribers as of December
31, 2002 compared with 147,805 prepaid subscribers as of December 31, 2001.

Vietnam

     Following our partner's decision to exercise his option to purchase 10% of
the operation, the Company currently has a 80% interest in Comvik International
(Vietnam) AB ("CIV") with the remaining 20% held by a private business partner.

     In 1994, CIV and Vietnam Mobile Services Co. ("VMS"), a government owned
company, entered into a revenue sharing agreement, a Business Cooperation
Contract ("BCC"), to operate a nationwide cellular GSM system in Vietnam
("Mobifone"). In May 1995, the State Committee gave final approval for this
revenue sharing agreement and the cellular license was issued. VMS owns the
non-exclusive license to provide cellular service throughout the entire country.
The revenue sharing agreement, which has a ten-year term from July 1, 1995,
provides that CIV will be entitled to receive 50% of Mobifone's net revenues for
the first five years of operation and 40% thereafter. In October 2000, the BCC
received an amended investment license that increased CIV's contribution to the
BCC by $15 million and maintained the 50% revenue sharing for the remaining five


                                      28
<PAGE>


years of the term of the BCC, to June 2005. In 2001, a further amended
investment license was received to increase the BCC's capital by $100 million.
Both CIV and VMS committed to contribute an additional capital of $50 million
each. Of the additional $65 million additional contribution required under the
amended investment licenses $18 million had been disbursed as of December 31,
2002. The revenue sharing agreement expires at the end of June 2005 and at that
time legal title to all equipment shall be transferred to VMS at a price of $1.
Negotiations are ongoing to extend the life of the revenue sharing agreement for
a significant period of time.

     Service commenced in July 1995 and covers all provinces, including the
important cities of Hanoi, Ho Chi Minh City and Da Nang. With the additional
investment of $50 million following the amended license issued in 2001, CIV has
agreed to invest a minimum of $192.8 million in the venture over the term of the
license. In 2002, 89 new sites were put into service and the main switching
platforms were upgraded to improve the efficiency of the network.

     A new prepaid product, Mobi4U, was launched in 2002, featuring a lower
prepaid airtime rate and a daily fee. By December 2002, almost 40,000 customers
had subscribed to this package.

     There are currently three other cellular operators in Vietnam; Call-link
(launched in May 1992, currently using an analogue DAMPS system, and currently
operated by Saigon Post and Telecommunication), Vinaphone (launched GSM services
in June 1996 and wholly owned by the government) and Saigon Postal (a business
cooperation contract between SK Telecom, LG Telecom and a private Vietnamese
company which plans to launch services using CDMA in July 2003). In addition,
VNPT has launched an urban cell-phone in Ho Chi Minh City and Hanoi City in
December 2002. Vietel, a government-owned operator currently providing Voice
Over Internet long-distance services, has also been awarded a GSM 900 mobile
communications license but has yet to indicate how or when the license will be
used.

     Vietnam has a total population of approximately 81.1 million and there is
currently an unsatisfied demand for basic telephone service.

     With the added impetus provided by the launch of prepaid services, Mobifone
continues to experience rapid growth and had 686,663 subscribers as of December
31, 2002, an increase of 37% compared to the 499,394 subscribers as of December
31, 2001. As at December 31, 2002, the above subscriber number includes 494,334
prepaid customers compared with the 365,678 prepaid customers reported at
December 31, 2001.




                                      29

<PAGE>


                                MIC LATIN AMERICA

Background

     MIC Latin America consists of the Company's cellular operations in Bolivia,
Colombia (divested February 2003), El Salvador, Guatemala, Honduras and
Paraguay. MIC Latin America's licenses cover approximately 49 million people as
of December 31, 2002, with an equity population of approximately 37 million.

     Total operating revenue for MIC Latin America was $277.6 million (excluding
El Salvador) at December 2002, which is a 7% decline from the prior year, mainly
due to currency devaluations in South America.

     During 2002, all operations implemented measures to control costs to offset
lower revenues during the year. Major savings were achieved through a headcount
reduction, the discontinuation of handset subsidies, the renegotiation of
certain contracts and the restructuring of distribution networks.

Bolivia

     The Company has a 100% equity interest in Telefonica Celular de Bolivia
S.A. ("Telecel"). Telecel has a non-exclusive license to operate a cellular
telephone system in the whole country, which has an estimated aggregate
population of 8.4 million. The license was renewed in September 1996, valid
retroactively from November 1995, for a 20-year term. Further renewals are
subject to negotiations with the government. Although the license was initially
awarded to cover only La Paz, on May 26, 1997, Telecel received an extension of
the license to cover the entire country. The license sets limits on subscriber
tariff rates and provides for charges on the use of frequencies and a payment of
1% of the monthly net recurring subscriber revenue to be paid to the
telecommunications authority. Telecel has entered into both interconnect and
calling party pay agreements for each of its license areas.

     Telecel's coverage includes 8 of the 9 districts in the country, including
La Paz, Santa Cruz (including Puerto Suarez), Cochabamba, Sucre, Beni, Potosi,
Taraija and Oruro.

     In the last quarter of 1996, Societa Finanziara Telefonica s.p.a., the
international telecommunications group, began providing cellular service. It
also owns a 50% interest in Bolivia's long distance telephone company. In 2000,
Western Wireless won a license for GSM that commenced service in 2001. Telecom
Italia also operates a GSM network in the 800 Mhz frequency as well as a TDMA
network. An additional two frequencies are expected to be offered when third
generation services are launched.

     In June 2001, Telecel signed an agreement for additional financing in the
amount of $25,000,000 with the IFC and $10,000,000 from the Nederlandse
Financierings-Maatschappij Voor Ontwikkelingslanden, N.V. (FMO), also known as
the Netherlands Development Finance Company. This financing bears interest at
LIBOR+3.00% and is repayable in installments starting in December 2002 until
December 2006. Among other things, the financing requires the company to
maintain certain financial covenants such as a debt ratio, long-term debt
service coverage, and debt to equity ratio. These investments were used to help
to fund the expansion and further digitalization of the Group's mobile cellular
telecommunications network in Bolivia. As of December 31, 2002, Telecel was in
breach of certain covenants on the IFC loan and the balance outstanding has been
classified as a short-term liability in the balance sheet.

     In November 2001, Bolivia deregulated its Long Distance market, and Telecel
signed a 40-year concession to provide long-distance services. In February 2002,
Telecel began offering both National and International Long Distance services.
In November 2001, Telecel signed a 40-year concession to provide data
transmission services throughout Bolivia.

     Telecel's subscriber base increased 18% in 2002 to 410,887 subscribers as
of December 31, 2002 from 348,683 subscribers as of December 31, 2001. Included
in these numbers are 387,837 prepaid subscribers as of December 31, 2002,
compared with 315,397 as of December 31, 2001.


                                      30
<PAGE>


Colombia

     The Company had a 95.4% equity interest in Empresa Regional de
Comunicaciones Celulares de la Costa Atlantica S.A., Celcaribe S.A.
("Celcaribe"), which in March 1994 obtained a non-exclusive license to operate a
cellular system in the northern region of the Republic of Colombia.

     The northern region of Colombia has a population of approximately 8.3
million, including the three large provincial capitals of Barranquilla,
Cartagena and Santa Marta. These cities are home to three of the country's four
major ports.

     In February 2003, MIC completed the sale of its interest in Celcaribe.

El Salvador

     The Company has a 70% equity interest in Telemovil El Salvador S.A.
("Telemovil"), which in July 1991 obtained authority to operate a non-exclusive
cellular telephone system in El Salvador. The formal license contract was signed
in September 1991. The license is for a 15-year period beginning September 1991.
The license is automatically renewable for successive five-year periods after
the initial 15-year period in the absence of default by Telemovil. Commercial
service commenced in January 1993 and the system currently covers the
metropolitan area of San Salvador, including Santa Tecla and the international
airport and the most important cities in the eastern and western regions. In May
1997, a prepaid card service was launched.

     The Company has a partner in Telemovil who holds a 15% interest and several
other partners who, together, hold an additional 15% interest.

     During the first quarter of 2001, an ongoing dispute arose with MIC's local
partners in Telemovil. Due to the nature of this dispute, MIC's management
determined that circumstances regarding its investment in Telemovil had changed,
so that proportional consolidation was no longer appropriate as of May 2001.
Therefore, as of May 2001, the entity was accounted for under the equity method.
As of December 31, 2002, this dispute has still to be settled and management no
longer feels it is able to exercise significant influence in the operation and
therefore believes it is more appropriate to show its investment as a
non-current asset in the balance sheet under the caption "Investment in
securities". Management hopes that this dispute will be resolved during the
course of 2003.

     Telemovil has entered into an agreement with the Company under which the
Company is entitled to a royalty of 5% of Telemovil's pre-tax profits for the
first ten years after the commencement of operations.

     In the first quarter of 1996, Telemovil signed a $20,000,000 Investment
Agreement with the IFC to finance part of the operations for a $45,000,000
two-year expansion program. This finance bears interest at LIBOR+4% and is
repayable in installments in the period between July 1999 and January 2003. As
of December 31, 2002 approximately $2,500,000 was outstanding. A commitment fee
of 0.5% per annum is paid on the unused portion of this facility. In connection
with this financing, the Company signed a keep-well agreement which provides
inter alia that (i) in the event of a payment default by Telemovil, the Company
will provide the necessary funds to Telemovil and (ii) the Company will not sell
or otherwise dispose of, or encumber or permit any lien to exist over, any of
the voting securities of Telemovil such that the Company would be a less than
51% shareholder of Telemovil.

     In total, there are currently two cellular licenses and one PCS license
issued in El Salvador.

Guatemala

     The Company has a 55% effective interest in Comunicaciones Celulares S.A.
("Comcel Guatemala") which has a non-exclusive license to operate a national
cellular system. Commercial service was launched in October 1990. The cellular
telephone network currently covers most of the country.

     Comcel Guatemala's other stockholders are Miffin Associates Corp., owning
35%, and Arkade International Inc. owning 10%.


                                      31
<PAGE>


     Comcel Guatemala had a concession to operate the 800 Mhz frequency band for
20 years from January 1990 to March 2003. In March 2003, Comcel Guatemala
purchased the license to operate the frequency band under an usufruct title, for
a period of 15 years ending 2018, which is renewable thereafter. Therefore, the
venture has canceled the concession on which it was required to pay royalties to
the government. Comcel Guatemala also has the usufruct title for 4Mhz (A' and
B') for a period ending 2013, which is renewable thereafter, and a license to
offer international long-distance services.

     Comcel Guatemala has entered into interconnect arrangements with Telgua,
the former PTT, and with the other 18 operators that offer their services in the
country. The interconnect charges are subject to adjustment by mutual agreements
between the parties.

     During 1999, an additional PCS license in the 1900 Mhz frequency was
awarded, generating a more competitive environment. By the end of 2001, the
cellular operators in the country included: Telgua, Telefonica, and Bell South,
all three with a nation-wide license.

     Comcel Guatemala is currently expanding the coverage of its network
throughout the country along the three major national highways. In June 1997, a
prepaid card service was launched. At the end of 1999, Comcel began the process
of digitalization of the network from AMPS to TDMA technology. A new prepaid
brand, Free, was launched in 2002. The plan has no bills or contracts and uses
automatic direct debit agreements to recharge balances.

     As of December 31, 2002, Comcel Guatemala had 467,620 subscribers, an
increase of 31% from 358,281 subscribers as of December 31, 2001. Its major
growth came from prepaid, obtaining a 52% increase over last year's customer
base.

     During the first quarter of 2003, two more cellular licenses were granted
to competitors through a bidding process. The licenses allow the purchaser to
provide cellular services nationwide.

Honduras

     The Company owns 50% of Telefonica Celular S.A. ("Celtel"), having
increased its ownership from 25% in January 2001. Celtel was awarded in 1996 a
non-exclusive AMPS cellular license for the Republic of Honduras, which has a
population of 6.6 million. The other stockholder is Motorola Inc., which owns
50%. Celtel paid a license fee of $5.1 million to the Honduran government for a
ten-year license. The license has since been extended until 2021. An additional
fee will be paid in 2006.

     Currently there is no other cellular operator in Honduras. The operation
commenced commercial service in September 1996. Competition is expected for year
2003.

     As of December 31, 2002 the operation had 326,508 subscribers compared with
the 237,629 subscribers as of December 31, 2001, an increase of 37% in the year.
As of December 31, 2002 the above number of total subscribers included 259,156
prepaid subscribers compared with 163,094 as of December 31, 2001.

Paraguay

     The Company owns 96% of Telefonica Celular del Paraguay S.A. ("Telecel
Paraguay"). One local partner owns the remaining 4% of Telecel Paraguay. In July
1991, Telecel Paraguay was awarded a license, as a result of a bidding process,
by Presidential decree to build, maintain and operate a cellular telephone
system and provide cellular telephone services within a 50-kilometer radius of
Asuncion, Paraguay's capital and largest city, and commenced operations in
August 1992. In addition, in March 1993 Telecel Paraguay's license was extended
to cover Ciudad del Este, the second largest city of the country located on the
Brazilian border, and began operations there in December 1993. In 1997, Telecel
Paraguay's license was extended to cover the entire country. Telecel Paraguay's
license was originally for a ten-year period ending 2001 and was not exclusive.
In December 2000, the license was renewed for a further five years, expiring in
September 2006.


                                      32
<PAGE>


     Paraguay has a free market in term of prices for telecommunication
services, only the changes in interconnection charges among cellular networks in
Paraguay's tariffs are subject to prior approval from the telecommunications
authority. The license arrangements include interconnect facilities to the
wire-line network at standard charges. Telecel Paraguay faces limited
cross-border competition in Ciudad del Este from a Brazilian operator and a
similar situation will occur in Encarnacion from an Argentinean operator.

     In December 1997, Telecel Paraguay was awarded the license for digital PCS.
The license covers the whole of Paraguay. The license was renewed in January
2003 for up to November 2007. A second cellular license plus a nationwide PCS
license has been awarded to a consortium including Telecom Italia that commenced
operations in June 1998. A third PCS license launched services beginning 1999,
and a fourth PCS license launched in March 2000.

     2002 was marked by a strong focus on prepaid services, including various
attractive plans with low prices. Also, strong price reductions were observed in
the market from the difficulty to maintain constant prices in U.S. dollars
terms, as well as impact of aggressive competition. A new prepaid brand, Free,
was launched. The plan has no bills or contracts and uses automatic direct debit
agreements to recharge balances. Currently, some 25,000 postpaid customers have
migrated to this plan, resulting in a considerable reduction in billing
collection costs.

     In 1998, the government of Paraguay introduced a foreign investment tax
incentive program. This initiative reduces the basic rate of income tax by 95%
on the incremental profits generated by new capital investment. The program was
backdated to January 1, 1997.

     SMS (Short Message Services) were expanded and new value added options now
includes chatting facilities, web messaging and premium packages (polls,
lotteries and journal advertisements).

     Telecel also provides Broadband and Dial Up Internet services. As at
December 31, 2002, Telecel was the third largest Internet provider in the
country, out of 14 operators, in terms of subscribers.

     Telecel Paraguay's subscriber base decreased 3% in 2002 to 550,109
subscribers as of December 31, 2002 from 564,512 subscribers as of December 31,
2001. This decrease is largely a result of the serious economic circumstances
that have hit the country during the year. Included in these numbers are 489,219
prepaid subscribers as of December 31, 2002, compared with 457,780 as of
December 31, 2001.












                                      33
<PAGE>


                                   MIC AFRICA

Background

     MIC Africa consists of the Company's cellular operations in Ghana, Senegal,
Sierra Leone and Tanzania. MIC Africa's licenses cover approximately 73.6
million people as of December 31, 2002, with an equity population of
approximately 53 million.

     Operating revenue in MIC Africa increased by 15%, reflecting positive
trends in Sierra Leone and Senegal during the year. Proportional cellular
subscribers increased by 27% to 217,928 at December 31, 2002. The main business
driver in Africa continued to be the growth in the number of pre-paid
subscribers, which, by December 2002, accounted for 98% of MIC Africa's total
customer base.

Ghana

     The Company now has a 100% equity interest in Millicom (Ghana) Ltd.
(operating under the trade name "Mobitel"). The Company increased its
shareholding from 70% to 100% in late 2002. Mobitel has a non-exclusive license
to operate analogue cellular services throughout Ghana and commenced operations
in May 1992. Mobitel also has a non-exclusive license to operate GSM cellular
services throughout the country and successfully launched its GSM network in
June 2002.

     Mobitel's license is of indefinite duration, while it's interconnect
agreement with Ghana Telecom, the local PTT, was for an initial five-year period
commencing in 1991. Although the interconnect agreement ended February 15, 1996,
this has not affected the system's service. The new interconnect rates and
settlement terms are in place and are revisited from time to time.

     During 1994 an additional cellular telephone license was awarded to a
competitor. This license holder commenced commercial operations in 1995. A third
license was awarded in 1996, with service commencing in November 1996, and a
fourth operator commenced operations in January 2001.

     Mobitel currently operates in Accra, Tema, Kumasi, Obuasi, Takoradi, and
Tamale. Further expansion is planned for mid-2003.

     As of December 31, 2002, Mobitel had a total of 52,060 subscribers,
representing an increase of 46% from 35,706 subscribers as of December 31, 2001.
As at December 31, 2002, the above subscriber numbers include 50,516 prepaid
subscribers, an increase of 51% compared with the 33,517 prepaid subscribers as
at December 31, 2001.

Senegal

     In July 1998, SentelGSM, a company owned 75% by the Company, was awarded a
nationwide GSM license for The Republic of Senegal. The Company's partner,
owning the remaining 25%, is a local businessman.

     The non-exclusive license, awarded for a period of 20 years, renewable
every five years thereafter, required no initial payment. However, there is an
annual administrative fee of approximately $85,000. The other cellular license
in the country, operated by Sonatel Mobile, a branch of Sonatel, the local
privatized PTT, commenced operations in September 1996. Currently, Sonatel is
owned 40% by France Telecom. A third license is currently in the process of
being granted.

     The population of The Republic of Senegal is approximately 10.6 million
people. The venture commenced operations in April 1999 with only a prepaid
product.

     As of December 31, 2002, the operation had 97,804 subscribers, an increase
of 12% over the 87,143 subscribers reported at December 31, 2001.


                                      34
<PAGE>


Sierra Leone

     In July 2000, the Company was awarded, through its subsidiary Millicom
Sierra Leone Limited ("MSL"), a nationwide license to provide GSM cellular
telephony in Sierra Leone. The license expires in August 2015. The Company owns
70% of MSL.

     Sierra Leone has a population of 5.6 million, with an estimated fixed-line
penetration of only 0.0024%. Initially, MSL has rolled-out the operation in
Freetown, the capital, with a population of 1.5 million. It commenced operations
in late May 2001 and operates a purely prepaid service.

     MSL introduced a Friends & Family service, giving a discount on a
customer's five most frequently called numbers, together with a similar service
for corporate customers giving discounted rates for international calls to the
five most called countries. These initiatives both proved very successful in
2001 and 2002. The company also offers Closed User Group to many major
organizations and associations, most notably the Medical Association of Sierra
Leone. During 2002, MSL offered a joint promotion with Sierra Leone Commercial
Bank, whereby potential mobile users can get a loan from the bank to buy a
handset and connection from MSL, this proved to be a big success.

     As at December 31, 2002, the operation had 13,411 subscribers, an 89%
increase from December 2001.

Tanzania

     MIC Tanzania Limited ("MIC Tanzania") was awarded a non-exclusive 15-year
license in November 1993 to install and operate a cellular telephone network in
the United Republic of Tanzania by the Tanzania Posts & Telecommunications
Corporation ("TP&TC") following a formal tender process. Service became
operational in September 1994.

      TP&TC was subsequently restructured to form Tanzania Telecommunications
Company Ltd. ("TTCL"), Tanzania Communications Commission and Tanzania Posts
Corporation. The Company owns a 57% equity interest in MIC Tanzania. TP&TC
originally owned 25% of the equity interest that was transferred to TTCL during
the restructuring process. This 25% interest was transferred to the Treasury
Registrar in 2000. Ultimate Communications Ltd., a private Tanzanian company,
owns 14%. The remaining 4% was scheduled to be transferred to TTCL on the
transfer of TTCL's regional licenses to MIC Tanzania in 1997. The conditions of
this transfer were not complied with by TTCL and the shares, although fully
paid, have not yet been issued.

     The initial cost of the license was $250,000 with an additional $696,000
paid in 1997 following a dispute as to whether the original license was for
nationwide coverage. On an annual basis MIC Tanzania pays a royalty of 5% of
airtime revenue and a license fee dependent upon the number of cell sites. The
license was re-issued in 2001 with additional frequency ranges.

     Under the interconnect agreement, MIC Tanzania pays interconnect charges at
the standard rate. In December 1995, the interconnect agreement was modified; a
"calling party pays" system was implemented by which MIC Tanzania no longer
charged its subscribers for incoming calls but collected revenue from TTCL
instead. The basis for charging interconnected traffic was disputed by TTCL from
January 1, 1999. In January 2001, this dispute was settled in favor of MIC
Tanzania and the dispute resolution documents were registered in the High Court
of Tanzania. Despite these documents, TTCL continued to refuse to pay components
of the interconnect and at December 31, 2002, approximately $13,000,000 is
contested by TTCL and in court proceedings. MIC Tanzania has won a court
injunction for TTCL to settle this amount. Currently, this remains unpaid and
subject to appeal processes.

     MIC Tanzania originally launched services using TACS technology. In
September 2000, MIC Tanzania launched a new GSM network that is being operated
concurrently with the original TACS network. Under the terms of a new license
issued in September 2001, MIC Tanzania may continue to operate the TACS network.
MIC Tanzania currently provides coverage to Dar es Salaam and the surrounding
area, Zanzibar and significant parts of the country. MIC Tanzania plans to add
eight new coverage sites and increase capacity in main regional centers.


                                      35
<PAGE>


     A competitor, Tritel, began operations in December 1995 but was unable to
expand business in line with the investment requirements. Being unable to face
its financial commitments under its license, Tritel stopped operations by the
end of 2002. In 1999 and 2000, three new licenses were issued, of which one,
Zantel, commenced operations on the island of Zanzibar in 1999. In 2000, Vodacom
commenced operations and have rapidly built-out their network to provide
coverage in most of the areas covered by MIC Tanzania. TTCL was privatized in
February 2001 and launched its own cellular operation through its subsidiary
Celtel in November 2001. Vodacom is now market leader in subscribers and
revenues following large network coverage roll out. Celtel and MIC Tanzania have
an equivalent proportion of the remaining subscriber base. Zantel has not
expanded its network on Tanzania mainland and for that reason, remains marginal
in terms of market share, but operates its own international gateway.

     MIC Tanzania is an approved enterprise under the Tanzania Investment Act,
1998, for a period of five years ending on December 31, 2003. Consequently, MIC
Tanzania can import equipment tax-free and can set-off any capital expenditure
against its taxable income in the year in which such expenditure is incurred.

     Further to the GSM network roll out, MIC Tanzania also introduced a number
of new value added services that further strengthened its position as the
leading innovator in the market.

     As of December 31, 2002 MIC Tanzania had 145,838 subscribers, including
140,265 prepaid, an 8% increase over the 134,578 subscribers as of December 31,
2001, including 131,237 prepaid subscribers.


























                                      36
<PAGE>


                                OTHER INVESTMENTS

Tele2 AB (formerly named NetCom AB)

     In January 1994, the Company obtained an option to acquire 20% of Comviq
GSM when Comviq GSM significantly increased its share capital. The Company
determined not to exercise its pre-emptive right to maintain its 20% equity
interest, which it previously owned, upon the increase in share capital and
converted its equity interest into an option to purchase from the other
shareholder, Tele2 AB (then known as NetCom, and previously known as NetCom
Systems AB), previously a subsidiary of Kinnevik, an interest equal to 20% of
the equity interest of Tele2 AB in Comviq GSM at the time the option was
exercised.

     In September 1996, the Company exchanged its option to acquire 20% of
Comviq GSM in return for shares in Tele2 AB. The value of the consideration
received by the Company represented the difference between the value of 20% of
Comviq GSM at the date of the exchange and the exercise price of the Company's
option in Comviq GSM at the date of the exchange. The exercise price of the
option was equal to 20% of the total equity of Tele2 AB in Comviq GSM
(calculated at the time of the exercise of the option) plus an annual rate of
return, related to the level of the Stockholm Inter-Bank Offering Rate
("STIBOR"), on such equity contribution. In addition, if the Company had
exercised the option, the Company would have been obligated to assume its pro
rata share of existing indebtedness and guarantees of Comviq GSM. There was no
cash consideration in the exchange transaction between the Company and Tele2 AB
and after the transaction the Company owned 7.65% of the fully diluted shares of
Tele2 AB. In March 1997, the Company's ownership in Tele2 AB was diluted to 7.5%
following an equity offering in which it did not participate.

     The Company initially accounted for its interest in Tele2 AB at a value of
$87,343,000, the value established at the time of the exchange transaction.
Between April 1998 and February 2000, the Company sold part of its investment,
leaving a net investment of 4.9%, realizing proceeds of $129,451,000 and a net
gain of $98,157,000. In 2001 and 2002, the Company sold additional shares for
proceeds of $125,195,000 and $167,238,000, respectively, realizing a net loss of
$15,931,000 and $168,818,000, respectively. In 2002, MIC also recognized an
other-than-temporary loss of $119,138,000.

     In July 2000, the Company announced it had accepted an offer from Tele2 AB
for the share capital of Societe Europeenne de Communication S.A. ("SEC"). In
the deal, Tele2 AB offered to exchange 11.5 SEC shares for one Tele2 AB share.
The Company exchanged its SEC shares on September 27, 2000. After the exchange,
the Company held 13.7% of the issued share capital of Tele2 AB.

     The Company's investment in Tele2 AB is carried at its market value.

     Tele2 AB is the leading pan-European telecommunications company offering
fixed and mobile telephony, data network and Internet services under the names
Tele2, Tango and Comviq to approximately 17 million people in 22 countries as at
December 2002. In addition, Tele2 AB operates Datametrix, which specializes in
systems integration; 3C Communications, operating public pay telephones and
public Internet services; Transac, providing billing and transaction processing
services; C cubed, offering branded prepaid calling cards. Tele2 AB also offers
cable television services under the Kabelvision brand name.

     Tele2 AB's Nordic operations cover Sweden, Norway, Denmark and Finland.
Tele2 AB provides cellular services in Sweden, while Denmark, Finland and Norway
are primarily fixed telephony operations. In October 2000, Tele2 AB became the
first mobile virtual network operator in Denmark. Tele2 AB has also been awarded
UMTS licenses in Sweden, Norway and Finland. During 2002, Tele2 AB reached
agreement for a Mobile Virtual Network Operator ("MNVO") in Norway, which is
intended to be launched during 2003.

     The Baltic and Eastern Europe operations cover the Baltics, Poland, Russia
and the Czech Republic. These are chiefly cellular operations. Tele2 AB intends
to launch fixed-line services in Poland during 2003.

     In central and southern Europe, Tele2 AB provides fixed telephony services
in Germany, the Netherlands, Switzerland, Austria, Belgium, Luxembourg,
Liechtenstein, France, Italy and Spain. In addition, Tele2 AB will


                                      37
<PAGE>


launch fixed-line services in Portugal, of which services were launched in
Spain in 2001. In addition, Tele2 AB provides cellular services in Austria,
Luxembourg, Liechtenstein, the Netherlands and Switzerland.

     In the fourth quarter 2001, Tele2 AB purchased MIC's cellular operations in
Russia.

     As at December 31, 2002, Tele2 AB had approximately 17 million subscribers,
an increase of 12% compared with the previous year. Of these, approximately 11.4
million are fixed-line telephony and Internet subscribers and 5.0 million are
cellular subscribers.

     Tele2 AB is listed on the Stockholm Stock Exchange under TEL2A and TEL2B,
and on the NASDAQ Stock Market under TLTOA and TLTOB.

     As at December 31, 2002, the Company held 6.8% of Tele2 AB with a market
value of $265,571,000.

Argentina

     In November 1998, the Company announced the award of a fixed wireless
license to provide data communication and value-added services in Argentina.
Millicom Argentina SA, in which MIC has a 65% equity interest, launched services
in May 2000. The license covers the six largest cities in Argentina, covering
approximately 90% of the urban population. The Company is focused on providing
Internet and communications for bandwidth intensive applications such as
high-speed data transmission and Internet access to small, medium and large
sized businesses and home office workers.

     During 2002, Argentina had to adjust its operation to face the difficulties
from the Government's debt default and currency devaluation of about 200%. The
service has now strong demand from corporations seeking lower cost data
connections, which replaces fiber optic or dedicated links.

     During 2002, Millicom Argentina obtained a license to offer mobile services
under a Mobile Virtual Network Operator concept, meaning that it could launch
cellular mobile services using existing mobile networks. There is no obligation
for existing operators to open their networks to the Company.

     As at December 31, 2002, Millicom Argentina had 4,462 subscribers, a
decrease of 6% over the reported 4,757 subscribers as at December 31, 2001.

Paraguay

     MIC was granted a nationwide license in August 1999 to provide data and
image transmission through two local frequencies of 2.4 GHz to 3.5 GHz in a 100
MHz bandwidth. The service began operating in May 2000. As at December 31, 2002,
there were 3,882 subscribers, an increase of 35% over the reported 2,879
subscribers as at December 31, 2001.

     2.4 Mhz operators are offering strong competition in the home sector,
particularly with a joint offer of cable TV services. A second 3.5 Mhz operator
is present in the market since 2002, who also operates the second TDMA network
nationwide.

     Telecel services are widely used by mission critical applications, like
bank branches, automated telling machines and supermarkets.

Peru

     In June 2000, the Company announced it had been awarded a nationwide
license to provide wireless data, Internet access and fixed telephony services
in Peru. The license covers the main nine cities and is valid for a 20-year
period with renewal for a similar period. The frequency award is one of three
license awards of this type in Peru. The Company is focused on providing
Internet access and communications for bandwidth intensive applications such as
high-speed data transmission and Internet access to businesses and home office
workers. Services were launched in January 2001 in Lima and now cover Chiclayo
and Trujillo. As at December 31, 2002, the operation reported 2,891 subscribers.


                                      38
<PAGE>


     The Company and the Peruvian government subscribed in May 2002, a
concession agreement to provide long-distance (domestic and international)
carrier services. The concession area comprises the following cities; Ancash,
Arequipa, Ica, La Libertad, Lambbayeque, Lima and the constitutional province of
Callao as well as signals abroad. The concession agreement is for a term of 20
years with renewal for a similar period or partial renewals for five years, not
to exceed 20 years.

     In 2003 voice services will be initiated within Lima, using the IP
architecture of the existing wireless network.

Other licenses

     The Company has been actively pursuing further licenses in countries where
it has existing cellular networks and strong brand recognition. A commercial
wireless license has also been awarded in Venezuela, however, the Company has
never commenced providing services in Venezuela.

Capital Expenditures and Divestitures

     The Company's capital expenditures, acquisitions and divestments and
sources of funding for fiscal 2002, fiscal 2001 and fiscal 2000 are as follows:

     From 2000 to 2002, inclusive, the Company has made the following
investments/divestments in operations:

   Investments

     2002:

     In November 2002, MIC acquired the remaining 30% shareholding in Millicom
(Ghana) Limited at a cost of $500,000.

     During 2002, MIC increased its ownership in Celcaribe, its cellular
operation in Colombia, through partial repayment of their debt, which was
treated as a capital increase, and through a capital increase to 95.4% as of
December 31, 2002. MIC subsequently sold its interest in Celcaribe in February
2003.

     In 2002, the Company invested $500,000 in its new venture in Lao People's
Democratic Republic.

     2001:

      In the first quarter of 2001, MIC increased its shareholding in Celtel
Honduras from 25% to 50%.

     In May 2001, 19,650 shares in Telemovil, MIC's cellular operation in El
Salvador, were put to the Company for a price of approximately $29.2 million.
This increased MIC's interest in Telemovil to 70%.

     In March and September 2001, certain shareholders in Celcaribe, the
operation in Colombia, put a total of 6,320,262 shares to MIC for a
consideration of $20.1 million. In addition, MIC contributed to a capital
increase in Celcaribe. As a result of the above, as at December 31, 2001, MIC's
ownership in Celcaribe had increased to 92.7% from 73.2% at December 31, 2000.

     2000:

     In January 2000, MIC invested $10 million in Modern Holdings (formerly
known as XSource), a subsidiary of Great Universal, in the form of a convertible
promissory note. In February 2000, these notes were converted into 1,293,095
shares of common stock, representing 8.5% of the share capital of XSource. At
December 31, 2002, the value of this investment has been reduced to $2,950,000.

     In March and September 2000, certain shareholders in Celcaribe, the
operation in Colombia, put a total of 6,438,970 shares to MIC for a
consideration of $17,560,000. In addition, MIC contributed to a capital increase


                                      39
<PAGE>


in Celcaribe. As a result of the above, as at December 31, 2000, MIC's ownership
in Celcaribe had increased to 73.2% from 41.6% at December 31, 1999.

     In November 2000, MIC acquired a shareholding of 98.6% in Paktel, in
Pakistan.

   Divestments

   2002:

   Following the sale of the Company's interest in FORA Telecom BV during 2001,
as described below, during 2002 MIC obtained the necessary GSM licenses and
therefore received an additional $30 million proceeds in cash. In addition,
certain loans for which MIC was liable were settled at less than their carrying
value. The credit realized on these less costs incurred in the acquisition of
the licenses, resulted in a net gain of $30,859,000 in 2002.

   In July 2002, MIC's partner in its cellular operation in Vietnam exercised
his options to purchase 10% of the share capital of the company. MIC has
recognized a gain of $16,603,000 on this transaction.

   In September 2002, MIC sold its interest in its cellular operation in the
Democratic Republic of Congo recognizing a loss of $21,000.

   In September 2002, the Group sold its 100% interest in Liberty Broadband Ltd.
(formerly known as Tele2 UK) recognizing a loss of $10,294,000.

     In May 2002, MIC sold a 17% interest in MIC Systems BV to Kinnevik for a
total consideration of $17,000,000 in order to make a repayment on the
Toronto-Dominion financing. In November 2002, MIC then sold its remaining 83%
interest in the subsidiaries of MIC Systems BV for a total consideration of Euro
95 million, approximately $97,000,000. These proceeds were mainly used to meet
our interest obligation on the Old Notes.

     In December 2002, MIC completed the sale of its cellular operation in the
Philippines for a nominal sum, realizing a loss of $35,988,000.

     During the course of 2002, MIC sold 8,743,110 Tele2 AB `B' shares,
recognizing a loss of $168,818,000. The proceeds were used to both make
repayments on the Toronto-Dominion financing and to meet our interest obligation
on the Old Notes.

     2001:

     During 2001, MIC sold 3,513,000 Tele2 AB class B shares realizing net
proceeds of approximately $125.2 million, giving an approximate net loss over
the average book value of $15.9 million.

     In November 2001, the Company sold 100% of its interest in FORA Telecom BV,
its Russian Cellular telephony operations to Tele2 AB. The agreement called for
$80 million of Tele2 AB class B shares, (corresponding to 2,461,449 Tele2 AB
class B shares), to be exchanged for the assets plus a maximum of an additional
$30 million depending on the outcome of GSM license applications for three of
MIC's existing cellular telephony operations in Russia. Upon execution of the
sale agreement, MIC agreed to assign deposits held for loans by Banque Invik and
waived all intercompany balances between the segment and the Company. The total
disposal resulted in a $6.7 million non-cash gain recognized in 2001.

     In September 2001, the Company sold its 24.5% investment in SkyCell
Communications Limited, the Indian cellular company operating in Chenai
(formerly known as Madras), to Bharti Tele-Ventures Limited. The sale resulted
in a $28.4 million gain on the disposal.

     2000:


                                      40
<PAGE>


     In July 2000, the Company announced it had accepted an offer from Tele2 AB
for the share capital of SEC. In the deal, Tele2 AB offered to exchange 11.5 SEC
shares for one Tele2 AB class B share. The Company exchanged its SEC shares on
27 September 2000, realizing a book gain of $609,941,000.

     In February 2000, the Company sold part of its investment in Tele2 AB for
$65,434,000 reducing it's holding from 5.77 % to 4.9 %, realizing a $55,321,000
capital gain.

     Set-out below is a table reflecting the Company's sales of its interests in
cellular systems and certain related information at the time of the sales in
2002, 2001 and 2000.

     Capital Expenditure

     The Company's capital expenditure in the last three years by geographical
region has been as follows:

U.S. $000s                           2002              2001             2000
                                   -------           -------          -------
Asia...........................     40,006            67,000           55,932
Latin America..................     76,616            81,612          122,367
Africa.........................     16,248            18,411           18,701
Europe.........................      2,948             5,260            4,837
Russia.........................          -             7,238            7,109
                                   -------           -------          -------
                                   135,818           179,521          208,946
                                   =======           =======          =======

     The main expenditures were for the introduction of digitalization in Latin
America, Sanbao and Africa and the expansion of existing networks both in terms
of areas covered and capacity.

     During the course of 2003, the Company has continued to invest in its
operations. The main areas of capital expenditure are the expansion of networks
into areas not yet covered and the increase in capacity of existing networks. In
the period to March 31, 2003 the following amounts were approved by the board of
directors in respect of each of these categories:


                                Network      Network
U.S. $000s                     expansion     capacity        Other         Total
- ----------                     ---------     --------       ------        ------
Latin America...............        875         8,777          129         9,781
Sanbao......................      4,675         5,708          931        11,314
Africa......................      3,993           980          552         5,525
                                  ------       ------        -----        ------
Total.......................      9,543        15,465        1,612        26,620
                                  =====        ======        =====        ======

     In addition to the above amounts, approval has been given for the purchase
of equipment in each region to up-grade and improve billing systems and office
equipment. It is anticipated that the above amounts will be spent over the
coming 12 months. The majority will be financed through suppliers, with some
being backed by a Company guarantee or stand-by letter of credit.


                                      41
<PAGE>


Gain and Loss on Exchange, Disposal and Write-down of Assets

<TABLE>
                                                    Approximate                   Debt
                                                     Population                Assumed by   Number of
Market                                 Ownership      Covered        Price     Purchaser   Subscribers  Date of Sale
- ---------------------------------    ------------   -----------   ----------- -----------  -----------  -------------
                                     (percentage)    (millions)  ($ millions) ($ millions)
<S>                                   <C>           <C>           <C>        <C>           <C>          <C>
                                                                                                           05/02 and
MIC Systems......................         100%             -        114.0          nil               -         11/02
Democratic Republic of Congo.....        50.9%          55.2          1.5            -               -         09/02
Philippines (i)..................        40.0%          84.0       nominal        29.5 (ii)     29,896         12/02
                                      From 20% to
Russia...........................        100%           47.5         80.0           -          236,516         11/01
India - Madras...................        24.5%           5.7         21.1           -           99,023         09/01
</TABLE>

(i)  The Company had an additional beneficial ownership of 7.9% through
     intermediary holding companies.

(ii) The debt figure above is 100% of the operation's external debt.

Organizational Structure

     Below is a list of MIC's significant subsidiaries and joint ventures as of
March 31, 2003, including the name, country of incorporation or residence and
proportion of ownership interest.

<TABLE>
                                                                                 Proportion of
                                                                                   ownership
Name                                               Country of residence             interest
- ------------------------------------         --------------------------------    -------------
<S>                                          <C>                                      <C>
Cam GSM Company Limited                      Cambodia                                 58.4%
Royal Telecam International Limited          Cambodia                                 57.0%
Millicom Lao Co. Ltd.                        Lao People's Democratic Republic         78.0%
Emtel Limited                                Mauritius                                50.0%
Pakcom Limited                               Pakistan                                 61.3%
Paktel Limited                               Pakistan                                 98.9%
Celltel Lanka Limited                        Sri Lanka                                99.9%
Comvik International (Vietnam) AB            Vietnam                                  80.0%
Millicom Argentina SA                        Argentina                                65.0%
Telefonica Celular de Bolivia SA             Bolivia                                 100.0%
Telemovil El Salvador SA (i)                 El Salvador                              70.0%
Comunicaciones Celulares SA                  Guatemala                                55.0%
Inversiones Rocafuerte SA                    Honduras                                 50.0%
Telefonica Celular del Paraguay SA           Paraguay                                 96.0%
Millicom Peru SA                             Peru                                    100.0%
Millicom (Ghana) Limited                     Ghana                                   100.0%
Sentel GSM                                   Senegal                                  75.0%
Millicom (SL) Limited                        Sierra Leone                             70.0%
MIC Tanzania Limited                         Tanzania                                 57.0%
</TABLE>

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

(i)  Telemovil El Salvador SA is classified as a non-current investment in
     securities.

Property, Plant and Equipment

     The Company's principal executive offices are located in Bertrange, the
Grand-Duchy of Luxembourg, where it leases approximately 448 square meters. The
lease is automatically renewable from year to year unless terminated by the
Company or the lessor upon six months advance written notice. The current annual
rental is approximately $167,000. The Company believes its principal executive
offices are suitable and adequate for its operations.


                                      42
<PAGE>


ITEM 5.  OPERATING AND FINANCIAL REVIEW AND PROSPECTS

     This discussion and analysis of the financial condition and results of
operations should be read in conjunction with the financial statements, notes
therein and schedules thereto which comprise part of this document.

     Unless otherwise indicated, all financial data and discussions therein in
this discussion and analysis are based upon financial statements prepared in
accordance with IFRS. See Note 30 of the Notes to the Consolidated Annual
Accounts for certain reconciliations between IFRS and U.S. GAAP.

Overview

     Since its inception, the Company has achieved significant growth, reaching
a total of 4,252,037 cellular subscribers worldwide as of December 31, 2002, as
compared with 3,322,869 at December 31, 2001, excluding divested operations and
El Salvador, and 2,455,228, excluding divested operations and El Salvador, at
December 31, 2000, a growth rate of 28% and 35% in 2002 and 2001, respectively.

     The Company had 3,021,873 proportional cellular subscribers as of December
31, 2002, compared with 2,415,474, excluding divested operations and El
Salvador, as of December 31, 2001 and 1,765,708, excluding divested operations
and El Salvador, as of December 31, 2000, a growth rate of 25% and 37% in 2002
and 2001, respectively. Proportional subscribers are the Company's share of the
total subscribers of its joint venture and subsidiary operations.

     In addition, as at December 31, 2002, the Company owned 6.8% of Tele2 AB
which grew its telephony subscriber base from approximately 15 million as of
December 31, 2001 to approximately 16.8 million as of December 31, 2002.

     MIC's revenues increased 6% over the three years ended December 31, 2002,
increasing from $570,840,000 in 2000 to $605,186,000 in 2002.

     The increase in MIC's revenues, despite a number of divestments, reflects
the continuing expansion of the subscriber base in existing operations as well
as additional revenues from ventures that became operational during each period.
Although total revenues increased, airtime per subscriber has tended to decrease
as the subscriber base has grown. In addition, connection fees and handset
prices were reduced, in some cases to zero, by most ventures as part of programs
to spur subscriber growth. Also, an increasing proportion of subscribers are
choosing the prepaid as opposed to postpaid option. A prepaid subscriber's usage
and airtime tends to be lower than that for a postpaid subscriber. As a result,
the rate of subscriber growth exceeded the rate of growth in revenues. The
improvement in operating profit reflects cost-cutting measures throughout the
Company.

Critical Accounting Policies

     The consolidated financial statements of the Group have been prepared in
accordance with International Financial Reporting Standards ("IFRS"). In
compiling these statements, management is required to make assumptions and
estimates. We believe that the following critical accounting policies involve
judgment areas that could materially affect the results of the Company. For a
detailed discussion of these and other accounting policies, see Note 2 of the
consolidated financial statements.

     Basis of Consolidation. Entities over which the Group has control are fully
consolidated. Entities over which the Group has joint control are consolidated
using the proportional method that combines the Group's proportional share of
assets, liabilities, income and expenses. The definition of full control is the
power to govern the financial and operating policies of an entity so as to
obtain benefits from it and is based on criteria such as the ability to vote
through items at shareholder and board level. The method of consolidation used
for each entity is based on management's assessments as to whether they have
full or joint control. The Company also owns 100% of Great Universal and Modern
Holdings. However, due to the warrant holders' right to exercise, MIC considers
it does not control either company and that severe long-term restrictions exist
which significantly impair the ability of either company to transfer funds to
MIC and therefore consolidates these


                                      43
<PAGE>


entities as other available-for-sale securities. Although MIC owns 70% of the
share capital of its operation in El Salvador, management has determined that,
due to a dispute with local shareholders, it is no longer able to exercise a
significant influence in the operation and therefore feels it is more
appropriate to show its investment as a long-term asset in the balance sheet
under the caption "Investment in securities".

     Collectability of Assets. Management is required to estimate the
collectability of trade debtors. As of December 31, 2002, these totaled
$140,785,000, of which management had estimated that $27,564,000 was unlikely to
be collected. These estimates are based on knowledge of the local markets and
prior credit history. The basis for the provisions made will vary between
subscribers and amounts due from other telephone companies and are simply
management's best estimates.

     Impairment of Non-current Assets. The Company records significant
intangible and tangible assets relating to wireless and non-wireless operations.
Intangible assets mainly relate to goodwill and license values and tangible
assets mainly relate to network value through property, plant and equipment.
Significant estimates and assumptions are required to decide the useful expected
lives of these assets and whether there is any impairment. These estimates are
made on a regular basis throughout the year as they can be significantly
affected by changes in competition, technology and other similar factors. When
certain operational and financial factors indicate an impairment of value,
management evaluates the carrying value of property, plant and equipment as well
as other assets including licenses and goodwill, in relation to the operating
performance and future cash flows of the underlying assets. When indicated, the
impairment losses are measured based on the difference between the estimated
recoverable amount and the carrying amount of the asset. Management's estimates
of recoverable amounts for the individual asset or, if not possible, the
cash-generating unit, are based on prices of similar assets, to the extent
available in the circumstances, and the result of valuation techniques. These
include net present values of estimated future cash flows and valuations based
on market transactions in similar circumstances. In addition to the evaluation
of possible impairment to the assets carrying value, the foregoing analysis also
evaluates the appropriateness of the expected useful lives of the assets. Any
negative change in relation to the operating performance or the expected future
cash flow of individual assets or of a cash generating unit will change the
expected recoverable amount of the underlying assets and therefore will decrease
the value of the underlying assets.

     In the year ended December 31, 2002, management identified an impairment of
its licenses to operate high-speed wireless data services in Peru and Venezuela
and, as a consequence, made a write-down of $3,034,000 in the value of these
licenses.

     Also, in 2002, MIC recognized an impairment on both goodwill and license
value in its operations in Colombia and Argentina. The total impairment
recognized, by country, being $77,456,000 and $2,496,000, respectively.

     Investments in Securities. The Company holds significant investments in
marketable and non-marketable securities. Marketable securities are carried at
fair value with unrealized changes in market value being recorded within
Shareholders' Equity under the caption "Revaluation Reserve". Where securities
classified as available-for-sale are sold or impaired or when there is a
significant or prolonged decline in the fair value below acquisition cost, the
accumulated fair value adjustments are included in the income statement as
"Gains and losses from investment securities". During 2002, the management of
the Company considered there had been a prolonged decline in the fair value of
its investment in Tele2 AB and consequently charged $119,138,000 to the income
statement. On a regular basis the Company compares the market value of its
investments to their carrying amount in order to identify potential impairment
issues. In considering whether the investment has been impaired, the Company
considers all available evidence such as, among other things, significant
financial difficulties of the issuer, breaches or default in loan agreements,
the recognition of prior impairment losses on that asset or the extent and
duration of a decline in fair value below cost. During 2002, MIC recognized an
impairment on its investment in Great Universal and Modern Holdings of
$5,027,000 and $7,050,000 respectively. The Company no longer has control or
significant influence over Telemovil El Salvador, so the Group's investment is
accounted for as an available-for-sale financial asset in 2002. The shares of
this investment are not quoted on a public market and management has not been
able to obtain reliable financial information since early 2001. Management has
made different estimates to value this investment using different valuation


                                      44
<PAGE>


techniques that have resulted in a wide range of fair values. Management has
therefore concluded that estimating a fair value in these conditions is
inappropriate. Consequently the investment is being carried at the carrying
amount as of December 31, 2001. The valuation exercise, however, produced
sufficient evidence for management to conclude that the investment has not been
impaired as of the balance sheet date.

     Revenue recognition.  The Group revenue comprises the following:

     (i) Revenues from provision of telecom services - these recurring revenues
     consist of monthly subscription fees, airtime usage fees, interconnection
     fees, roaming fees, revenue from the provision of data clearing services
     and other telecommunications services such as data services and short
     message services. Recurring revenues are recognized on an accrual basis,
     i.e. as the related services are rendered. Unbilled revenues for airtime
     usage and subscription fees resulting from services provided from the
     billing cycle date to the end of each month are estimated and recorded.


     (ii) Connection revenues - initial connection fees are recognized when
     charged, i.e. upon initial signing of the contract with customers.

     (iii) Equipment revenues - these revenues consist of the sale of handsets
     and accessories. Revenues from these sales are recognized at the time that
     the item is delivered to the customer.

     Functional Currency. The measurement currency of the Group is the U.S.
dollar. The Company is located in Luxembourg and its subsidiaries, joint
ventures and associated companies operate in different currencies. The
measurement currency of the Company is the U.S. dollar because of the
significant influence of the U.S. dollar on its operations. The measurement
currency of each subsidiary, joint venture and associated company, where these
are foreign entities, is determined in accordance with the requirements of SIC
19 `Reporting Currency - Measurement and Presentation of Financial Statements
under IFRS 21 and IFRS 29'.

     Derivatives. IFRS 39 requires that all financial assets and financial
liabilities, including derivatives, be recognized on the balance sheet.
Derivatives are initially recorded at cost either in other current assets or
other financial liabilities as applicable and then are re-measured to fair value
through the statement of profit and loss under the caption "Fair value result on
financial instruments". Upon adoption of IFRS 39 on January 1, 2001, the Company
recorded a cumulative negative adjustment related to these derivatives,
reflected in shareholders' equity of $45,264,000.

     Certain derivatives embedded in other financial instruments, such as call
and put options related to the Company's subordinated debt, are treated as
separate derivatives when their risks and characteristics are not closely
related to those of the host contract and the host contract is not carried at
fair value with unrealized gains and losses reported in income.

     Goodwill. The excess of cost of an acquisition over the Group's interest in
the fair value of the net identifiable assets of the acquired subsidiary,
associate or joint venture at the date of transaction is recorded as Goodwill
and recognized as an asset in the balance sheet. Goodwill is amortized using the
straight-line method over its estimated useful life but not longer than 20
years. Goodwill on associates is included in their carrying value in the caption
"Investments in associated companies".

     At each balance sheet date the Group assesses whether there is any
indication of impairment. If such indications exist an analysis is performed to
assess whether the carrying amount of goodwill is fully recoverable. A
write-down is made if the carrying amount exceeds the recoverable amount.

     Negative goodwill represents the excess of the fair value of the Group's
share of the net assets acquired over the cost of acquisition. Negative goodwill
is presented in the same balance sheet classifications as goodwill. To the
extent that negative goodwill relates to expectations of future losses and
expenses that are identified in the Group's plan for the acquisition and can be
measured reliably, but which do not represent identifiable liabilities, that
portion of negative goodwill is recognized in the income statement when the
future


                                      45
<PAGE>


losses and expenses are recognized. Any remaining negative goodwill, not
exceeding the fair values of the identifiable non-monetary assets acquired, is
recognized in the income statement over the remaining weighted average useful
life of the identifiable acquired depreciable/amortizable assets; negative
goodwill in excess of the fair values of those assets is recognized in the
income statement immediately.

     Equity Compensation Benefits- Share options are granted to management and
key employees. Options are granted at the market price of the shares on the date
of the grant and are exercisable at that price. Options are exercisable
beginning three years from the date of grant and have a contractual option term
of six years. When the options are exercised, the proceeds received net of any
transaction costs are credited to share capital (nominal value) and share
premium. The Company does not make a charge to staff costs in connection with
share options.

     Recent U.S. GAAP pronouncements -

         In August 2001, the Financial Accounting Standards Board ("FASB")
         issued Statement of Financial Accounting Standard No.143 (SFAS 143),
         Accounting for Asset Retirement Obligations. SFAS 143 applies to all
         entities and addresses financial accounting and reporting for legal
         obligations associated with the retirement of long-lived assets that
         result from the acquisition, construction, development and (or) the
         normal operation of a long-lived asset, except for certain obligations
         of lessees. SFAS 143 is effective from January 2003 and requires
         obligations associated with the retirement of a tangible long-lived
         asset to be recorded as a liability upon acquisition of the asset. The
         Company does not consider that this will have a material impact on its
         consolidated financial statements.

         The FASB issued Statement of Financial Accounting Standard No. 145
         (SFAS 145), Rescission of FASB Statements No. 4, 44, and 64, Amendment
         of FASB Statement No. 13, and Technical Corrections, effective for
         fiscal years beginning May 15, 2002 or later that rescinds FASB
         Statement No. 4, Reporting Gains and Losses from Extinguishment of
         Debt, FASB Statement No. 64, Extinguishments of Debt made to satisfy
         sinking-fund requirement, and FASB Statement No. 44, Accounting for
         Intangible Assets of Motor Carriers. This Statement amends FAS No. 4
         and FAS No. 13, Accounting for Leases, to eliminate an inconsistency
         between the required accounting for sale-leaseback transactions. This
         Statement also amends other existing authoritative pronouncements to
         make various technical corrections, clarify meanings or describe their
         applicability under changed conditions. By adopting SFAS 145 in fiscal
         year 2003, MIC expects to reclassify gains on the extinguish of debt
         recorded in 2002, which are not sinking fund payments, of $28,676,000
         from extraordinary to ordinary gains.

         In July 2002, the FASB issued Statement of Financial Accounting
         Standard 146 (SFAS 146), Accounting for Costs Associated with Exit or
         Disposal Activities. SFAS 146 addresses financial accounting and
         reporting for costs associated with exit or disposal activities and
         nullifies Emerging Issues Task Force (EITF) Issue No. 94-3, "Liability
         Recognition for Certain Employee Termination Benefits and Other Costs
         to Exit an Activity (including Certain Costs Incurred in a
         Restructuring)". SFAS 146 is effective for disposal activities
         initiated after December 31, 2002. As the Company has not currently
         commenced exit or disposal activities as defined in SFAS 146, adoption
         of the Standard is not expected to have a material impact on its
         consolidated financial statements.

         In December 2002, the FASB issued Statement of Financial Accounting
         Standard 148 (SFAS 148), Accounting for Stock-Based Compensation -
         Transition and Disclosure - an Amendment of SFAS No. 123. SFAS 148
         provides alternative methods of transition for a voluntary change to
         the fair value based method of accounting for stock-based employee
         compensation. In addition, SFAS 148 amends the disclosure requirements
         of SFAS 123, "Accounting for Stock-Based Compensation", to require
         prominent disclosures in both annual and interim financial statements
         about the method of accounting for stock-based employee compensation
         and the effect of the method used on reported results. SFAS 148 does
         not change the fair value measurement principles of SFAS 123. As MIC
         has elected to continue to account for stock compensation in accordance
         with APB 25, the adoption of the Standard is


                                      46
<PAGE>


         not expected to have a material impact on its consolidated financial
         statements. However, the Company has already adopted the disclosure
         requirements of SFAS 148.

         In April 2003, the FASB issued Statement of Financial Accounting
         Standard No. 149 (SFAS 149), Amendment of Statement 133 on Derivative
         Instruments and Hedging Activities. SFAS No. 149 amends and clarifies
         financial accounting and reporting for derivative instruments,
         including certain derivative instruments embedded in other contracts
         (collectively, referred to as derivatives) and for hedging activities
         under SFAS No. 133. This Statement is effective for contracts entered
         into or modified after June 30, 2003, and for hedging relationships
         designated after June 30, 2003. The Company does not consider that SFAS
         149 will have a material impact on its consolidated financial
         statements.

         In May 2003, the FASB issued Statement of Financial Accounting Standard
         No. 150 (SFAS 150), Accounting For Certain Financial Instruments with
         Characteristics of both Liabilities and Equity. SFAS No. 150
         establishes standards for how a company classifies and measures certain
         financial instruments with characteristics of both liabilities and
         equity. It requires that a company classify a financial instrument that
         is within its scope as a liability (or an asset in some circumstances).
         Many of those instruments were previously classified as equity. This
         Statement is effective for financial instruments entered into or
         modified after May 31, 2003, and otherwise is effective for the first
         fiscal period beginning after December 15, 2003. The Company does not
         consider that SFAS 150 will have a material impact on its consolidated
         financial statements.

         In November 2002, the FASB issued Financial Interpretation No. 45 (FIN
         45), Guarantor's Accounting and Disclosure Requirements for Guarantees,
         Including Indirect Guarantees of Indebtedness of Others. Under this
         interpretation, a guarantor must recognize the fair value of the
         obligation it assumes under the guarantee, upon issuance of a
         guarantee. Additionally, FIN 45 requires that the guarantor determine
         and disclose its policy for subsequently re-measuring the guarantor's
         liability. The initial recognition and initial measurement provisions
         of FIN 45 are applicable on a prospective basis to guarantees issued or
         modified after December 31, 2002. The Company is currently assessing
         the impact that FIN 45 will have on its consolidated financial
         statements. The disclosure requirements of FIN 45 are applicable for
         financial statements that end after December 15, 2002. Accordingly,
         such disclosures are included in Note 17 of the consolidated financial
         statements.

         In January 2003, the FASB issued Financial Interpretation No. 46 (FIN
         46), Consolidation of Variable Interest Entities. FIN 46 generally
         applies to all business enterprises and all arrangements used by
         business enterprises, and it requires that a business enterprise
         identify all its Variable Interest Entities ("VIEs"). VIEs are those
         entities possessing certain characteristics, which indicate either a
         lack of equity investment to cover expected losses of the entity or a
         lack of controlling financial interest by an investor. The party that
         absorbs a majority of the entity's expected losses, receives a majority
         of its expected residual returns, or both, as a result of holding
         variable interests is deemed to be the Primary Beneficiary and must
         consolidate the VIE. The measurement principles of this interpretation
         apply to all VIEs created after January 31, 2003 and to all VIEs in
         which an enterprise obtains an interest after that date. Additionally,
         the measurement principles of FIN 46 for all VIEs held by MIC prior to
         January 31, 2003 will be effective for MIC's 2004 financial statements.
         However, MIC has determined that it is reasonably possible that MIC
         will either consolidate or disclose information about its operation in
         Argentina and its other joint ventures (see Note 3) when FIN 46 becomes
         effective.


                                      47
<PAGE>


Results of Operations for the Years Ended December 31, 2002 and 2001

     The following table sets-forth certain profit and loss statement items for
the years indicated
<TABLE>

                                                              2002           2001    Impact on net loss for year
                                                           ---------      --------   ---------------------------
All figures in U.S. $000s, except percentages                                              Amount        Percent
- --------------------------------------------------                                   -------------  ------------
<S>                                                         <C>            <C>            <C>                <C>
Revenues..........................................          605,186        644,570        (39,384)           (6%)
Cost of sales.....................................         (269,621)      (283,443)        13,822             5%
Sales and marketing...............................          (80,941)       (95,463)        14,522            15%
General and administrative expenses...............         (164,703)      (172,912)         8,209             5%
Gain from sale of subsidiaries and joint
   ventures, net..................................            88,814         35,047        53,767           153%
Other operating expenses..........................          (56,422)       (35,013)      (21,409)           (61%)
Operating profit..................................           122,313         92,786        29,527            32%
Loss from investment securities......................       (299,963)       (15,931)     (284,032)            -
Interest expense..................................         (185,959)      (209,912)        23,953            11%
Exchange losses...................................          (23,483)       (17,313)       (6,170)           (36%)
Charge for taxes..................................          (22,734)        (8,217)      (14,517)          (177%)
Net loss for the year.............................         (385,143)      (138,053)     (247,090)          (179%)
</TABLE>

     Subscribers - The Company's worldwide cellular subscribers increased over
the year ended December 31, 2002 by 28% to 4,252,037 from 3,322,869 as of
December 31, 2001 (3,366,551 including divested operations and El Salvador),
with proportional subscribers increasing by 25% to 3,021,873 as of December 31,
2002 from 2,415,474 as of December 31, 2001 (2,436,409 including divested
operations and El Salvador). Net additions, excluding divested operations and El
Salvador, of subscribers for the year were 929,168, a 7% increase over the
867,641 additions in 2001 (excluding divested operations and El Salvador). Of
the total subscribers as of December 31, 2002, 3,672,702 were prepaid, an
increase of 37% over the 2,676,403 prepaid subscribers as of December 31, 2001,
excluding divested operations and El Salvador. Prepaid services have now been
launched in all markets. The three largest contributors to subscriber growth in
2002 were the operations in Cambodia, Guatemala and Vietnam with a total of
421,956 new subscribers.

     Revenues - Total revenues for the Company in the year were $605,186,000, a
decrease of 6% over the previous year. The decrease is largely due to the
Company's operations in Russia and Madras which were divested during 2001 and
the change in consolidation method for the Company's operation in El Salvador.
In 2001, these divested operations had consolidated revenues of $59,089,000.
Excluding these, revenues increased by over 3% in the year from $585,481,000.
The three largest contributors to revenues were the Company's operations in
Vietnam, Paraguay and Guatemala. Using reported revenues and gross subscribers,
average revenue per average number of subscribers has declined in the year from
$192 in 2001 to $151 in 2002, reflecting the increasing proportion of prepaid
subscribers whose usage and airtime tend to be lower than that of postpaid
customers. In addition, revenues have been hit by currency devaluations, in
particular, a 54% decline in the value of the currency in Paraguay.

     Cost of sales - Cost of sales decreased by 5% in the year to $269,621,000.
The lower cost of sales is explained by divestment of Madras and the Russian
operations during 2001 and the change in consolidation method for El Salvador.
The total cost of sales for these operations in 2001 was $18,194,000. Omitting
these, total cost of sales in 2001 were $265,249,000. In addition, during 2002,
the Company charged $6,833,000 as an impairment against network equipment in
Liberty Broadband. As a percentage of total revenues, cost of sales for cellular
operations increased from 44.0% in 2001 to 44.6% in 2002.

     Sales and marketing - Sales and marketing expenses have decreased by 15% in
the year to $80,941,000. This decrease reflects the large sales and marketing
expenses in the prior year following the digitalization of networks. Sales and
marketing, as a percentage of revenues, decreased from 14.8% in 2001 to 13.4% in
2002.


                                      48
<PAGE>


     General and administrative expenses - General and administrative expenses
decreased by 5% in the year to $164,703,000. The decrease is largely due to a
lower depreciation charge in the year of $33,372,000 (2001: $46,894,000). As a
percentage of revenues, general and administrative expenses increased marginally
from 26.8% to 27.2% reflecting lower revenues as a result of divestments in both
2001 and 2002.

     Gain from sale of subsidiaries and joint ventures, net - During 2002 MIC
made a gain of $88,814,000 from the sale of subsidiaries and joint ventures, up
$53,767,000 compared with 2001. The main items in this were a gain of
$87,655,000 on the sale of Mach, a gain of $16,603,000 realized when the local
partner in Vietnam exercised his option to purchase 10% of the Group's interest
in Vietnam and a loss of $35,988,000 on the sale of its cellular operation in
the Philippines. In addition, during 2002, MIC obtained the necessary GSM
licenses for the Russian operations disposed of in 2001, realizing a further
gain of $30,859,000.

     Other operating expenses - Other operating expenses have increased by 61%
in the year to $56,422,000 from $35,013,000 in 2001. The increase is mainly due
to an increased goodwill impairment charge, up from $1,652,000 in 2001 to
$36,308,000 in 2002, in respect of Colombia and Argentina as MIC recognized a
defference between the recoverable amount and the carrying amount of its
intangibles. Goodwill amortization has remained relatively constant during the
year at $7,865,000 compared to $8,090,000 in 2001. Corporate costs have
decreased in the year from $25,271,000 to $21,591,000, reflecting the
reorganization of the regional offices and a cost review during the year.

     Operating profit - Total operating profit for the Company for the year
ended December 31, 2002 was $122,313,000, compared with $92,786,000 in 2001, an
increase of 32%. The increase in the year is largely due to higher gains on the
sale of subsidiaries and joint ventures, which were $88,814,000 in 2002 (2001:
$35,047,000) offsetting lower revenues resulting from divestments in 2001 and
2002.

     Loss from investment securities - The loss from investment securities
increased from $15,931,000 in 2001 to $299,963,000 in 2002. During 2002, the
Company recorded a loss of $168,818,000 (2001: $15,931,000) on the sale of
shares in Tele2 AB. In addition, the Company recognized a significant and
prolonged decline in the value of its investment in Tele2 AB and, as a result,
charged $119,138,000 to the profit and loss account. In addition, during 2002
MIC recognized an impairment on its investments in Modern Holdings (formerly
known as XSource) and Great Universal, totaling $12,077,000 due to uncertainty
concerning its recoverability, see Note 20 to the Consolidated Annual Accounts
for more information.

     Interest expenses - Interest expense for the year ended December 31, 2002
decreased 11% to $185,959,000 from $209,912,000 in 2001. This decrease arose
from the repayment of debt during the year, in particular the repurchase of
$44,000,000 nominal value of Old Notes.

     Exchange losses - The Company's net exchange losses for the year ended
December 31, 2002 were $23,483,000 compared to $17,313,000 for 2001, an increase
of 36% largely due to the sharp devaluation of the Pesos in Argentina and losses
on the Toronto Dominion loan that is financed in Swedish Krone.

     Charge for taxes - The net tax charge for 2002 increased to $22,734,000
from $8,217,000 in 2001. The increase is due to two causes. Firstly, increased
profitability throughout the Group resulting in higher tax charges in 2002.
Secondly, a tax provision that was established at the date of the formation of
the Group was reversed, significantly reducing the tax charge in 2001. At the
time of the Merger, the Group recorded a provision of $13,544,000 as a deferred
tax liability for the Tax Liabilities. In October 2001, the Company determined
that the Tax Liability, as defined by the Merger Agreement, amounted to
$7,023,000, resulting in a difference of $6,521,000.This difference was settled
by the final issuance of 374,521 of the Company's shares and a realized gain of
$3,521,000, corresponding to the difference between the issuance price and the
share price as of the date of the transaction.

     Net loss for the year - The net loss for the year ended December 31, 2002
was $385,143,000 compared to $138,053,000 in 2001.


                                      49
<PAGE>


Results of Operations for the Years Ended December 31, 2001 and 2000

     The following table sets-forth certain profit and loss statement items for
the years indicated

<TABLE>
                                                                                    Impact on net (loss) profit
                                                             2001           2000             for year
                                                           --------       --------  ----------------------------
All figures in U.S. $000s, except percentages                                              Amount        Percent
- -------------------------------------------------                                   -------------    -----------
<S>                                                         <C>            <C>             <C>               <C>
Revenues..........................................          644,570        570,840         73,730            13%
Cost of sales.....................................         (283,443)      (318,316)        34,873            11%
Sales and marketing...............................          (95,463)       (88,097)       (7,366)           (8)%
General and administrative expenses...............         (172,912)      (174,177)         1,265             1%
Gain (loss) from sale of subsidiaries and joint
   ventures, net..................................            35,047        (2,755)        37,802              -
Other operating expenses..........................          (35,013)       (40,873)         5,860            14%
Operating profit (loss)...........................            92,786       (53,378)       146,164              -
Loss from associated companies....................           (3,112)       (43,178)        40,066            93%
(Loss) gain from investment securities............          (15,931)        665,262     (681,193)              -
Interest expense..................................         (209,912)      (196,002)      (13,910)           (7)%
Exchange losses...................................          (17,313)       (23,015)         5,702            25%
Charge for taxes..................................           (8,217)       (26,264)        18,047            69%
Net (loss) profit for the year....................         (138,053)        355,388     (493,441)              -
</TABLE>

     In the discussion below, reference to divested operations means operations
that had been divested as of December 31, 2001.

     Subscribers - The Company's worldwide cellular subscribers increased over
the year ended December 31, 2001 by 29% to 3,741,136 from 2,909,961 as of
December 31, 2000 (3,147,187 including divested operations), with proportional
subscribers increasing by 35% to 2,698,619 as of December 31, 2001 from
2,005,785 as of December 31, 2000 (2,110,857 including divested operations). Net
additions, excluding divested operations, of subscribers for the year were
831,175, a 25% decrease over the 1,036,645 additions in 2000 (excluding divested
operations). Of the total subscribers as of December 31, 2001, 2,995,619 were
prepaid, an increase of 41% over the 2,131,328 prepaid subscribers as of
December 31, 2000, excluding divested operations. Prepaid services have now been
launched in all markets. The three largest contributors to subscriber growth in
2001 were the operations in Cambodia, Pakistan and Vietnam with a total of
440,805 new subscribers.

     The above figures for subscribers include those of MIC's operation in El
Salvador, even though as of May 2001, MIC began accounting for the venture under
the equity method. The profit and loss figures detailed below include MIC's
proportional share of the results of its operation in El Salvador for 2000, but
for 2001 only includes its proportional share up to the end of April 2001. At
that time, MIC started to account for this operation under the equity method.

     Revenues - Total revenues for the Company in 2001, were $644,570,000, an
increase of 13% over the previous year. The three largest contributors to
revenues were the Company's operations in Paraguay, Vietnam and Guatemala.
Average revenue per average number of subscribers has declined in the year from
$325 in 2000 to $255 in 2001, reflecting the increasing proportion of prepaid
subscribers whose usage and airtime tend to be lower than that of postpaid
customers.

     Cost of sales - Cost of sales have decreased by 11% in 2001 to
$283,443,000. Depreciation charges in 2001were higher at $98,190,000 (2000:
$86,104,000) reflecting network increases whilst the total for 2000 includes
$74,180,000 for impairments on analogue equipment. As a percentage of total
revenues, cost of sales for cellular operations decreased from 55.8% in 2000 to
44.0% in 2001.

     Sales and marketing - Sales and marketing expenses have increased by 8% in
2001 to $95,463,000. This increase reflects the large increase in subscribers
during 2001 following the introduction of increased digitalization of networks
and the new operations established during 2001. The main increase was in Sanbao


                                      50
<PAGE>


Telecom where sales and marketing expenses increased by 55% in 2001. Sales and
marketing as a percentage of revenues has decreased from 15.4% in 2000 to 14.8%
in 2001.

     General and administrative expenses - General and administrative expenses
decreased by 1% in 2001 to $172,912,000. During the course of 2000, MIC took
impairment charges of $29,249,000 on certain license values and fixed fee
licenses. As a percentage of revenues, general and administrative expenses
decreased from 30.5% to 26.8% reflecting the tight control of overheads by
existing operations.

     Gain (loss) from sale of subsidiaries and joint ventures, net - During
2001, MIC made a gain of $35,047,000 from the sale of its operations in India
and Russia. During 2000, MIC made a loss of $2,755,000 from the impairment of
certain start-up ventures.

     Other operating expenses - During 2001, other operating expenses decreased
by 14% to $35,013,000 as a result of strict controls over corporate costs.

     Operating profit (loss) - Total operating profit for the Company for the
year ended December 31, 2001 was $92,786,000, compared with a loss of
$53,378,000 in 2000. The increase in the year is due to gains on the sale of
subsidiaries and joint ventures in 2001 and the impairment of analogue equipment
and related intangibles in 2000 together with increased profitability in the
operations.

     Loss from associated companies -The Company's operation in El Salvador was
consolidated on a proportional basis up to the end of April 2001. However,
following a dispute with local shareholders, group management determined that
circumstances regarding its investment were changed to the extent that
proportional consolidation was no longer appropriate. Therefore, as of May 2001,
the entity was accounted for under the equity method. The charge for 2000
reflects the Company's share of the losses of SEC for the nine months to
September 30, 2000, at which date the Company exchanged its shareholding in SEC
for shares in Tele2 AB, from when the investment was accounted for as a trade
investment.

     (Loss) gain from investment securities - In 2001, MIC recorded a loss of
$15,931,000 on the sale of Tele2 AB shares. In 2000, following the exchange
offer of Tele2 AB, the Company exchanged its 29.6% interest ownership in SEC
realizing a gain of $609,941,000, corresponding to the market value of the Tele2
AB shares obtained less the value of SEC as recorded in the books of the
Company. In addition, during 2000, the Company sold shares in Tele2 AB
recognizing a gain of $55,321,000.

     Interest expenses - Interest expenses for the year ended December 31, 2001
increased 7% to $209,912,000 from $196,002,000 in 2000. This increase arose from
higher accrued interest on the Old Notes.

     Exchange losses - The Company's net exchange losses for the year ended
December 31, 2001 were $17,313,000 compared to $23,015,000 for 2000, a decrease
of 25% largely due to the more stable currency in Ghana compared with 2000.
Exchange losses in 2001 arose primarily from the depreciation of the guarani in
Paraguay and the peso in Colombia.

     Charge for taxes - The net tax charge for 2001 decreased to $8,217,000 from
$26,264,000 in 2000. This comprises an income tax charge of $25,577,000, against
a charge of $17,771,000 in 2000, and a deferred tax credit of $17,360,000,
against a charge of $8,493,000 in 2000. The increased income tax charge in the
year is the result of increased taxable profits throughout the Group. The
deferred tax credit is largely due to timing differences and the reversal of a
tax provision established at the date of the formation of the Group. In October
2001, the Company determined that the Tax Liability, as defined by the Merger
Agreement, amounted to $7,023,000. At the time of the Merger, the Group recorded
a provision of $13,544,000 as a deferred tax liability for the Tax Liabilities,
resulting in a difference of $6,521,000. Under the terms of the Merger Agreement
the Company was required to issue additional shares equal to the amount of the
provision that did not crystallize divided by the market price of the shares at
the date of the merger. This resulted in the issuance of 374,521 shares with a
fair value at the date of the transaction of $3,000,000. The difference of
$3,521,000 has been recorded as other income.


                                      51
<PAGE>


     Net (loss) profit for the year - The loss after taxes for the year ended
December 31, 2001 was $138,053,000, or $8.46 per share, compared to a profit of
$355,388,000, or $21.54 per share on a fully diluted basis in 2000.

Liquidity and Capital Resources

     Overview

     In the Company's opinion, the working capital is sufficient for the
Company's present requirements.

     As at December 31, 2002 MIC reported total consolidated outstanding debt
and other financing of $1,228,575,000. Of this, $912,539,000 was in respect of
the Old Notes, net of deferred financing costs, interest on which became
payable on a semiannual basis commencing December 1, 2001. MIC expects to meet
its payment obligations on the Old Notes and the New Notes through operating
income and the sale of assets. In addition, the Group had a remaining amount
outstanding of $54,638,000 on its Toronto-Dominion Securities facility, net of
deferred financing costs. The majority of the remaining debt of $261,398,000,
on a consolidated basis, is recorded in the books of the Company's individual
operations.

     At the venture level, the Company seeks, in the long term, to finance the
costs of developing and expanding cellular operations on a project-by-project
basis. Ventures are typically financed initially by MIC contributions in the
form of equity and, in some cases, debt. In many cases the Company seeks to
replace MIC debt financing with third party financing after the initial stages
of a venture's development. Sources of financing at the venture level have
included vendor financing provided by equipment suppliers, project financing
from commercial banks and international agencies such as IFC and OPIC, bank
lines of credit and sales of equity and debt issued by its venture companies.

     In 2002, the Company had a positive operating cash flow of $72,581,000,
compared with $103,969,000 in 2001. The decrease is mainly due to an additional
payment of interest on the Old Notes. A number of the Company's ventures have
generated positive operating cash flows. This cash has been employed to expand
operations and finance capital expenditure at the venture level. In addition,
during 2002, MIC's operations up-streamed approximately $96,700,000 to MIC which
was used to meet interest obligations under the Old Notes. External sources of
funding are expected to continue to play an important role in financing both at
the parent company level and at the venture level, although additional debt may
be subject to restrictions imposed by existing debt.

     Cash generated by investing activities was $141,665,000, compared with a
$167,074,000 usage of cash in 2001. During the year, the Company sold part of
its interest in Tele2 AB, realizing proceeds of $167,238,000. In addition, the
Company realized net proceeds of $106,452,000 on the sale of MIC Systems and an
additional $27,547,000 for the acquisition of the remaining GSM licenses in
Russia. The main outlay in the year was the purchase of tangible fixed assets
for $135,818,000. This was to expand coverage and update to new technologies and
showed a decrease from the $192,178,000 recorded in 2001.

     Financing activities used total cash of $199,780,000 in the year, compared
with cash provided of $22,576,000 in 2001. In the course of 2002, MIC used
$363,584,000 to repay debt while raising an additional $182,828,000 through the
issuance of debt and other financing.

     The net cash generated in the year was $14,175,000 compared with an outflow
of $38,645,000 in 2001. The Company had closing cash and cash equivalents
balance of $70,451,000 as of December 31, 2002.

     Historically, the Company has sold certain operations and shares in Tele2
AB in order to provide funding and to reduce indebtedness. The Company may make
further asset sales from time to time, by means of selling all or a part of any
existing operation for strategic reasons. MIC's ability to continue to make
these asset sales may be restricted by covenants contained in financing
agreements. These restrictions would require consent of lenders to amend.
Furthermore, following the refinancing of the Company's debt and other factors,
the Company has pledged a portion of its Tele2 AB shares to its creditors.


                                      52
<PAGE>


     As of December 31, 2002, on a consolidated basis, the Company had total
outstanding debt and other financing of approximately $1,228,575,000, calculated
as the Company's consolidated interest of total debt, compared with
$1,455,974,000 as of December 31, 2001. The decrease in the year of $227,399,000
is largely due to a repayment of $115,829,000 on the Toronto-Dominion Securities
facility, a repurchase of Old Notes with a face value of $44,000,000 and a
reduction of $40,018,000 in the debt of Celcaribe. As of December 31, 2002, the
total debt and other financing of the Company and each of the ventures,
combining 100% of each venture's debt, was $1,289,893,000. Of the total
indebtedness of the combined ventures, $189,395,000 represented indebtedness
that is secured by pledged assets, letters of credit or MIC guarantees.

     Operational financing

     At the venture level there are a number of significant debt financings.

     In order to finance a license acquisition in the Northern region of
Colombia, in May 1994, Celcaribe sold $108,769,005 of trust certificates to
institutional investors which consisted of $82,504,129 of Celcaribe 14.5% Senior
Secured Note Trust Certificates due 2004 (the "Note Trust Certificates") and
$26,264,876 in Celcaribe Ordinary Share Trust Certificates (the "Share Trust
Certificates"). The holders of the Share Trust Certificates have the right to
require the Company to purchase such certificates. The amount outstanding under
this finance as of December 31, 2002, was $67,700,000. The fair value of the
outstanding Note Trust Certificates at December 31, 2002, based upon secondary
market trading information, was $48,067,000 (2001: $61,044,000). Celcaribe also
obtained approximately $11,400,000 of bank financing. Following the Company's
divestment of Celcaribe in March 2003, the above liability is no longer part of
the Company's liabilities.

     In September 2000, ABN-Amro arranged a seven-and-a-half-year syndicated
loan of Lkr 1,534,000,000 (approximately $20,000,000) for Celltel Lanka Limited,
MIC's 99.9% owned operation in Sri Lanka. This financing bears interest at 3%
over the weighted average Treasury Bill Rate and is repayable over 13
installments commencing one year from signing. At December 31, 2002, $13,418,000
was outstanding.

     In June 2001, Telefonica Celular de Bolivia SA signed an agreement for
additional financing in the amount of $25,000,000 with the IFC and $10,000,000
from the Nederlandse Financierings-Maatschappij Voor Ontwikkelingslanden, N.V.
(FMO), also known as the Netherlands Development Finance Company. This financing
bears interest at LIBOR+3.00% and is repayable in installments starting in
December 2002 until December 2006. Among other things, the financing requires
the company to maintain certain financial covenants such as a debt ratio,
long-term debt service coverage, and debt to equity ratio. As of December 31,
2002 the company was in breach of certain covenants on the IFC loan and the
outstanding balance had been re-classified as short-term financing. As of
December 31, 2002, $31,030,000 was drawn down related to these financings. These
investments will help to fund the expansion and further digitalization of the
Group's mobile cellular telecommunications network in Bolivia.

     In November 2002, Pakcom signed a syndicated finance agreement for Rupees
800 million (approximately $13,700,000). For this agreement Faysal Bank Limited
acts as security agent and Standard Chartered Bank acts as facility agent. The
facility is repayable in monthly installments until December 31, 2004 and
attracts interest at State Bank of Pakistan discount rate plus 1.75%, with a
floor rate of 11.75%. As of December 31, 2002, $13,185,000 of this facility was
outstanding.

     Corporate financing

     In June 1996, the Company issued $962,000,000 principal amount at maturity
of 131/2% Senior Subordinated Discount Notes due 2006 (the "Old Notes"). The Old
Notes will mature on June 1, 2006. The Old Notes were issued at 52.075% of their
principal amount and the purchase discount on the Old Notes accretes at a rate
of 131/2% compounded semiannually from issuance until June 1, 2001. The net cash
proceeds to the Company from the issuance of the Old Notes after deducting
discount and estimated expenses were approximately $483,433,000. The Old Notes
began accruing cash interest on June 1, 2001 and cash interest will continue to
accrue until maturity on the Old Notes at a rate of 131/2% per annum, payable
semiannually in arrears on June 1 and December 1, commencing December 1, 2001.


                                      53
<PAGE>


     The Old Notes are redeemable at the option of the Company, in whole or in
part, at any time at redemption prices starting at 106.75% of the principal
amount in year 2001 and decreasing to 100.00% in year 2004 plus accrued and
unpaid interest, if any, to the date of redemption.

     During 2002, the Company purchased Old Notes with a face value of
$44,000,000 at market prices at the time. As of December 31, 2002, MIC has
offset $5,461,000 (2001: $7,399,000) of deferred financing fees against the
value of the Old Notes.

     As of December 31, 2002, MIC had total consolidated debt of approximately
$1,228,575,000 which required substantial free cash flows (i.e. cash flows
generated from the operations and available for repayment of debt and interests)
to finance the interest. During 2002, operating cash flows available to MIC were
insufficient to pay interest on the Old Notes as it became due and there was a
risk that our planned dispositions would be insufficient to pay the interest on
the Old Notes as it became due. Reflecting the risks involved with our leverage,
the market price of the Old Notes had traded significantly below par value. In
order to reduce the extent of our payments, on January 21, 2003, MIC made an
exchange offer and consent solicitation to bondholders of the Old Notes. On May
8, 2003, MIC announced the closing of this offer with the tendering of
approximately 85% of the Old Notes. Under the terms of this exchange, holders of
the Old Notes received $720 of our newly issued 11% Senior Notes due 2006 and
$81.70 of our newly issued 2% Senior Convertible PIK Notes due 2006 per $1,000
of Old Notes. In addition, in consideration for consenting to certain amendments
to the indenture under which the Old Notes were issued, eligible holders who
consented to amendments of the indentures of the Old Notes received $50.00 in
cash for each $1,000 in principal amount of Old Notes they tendered. Following
the successful completion of the exchange offer, MIC has significantly reduced
its overall level of indebtedness and interest burden, improved its near-term
liquidity position and created greater ongoing financial and operating
flexibility. For example, our interest obligations under the Old Notes were
$129,870,000 each year, while our interest obligation under the New Notes is
$81,624,000 each year. For a more detailed description of the exchange offer and
its terms, see "Item 10. Additional Information - Material Contracts." There is
a risk that future cash flows generated will be insufficient to repay interest
and/or principal on all our existing debt obligations as they become due.

     In December 2001, the Group entered into a loan agreement with
Toronto-Dominion Securities for a maximum facility amount of SEK 1,855 million
(approximately $175 million as of December 31, 2001) to replace an existing
facility. In exchange for the agreement, the Group has pledged a portion of its
Tele2 AB class B shares. The number of shares pledged is adjusted on a monthly
basis based on the Tele2 AB class B shares market value. The facility bears an
annual interest rate calculated using the current STIBOR rate plus 2% payable on
a monthly basis, and must be fully repaid by November 2004. As of December 31,
2002, $54,638,000 (2001: $173,365,000) was outstanding under this facility
collateralized by 6,184,293 (2001: 9,115,479) Tele2 AB class B shares. This
transaction has been accounted for as a borrowing and the related Tele2 AB class
B shares are recorded as pledged securities under the caption "Investment in
securities".

     Other Short-Term Liabilities

     As of December 31, 2002, the Company had a total of $375,862,000 (2001:
$469,191,000) of short-term liabilities, including $156,666,000 (2001:
$153,898,000) of short-term debt and other financing. Management expects a
substantial portion of such short-term debt to be extended prior to maturity.

     As of December 31, 2002 the Company and its operations had commitments to
purchase within one-year network equipment, land and buildings and other fixed
assets with a value of $11,867,000 (2001: $56,436,000) from a number of
suppliers.

Geographical Segment Information

     The table below sets forth the Company's revenue by geographical segment
for the periods indicated.

                                      54
<PAGE>

                                                    Year Ended December 31,
                                               ---------------------------------
                    In U.S. $000s               2002         2001         2000
                                               -------      -------      -------
Latin America...............................   277,554      315,321      313,842
   Of which El Salvador.....................         -       17,311       45,555
Asia........................................   233,671      209,635      154,256
   Of which divested........................     1,113        5,878        9,533
Africa......................................    52,080       45,323       33,897
Other.......................................    15,671       11,945        3,798
   Of which divested........................     2,620        2,156        1,422
MIC Systems (divested in 2002)..............    28,186       26,300       28,027
FORA Telecom (divested in 2001).............         -       37,716       36,999
Unallocated items...........................        41           15           21
Inter-segment eliminations..................    (2,017)      (1,685)           -
   Of which divested........................      (463)        (378)           -
                                               -------      -------      -------
                                               605,186      644,570      570,480
                                               =======      =======      =======

Contractual Obligations

     The Company has various contractual obligations to make future payments,
including debt agreements and lease obligations. The following table summarizes
MIC's obligations under these contracts due by period as of December 31, 2002:

<TABLE>
                                                                 2004 and     2006 and
In U.S. $000s                                           2003        2005         2007     Post 2007     Total
- -------------                                         -------     -------      -------    ---------  --------
<S>                                                   <C>         <C>          <C>           <C>     <C>
Debt............................................      156,666     143,119      935,342       1,807   1,236,934
Operating leases................................          246         427          295         196       1,164
Financial leases................................          290         164            2           -         456
                                                      -------     -------      -------       -----   ---------
Total...........................................      157,202     143,710      935,639       2,003   1,238,554
                                                      =======     =======      =======       =====   =========
<CAPTION>

     The above table includes obligations of the Company's subsidiaries and
joint venture, summarized in the following table:

                                                                 2004 and     2006 and
In U.S. $000s                                           2003       2005         2007      Post 2007     Total
- -------------                                         -------    --------     --------    ---------  --------
<S>                                                   <C>         <C>          <C>           <C>     <C>
Debt............................................      156,666      85,203       17,342       1,807     261,018
Operating leases................................          246         427          295         196       1,164
Financial leases................................          290         164            2           -         456
Total...........................................      157,202      85,794       17,639       2,003     262,638
</TABLE>

     At December 31, 2002, MIC was in breach of loan covenants for a total debt
of $22,459,000 (2001: $174,000), which is classified as short-term debt on the
balance sheet. None of the above facilities have been called by the banks
concerned. In the opinion of management, the outcome of discussions to resolve
these breaches will not materially impact the ability of these companies to
maintain adequate funding arrangements to support and develop future operations.

ITEM 6.  DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES.

Directors and Executive Officers


                                      55
<PAGE>


     The directors of the Company are as follows:

                                                                 Date of
                                                    Year        Expiration
    Name                      Position           Appointed       of Term
  ----------------------      --------           ---------      ----------
  E. Hakan Ledin              Chairman              1990         May 2004
  Vigo Carlund                Member                2002         May 2004
  Ernest Cravatte             Member                2003         May 2004
  Lars-Johan Jarnheimer       Member                2001         May 2004
  Daniel Johannesson          Member                2003         May 2004
  Raymond Kirsch              Member                1994         May 2004
  Michel Massart              Member                2003         May 2004
  Cristina Stenbeck           Member                2003         May 2004

     E. Hakan Ledin, age 65, Chairman, was President of Millicom International
Holdings Limited, a subsidiary of Mil-Inc, from 1987 until December 1990, when
Millicom International Holdings Limited became part of the Company and Mr. Ledin
became an Executive Vice-President of the Company. He became Vice Chairman on
May 9, 1995 and was appointed Chairman in August 2002. Previously, he was Group
Executive Vice President and a director of Telefonaktiebolaget L M Ericsson as
well as Chairman and President of Ericsson Inc. He became a director of the
Company in May 1991. Mr. Ledin is also Vice Chairman of Tele2 AB.

     Vigo Carlund, age 47, non-executive member, has worked for the Kinnevik
Group since 1968. In 1997 he became Vice President of Industriforvaltnings AB
Kinnevik and took over as President in May 1999. He is also Chairman of Transcom
WorldWide S.A. and Korsnas AB. He was appointed to the Board of MIC in 2002 and
is also a director of Tele2 AB and Viking Telecom AB.

     Ernest Cravatte, age 53, is a practicing lawyer in Luxembourg and a former
member of the Executive Management of Banque Generale du Luxembourg. He has also
held positions on various banking supervisory committees.

     Lars-Johan Jarnheimer, age 43, non-executive member, was appointed to the
board in May 2001. He has been President and CEO of Tele2 AB since March 1999,
and previously was Vice-President of Industriforvaltnings AB Kinnevik and
President of Investment AB Kinnevik.

     Daniel Johannesson, age 60, has held a number of executive positions at
major Swedish companies including Senior Executive of the construction company
Skanska, where he was responsible for their telecommunications and facilities
management interests, and Chief Executive Officer of Industriforvaltnings AB
Kinnevik and national railway operator, SJ.

     Raymond Kirsch, age 60, non-executive member, is the President and Chief
Executive Officer of Banque et Caisse d'Epargne de L'Etat Luxembourg. He became
a director of the Company in May 1994.

     Michel Massart, age 52, non-executive member, was appointed to the Board in
May 2003. Up to June 2002, he was a Partner of PricewaterhouseCoopers in
Belgium, where he set up the corporate finance department in 1997, and was a
former member of the Board of the Institute of Statutory Auditors and is
currently a professor at Solvay Business School in Brussels, Belgium.

     Cristina Stenbeck, age 25, is Vice Chairman of the Board of Directors of
Industriforvaltnings AB Kinnevik, Invik & Co. and Metro International, and a
member of the Board of Directors of Modern Times Group, Tele2 AB and Transcom
WorldWide.


                                      56
<PAGE>


Senior Management

  Name                         Position
- --------------------           ----------------------------------------
Marc Beuls                     President and Chief Executive Officer
Mikael Grahne                  Chief Operating Officer of MIC
John Ratcliffe                 Chief Financial Controller
Won-Suck Song                  Executive Vice President - Operations
Judy Tan                       Chief of Finance - Global Operations

     Marc Beuls, age 46, President and Chief Executive Officer, was promoted to
his current position in January 1998 from his position as Senior Vice-President
Finance. Mr. Beuls joined the Company in March 1992. Prior to joining the
Company he held several positions with Generale Banque Belgium, both as branch
manager and senior trade finance manager for emerging markets. Mr. Beuls is also
a non-executive director of Tele2 AB.

     Mikael Grahne, age 50, joined MIC in February 2002 having previously been
President of Seagram Latin America. Prior to this he held various senior
management positions at PepsiCo and at Procter & Gamble. Mr. Grahne has an MBA
from the Swedish School of Economics in Helsinki.

     John Ratcliffe, age 40, joined MIC as Group Financial Controller in January
1998 having previously worked at United News & Media Plc. He was appointed to
his present position in November 2002. He qualified as a Chartered Accountant
with Hayes Allan in London having obtained a mathematics and business management
degree from London University.

     Won-Suck Song, age 36, was appointed to his current position in October
2002. He started his career with the Kinnevik Group in 1997 where he held the
position of Chief Operating Officer of Metro International before being
transferred in June 2001 to Tele2 AB as Executive Vice President.

     Judy Tan, age 32, joined MIC in 1998 with responsibility for the Asian
operations. She was appointed to her current position in November 2002 with
responsibility for all operating ventures. She qualified as a Certified Public
accountant with PriceWaterhouse, Singapore and has an MBA from Imperial College,
London.

     All the members of the board of directors and other corporate officers can
be contacted through our principal executive office, the address for which can
be found on the cover page of this form.

     The aggregate amount of compensation paid by the Company and its
subsidiaries during the Company's last fiscal year ended December 31, 2002 to
the directors of MIC was $1,711,000, and to the executive officers and senior
management was $961,000. In addition, options to purchase 66,666 MIC common
stock, with a par value of $6 each, were issued to directors. These options are
exercisable in tranches for an indefinite period after one year from the date of
issuance at a price of $15 each. Also, options to purchase 47,333 MIC common
stock, with a par value of $6 each, were issued to senior management of MIC.
These options are exercisable in tranches, with a maximum exercise period of six
years, after three years from the date of issuance at a price of $15 each.

     During the Company's last fiscal year, no amounts were set aside as accrued
by the Company to provide pension, retirement or other similar benefits to its
directors and officers.

     The following options to purchase MIC common stock with a par value of $6
each, issued to directors, officers and employees of the Company, are
outstanding as of December 31, 2002.

<TABLE>
                                                                Exercise
                                                Number of        price
            Date issued                          options           $               Terms of option
   -------------------------------------        ---------       --------   ----------------------------------
<S>                                             <C>             <C>        <C>
   May 1994, 1995, 1996, 1997, 1998,                                       Exercisable in tranches, for an
      January 1998, August 1999, May                            15.00 -    indefinite period, after one year
      2000, December 2001 and 2002......         560,266        146.625    from the date of issuance
   May 1994, 1995, 1996, 1997, 1998,
      2000, August 1996, November 1996,                                    Exercisable in tranches, with a
      March 1997, August 1999, May                                         maximum exercise period of six
      2000, June 2000, December 2001                            15.00 -    years, after three years from the
      and 2002..........................         494,984         127.50    date of issuance
                                             -----------
   Balance as of December 31, 2002......       1,055,250
                                             ===========
</TABLE>

     Of the above options, 489,051 (2001: 514,092; 2000: 390,072) were
exercisable at December 31, 2002. No options were exercised during 2002 (2001:
111; 2000: 54,685), and 426,534 (2001: 103,977; 2000: 115,056) options, with an
exercise price of between $36.00 and $143.625 were forfeited.


                                      57
<PAGE>


     Included above are 200,000 options to purchase MIC Common Stock, with a par
value of $6 each, which are held by directors of the Company as a group.

      In February 2003, an Extraordinary General Meeting of the Company passed a
resolution approving a reverse share split whereby three existing shares of a
par value of $2 each would be exchanged for one new share with a par value of $6
each. The number and exercise price of options referred to above have been
restated to reflect the reverse share split.

Board Practices

   Directors' Service Agreements

     None of the Company's directors has entered into service agreements with
the Company or its subsidiaries providing for benefits upon termination of
employment.

   Audit Committee

     The Company's directors have established an Audit Committee that convenes
at least twice a year, comprising Mr. Lars-Johan Jarnheimer and Mr. Raymond
Kirsch, both of whom are directors of the Company. This committee has
responsibility for planning and reviewing the Company's annual and quarterly
reports and accounts and the involvement of MIC's auditors in that process,
focusing particularly on compliance with legal requirements and accounting
standards, and ensuring that an effective system of internal financial controls
is maintained. The ultimate responsibility for reviewing and approving the
Company's annual and quarterly reports and accounts remains with the Company's
directors.

   Remuneration Committee

     The Company's directors have established a Remuneration Committee
comprising Mr. Marc Beuls, the Chief Executive Officer and Mr. Ledin, the
Chairman. This committee reviews and makes recommendations to the Company's
directors regarding its compensation policies and all forms of compensation to
be provided to our executive officers and other employees.

Employees

     The Company employed an average of 2,080 (2001: 3,032; 2000: 3,515)
employees for the year ended December 31, 2002. Of these, in 2002, 680 were
employed in Asia, 981 in Latin America, 325 in Africa, 89 in Europe and 5 in the
United States.

Share Ownership of Directors and Officers

     The following table sets forth, as at March 31, 2003, the total amount of
MIC Common Stock, with a par value of $6 each, beneficially owned by the
directors and other executive officers and senior management of the Company, and
the percentage of the MIC Common Stock represented by such MIC Common Stock.

  Title of Class      Identity of Person or Group    Amount Owned     % of Class
- -------------------   --------------------------     -----------      ----------
Common Stock                Directors(1)                1,531,431        9.4%
Common Stock                Senior management              16,286        0.1%

- ---------------------------------------
(1) This includes 1,283,235 shares owned by the 1980 Stenbeck Trust and 105,114
    shares owned by The 1985 Stenbeck Trust.

ITEM 7.  MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

     The following table sets forth certain information known to the Company as
of March 31, 2003, unless indicated, with respect to beneficial ownership of the
MIC Common Stock, with a par value of $6 each, by: (i) each person who
beneficially owns more than 5% of the MIC Common Stock; and (ii) all officers
and directors as a group. Except as otherwise indicated, the holders listed
below have sole voting and investment power with


                                      58
<PAGE>


respect to all shares beneficially owned by them. The holders listed below have
the same voting rights as the holders of MIC Common Stock. For purposes of this
table, a person or group of persons is deemed to have "beneficial ownership" of
any shares as of a given date which such person or group of persons has the
right to acquire within 60 days after such date. For purposes of computing the
percentage of outstanding shares held by each person, or group of persons,
named below on a given date, any security which such person or persons has the
right to acquire within 60 days after such date (including shares which may be
acquired upon exercise of vested portions of stock options) is deemed to be
outstanding, but is not deemed to be outstanding for the purpose of computing
the percentage ownership of any other person. The Company is deemed to be
controlled by Kinnevik B.V. by virtue of their ownership of 35.6% of the
Company's outstanding common stock.

<TABLE>

Title of Class       Identity of Person or Group              Amount owned        Percent of Class
- ----------------     -------------------------------------   --------------      ----------------
<S>                   <C>                                     <C>                     <C>
MIC Common Stock     Kinnevik B.V. (1)                        5,799,433 (1)           35.6%
                     Westblaak 79
                     3012 KE Rotterdam
                     The Netherlands
MIC Common Stock     Genesis Asset Managers International     1,125,011 (2)            6.9%
                        Limited
MIC Common Stock     Barry R. Feirstein                         833,333 (3)            5.1%
MIC Common Stock     T. Rowe Price Associates Inc.              927,600 (4)            5.7%
MIC Common Stock     All directors and officers as a group    1,927,661 (5)           11.6%
</TABLE>

- ---------------------------------------
(1)  Kinnevik B.V. is a wholly owned subsidiary of Kinnevik. Includes 503,524
     shares of MIC Common Stock held by Kinnevik International AB, a subsidiary
     of Kinnevik. Of the 5,799,433 shares, Kinnevik has pledged 1,416,666
     against various borrowings.

(2)  As of February 13, 2003, information filed with the Securities and Exchange
     Commission, pursuant to Schedule 13G, jointly with Genesis Asset Managers
     International Limited.

(3)  As of December 6, 2002, information filed with the Securities and Exchange
     Commission, pursuant to Schedule 13G.

(4)  T. Rowe Price Associates Inc. has sole voting power over 123,900 shares.
     The number of shares held is information filed with the Securities and
     Exchange Commission, pursuant to Schedule 13G, as at February 14, 2003.

(5)  Includes 379,944 shares of MIC Common Stock that may be acquired upon the
     exercise of stock options of the Company that are currently exercisable.
     Also includes 1,283,235 shares of MIC Common Stock owned by The 1980
     Stenbeck Trust and 105,114 shares of MIC Common Stock owned by The 1985
     Stenbeck Trust.

     In the past the Company allowed its senior management to participate in its
joint venture companies. In the future, management participation in the business
of the Company will only be through options granted to acquire MIC Common Stock.

Related Party Transactions

     On December 31, 1995, MIC acquired 17.7% of Mach from Kinnevik. The
consideration, which was to have a minimum present value of $5,000,000 at
December 31, 1995, consisted of (i) an initial payment of $1,000,000 plus
interest, at the ruling market rate, for the month of January 1996, (ii) seven
additional payments for each of the financial years 1996 to 2002, calculated as
17.7% of Mach's pre-tax profit for the relevant year and payable in April of the
following year, and (iii) a final payment payable in April 2003, calculated as
the higher of (a) the sum of the seven additional payments multiplied by a
factor of 1.3 minus the initial payment or (b) the amount required to make the
present value of all payments at December 31, 1995 equal to $5,000,000. The
final payment is to be made in common stock of MIC using a pre-stock split share
price of $30.50 per share. An amount of $3,958,000 (2001: $7,042,000), equal to
the estimated remaining purchase payment for this transaction based on the
results of Mach to date, is included in the balance sheet under the heading
"Amounts


                                      59
<PAGE>


due to shareholders". In 1996 the remaining 2.7% of Mach was purchased from the
remaining unrelated shareholder giving MIC a 100% interest.

     In May 2002, MIC sold a 17% interest in MIC Systems BV, the parent company
of Mach, to Kinnevik B.V. for $17,000,000.

     As of December 31, 2002, MIC owed $63,000 (2001: $116,000) to Kinnevik for
additional charges relating to services provided.

     During 2002, Kinnevik purchased Old Notes on the open market with a face
value of $44,000,000. MIC then exchanged these for $1,500,000 cash and 672,016
Tele2 AB shares at market prices.

     During the course of 2002, MIC sold an additional 6,177,369 Tele2 AB `B'
shares at market prices to Kinnevik for a value of $104,295,000.

     On September 27, 2000, following an exchange offer made by Tele2 AB, the
Company exchanged its SEC shares into Tele2 AB shares.

     In November 2001, the Company sold 100% of its interests in FORA Telecom
BV, its Russian Cellular telephony operations to Tele2 AB. The agreement called
for $80 million in Tele2 AB class `B' shares to be exchanged for the assets plus
a maximum equivalent of $30 million in cash or additional Tele2 AB "B" shares,
depending on the outcome of GSM license applications for three of MIC's existing
cellular telephony operations in Russia. The sale resulted in a $6,693,000 gain
on the disposal in 2001. During 2002, MIC obtained the necessary GSM licenses
referred to above and therefore received the additional $30 million proceeds in
cash. In addition, certain loans for which MIC was liable were settled at less
than their carrying value. The credit realized on the receipt of the $30 million
in cash and the settlement of loans of $ 3,755,000, less costs of $ 2,896,000
incurred in the acquisition of the licenses, resulted in a net gain of
$30,859,000 in 2002.

     The Group maintains corporate bank accounts at Banque Invik through which
it makes payments and receives monies in the normal course of business. As of
December 31, 2002, the Group had current accounts, time deposits and blocked
deposits at Banque Invik.

   MIC charged $nil (2001: $280,000; 2000: $800,000) to related parties for
services rendered.

   Great Universal

     As of December 31, 1998, the Group, through its subsidiary MIC-USA inc.
("MIC-USA"), had a 100% temporary and restricted shareholding in Great
Universal. On December 31, 1999, MIC-USA transferred its 100% ownership and
related rights in Great Universal to Great Universal LLC 1999 Trust for a
consideration of $5,027,000, corresponding to the net book value of MIC's
investment in Great Universal. This amount is recorded in Investment in
securities. During 2002, management made an impairment for 100% of this asset
due to uncertainty concerning its recoverability. Following the reorganization
described below, the rights and obligations of MIC-USA toward Great Universal
were assigned to Great Universal LLC. Great Universal continues to indemnify MIC
against certain contingent liabilities of Millicom. Great Universal is currently
engaged in the communications, information technology, teleservices and media
industries primarily in the United States.

     In June 1999, Great Universal effected a reorganization of Great Universal
and its subsidiaries, in which Great Universal was merged with and into Great
Universal LLC and operations were spun off into two separate businesses, being
Great Universal and Modern Holdings. Great Universal Inc. holds the subsidiaries
in teleservices, television and media and specialized electronics industries,
and Modern Holdings holds the subsidiaries in the integrated network services
industries. Great Universal LLC holds 100% of common shares in Great Universal
Inc. and 53% of common shares in Modern Holdings. MIC does not consolidate its
investment in Great Universal as, due to the warrant holders' right to exercise,
it considers it does not control Great Universal and also that there exist
severe long-term restrictions that significantly impair the ability of Great
Universal to transfer funds to MIC.


                                      60
<PAGE>


     In January 2000, Modern Holdings sold its 100% interest in MACH USA to MACH
SA for a total consideration of $1,800,000. Due to the loss situation of MACH
USA and the low expected development of MACH USA, the Company's management
decided to close the activities of MACH USA and to write down the investment.

     In January 2000, MIC invested $10,000,000 in Modern Holdings in the form of
promissory notes. In February 2000, those notes were converted into 1,293,095
shares of common stock, representing 8.5% of the share capital of Modern
Holdings. This investment is recorded as a non-current available-for-sale
security. As of December 31, 2002, following a restructuring of Modern Holdings
and an independent valuation, MIC recognized an impairment of $7,050,000 on its
investment.

     The largest single shareholder in the Company is Kinnevik, with a direct
interest of approximately 36%. The following purchases and outstanding balances
occurred with companies affiliated to Kinnevik and MIC. All transactions were
conducted on commercial terms and conditions at market prices. The services
supplied covered fraud detection, network and IT support, acquisition of assets
and customer care systems.

     As of December 31, 2002 and 2001, MIC had the following payables and
purchases to related parties:

<TABLE>
                                     Purchases in year             Amount payable at
                                                                   December 31,
                                          2002         2001             2002         2001
                                     ------------------------------------------------------
                                        US $000s     US $000s         US $000s     US $000s
                                     ------------------------------------------------------
<S>                                          <C>        <C>                 <C>         <C>
Bassett..........................            669        1,222               23          101
Great Universal..................              -            -               25           39
Netcom Consultants...............            157          554                9           56
Procure-it-right.................            839          962              100            1
Applied Sales Management.........            110          100                -            -
Applied Value....................          2,009          484              252            -
Praesidium.......................            204           70                -            3
Lothar Systems...................             10        1,601              288          508
Ephibian.........................             38            -                -            -
Shared Value.....................            656          477               23            -
YXK Systems......................             28            -                -            -
Search Value.....................            489          189                -            -
Banque Invik.....................            638          438               44            -
Tele2............................             50           25            5,723       10,596
                                     ------------------------      -----------       ------
                                           5,897        6,122            6,487       11,304
                                     ========================      ===========       ======
</TABLE>

     As of December 31, 2002 and 2001, MIC had the following receivables from
Kinnevik and other related parties:

                                         2002         2001
                                     ------------- -----------
                                       US $000s     US $000s
                                     ------------- -----------
Kinnevik.........................           1,976       2,581
Modern Times Group...............             752         281
Metro............................             734         256
Lothar...........................             922          29
Tele2............................             359       4,216
Modern Holdings..................           1,825       1,633
Netcom...........................              64         100
Shared Value.....................              18           6
Stonebrook Enterprises...........             156         156
                                     ------------  ----------
                                            6,806       9,258
                                     ============  ==========


                                      61
<PAGE>


     In the opinion of management of the Company, the terms of the transactions
described above in this section are at least as favorable to the Company as
could have been obtained from independent parties.

ITEM 8.  FINANCIAL INFORMATION

Financial Statements and Other Information

     See Item 18 for the Company's Financial Statements.

Legal Proceedings

     The Company is currently in litigation in certain operations, but in
management's opinion these will not have a material negative impact on the
Company's financial position or operations.

Dividend Policy

     Holders of the MIC Common Stock are entitled to receive dividends ratably
when, as and if declared by the Company's Board of Directors, subject to
Luxembourg legal reserve requirements. The Company has not paid any cash
dividends on its common stock since inception. The Company anticipates that it
will retain any earnings for use in the operation and expansion of its business
and does not anticipate paying any cash dividends on the MIC Common Stock in the
foreseeable future. In addition, the ability of the Company to make dividend
payments or other payments on its common stock is limited by the Indenture for
the Company's New Notes. Management will consider any tax consequences to the
Company before declaring a dividend.

ITEM 9.  THE OFFER AND LISTING

     The principal trading market for the MIC Common Stock is the NASDAQ
National Market.

     In February 2003, an Extraordinary General Meeting of the Company passed a
resolution approving a reverse share split whereby three existing shares of a
par value of $2 each were exchanged for one new share with a par value of $6.
The prices quoted above for the periods from 1996 to 2002 are pre-reverse share
split and are therefore based on shares with a par value of $2 each. The figures
quoted for 2003 show the high and low closing market prices for the shares with
a par value of $2 each and post-reverse split.

                                                    High                Low
                                                   --------           --------
Year ended December 31, 1998
First Quarter................................      $45.00             $34.125
Second Quarter...............................      $45.50             $36.875
Third Quarter................................      $53.3125           $24.125
Fourth Quarter...............................      $38.375            $13.75

Year ended December 31, 1999
First Quarter................................      $39.50             $22.875
Second Quarter...............................      $40.00             $26.00
Third Quarter................................      $31.625            $25.125
Fourth Quarter...............................      $64.50             $24.75

Year ended December 31, 2000
First Quarter................................      $81.50             $49.375
Second Quarter...............................      $68.625            $35.00
Third Quarter................................      $51.75             $34.125
Fourth Quarter...............................      $36.75             $21.4375

Year ended December 31, 2001
First Quarter................................      $34.25             $18.625
Second Quarter...............................      $31.45             $17.9375
Third Quarter................................      $24.98             $10.25


                                      62
<PAGE>


Fourth Quarter...............................      $12.35             $9.16
Year ending December 31, 2002
First Quarter................................      $13.92             $4.67
Second Quarter...............................      $7.85              $1.60
Third Quarter................................      $1.74              $0.66
Fourth Quarter...............................      $2.29              $0.39

Year ending December 31, 2003
Pre-reverse share split .....................
November 2002................................      $1.90              $1.08
December 2002................................      $2.29              $1.49
January 2003.................................      $3.00              $1.77
February 2003................................      $1.96              $1.45
Post-reverse share split to April 30, 2003 ..
February 2003................................      $5.70              $4.51
March 2003...................................      $6.75              $4.51
April 2003...................................      $9.86              $7.09

     On May 12, 2003 the closing market price for the MIC Common Stock was
$13.80.

     As of March 31, 2003, 519 holders of record having registered addresses in
the United States held approximately 56% of the outstanding shares of MIC Common
Stock. Daily trading volume on the NASDAQ National Market ranged from 400 shares
to 781,033 shares, adjusted to reflect the reverse share split, during the
period from December 31, 2001 through April 30, 2003.

     There are currently no Luxembourg decrees or regulations restricting the
import or export of capital affecting the remittance of dividends or other
payments to holders of MIC Common Stock who are non-residents of the Grand-Duchy
of Luxembourg.

     There are no limitations relating only to non-residents of the Grand-Duchy
of Luxembourg under Luxembourg law or the Articles of Incorporation of the
Company on the right to be a holder of, and to vote in respect of MIC Common
Stock.

ITEM 10. ADDITIONAL INFORMATION

Memorandum and Articles of Association

   Registration and Object

     Millicom International Cellular is a public liability company ("societe
anonyme") governed by the Luxembourg law of August 10, 1915 on Commercial
Companies, incorporated on June 16, 1992 and registered with the Luxembourg
Trade Register ("Registre de Commerce et des Societes") under the number
B-40.630.

     Article 3 of the articles of incorporation of the Company defines the
purpose of the Company as follows: "the purposes for which the Company is formed
are to engage in all transactions pertaining directly or indirectly to the
acquisition of participating interests in any business enterprise, including but
not limited to, the administration, management, control and development of any
such enterprise, and to engage in all other transactions in which a company
created under the laws of Luxembourg may engage".

   Directors

     Restrictions on voting - In case a director has a personal material
interest in a proposal, arrangement or contract to be decided by the Company,
article 13 of the articles of incorporation of the Company provide that the
validity of the decision of the Company will not be affected by a conflict of
interest existing for a director. However, any such personal interest must be
disclosed to the board of directors and the concerned director can


                                      63
<PAGE>


not vote on the relevant issue. Such conflict of interest must be reported to
the next general meeting of shareholders.

     Compensation - The decision on the annual remuneration of the directors
("tantiemes") is reserved by article 12 of the articles of incorporation to the
general meeting of shareholders. Directors can therefore not vote compensation
to themselves. Yet, the Directors could vote on the employment contract terms of
their own contract with the Company (including special bonuses there under) and,
if the Articles so permit (which they do for MIC) on the allotment of shares
under a share option scheme.

     Borrowing powers - The Directors generally have unrestricted borrowing
powers on behalf of and for the benefit of the Company.

     Age limit - There is no age limit for being a director of the Company.
Directors are appointed for a maximum of six years and are re-eligible.

     Share ownership requirements - Directors need not be shareholders.

   Shares

     Rights attached to the shares - The Company has only one class of shares,
each share entitling (i) to one vote at the general meeting of shareholders,
(ii) to receiving dividends out of distributable profits when such distributions
are decided and (iii) to share in any surplus left after the payment of all the
creditors in the event of liquidation. There is a preferential subscription
right under any Share or Rights issue for cash, unless the Directors restrict
the exercise thereof.

     Redemption of shares - The articles of incorporation provide for the
possibility and the terms of the repurchase by the Company of its own shares,
solely at the Company's initiative.

     Sinking funds - The Company's shares are not subject to any sinking fund.

     Liability to further Capital Calls - All of the issued shares in the
Company's capital are fully paid. Accordingly none of the Company's shareholders
are liable for further capital calls.

     Principal Shareholder Restrictions - There are no provisions in the
articles of incorporation that would discriminate against any existing or
prospective holder of the Company's shares as a result of such shareholder
owning a substantial number of shares.

   Changes to the Shareholders' Rights

     In order to change the rights attached to the shares of the Company, a
general meeting of shareholders must be duly convened and held before notary, as
it implies the amendment of the articles of incorporation of the Company. A
quorum of presence of at least 50% is required (in a meeting held on a first
call) and the decision must be taken by a majority of two thirds of the shares
present or represented. Any change to the obligations attached to shares may
only be passed with the unanimous consent of all the shareholders.

   Shareholders meetings

     General meetings of shareholders are convened by convening notice published
in the Luxembourg official Gazette and in a Luxembourg newspaper, twice at an
interval of eight days, at least eight days prior to the meeting. If all the
shares are registered shares, a convening notice may, as an alternative to the
publication, be sent to each shareholder by registered mail at least eight days
before the annual general meeting. According to article 17 of the articles of
incorporation of the Company, the board of directors determines in the convening
notice the formalities to be observed by each shareholder for admission to the
general meeting of shareholders. An annual general meeting of shareholders must
be convened every year on the date provided for in the articles of incorporation
(article 18: the last Tuesday of May of each year). Other meetings can be
convened as necessary.


                                      64
<PAGE>


   Limitation on Securities Ownership

     There are no limitations under Luxembourg law or the articles of
incorporation on the rights for non-resident or foreign entities to own shares
in the Company.

   Change of control

     There are no provisions in the articles of incorporation of the Company
that would have an effect of delaying, deferring or preventing a change in
control of the Company and that would operate only with respect to a merger,
acquisition or corporate restructuring involving the Company, or any of its
subsidiaries. Luxembourg laws impose the mandatory disclosure of an important
participation in the Company and any change in such participation.

   Disclosure of Shareholder Ownership

     There are no provisions of the articles of incorporation by which a certain
ownership threshold must be disclosed. However, Luxembourg laws provide that any
entity or person holding more than certain thresholds (10%, 20%, 33 1/3%, 50%
and 66 2/3%) of a company listed on the Luxembourg Stock Exchange must declare
such shareholding to the Luxembourg Stock Exchange and to the Company itself.
Such disclosure is mandatory also in case of a decrease beyond such respective
thresholds.

Material Contracts

     In May 2003, the Company issued approximately $562 million of 11% Senior
Notes due 2006 (the "11% Notes") and approximately $64 million of 2% Senior
Convertible PIK (payment in kind) Notes due 2006 (the "2% Notes" together with
the 11% Notes, the "New Notes") in exchange for $781 million of the Company's 13
1/2 Senior Subordinated Discount Notes due 2006 (the "Old Notes"). The 11% Notes
were issued pursuant to an indenture dated May 8, 2003 between the Company and
The Bank of New York (the "11% Indenture") and the 2% Notes were issued pursuant
to an indenture dated May 8, 2003 between the Company and The Bank of New York
(the "2% Indenture together with the 11% Indenture, the "New Indentures"). As of
May 20, 2003, $137,080,000 of Old Notes remained outstanding.

     The New Notes are senior, unsecured obligations of the Company. The 11%
Notes will bear interest at 11% and the 2% Notes will bear interest at 2%
payable semi-annually in arrears on June 1 and December 1 of each year, with a
final maturity on June 1, 2006. The interest on the 11% Notes is payable in
cash. The interest on the 2% Notes is payable, at the Company's option, in cash
or through the issuance of 2% Notes (valued at 100% of the principal amount of
such additional notes).

     For the 11% Notes only, on each of June 1, 2004, December 1, 2004, June 1,
2005 and December 1, 2005 the Company will deposit with The Bank of New York or
the Paying Agent under the 11% Indenture an amount in cash equal to $17,500,000.
Each such amortization payment will be applied to the redemption on such date of
$17,500,000 in principal amount of 11% Notes.

     The Holders of the 2% Notes may convert their 2% Notes into shares of the
Company's common stock at an initial conversion price of $10.75 per share,
subject to adjustment as set forth in the 2% Indenture, at any time on or before
the close of business on the last trading day prior to June 1, 2006, unless the
Company has previously redeemed or repurchased the 2% Notes.

     At maturity of the 2% Notes, the Company may, at its option, pay all or a
portion of the then outstanding principal amount of the 2% Notes in cash or in
shares of the Company's common stock. If the Company decides to pay the holder
of the 2% Notes all or a portion of the outstanding principal amount in shares
of its common stock, the Company will calculate the number of shares of common
stock such holder is entitled to receive by dividing the principal amount of 2%
Notes being repaid by the lesser of (a) the conversion price and (b) the average
closing price of the common stock over the 60 day period immediately preceding
the maturity date.


                                      65
<PAGE>


     The New Notes are redeemable at the option of the Company, at any time
prior to June 1, 2004 in whole or in part, at a price of 102.25% of the
outstanding principal amount plus accrued and unpaid interest to the date of
redemption and at June 1, 2004 and thereafter at a price of 100% of the
outstanding principal amount plus accrued and unpaid interest to the date of
redemption.

     The New Indentures pursuant to which the New Notes were issued contain
certain covenants that, among others, restrict the ability of the Company, its
Restricted Subsidiaries, Restricted Affiliates and Restricted Subsidiaries of
its Restricted Affiliates (each as defined in the New Indentures) to (i) incur
additional indebtedness; (ii) pledge or dispose of assets; (iii) make
distributions on and repurchases of its common stock or make certain
investments; (iv) have restrictions on the ability of Restricted Subsidiaries or
Restricted Affiliates to make dividend or other payments to the Company; and (v)
engage in transactions with affiliates. The Indenture also restricts the ability
of the Company to merge or consolidate with or transfer all or substantially all
of its assets to another entity.

     The issuance of the New Notes was conditioned upon delivery of consent to
amendments to the indenture under which the Old Notes were issued (the "Old
Indenture") and waivers to certain provisions contained in the Old Indenture.
The Old Indenture was modified by a supplemental indenture. The supplemental
indenture eliminated the covenants contained in the Old Indenture "Limitation on
Restricted Payments", "Limitations on Dividend and Other Payment Restrictions
Affecting Subsidiaries" and "Limitation on Asset Dispositions".

     The Company has paid each holder of the Old Notes that consented to the
amendments to the Old Indenture $50 for each $1,000 in principal amount of
outstanding Old Notes validly tendered by such consenting holder and accepted
for exchange, as a consent fee.

Exchange Controls

     There are currently no governmental laws, decrees, regulations or other
legislation of Luxembourg that may affect (i) the import or export of capital
including the availability of cash and cash equivalents for use by the Company's
group and (ii) the remittance of dividends, interests or other payments to
non-resident holders of the Company's securities other than those deriving from
the U.S.-Luxembourg double taxation treaty.

Taxation

     The following paragraphs describe very generally the tax laws of Luxembourg
as they apply to investors in the Company, which is a Luxembourg corporation,
and also the taxation of investors who are citizens, residents or domiciliaries
of the United States. The following is intended merely as a general summary of
the principal tax consequences of the receipt, holding and disposition of shares
of MIC Common Stock, and is not intended as a substitute for professional tax
advice that takes into account the particular circumstances relevant to a
specific investor. Accordingly, investors should consult their own professional
advisors on the possible tax consequences of holding or disposing of shares of
MIC Common Stock, under the laws of their countries of citizenship, residence or
domicile.

   Luxembourg Taxation

     Because the Company is a Luxembourg corporation, domestic Luxembourg law
generally imposes a 20% withholding tax on dividends paid by the Company under
certain circumstances. Certain reduced rates of withholding tax, or exemptions
from withholding tax, are available under provisions of domestic Luxembourg law
and bilateral tax treaties entered into between Luxembourg and various other
countries. Investors should consult their tax advisors with respect to the
possible availability of such reduced rates or exemptions.

   United States Investors

     (a) Luxembourg Taxation. The United States and Luxembourg have signed a
Convention between the United States of America and the Grand-Duchy of
Luxembourg with Respect to Taxes on Income and Property (the "Treaty") for the
purpose of avoiding double taxation. The provisions of this new treaty governing
taxes withheld at source apply to amounts paid or credited on or after January
1, 2001; for taxes on other income and on


                                      66
<PAGE>


capital, the provisions of this new treaty apply for fiscal periods beginning
on or after January 1, 2001. There is the possibility to opt for the provisions
of the old Treaty for an additional taxable year if the old Treaty provides for
a greater relief from tax. The old Treaty provides that dividends received from
the Company by a U.S. Holder (as defined below) that qualifies for Treaty
benefits and that does not conduct a business through a "permanent
establishment" in Luxembourg, will be subject to Luxembourg tax at the rate of
7.5% on the gross amount of such dividend. The Luxembourg withholding agent is
required to withhold Luxembourg tax at the full statutory rate subject to
refund of amounts withheld in excess of the treaty rates upon the filing of
appropriate documentation with the Luxembourg tax authorities. A U.S. Holder
(as defined below) whose only contact with Luxembourg is the receipt, holding
and ultimate disposition of shares of MIC Common Stock should not be required
to file any tax returns in Luxembourg.

     The new treaty changes the rate of Luxembourg tax on dividends received
from the Company by a U.S. Holder from 7.5% to 15% of the gross amount of such
dividend; if the U.S. Holder is a company that owns directly at least 10% of the
Company's voting stock, then the new treaty will reduce the rate of Luxembourg
taxation on dividends to 5%; in certain cases the new treaty will exempt from
Luxembourg taxation dividends paid to U.S. Holders that are treated as
corporations for U.S. federal income tax purposes, that are residents of the
United States under the new treaty, and that directly hold at least 25% of the
Company's voting stock. As in the current Treaty, these reduced rates will be
available only for dividends that are not attributable to a permanent
establishment through which the U.S. Holder conducts a business in Luxembourg.
In addition, the benefits of the new treaty will be available to U.S. Holders
that are "qualified residents" of the United States, as defined in the treaty.

     (b) Special Considerations. Unfavorable U.S. tax rules apply to U.S.
shareholders of a "passive foreign investment company" ("PFIC") or a "foreign
personal holding company" ("FPHC"). There can be no assurance that we presently
are not, or will not become, a PFIC. Our substantial investment in associated
companies' securities and other "passive assets", and the recent decline in the
value of our stock, result in a risk that we are a PFIC or could become a PFIC
in the future. See "--PFIC Considerations" and "--FPHC Considerations."

     (c) Taxation of Distributions on MIC Common Stock. Distributions made by
the Company with respect to MIC Common Stock (including the amount of any
Luxembourg taxes withheld there from) will generally be includable in the gross
income of a United States person who is an individual citizen or resident of the
United States for U.S. federal income tax purposes, a corporation or a
partnership created or organized in the United States or under the laws of the
United States or of any state, or an estate or trust (other than a foreign
estate or trust) that holds MIC Common Stock (a "U.S. Holder") as dividend
income to the extent that such distributions are paid out of the Company's
current or accumulated earnings and profits as determined under U.S. federal
income tax principles. A corporation organized in the United States or under the
laws of the United States that owns 10% of the Company's voting stock, however,
may be entitled to a deduction for United States income tax purposes for a
portion of a distribution treated as dividend income. To the extent, if any,
that the amount of any such distribution exceeds the Company's current or
accumulated earnings and profits as so computed, it will first reduce the U.S.
Holder's tax basis in its MIC Common Stock to the extent thereof, and, to the
extent in excess of such tax basis, will be treated as a gain from the sale or
exchange of property.

     On May 28, 2003, President Bush signed the Jobs and Growth Tax Relief
Reconciliation Act of 2003. Among other changes, this legislation lowers from
39.5% to 15% the maximum tax rate applicable to "qualified dividends" received
by individuals. Dividend income paid by the Company to a U.S. Holder will not be
eligible for this rate reduction if the Company is a PFIC or a FPHC for its tax
year in which the dividend is paid, or for its previous tax year. See "-PFIC
Considerations" and "-FPHC Considerations".

     Future distributions of rights to subscribe to MIC Common Stock, or of MIC
Common Stock that are made as part of a pro rata distribution to all
shareholders generally will not be subject to U.S. federal income tax.

     Subject to certain conditions and limitations, the amount of any Luxembourg
taxes (other than taxes with respect to which a U.S. Holder is entitled to a
refund under the Treaty, even if such refund is not claimed or received)
withheld on a distribution by the Company will be creditable against such
holder's U.S. federal income tax liability. Distributions with respect to MIC
Common Stock that are taxable as dividends will


                                      67
<PAGE>


generally constitute foreign source income for purposes of the foreign tax
credit limitation. The limitation on foreign taxes eligible for credit is
calculated separately with respect to specific classes of income. For this
purpose, dividends distributed by the Company with respect to the MIC Common
Stock will generally constitute "passive income" or, in the case of certain
U.S. Holders, "financial services income."

     A U.S. Holder must hold the MIC Common Stock for a minimum holding period
in order to claim a foreign tax credit with respect to Luxembourg tax withheld
from a dividend distribution on the common stock. The minimum holding period for
common stock is 16 days, and such holding period must be satisfied within the
30-day period beginning on the date that is 15 days prior to the ex-dividend
date. Any period for which the U.S. Holder protects itself from risk of loss is
not includable in the minimum 16-day holding period. Amounts not currently
creditable against U.S. tax may instead be currently deducted at the election of
the U.S. Holder.

     (d) Taxation on Disposition of MIC Common Stock. U.S. Holders will
recognize gain or loss for U.S. federal income tax purposes on the sale or
other disposition of MIC Common Stock in the same manner as on the sale or
other disposition of any other shares. Such gain or loss will be a capital gain
or loss if the MIC Common Stock is held as a capital asset. Gain, if any,
generally will be U.S. source gain.

     Net capital gains (i.e. generally capital gains in excess of capital
losses) recognized by an individual U.S. Holder upon the sale of a capital asset
that has been held for more than 12 months will generally be subject to tax at a
rate not to exceed 20%. Net capital gains recognized by an individual from the
sale of a capital asset that had been held for 12 months or less will be subject
to tax at ordinary income tax rates. In addition, capital gains recognized by a
corporate U.S. Holder will continue to be subject to tax at the ordinary income
tax rates applicable to corporations.

     (e) PFIC Considerations. A foreign corporation is a PFIC for any taxable
year if either (i) at least 75% of its gross income is "passive income" or (ii)
at least 50% of its assets produce, or are held for the production of, "passive
income." For purposes of determining whether it is a PFIC, a foreign corporation
is treated as holding its share of the assets, and receiving its share of the
income, of any other corporation in which it owns (directly or indirectly) 25%
or more of the stock (by value). Our substantial investment in associated
companies' securities and other "passive assets", and the recent decline in the
value of our stock, as well as the possibility that the Company may generate
significant amounts of passive income from time to time, could cause us to be a
PFIC currently, or to become a PFIC in the future.

      If the Company is a PFIC in any taxable year, a U.S. Holder who
beneficially owns MIC Common Stock, during such year must make an annual return
on IRS Form 8621 that describes the distributions received with respect to the
MIC Common Stock and any gain realized on the disposition of such MIC Common
Stock. Furthermore, if the Company is a PFIC for any taxable year during which a
U.S. Holder holds MIC Common Stock, such U.S. Holder generally will be subject
to special rules (regardless of whether the Company continued to be a PFIC) with
respect to (i) any "excess distribution" made with respect to the MIC Common
Stock (generally, any distributions received by the U.S. Holder on MIC Common
Stock in a taxable year that is greater than 125% of the average annual
distributions received by the U.S. Holder in the three preceding taxable years,
or, if shorter, the U.S. Holder's holding period for the MIC Common Stock) and
(ii) any gain realized on the sale or other disposition of MIC Common Stock.
Under these rules, (a) the excess distribution or gain would be allocated
ratably over the U.S. Holder's holding period for the MIC Common Stock, (b) the
amount allocated to the current taxable year would be taxed as ordinary income
and (c) the amount allocated to each of the other taxable years would be subject
to tax at the highest rate of tax in effect for the applicable class of taxpayer
for that year and an interest charge for the deemed deferral benefit would be
imposed with respect to the resulting tax attributable to each such other year.

     A U.S. Holder could avoid the imposition of the interest charge with
respect to such shares by making certain elections (either a mark-to-market
election or a qualified electing fund ("QEF") election). To make the
mark-to-market election, the MIC Common Stock must be considered marketable
under U.S. income tax rules. For a U.S. Holder to make the QEF election, the
Company would have to satisfy certain reporting requirements.


                                      68
<PAGE>


     Neither we nor our advisors have the duty to or will undertake to inform
U.S. Holders whether or not we are a PFIC. We do not currently intend to make
available the information necessary for a U.S. Holder to make a QEF election in
the event we are determined to be a PFIC.

     Because of the complexity of these rules regarding ownership of stock in a
PFIC by a U.S. Holder, U.S. Holders of MIC Common Stock should consult with
their own tax advisors regarding any potential reporting or tax obligations, as
well as their potential election options.

     (f) FPHC Considerations. A foreign corporation will generally be a FPHC for
any taxable year if (i) at least 60% (50% in certain cases) of its gross income
consists of "foreign personal holding company income" and (ii) at any time
during such year more than 50% of the voting power or value of its stock is
owned, directly or pursuant to rules of attribution, by, or for, five or fewer
individuals who are citizens or residents of the United States (a "U.S. Group").
For this purpose, foreign personal holding company income generally includes
dividends and interest. Because the Company's principal source of income is
expected to be dividends and interest from its subsidiaries, the Company is
likely to satisfy the FPHC income test. With respect to the FPHC ownership test,
although the Company believes that a significant percentage of its stock may be
treated as owned, under the FPHC attribution rules, by five or fewer U.S.
individuals, the Company is not aware of any facts which would indicate that a
U.S. Group with respect to the Company exists as of March 15, 2003. Future
changes in the ownership of the Company's stock, which the Company has no reason
to anticipate, could affect its status for purposes of the FPHC rules.

     If the Company is a FPHC for any taxable year, each U.S. Holder who owns
Shares on the last day of such year, or if earlier, the last day in such year on
which a U.S. Group existed with respect to the Company will be required to
include in gross income as a dividend such U.S. Holder's pro rata share of the
Company's undistributed taxable income, subject to adjustments, determined using
U.S. tax accounting principles.

Documents on Display

     It is possible to read and copy documents referred to in this annual report
on Form 20-F that have been filed with the Securities and Exchange Commission at
the Securities and Exchange Commission's public reference room located at 450
Fifth Street, NW, Washington D.C. 20549. Please call the Securities and Exchange
Commission at 1-800-SEC-0330 for further information on the public reference
rooms and their copy charges.

ITEM 11..QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

     The principal market risks to which the Company is exposed are interest
rate risk and foreign currency exchange risk.

   Interest Rate Risk

     The interest rate risk to which the Company is exposed is principally a
function of the Company's long-term debt. To alleviate this risk, the Company
obtains both fixed-rate and floating-rate debt.

     The table below summarizes as at December 31, 2002, the Company's debt
between fixed- and floating-rates.

<TABLE>
                                                                   Amounts due within
                                         ---------------------------------------------------------------------------
                                                   1 - 2         2 - 3     3 - 4        4 - 5     After 5
                                         1 year    years         years     years        years      years     Total
                                         ------    ------       ------    -------       -----     -------  ---------
                                                             (US $000s, except percentages)
<S>                                      <C>       <C>           <C>      <C>             <C>      <C>       <C>
Fixed rate
U.S. dollar.....................         43,692    36,187        1,457    913,750         886          -     995,972
Average interest rate...........           12.7%     13.6%         6.2%      13.5%        6.9%         -

Colombia (1)....................            389         -            -          -           -          -         389
Mauritius.......................            105         -            -          -           -          -         105


                                      69
<PAGE>

<CAPTION>

<S>                                      <C>       <C>           <C>      <C>             <C>      <C>       <C>
Pakistan........................         18,764         -            -          -           -          -      18,764
Paraguay........................          1,169         -            -          -           -          -       1,169
Senegal.........................            326       278          166        142         140          -       1,052
                                         ------    ------       ------    -------       -----      -----   ---------
Local currency..................         20,753       278          166        142         140          -      21,479
                                         ------    ------       ------    -------       -----      -----   ---------
Average interest rate...........           11.8%      8.4%         8.4%       8.4%        8.4%
                                         ------    ------       ------    -------       -----      -----   ---------

Total fixed rate................         64,445    36,465        1,623    913,892       1,026          -   1,017,451
                                         ======    ======       ======    =======       =====      =====   =========

Floating rate
U.S. dollar.....................         52,888     9,288        6,981      3,969       3,570          -      76,696
Average interest rate...........            5.7%      5.3%         6.1%       6.2%        8.2%

Colombia (1)....................          7,190         -            -          -           -          -       7,190
Ghana...........................            451         -            -          -           -          -         451
Guatemala.......................          4,548     2,844        2,419      3,221       1,322      1,807      16,161
Mauritius.......................          2,433     1,426          569          -           -          -       4,428
Pakistan........................         15,176     6,592            -          -           -          -      21,768
Senegal.........................          1,720     1,516        1,516      1,516         758          -       7,026
Sri Lanka.......................          7,815     7,304        7,040        607           -          -      22,766
Sweden..........................              -    54,638            -          -           -          -      54,638
                                         ------    ------       ------    -------       -----      -----   ---------
Local currency..................         39,333    74,320       11,544      5,344       2,080      1,807     134,428
                                         ------    ------       ------    -------       -----      -----   ---------
Average interest rate...........           12.2%      7.3%        10.6%       8.7%        8.3%       8.2%
                                         ------    ------       ------    -------       -----      -----   ---------
                                         ------    ------       ------    -------       -----      -----   ---------
Total floating rate.............         92,221    83,608       18,525      9,313       5,650      1,807     211,124
                                         ======    ======       ======    =======       =====      =====   =========

Total...........................        156,666   120,073       20,148    923,205       6,676      1,807   1,228,575
                                         ======    ======       ======    =======       =====      =====   =========
</TABLE>


(1) Operation sold in February 2003.


                                      70
<PAGE>


     The table below summarizes as at December 31, 2001, the Company's debt
between fixed- and floating-rates.

<TABLE>
                                                                   Amounts due within
                                                    1 - 2      2 - 3       3 - 4        4 - 5     After 5
                                          1 year    years      years       years        years      years      Total
                                         ------    ------       ------    -------       -----     -------  ---------
                                                             (US $000s, except percentages)
Fixed rate
<S>                                      <C>       <C>          <C>       <C>         <C>         <C>      <C>
U.S. dollar.....................         46,127    35,176       33,935          -     963,230          -   1,078,468
                                         ------    ------       ------    -------     -------      -----   ---------
Average interest rate...........           12.2%     13.6%        13.9%          -       13.5%         -

Argentina.......................            580       410            -          -           -          -         990
Colombia........................            421         -            -          -           -          -         421
India...........................              -         5            -          -           -          -           5
Mauritius.......................          2,043     1,436        1,346        346           -          -       5,171
Pakistan........................          7,477     3,914            -          -           -          -      11,391
Paraguay........................          1,889         -            -          -           -          -       1,889
Philippines.....................            623         -            -          -       1,449          -       2,072
Senegal.........................            197       170          121         20           -          -         508
                                         ------    ------       ------    -------     -------      -----   ---------
Local currency..................         13,230     5,935        1,467        366       1,449          -      22,447
Average interest rate...........           10.0%     12.5%        12.1%      12.2%       13.9%         -
                                         ------    ------       ------    -------     -------      -----   ---------

Total fixed rate................         59,357    41,111       35,402        366     964,679          -   1,100,915
                                         ======    ======       ======    =======       =====      =====   =========

Floating rate
U.S. dollar.....................         69,017    21,276       14,110     10,042       9,443          -     123,888
                                         ------    ------       ------    -------     -------      -----   ---------
Average interest rate...........            7.3%      7.9%         7.9%       6.8%        6.5%         -

Colombia........................          8,596         -            -          -           -          -       8,596
Ghana...........................          1,076       361            -          -           -          -       1,437
Guatemala.......................          3,632     1,863        4,890      3,352         382          -      14,119
Luxembourg......................              -     1,744            -          -           -          -       1,744
Pakistan........................              -     3,847            -          -           -          -       3,847
Philippines.....................          7,721         6            -          -           -          -       7,727
Senegal.........................          1,419     1,288        1,288      1,288       1,288        697       7,268
Singapore.......................             21         -            -          -           -          -          21
Sri Lanka.......................          3,059     6,937        6,937      6,025         468          -      23,426
Sweden..........................              -         -      173,365          -           -          -     173,365
                                         ------    ------       ------    -------     -------      -----   ---------
Local currency..................         25,524    16,046      186,480     10,665       2,138        697     241,550
                                         ------    ------       ------    -------     -------      -----   ---------
Average interest rate...........           12.9%     12.1%         6.3%      12.4%        9.4%       7.2%
                                         ------    ------       ------    -------     -------      -----   ---------
Total floating rate.............         94,541    37,322      200,590     20,707      11,581        697     365,438
                                         ======    ======       ======    =======      ======      =====   =========

Total...........................        153,898    78,433      235,992     21,073     976,260        697   1,466,353
                                         ======    ======       ======    =======     =======      =====   =========
</TABLE>


                                      71
<PAGE>


     The Company does not use interest rate swaps, forward rate agreements or
any future contracts but manages its interest exposure by diversifying its debt
between fixed- and floating-rate loans.

     Included in the total for U.S. Dollar fixed rate balances above is
$985,700,000 (2001: $1,061,740,000) in respect of the book value of Old Notes
and notes in Colombia for which the fair value is $488,133,000 (2001:
$691,154,000). For all other amounts, the fair value is taken to be the book
value as stated above.

   Exchange Rate Risk

     The Company is exposed to fluctuations of the U.S. dollar against certain
other currencies. The Company publishes its financial statements in U.S. dollars
while a significant proportion of its assets, liabilities, sales and costs are
denominated in other currencies. The Company currently conducts business in 17
currencies.

     The Company seeks to protect its reported earnings from falling in U.S.
dollar terms, from currency depreciation, by periodically adjusting its prices
in local currency terms to reflect any such depreciation. In certain countries
that experience very high inflation the Company sets its prices in direct
relation to the U.S. dollar. However, there can be no assurance that a
significant devaluation of a currency against the U.S. dollar can be offset, in
whole or in part, by a corresponding price increase, even over the long term. To
some extent, the broad mix of currencies in which the Company conducts its
businesses and the geographic spread of its operations provides the Company with
some measure of protection against specific exchange rate movements and reduces
the overall sensitivity of the Company's results to specific exchange rate
fluctuations. The Company does not hedge its foreign currency exposure as it is
considered that the cost of purchasing financial instruments outweighs the
benefits derived.

     At the venture level, the Company seeks to reduce its foreign exchange
exposure arising from transactions through a policy of matching, as far as
possible, assets and liabilities. In some cases, the Company may borrow in U.S.
dollars because it is either advantageous for ventures to incur debt obligations
in U.S. dollars or because dollar-denominated borrowing is the only funding
source available to a venture. In these circumstances, the Company has currently
decided to accept the inherent currency risk, principally because of the
relatively high cost of buying, or inability to buy, forward cover in currencies
of the countries in which the Company operates. See also Note 2 of the Notes to
the Consolidated Annual Accounts for a description of the currencies in which
the Company operates.

     The following table summarizes the Company's debt detailing the balances at
December 31, 2002, that were denominated in U.S. dollars and that in other local
currencies:

<TABLE>
                                                                   Amounts due within
                                         ---------------------------------------------------------------------------
                                                    1 - 2        2 - 3     3 - 4       4 - 5      After 5
                                         1 year     years        years     years       years       years     Total
                                         ------    ------       ------    -------     -------     -------  ---------
                                                                       (US $000s)
<S>                                      <C>        <C>          <C>      <C>        <C>          <C>      <C>
U.S. dollar.....................         96,581     45,475       8,438    917,719    4,456             -   1,072,669

Colombia........................          7,579          -           -          -           -          -       7,579
Ghana...........................            451          -           -          -           -          -         451
Guatemala.......................          4,547      2,844       2,419      3,221       1,322      1,807      16,160
Mauritius.......................          2,538      1,426         569          -           -          -       4,533
Pakistan........................         33,940      6,592           -          -           -          -      40,532
Paraguay........................          1,169          -           -          -           -          -       1,169
Senegal.........................          2,046      1,794       1,682      1,658         898          -       8,078
Sri Lanka.......................          7,815      7,304       7,040        607           -          -      22,766
Sweden..........................              -     54,638           -          -           -          -      54,638
                                         ------    ------       ------    -------     -------      -----   ---------
Total local currency............         60,085     74,598      11,710      5,486       2,220      1,807     155,906
                                         ------    ------       ------    -------     -------      -----   ---------

Total...........................        156,666    120,073      20,148    923,205       6,676      1,807   1,228,575
                                         ======    ======       ======    =======      ======      =====   =========
</TABLE>


                                      72
<PAGE>


     The following table summarizes the Company's debt detailing the balances at
December 31, 2001, that were denominated in U.S. dollars and that in other local
currencies:

<TABLE>
                                                                   Amounts due within
                                                   1 - 2        2 - 3      3 - 4      4 - 5      After 5
                                         1 year    years        years      years      years        years      Total
                                         ------    ------       ------    -------     -------    -------   ---------
                                                                         ($'000)
<S>                                     <C>         <C>         <C>        <C>        <C>        <C>       <C>
U.S. dollar.....................        115,143     56,453      48,045     10,042     972,673          -   1,202,356
                                         ------    ------       ------    -------     -------      -----   ---------

Argentina.......................            580        410           -          -           -          -         990
Colombia........................          9,017          -           -          -           -          -       9,017
Ghana...........................          1,076        361           -          -           -          -       1,437
Guatemala.......................          3,632      1,863       4,890      3,352         382          -      14,119
India...........................              -          5           -          -           -          -           5
Luxembourg......................              -      1,744           -          -           -          -       1,744
Mauritius.......................          2,043      1,436       1,346        346           -          -       5,171
Pakistan........................          7,477      7,761           -          -           -          -      15,238
Paraguay........................          1,889          -           -          -           -          -       1,889
Philippines.....................          8,344          6           -          -       1,449          -       9,799
Senegal.........................          1,616      1,458       1,409      1,308       1,288        697       7,774
Singapore.......................             21          -           -          -           -          -          21
Sri Lanka.......................          3,059      6,937       6,937      6,025         468          -      23,428
Sweden..........................              -          -     173,365          -           -          -     173,365
                                         ------    ------       ------    -------     -------      -----   ---------
Total local currency............         38,754     21,981     187,947     11,031       3,587        697     263,997
                                         ------    ------       ------    -------     -------      -----   ---------

Total...........................        153,898     78,433     235,992     21,073     976,260        697   1,466,353
                                         ======    ======       ======    =======      ======      =====   =========
</TABLE>

     In the years ended December 31, 2002, 2001 and 2000 the Company incurred
exchange losses of $23,483,000, $17,313,000 and $23,015,000, respectively.

ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

     Not applicable.


                                     PART II

ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES

     Not applicable.

ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF
         PROCEEDS

     Not applicable.

ITEM 15. CONTROLS AND PROCEDURES

     Within 90 days prior to the date of this report, the Company, under the
supervision and with the participation of the Company's management, including
the Chief Executive Officer, the Chief Financial Controller and the Chief of
Finance - Global Operations, performed an evaluation of the effectiveness of the
Company's disclosure controls and procedures. Based on this evaluation, the
Company's Chief Executive Officer, Chief Financial Controller and Chief of
Finance - Global Operations concluded that the Company's disclosure controls and
procedures are effective for gathering, analyzing and disclosing the information
the Company is required to disclose in the reports it files under the Securities
Exchange Act of 1934, within the time periods specified in the SEC's rules and
forms. The Company's management necessarily applied its judgement in assessing
the costs and benefits of such controls and procedures, which by their nature
can provide only reasonable assurance regarding management's control objectives.


                                      73
<PAGE>


     There have been no significant changes in the Company's internal controls
or other factors that could significantly affect internal controls subsequent to
the date of their evaluation.


ITEM 16. [RESERVED]


                                    PART III

ITEM 17. FINANCIAL STATEMENTS

     Not applicable.

ITEM 18. FINANCIAL STATEMENTS

     See pages F-1 through F-82.

ITEM 19. EXHIBITS

1.1      Memorandum and Articles of Association and bylaws of Millicom
         International Cellular S.A.

4.1      Indenture dated May 8, 2003, between the Company and The Bank of New
         York, as trustee, relating to $562,219,000 11% Senior Subordinated
         Notes due 2006.

4.2      Indenture dated May 8, 2003, between the Company and The Bank of New
         York, as trustee, relating to $63,714,000 2% Senior Convertible PIK
         Notes due 2006.

4.3      Supplemental indenture dated May 23, 2003, between the Company and The
         Bank of New York, as trustee, relating to the 13 1/2% Senior
         Subordinated Notes due 2006.

7.1      Explanation of the calculation of earnings per share.

99.1     Section 906 Certifications.










                                      74
<PAGE>


                                   SIGNATURES

     Pursuant to the requirements of Section 12 of the Securities Exchange Act
of 1934, the Registrant certifies that it meets all of the requirements for
filing on Form 20-F and has duly caused this annual report to be signed on its
behalf by the undersigned, thereunto duly authorized.

     Dated June 30, 2003




                                            MILLICOM INTERNATIONAL CELLULAR S.A.


                                            By: /s/  E. Hakan Ledin
                                                --------------------------------
                                            Name:  E. Hakan Ledin
                                            Title: Chairman and Director



                                            By: /s/  M. Beuls
                                                --------------------------------
                                                Name:  M. Beuls
                                                Title: President and
                                                       Chief Executive Officer






















                                      75
<PAGE>


I, Marc Beuls, Chief Executive Officer, certify that:

1. I have reviewed this annual report on Form 20-F of Millicom International
Cellular S.A.;

2. Based on my knowledge, this annual report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this annual
report;

3. Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this annual report;

4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have;

a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this annual report is being prepared;

b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this annual
report (the "Evaluation Date"); and

c) presented in this annual report our conclusions about the effectiveness of
the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrant's auditors and the audit
committee of the registrant's board of directors (or persons performing the
equivalent function):

a) all significant deficiencies in the design or operation of internal controls
which could adversely affect the registrant's ability to record, process,
summarize and report financial data and have identified for the registrant's
auditors any material weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal controls;
and

6. The registrant's other certifying officers and I have indicated in this
annual report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.


Date:    June 30, 2003
                                            /s/  Marc Beuls
                                            ------------------------------------
                                            Marc Beuls
                                            Chief Executive Officer



                                      76
<PAGE>



I, John Ratcliffe, Chief Financial Controller, certify that:

1. I have reviewed this annual report on Form 20-F of Millicom International
Cellular S.A;

2. Based on my knowledge, this annual report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this annual
report;

3. Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this annual report;

4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have;

a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this annual report is being prepared;

b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this annual
report (the "Evaluation Date"); and

c) presented in this annual report our conclusions about the effectiveness of
the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrant's auditors and the audit
committee of the registrant's board of directors (or persons performing the
equivalent function):

a) all significant deficiencies in the design or operation of internal controls
which could adversely affect the registrant's ability to record, process,
summarize and report financial data and have identified for the registrant's
auditors any material weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal controls;
and

6. The registrant's other certifying officers and I have indicated in this
annual report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.


Date:    June 30, 2003
                                            /s/  John Ratcliffe
                                            ------------------------------------
                                            John Ratcliffe
                                            Chief Financial Controller


                                      77
<PAGE>


I, Judy Tan, Chief of Finance - Global Operations, certify that:

1. I have reviewed this annual report on Form 20-F of Millicom International
Cellular S.A;

2. Based on my knowledge, this annual report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this annual
report;

3. Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this annual report;

4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have;

a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this annual report is being prepared;

b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this annual
report (the "Evaluation Date"); and

c) presented in this annual report our conclusions about the effectiveness of
the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrant's auditors and the audit
committee of the registrant's board of directors (or persons performing the
equivalent function):

a) all significant deficiencies in the design or operation of internal controls
which could adversely affect the registrant's ability to record, process,
summarize and report financial data and have identified for the registrant's
auditors any material weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal controls;
and

6. The registrant's other certifying officers and I have indicated in this
annual report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.


Date:    June 30, 2003
                                            /s/  Judy Tan
                                            ------------------------------------
                                            Judy Tan
                                            Chief of Finance -- Global
                                              Operations



                                      78
<PAGE>




                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
                                       OF
                      MILLICOM INTERNATIONAL CELLULAR S.A.
                                AND SUBSIDIARIES


Independent Auditor's Report.............................................    F-1
Consolidated Balance Sheets as of December 31, 2002 and 2001.............    F-2
Consolidated Statements of Profit and Loss for the years ended
        December 31, 2002, 2001 and 2000.................................    F-4
Consolidated Statements of Cash Flows for the years ended
        December 31, 2002, 2001 and 2000.................................    F-5
Consolidated Statements of Changes in Shareholders' Equity for
        the Years ended December 31, 2002, 2001 and 2000.................    F-6
Notes to the Consolidated Annual Accounts as of December 31, 2002
        and 2001, including reconciliation to U.S. GAAP (Note 30)........    F-7
1.      Organization.....................................................    F-7
2.      Summary of Consolidation and Accounting Policies.................    F-7
        (a)     Group Accounting.........................................    F-8
        (b)     Goodwill.................................................    F-9
        (c)     Licenses.................................................   F-10
        (d)     Deferred costs...........................................   F-10
        (e)     Tangible assets..........................................   F-10
        (f)     Inventories..............................................   F-11
        (g)     Time and pledged deposits................................   F-11
        (h)     Cash and cash equivalents................................   F-11
        (i)     Foreign currency translation.............................   F-11
        (j)     Revenue recognition......................................   F-12
        (k)     Prepaid cards............................................   F-13
        (l)     Cost of sales............................................   F-13
        (m)     Customer acquisition costs...............................   F-13
        (n)     Leases...................................................   F-13
        (o)     Taxation.................................................   F-14
        (p)     (Loss) earnings per common share.........................   F-14
        (q)     Amounts due from joint ventures..........................   F-14
        (r)     Financial instruments....................................   F-14
        (s)     Risk management..........................................   F-16
        (t)     Impairment of non-financial assets.......................   F-17
        (u)     Segment reporting........................................   F-17
        (v)     Comparatives.............................................   F-17
        (w)     Equity compensation benefits.............................   F-17
3.      Joint Ventures and Subsidiaries..................................   F-18
        (a)     Joint ventures...........................................   F-20
        (b)     Subsidiary companies.....................................   F-21
        (c)     Associated companies.....................................   F-21
4.      Goodwill.........................................................   F-22
5.      Licenses.........................................................   F-24
6.      Deferred costs and other non-current assets, net.................   F-25
7.      Tangible assets..................................................   F-26
8.      Investment in Securities.........................................   F-27
9.      Derivatives arising from business combinations...................   F-29
10.     Pledged deposits.................................................   F-31
11.     Inventories......................................................   F-32


                                      79
<PAGE>


12.     Trade receivables, net...........................................   F-32
13.     Other current assets.............................................   F-33
14.     Time deposits....................................................   F-33
15.     Cash and cash equivalents........................................   F-34
16.     Shareholder's equity.............................................   F-34
        (a)     Share capital and premium................................   F-34
        (b)     Treasury stock...........................................   F-34
        (c)     Legal and consolidation reserves.........................   F-34
        (d)     Options outstanding......................................   F-35
17.     Borrowings.......................................................   F-37
        (a)     Company borrowings.......................................   F-37
        (b)     Corporate subordinated debt..............................   F-39
        (c)     Other debt...............................................   F-41
        (d)     Analysis of borrowings by maturity.......................   F-43
18.     Analysis of group revenues and cost of revenues,
          segmental reporting............................................   F-44
19.     Personnel charges................................................   F-48
20.     Gain and loss on exchange, disposal and write-down of assets, net   F-49
        (a)     Write-down of assets, net................................   F-49
        (b)     Gain (loss) from sale of subsidiaries and joint
                  ventures, net..........................................   F-51
        (c)     (Loss) gain from investment securities...................   F-52
        (d)     Disclosure on discounting operations.....................   F-53
21.     Taxes   .........................................................   F-54
22.     Cash flow from operating activities..............................   F-56
23.     Acquisition of subsidiaries......................................   F-56
24.     Disposal of subsidiaries.........................................   F-57
25.     Non-cash investing and financing activities......................   F-57
26.     Commitments and contingencies....................................   F-58
27.     Related party transactions.......................................   F-60
28.     Other current liabilities........................................   F-63
29.     (Loss) earnings per common share.................................   F-63
30.     Reconciliation to U.S. GAAP......................................   F-64
31.     Subsequent Events................................................   F-81



                                      80
<PAGE>


PricewaterhouseCooper

- --------------------------------------------------------------------------------
                                                PricewaterhouseCooper
                                                Societe a responsabilite limitee
Report of the independent auditors              Reviseur d'entreprises
                                                400, route d'Esch
                                                B.P. 1443
To the shareholders of                          L-1014 Luxembourg
Millicom International Cellular S.A.            Telephone +352 494848-1
                                                Facsimile + 352 494848-2099
- --------------------------------------------------------------------------------

     We have audited the accompanying consolidated balance sheets of Millicom
International Cellular S.A. and its subsidiaries ("MIC") as of December 31, 2002
and 2001, and the related consolidated statements of profit and loss, changes in
shareholders' equity and cash flows for the three years ended December 31, 2002,
2001 and 2000. These consolidated financial statements are the responsibility of
the Board of Directors. Our responsibility is to express an opinion on these
financial statements based on our audit.

     We conducted our audit in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statements presentation. We believe that our audit provides a reasonable basis
for our opinion.

     In our opinion, based on our audit, the consolidated financial statements
referred to above present fairly, in all material respects, the financial
position of Millicom International Cellular S.A. and its subsidiaries as of
December 31, 2002 and 2001, and the results of their operations, changes in
shareholders' equity and cash flows for the three years ended December 31, 2002,
2001 and 2000, in conformity with International Financial Reporting Standards as
published by the International Accounting Standards Board.

     International Financial Reporting Standards vary in certain significant
respects from accounting principles generally accepted in the United States.
Application of accounting principles generally accepted in the United States
would have affected the profit (loss) after taxes for each year, as well as the
shareholders' equity for the three years ended December 31, 2002, 2001 and 2000,
to the extent summarized in Note 30 to the consolidated financial statements.

     As discussed in Note 30, MIC has restated its shareholders' equity and its
profit (loss) after taxes as of and for each of the two years ended December 31,
2001 and 2000 as reported in accordance with accounting principles generally
accepted in the United States, previously audited by other independent auditors
who have ceased operations.


PricewaterhouseCoopers S.a r.l.                      Luxembourg, June 30, 2003
Reviseur d'entreprises




                                      F-1
<PAGE>


Consolidated balance sheets                               Millicom International
As of December 31, 2002 and 2001                                   Cellular S.A.
- --------------------------------------------------------------------------------


                                                            2002          2001
                                             -----------------------------------

ASSETS                                       Notes      US$ `000       US$ `000
- --------------------------------------------------------------------------------

NON-CURRENT ASSETS

Intangible assets

    Goodwill, net                                4        10,172         52,575
    Licenses, net                                5        84,471        164,541
    Deferred costs and other
       non-current assets, net                   6         4,919         15,685

Tangible assets, net                             7       458,933        512,236

Financial assets

    Investment in securities                     8       220,386        676,829
    Investments in associated companies          3        1,013         52,858
    Pledged deposits                            10        32,921         47,404

Deferred taxation                               21         8,470          3,785

                                                      ----------      ---------
TOTAL NON-CURRENT ASSETS                                 821,285      1,525,913
                                                      ----------      ---------

CURRENT ASSETS

Investment in securities                         8       101,540              -
Inventories                                     11         6,962         12,932
Trade receivables, net                          12       113,221        136,078
Amounts due from joint ventures                  3        14,053         46,001
Amounts due from other related parties          27         6,806          9,258
Prepaid and accrued income                                14,148         27,228
Other current assets                            13        38,453         35,800
Time deposits                                   14        16,200         21,444
Cash and cash equivalents                       15        70,451         56,276


                                                      ----------      ---------
TOTAL CURRENT ASSETS                                     381,834        345,017
                                                      ----------      ---------

TOTAL ASSETS                                           1,203,119      1,870,930
                                                      ==========      =========


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




                                      F-2
<PAGE>


Consolidated balance sheets                               Millicom International
As of December 31, 2002 and 2001                                   Cellular S.A.
- --------------------------------------------------------------------------------




                                                            2002           2001
                                                        ------------------------

SHAREHOLDERS' EQUITY
  AND LIABILITIES                            Notes      US$ `000       US$ `000
- --------------------------------------------------------------------------------

 SHAREHOLDERS' EQUITY                           16

    Share capital and premium                            281,989        281,989
    Treasury stock                                       (54,521)       (52,033)
    Legal reserve                                          4,256          4,256
    Retained (loss) profit brought forward               (57,719)        80,334
    Loss for the year                                   (385,143)      (138,053)
    Revaluation reserve                                        -       (61,325)
    Currency translation reserve                         (84,121)      (46,274)

                                                        ---------     ----------
 TOTAL SHAREHOLDERS' EQUITY                             (295,259)         68,894
                                                        ---------     ----------

 Minority interest                                        23,733          10,262

 LIABILITIES

 NON-CURRENT LIABILITIES

    Deferred taxation                           21        26,874         20,507
    Borrowings
       Corporate subordinated debt              17       912,539        954,601
       Other debt and financing                 17       159,370        347,475
                                                       ---------      ---------
                                                       1,098,783      1,322,583
                                                       ---------      --------
 CURRENT LIABILITIES

    Other debt and financing                    17       156,666        153,898
    Trade payables                                        90,945        109,739
    Amounts due to shareholders                 27         4,021          7,158
    Amounts due to other related parties        27         6,487         11,304
    Other financial liabilities                  9             -         36,365
    Accrued interest and other expenses                   42,745         57,981
    Other current liabilities                   28        74,998         92,746
                                                       ---------      ----------
                                                         375,862        469,191
                                                       ---------      ----------
 TOTAL LIABILITIES                                     1,474,645      1,791,774
                                                       ---------      ----------

 TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES
                                                       1,203,119      1,870,930
                                                       =========      =========

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


                                      F-3
<PAGE>


<TABLE>
Consolidated statements of profit and loss                                                        Millicom International
for the years ended December 31, 2002, 2001 and 2000                                                        Cellular S.A
- ------------------------------------------------------------------------------------------------------------------------

                                                                                   2002             2001            2000
                                                               ---------------------------------------------------------
                                                               Notes           US$ '000         US$ '000        US$ '000

<S>                                                               <C>           <C>              <C>              <C>
Revenues                                                          18            605,186          644,570          570,840

Cost of sales                                                     18           (269,621)        (283,443)        (318,316)
                                                                             ----------       ----------       ----------
GROSS PROFIT                                                                    335,565          361,127          252,524

Sales and marketing                                                             (80,941)         (95,463)         (88,097)
General and administrative expenses                                            (164,703)        (172,912)        (174,177)
Gain (loss) from sale of subsidiaries and joint ventures, net     20             88,814           35,047          (2,755)
Other operating expenses                                         4, 20          (56,422)         (35,013)         (40,873)

                                                                             ----------       ----------       ----------
OPERATING PROFIT (LOSS)                                                         122,313           92,786          (53,378)

Profit (loss) from associated companies                           18                 62           (3,112)         (43,178)

                                                                             ----------       ----------       ----------
PROFIT (LOSS) BEFORE  FINANCIAL INCOME  (EXPENSE),  TAXES AND                   122,375           89,674         (96,556)
MINORITY INTEREST

(Loss) gain from investment securities                            20          (299,963)         (15,931)          665,262
Interest expense                                                  17          (185,959)        (209,912)        (196,002)
Interest income                                                                  12,726           22,768           28,395
Other income                                                     16,17           42,247           11,596                -
Fair value result on financial instruments                         9            (7,858)          (9,914)                -
Exchange loss, net                                                             (23,483)         (17,313)         (23,015)

                                                                             ----------       ----------       ----------
(LOSS) PROFIT BEFORE TAXES AND MINORITY INTEREST                              (339,915)        (129,032)          378,084
Charge for taxes                                                  21           (22,734)          (8,217)         (26,264)

                                                                             ----------       ----------       ----------
(LOSS) PROFIT BEFORE MINORITY INTEREST                                        (362,649)        (137,249)          351,820
Minority interest                                                              (22,494)            (804)            3,568

                                                                             ----------       ----------       ----------
NET (LOSS) PROFIT FOR THE YEAR                                                (385,143)        (138,053)          355,388
                                                                             ==========       ==========       ==========

Basic (loss) earnings per common share (US$)                      29             (23.60)           (8.46)           21.84
                                                                             ==========       ==========       ==========
Weighted average number of shares
  outstanding in the year (in 000's)                              29             16,318           16,314           16,273
                                                                             ==========       ==========       ==========
Diluted (loss) earnings per common  share, (US$)                  29             (23.60)           (8.46)           21.54
                                                                             ==========       ==========       ==========
Weighted average number of shares and
  diluted potential common shares (in 000's)                      29             16,318           16,314           16,500
                                                                             ==========       ==========       ==========
</TABLE>


                                      F-4
<PAGE>

<TABLE>
Consolidated statements of Cash Flows                                                      Millicom International
for the years ended December 31, 2002, 2001 and 2000                                                 Cellular S.A
- -----------------------------------------------------------------------------------------------------------------

                                                                       2002              2001                2000
                                                           ------------------------------------------------------
                                                           Notes     US $'000            US $'000        US $'000
                                                           ------------------------------------------------------


<S>                                                        <C>         <C>               <C>             <C>
Net cash provided by operating activities                  22          72,581            103,969         127,469
                                                                    ---------          ---------         -------

Cash flow from investing activities
Acquisition of subsidiaries and joint ventures,
  net of cash acquired                                     23          (2,000)            (22,978)        (27,399)
Increase in investment in associate company                                 -            (29,213)              -
Cash impact of change in consolidation method                               -                 470            366
Proceeds from the disposal of subsidiaries and
joint ventures, net of cash                                24         135,071             19,251              17
Purchase of licenses and other non-current assets
                                                                       (2,064)            (11,631)        (29,833)
Increase in deferred costs                                             (3,141)             (6,692)         (6,400)
Purchase of investments in securities                                    (186)             (1,728)        (11,646)
Proceeds from the disposal of investments in securities
                                                                      167,082             125,196          65,434
Purchase of tangible fixed assets                                    (135,818)           (192,178)       (182,771)
Disposal of tangible fixed assets                                         307              16,873           2,427
Increase in amounts due from joint venture partners
                                                                       (7,131)            (35,372)         (2,294)
Increase in pledged deposits                                          (16,506)            (39,083)         (2,414)
Decrease in time deposits                                               6,051              10,011          12,149
                                                                   ----------          ----------        --------
Net cash provided (used) by investing activities                      141,665            (167,074)       (182,364)
                                                                   ----------          ----------        --------

Cash flow from financing activities
Proceeds from the issuance of share capital                                 -                   -             774
Proceeds from the issuance of debt  and other financing
                                                                      182,828             379,957         276,778
Repayment of debt and other financing                                (363,584)           (358,294)       (173,563)
Proceeds from minority share of
  recapitalization of subsidiary                                            -                   -           4,206
Payment of dividends to minority interests                            (16,536)                  -               -
Proceeds from shareholders                                                  -                 905             516
Net (purchase) sale of treasury stocks                                 (2,488)                  8           3,797
                                                                   ----------          ----------        --------
Net cash (used) provided by financing activities
                                                                     (199,780)             22,576         112,508
                                                                   ----------          ----------        --------
Cash effect of exchange rate changes                                     (291)              1,884            (775)
                                                                   ----------          ----------        --------

Net increase (decrease) in cash and
  cash equivalents                                                     14,175           (38,645)           56,838
Cash and cash equivalents, beginning                                   56,276             94,921           38,083
                                                                   ----------          ----------        --------
Cash and cash equivalents, ending                                      70,451              56,276          94,921
                                                                   ==========          ==========        ========


     The accompanying notes are an integral part of these consolidated financial statements.
</TABLE>


                                                                          F-5
<PAGE>

<TABLE>

Consolidated Statements of Changes                                                                     Millicom International
in Shareholders' Equity                                                                                         Cellular S.A.
for the years ended December 31, 2002, 2001 and 2000
- ------------------------------------------------------------------------------------------------------------------------------
                                   -------------------------------------------------------------------------------------------
                                   Number of  Number of                                                   Profit
                                   shares     shares                                                      and loss    Other
                                   out-       held in      Share      Share       Treasury   Revaluation  account     Reserves
                                   Standing   the Group    Capital    premium     stock      reserve      (Restated)  (i)
                                   ---------  ---------    --------   --------    --------   -----------  ----------  --------
                                      `000       `000      US$ `000   US$ `000    US$ `000   US$ `000     US$ `000    US$ `000
                                   ---------  ---------    --------   --------    --------   ----------   ----------  --------
<S>                                  <C>        <C>         <C>        <C>        <C>         <C>        <C>          <C>
Balance as of December 31, 1999      70,737     (22,036)    141,474    136,742    (55,838)    333,778    (225,828)    (35,499)

Transfer to legal reserve              --          --          --         --         --          --          (613)        613

Shares issued via the  exercise          13         150          26        748      3,797        --          --          --
of options during the year

Profit for the year                    --          --          --         --         --          --       355,388        --

Movement in revaluation reserve        --          --          --         --         --      (316,042)       --          --

Movement in currency translation       --          --          --         --         --          --          --         2,445
reserve

                                   --------    --------    --------   --------   --------    --------    --------    --------
Balance as of December 31, 2000      70,750     (21,886)    141,500    137,490    (52,041)     17,736     128,947     (32,441)

Cumulative effect of adopting          --          --          --         --         --          --       (45,264)       --
IAS 39 (ii)

                                   --------    --------    --------   --------   --------    --------    --------    --------
Restated balance as of January       70,750     (21,886)    141,500    137,490    (52,041)     17,736      83,683     (32,441)
1, 2001

Transfer to legal reserve              --          --          --         --         --          --        (3,349)      3,349

Shares issued/sold via the             --             1        --         --            8        --          --          --
 exercise of options  during the
 year

Loss for the year                      --          --          --         --         --          --      (138,053)       --

Issuance of Shares                      374        --           749      2,250       --          --          --          --

Movement in revaluation reserve        --          --          --         --         --       (79,061)       --          --

 Movement in currency                  --          --          --         --         --          --          --       (12,926)
 translation reserve

                                   --------    --------    --------   --------   --------    --------    --------    --------
Balance as of December 31, 2001      71,124     (21,885)    142,249    139,740    (52,033)    (61,325)    (57,719)    (42,018)

Shares issued/sold via the             --          --          --         --         --          --          --          --
 exercise of options during the
 year

Loss for the year                      --          --          --         --         --          --      (385,143)       --

Shares purchased during the year       --          (386)       --         --       (2,488)       --          --          --
Effect of reverse stock split       (47,416)     14,847        --         --         --          --          --          --

 Prolonged decrease in  market         --          --          --         --         --        61,325        --          --
value

 Movement in currency                  --          --          --         --         --          --          --       (37,847)
translation reserve

                                   --------    --------    --------   --------   --------    --------    --------    --------
Balance as of December 31, 2002      23,708      (7,424)    142,249    139,740    (54,521)       --      (442,862)    (79,865)
                                   ========    ========    ========   ========   ========    ========    ========    ========

(i) Other  reserves  at  December  31,  2002  consist  of  a  $(84,121,000)  currency  translation  reserve  (2001:  $(46,274,000),
    2000: $(33,348,000)) and a $4,256,000 legal reserve (2001: $4,256,000, 2000: $907,000 ).

(ii)  See Note 2r.

The accompanying notes are an integral part of these consolidated financial statements.
</TABLE>


                                      F-6
<PAGE>


Notes to the Consolidated Annual Accounts                 Millicom International
As of December 31, 2002 and 2001                                   Cellular S.A.
- --------------------------------------------------------------------------------


1.   ORGANIZATION

Millicom International Cellular S.A. (the "Company"), a Luxembourg Societe
Anonyme, and its subsidiaries, joint ventures and associated companies (the
"Group" or "MIC") is a global telecommunications investor with cellular
operations in Latin America, Asia and Africa. As of December 31, 2002, the
Company had interests in 16 cellular operations in 15 countries. In addition,
MIC provides high-speed wireless data services in five countries. MIC also has a
6.8% interest in Tele2 AB. Tele2 AB is an alternative pan-European
telecommunications company offering fixed and mobile telephony, data network and
internet services in 22 countries. The Company's shares are traded on the NASDAQ
National Market under the symbol MICC and on the Luxembourg stock exchange. The
Company has its registered office at 75, Route de Longwy, L-8080, Bertrange,
Grand-Duchy of Luxembourg.

MIC's cellular interests ("MIC Cellular") operate through strategic operating
entities principally focused on major geographic regions of the world:

Sanbao Telecom (Asia)
MIC Latin America
MIC Africa

In 2001, MIC disposed of FORA Telecom, its Russian segment (Note 20). In
November 2002, MIC disposed of MIC Systems, its GSM clearing-house.

The Group was formed in December 1990 when Industriforvaltnings AB Kinnevik
("Kinnevik"), a company established in Sweden, and Millicom Incorporated
("Millicom"), a corporation established in the United States of America,
contributed their respective interests in international cellular joint ventures
to form the Group. During 1992, the Group was restructured under a new ultimate
parent company, maintaining the same name. On December 31, 1993, Millicom was
merged ("the Merger") into a wholly owned subsidiary of MIC, MIC-USA Inc
("MIC-USA") a Delaware corporation, and the outstanding shares of Millicom's
common stock were exchanged for approximately 46.5% of MIC's common stock
outstanding at that time.

As of December 31, 2002, Kinnevik owns approximately 36% of MIC.

2.   SUMMARY OF CONSOLIDATION AND ACCOUNTING POLICIES

Basis of preparation

The consolidated financial statements of the Group are presented in US dollars
and have been prepared in accordance with International Financial Reporting
Standards ("IFRS") as published by the International Accounting Standards Board.
The consolidated financial statements have been prepared under the historical
cost convention as modified by the revaluation of certain financial assets and
liabilities. These consolidated financial statements are not prepared for the
purposes of statutory filing.

The Group has experienced significant losses during the last two years and has
negative equity of $295,259,000 at December 31, 2002. The Group has substantial
outstanding debt, significant debt service obligations and capital requirements.
Management of the Group has taken certain measures to restructure the operations
of the Group and reduce the extent of its obligations. This has included the
disposal of certain businesses and investments during 2002 (see Note 20) and
subsequent to the end of the year (see Note 31). Further, the Group has made an
exchange offer


                                      F-7
<PAGE>


Notes to the Consolidated Annual Accounts                 Millicom International
As of December 31, 2002 and 2001                                   Cellular S.A.
- --------------------------------------------------------------------------------


to holders of the Senior Subordinated Discount Notes (see Note 17 for a
description of the Senior Subordinated Discount Notes, and Note 31 for a
description of the exchange offer). Management expects that the Group will
generate sufficient cash from operations to meet its obligations as they come
due and the financial statements have been prepared on the basis that the Group
is a going concern.

The preparation of financial statements in conformity with generally accepted
accounting principles requires the use of estimates and assumptions that affect
the reported amounts of assets and liabilities and disclosure of contingent
assets and liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period. Although these
estimates are based on management's best knowledge of current event and actions,
actual results ultimately may differ from those estimates.

Beginning on January 1, 2001, IAS 39, "Financial Instruments: Recognition and
Measurement" became effective. The statement required that all financial assets
and financial liabilities, including derivatives, be recognized on the balance
sheet. Upon adoption of IAS 39, the Group recorded a cumulative adjustment,
reflected in shareholders' equity, related to the options and other contracts as
discussed in note 9, of $45,264,000.

The consolidated financial statements are prepared in accordance with the
following significant consolidation and accounting policies:

     a) Group accounting

Subsidiaries
Subsidiaries, which are those entities (including Special Purpose Entities) in
which the Group has an interest of more than one half of the voting rights or
otherwise has power to govern the financial and operating policies, are
consolidated.

The existence and effect of potential voting rights that are presently
exercisable or presently convertible are considered when assessing whether the
Group controls another entity.

Subsidiaries are consolidated from the date on which control is transferred to
the Group and are no longer consolidated from the date that control ceases. The
purchase method of accounting is used to account for the acquisition of
subsidiaries. The cost of an acquisition is measured as the fair value of the
assets given up, shares issued or liabilities undertaken at the date of
acquisition plus costs directly attributable to the acquisition. The excess of
the cost of acquisition over the fair value of the net assets of the subsidiary
acquired is recorded as goodwill. See note 2(b) for the accounting policy on
goodwill. Intercompany transactions, balances and unrealized gains on
transactions between Group companies are eliminated; unrealized losses are also
eliminated unless cost cannot be recovered. Where necessary, accounting policies
of subsidiaries have been changed to ensure consistency with the policies
adopted by the Group.

Associates
Investments in associates are accounted for by the equity method of accounting.
Under this method the Company's share of the post-acquisition profits or losses
of associates is recognized in the income statement and its share of
post-acquisition movements in reserves is recognized in reserves. The cumulative
post-acquisition movements are adjusted against the cost of the investment.
Associates are entities over which the Group generally has between 20% and 50%
of the voting rights, or over which the Group has significant influence, but
which it does not control.


                                      F-8
<PAGE>


Notes to the Consolidated Annual Accounts                 Millicom International
As of December 31, 2002 and 2001                                   Cellular S.A.
- --------------------------------------------------------------------------------


Unrealized gains on transactions between the Group and its associates are
eliminated to the extent of the Group's interest in the associates; unrealized
losses are also eliminated unless the transaction provides evidence of an
impairment of the asset transferred. The Group's investment in associates
includes goodwill (net of accumulated amortization) on acquisition. When the
Group's share of losses in an associate equals or exceeds its interest in the
associate, the Group does not to recognize further losses, unless the Group has
incurred obligations or made payments on behalf of the associates.

Joint ventures

Entities that are jointly controlled are consolidated using the proportional
method which combines the Group's assets, liabilities, income and expenses with
the Group's share of the assets, liabilities, income and expenses of the joint
ventures in which the Group has an interest.

The Group recognizes the portion of gains or losses on the sale of assets by the
Group to the joint venture that is attributable to the other venturers. The
Group does not recognize its share of profits or losses from the joint venture
that result from the purchase of assets by the Group from the joint venture
until it resells the assets to an independent party. However, if a loss on the
transaction provides evidence of a reduction in the net realizable value of
current assets or an impairment loss, the loss is recognized immediately.

     b) Goodwill

     The excess of cost of an acquisition over the Group's interest in the fair
value of the net identifiable assets of the acquired subsidiary, associate or
joint venture at the date of transaction is recorded as Goodwill and recognized
as an asset in the balance sheet. Goodwill is amortized using the straight-line
method over its estimated useful life but not longer than 20 years. Goodwill on
associates is included in their carrying value in the caption "Investments in
associated companies".

At each balance sheet date the Group assesses whether there is any indication of
impairment. If such indications exist an analysis is performed to assess whether
the carrying amount of goodwill is fully recoverable. A write-down is made if
the carrying amount exceeds the recoverable amount.

Negative goodwill represents the excess of the fair value of the Group's share
of the net assets acquired over the cost of acquisition. Negative goodwill is
presented in the same balance sheet classifications as goodwill. To the extent
that negative goodwill relates to expectations of future losses and expenses
that are identified in the Group's plan for the acquisition and can be measured
reliably, but which do not represent identifiable liabilities, that portion of
negative goodwill is recognized in the income statement when the future losses
and expenses are recognized. Any remaining negative goodwill, not exceeding the
fair values of the identifiable non-monetary assets acquired, is recognized in
the income statement over the remaining weighted average useful life of the
identifiable acquired depreciable/amortizable assets; negative goodwill in
excess of the fair values of those assets is recognized in the income statement
immediately.


                                      F-9
<PAGE>


Notes to the Consolidated Annual Accounts                 Millicom International
As of December 31, 2002 and 2001                                   Cellular S.A.
- --------------------------------------------------------------------------------


     c) Licenses

The carrying value of licenses for the right to provide mobile cellular,
wireless and other telephone services as well as related ancillary services held
by joint ventures and subsidiaries is disclosed in note 5.

The Group operates in an industry that is subject to changes in competition,
regulation, technology and subscriber base evolution. In addition, the terms of
the licenses, which have been awarded for various periods, are subject to
periodic review for, amongst other things, rate making, frequency allocation and
technical standards. Licenses are amortized using the straight-line basis over
periods of five to 20 years depending on the term of the license. Licenses held,
subject to certain conditions, are renewable and are generally non-exclusive.
MIC does not currently expect any of the Group's telephone operations to be
required to cease due to license reviews and renewals. Under the terms of the
respective licenses, the joint ventures and subsidiaries are entitled to enter
into interconnection agreements with operators of both landline and other
cellular systems.

     d)  Deferred costs

The Group capitalizes internal software development costs. The capitalization of
these costs begins when a software package's technological feasibility has been
established and the costs can be measured reliably and ends when the software
package is completed and ready for use. On completion of each software package,
such costs are amortized on a straight-line basis over three to five years with
a periodic evaluation as to their ultimate realization. The majority of these
costs related to Multinational Automated Clearing House SA ("MACH"), a
subsidiary developing clearing services for Global System for Mobile
Communications ("GSM") operators.

     e)  Tangible assets

Tangible assets are stated at cost and are depreciated over their estimated
useful lives using the straight-line method. All repairs and maintenance
expenditures are expensed as they occur.

Maximum estimated useful lives are:

                  Buildings                40 years or life of lease if lower
                  Networks                 five to ten years
                  Other                    two to seven years

Construction in progress consists of the cost of labor and other direct costs
associated with tangible assets being constructed by the Group.

Costs directly associated with the establishment of new networks are recorded as
construction in progress in tangible fixed assets in the consolidated balance
sheets. Such costs are primarily related to engineering and design work for the
installation of the network and systems integral to its operation. The
amortization of these costs commences on the date that the network becomes
operational.

The cost of major renovations is included in the carrying amount of the asset
when it is probable that future economic benefits in excess of the originally
assessed standard of performance of the existing asset will flow to the Group.
Major renovations are depreciated over the remaining useful life of the related
asset.


                                     F-10
<PAGE>


Notes to the Consolidated Annual Accounts                 Millicom International
As of December 31, 2002 and 2001                                   Cellular S.A.
- --------------------------------------------------------------------------------


     f) Inventories


Inventories consist of cellular telephone equipment and related accessories,
which are classified as trading inventory, and network equipment spares, which
are classified as non-trading inventory. Inventory is stated at the lower of
cost or market value, with cost determined on a first-in, first-out basis and
market value based on the estimated net realizable value.

     g)  Time and pledged deposits


Time deposits represent cash deposits with banks that earn interest at market
rates and have maturity periods of between six and nine months.

Pledged deposits represent contracted cash deposits with banks that are held as
security for debts either at the corporate or operational entity level. MIC is
unable to access these funds until either the relevant debt is repaid or
alternative security is arranged with the lender.

     h)  Cash and cash equivalents

Highly liquid investments with an original maturity of three months or less are
considered to be cash equivalents.

Cash and cash equivalents are carried in the balance sheet at cost. For the
purposes of the cash flow statement, cash and cash equivalents comprise cash on
hand, deposits held at call with banks and other short-term highly liquid
investments with original maturities of three months or less. Bank overdrafts
are included within other debt and financing in current liabilities on the
balance sheet.

     i)  Foreign currency translation


    i) Reporting and measurement currency

The measurement currency of the Group is the US dollar. The Company is located
in Luxembourg and its subsidiaries, joint ventures and associated companies
operate in different currencies. The measurement currency of the Company is the
US dollar because of the significant influence of the US dollar on its
operations. The measurement currency of each subsidiary, joint venture and
associated company, where these are foreign entities, is determined in
accordance with the requirements of SIC 19 `Reporting Currency - Measurement and
Presentation of Financial Statements under IAS 21 and IAS 29'.

     ii) Transactions and balances

In the financial statements of Group entities, transactions denominated in
foreign currencies are recorded in the local currency at the actual exchange
rate existing at the date of the transaction. Monetary assets and liabilities
denominated in foreign currencies at the year-end are reported at the exchange
rates prevailing at the year-end. Any gain or loss arising from a change in
exchange rates subsequent to the date of the transaction is included as an
exchange gain or loss in the consolidated statements of profit and loss.

                                     F-11
<PAGE>


Notes to the Consolidated Annual Accounts                 Millicom International
As of December 31, 2002 and 2001                                   Cellular S.A.
- --------------------------------------------------------------------------------


For the purposes of consolidating joint ventures and subsidiaries that report in
currencies other than US dollars, the balance sheets are translated using the
closing rate method. Profit and loss accounts are translated at the average
exchange rate during the year. Foreign exchange gains and losses arising from
the translation of financial statements are recorded as a separate component of
shareholders' equity.

The following is a table of the principal currency translation rates to the US
dollar as of December 31, 2002 and 2001 and the average rates for the year ended
December 31, 2002.

                                       2002             2002           2001
Country               Currency     Average rate    Year-end rate   Year-end rate
- --------------------------------------------------------------------------------

Argentina             Pesos             3.15             3.36           1.00
El Salvador           Colon             8.75             8.75           8.75
Ghana                 Cedi          7,957.19         8,400.00       7,400.00
Guatemala             Quetzal           7.81             7.64           7.91
Honduras              Lempira          16.39            16.92          15.88
India                 Rupee            48.56            47.97          48.22
Luxembourg            Euro              1.06             0.95           1.12
Mauritius             Rupee            29.96            29.30          30.25
Pakistan              Rupee            59.50            58.25          59.90
Paraguay              Guarani       5,697.27         7,150.00       4,635.00
Philippines           Peso             51.74            53.60          51.60
Senegal               CFA franc       696.21           625.76         736.70
Sierra Leone          Leone         2,058.09         1,970.00       2,091.00
Sri Lanka             Rupee            95.56            96.73          93.16
Tanzania              Shilling        960.69           963.00         917.00
United Kingdom        Pound             0.67             0.62           0.69

Unrealized gains and losses arising from changes in foreign currency exchange
rates are not cash flows. However, the effect of exchange rate changes on cash
and cash equivalents held or due in a foreign currency is reported in the cash
flow statement in order to reconcile cash and cash equivalents at the beginning
and end of the period.

Foreign exchange risk
MIC seeks to reduce its foreign currency exposure through a policy of matching,
as far as possible, assets and liabilities denominated in foreign currencies. In
some cases, MIC may borrow in US dollars because it is either advantageous for
joint ventures and subsidiaries to incur debt obligations in US dollars or
because US dollar-denominated borrowing is the only funding source available to
a joint venture or subsidiary. In these circumstances, MIC has currently decided
to accept the remaining currency risk associated with the financing of its joint
ventures and subsidiaries, principally because of the relatively high cost of
forward cover in the currencies of the countries in which the Group operates.

     j) Revenue recognition

The Group revenue sources in the consolidated income statement comprise the
following:

Revenues from provision of telecom services
These recurring revenues consist of monthly subscription fees, airtime usage
fees, interconnection fees, roaming fees, revenue from the provision of data
clearing services and other telecommunications services such as data services
and short message services. Recurring revenues are recognized on an accrual
basis, i.e. as the related services are rendered. Unbilled


                                     F-12
<PAGE>


Notes to the Consolidated Annual Accounts                 Millicom International
As of December 31, 2002 and 2001                                   Cellular S.A.
- --------------------------------------------------------------------------------


revenues for airtime usage and subscription fees resulting from services
provided from the billing cycle date to the end of each month are estimated and
recorded.

Connection revenues
Initial connection fees are recognized when charged, i.e. upon initial signing
of the contract with customers.

Equipment revenues
These revenues consist of the sale of handsets and accessories. Revenues from
these sales are recognized at the time that the item is delivered to the
customer.

     k) Prepaid cards

Prepaid cards allow the forward purchase of a specified amount of airtime by
customers. Revenues are recognized as credit is used. Unutilized airtime is
carried in the balance sheet and is included under deferred income within other
current liabilities.

     l) Cost of sales

The primary cost of sales incurred by the Group in relation to the provision of
telecommunication services relates to interconnection costs, roaming costs,
rental of channel, costs of handsets and other accessories sold and commissions
payable to agents for obtaining customers on behalf of the Group. Costs of sales
are recorded on an accrual basis.

Cost of sales also includes the depreciation, amortization and impairment of
network equipment (Note 2 e) and licenses (Note 2 c).

     m) Customer acquisition costs

Specific customer acquisition costs, including handset subsidies and free phone
promotions, are charged to sales and marketing when the subscriber is activated.
Advertising costs are charged to sales and marketing when incurred and amounted
to $24,914,000 for the year ended December 31, 2002 (2001: $31,376,000; 2000 :
$30,065,000).

     n) Leases

Operating lease rentals are charged to the profit and loss account on a
straight-line basis over the life of the lease.

Leases of property, plant and equipment where the Group has substantially all
the risks and rewards of ownership are classified as finance leases. Finance
leases are capitalized at the inception of the lease at the lower of the fair
value of the leased property or the present value of the minimum lease payments.
Each lease payment is allocated between the liability and finance charges so as
to achieve a constant rate on the finance balance outstanding. The corresponding
rental obligations, net of finance charges, are included in borrowings. The
interest element of the finance cost is charged to the income statement over the
lease period so as to produce a constant periodic rate of interest on the
remaining balance of the liability for each period. The property, plant and
equipment acquired under finance leases are depreciated over the shorter of the
useful life of the asset or the lease term.


                                     F-13
<PAGE>


Notes to the Consolidated Annual Accounts                 Millicom International
As of December 31, 2002 and 2001                                   Cellular S.A.
- --------------------------------------------------------------------------------


     o)  Taxation

The companies of the Group are subject to taxation in the countries in which
they operate. Corporate tax, including deferred taxation where appropriate, is
applied at the applicable current rates on their taxable profits. Deferred
income taxes are determined using the liability method whereby the future
expected consequences of temporary differences between the tax bases of assets
and liabilities and their reported amounts in the financial statements are
recognized as deferred tax assets and liabilities.

     Deferred tax assets are recognized to the extent that it is probable that
future taxable profit will be available against which the temporary differences
can be utilized.

     Deferred income tax is provided on temporary differences arising on
investments in subsidiaries, associates and joint ventures, except where the
timing of the reversal of the temporary difference can be controlled and it is
probable that the temporary difference will not reverse in the foreseeable
future.

     p)  (Loss) earnings per common share

Basic (loss) earnings per common share are based on the (loss) profit for the
year divided by the weighted average number of common shares outstanding during
the year. Diluted (loss) earnings per share is calculated by dividing the net
income attributable to ordinary shareholders by the sum of the weighted average
number of common shares outstanding and the dilutive effect of the weighted
average number of dilutive potential ordinary shares.

     q)  Amounts due from joint ventures

In the ordinary course of business, the Company advances cash to fund operations
of the joint ventures. During consolidation of the Group's financial statements,
certain amounts are eliminated based on the Company's ownership percentage in
each joint venture. The remaining amount represents the partner's share of the
joint venture's payable to the Company.

     r)  Financial instruments

A financial instrument is any contract that gives rise to both a financial asset
of one enterprise and a financial liability or equity instrument of another
enterprise. After the initial recognition, the Group revalues financial assets
held as available-for-sale and derivatives at fair value.

Fair value is defined as the amount at which the instrument could be exchanged
in a current transaction between knowledgeable willing parties in an arm's
length transaction, other than in a forced or liquidation sale. Fair values are
obtained from quoted market prices, discounted cash flow models and
option-pricing models using management's estimates as appropriate.

Investment in securities

The Company has classified all of its financial assets and financial liabilities
in accordance with the categories identified in IAS 39. Management considers all
of the Group's investments in marketable and non-marketable equity securities,
other than subsidiaries, joint ventures and associated companies, to be
available for sale.


                                     F-14
<PAGE>


Available-for-sale securities are reported at fair value with net unrealized
gains or losses reported within shareholders' equity under the caption
"Revaluation reserve". Realized gains and losses are computed on an average cost
basis and are recorded in the profit and loss statement.

When securities classified as available-for-sale are sold or impaired or when
there is a significant and prolonged decline in the fair value below acquisition
cost, the accumulated fair value adjustments are included in the income
statement as gains and losses from investment securities.

The Group determines the fair value of its investment in securities, which is
comprised of available-for-sale securities, based on quoted market prices. The
fair value of non-marketable securities is based on management's best estimate
of the amount at which the securities could be sold in a current transaction.

Unquoted available-for-sale equity investments are reviewed for impairment
losses every balance sheet date and whenever events or changes in circumstances
indicate that the carrying amount may not be recoverable. When a review for
impairment is conducted, the recoverable amount is assessed by reference to the
net present value of expected future cash inflows. The discount rate applied is
based upon the entities' weighted average cost of capital with appropriate
adjustment for the risks associated with the investment under assessment. When
the level of information available to calculate the net present value of
expected future cash inflows makes this exercise unworkable, management uses
different valuation techniques to estimate whether there is objective evidence
of impairment and to determine the likely amount of impairment, if any.

Other current financial assets and liabilities

The fair value of the other current financial assets and liabilities due within
one year approximate the carrying value disclosed in the financial statements
due to the short-term nature on which these transactions settle. Current assets,
on which provisions are necessary, are netted against that provision to reflect
the estimated amount that will be settled.

Borrowings

Borrowings are recognized initially at the proceeds received, net of transaction
costs incurred. Borrowings are subsequently stated at amortized cost using the
effective yield method; any difference between proceeds (net of transaction
costs) and the redemption value is recognized in the income statement over the
period of the borrowings.

Corporate subordinated debt consists of 13,5 % Senior Subordinated Discount
Notes due in 2006 (Note 17). These were issued at a discount and were initially
recorded based on the face value less the un-amortized discount. The discount
between the issue and redemption values is amortized through the interest
expense account in the income statement at a constant percentage of the balance
sheet carrying value. The corresponding amount is added to the balance sheet
carrying value of the notes for each period up to the commencement of the
payment of cash interest.

Borrowings due after more than one year, excluding corporate subordinated debt
and subordinated debt notes in Colombia, primarily comprises bank loans bearing
market rates of interest that vary on a regular basis.


                                     F-15
<PAGE>


Notes to the Consolidated Annual Accounts                 Millicom International
As of December 31, 2002 and 2001                                   Cellular S.A.
- --------------------------------------------------------------------------------


Derivative financial instruments

IAS 39 requires that all financial assets and financial liabilities, including
derivatives, be recognized on the balance sheet. Derivatives are initially
recorded at cost either in other current assets or other financial liabilities
as applicable and then are re-measured to fair value through the statement of
profit and loss under the caption "Fair value result on financial instruments".
Upon adoption of IAS 39, the Company recorded a cumulative adjustment related to
these derivatives, reflected in shareholders' equity of $45,264,000. See note 9
for further description and fair value of the derivatives.

Certain derivatives embedded in other financial instruments, such as call and
put options related to the Company subordinated debt (Note 17), are treated as
separate derivatives when their risks and characteristics are not closely
related to those of the host contract and the host contract is not carried at
fair value with unrealized gains and losses reported in income.

Trade receivables
Trade receivables are carried at original invoice amount less provision made for
impairment of these receivables. A provision for impairment of trade receivables
is established when there is objective evidence that the Group will not be able
to collect all amounts due according to the original terms of receivables. The
amount of the provision is the difference between the carrying amount and the
recoverable amount, being the present value of expected cash flows, discounted
at the market rate of interest for similar borrowers.

     s)  Risk management


Liquidity Risk
The Group has incurred significant indebtedness but evaluates its ability to
meet its obligations on an ongoing basis. Based on these evaluations, the Group
devises strategies to manage its liquidity risk, including the designation of
certain assets as available for sale.

Credit Risk
Financial instruments that potentially subject the Group to concentrations of
credit risk are primarily cash and cash equivalents, time and pledge deposits,
letters of credit, available-for-sale securities and accounts receivable. The
counter-parties to the agreements relating to the Group's cash and cash
equivalents, time deposits, pledge deposits and available-for-sale securities
are significant financial institutions. Management does not believe there is a
significant risk of non-performance by these counter-parties. Accounts
receivable are derived from the provision of telecom services to a large number
of customers, including businesses and individuals as well as local
telecommunications companies and the related concentration of credit risk is
therefore limited. The Group maintains a provision for impairment of trade
receivables based upon the expected collectability of all trade accounts
receivable.


                                     F-16
<PAGE>


     t)  Impairment of non-financial assets

The recoverability of the Group's assets, including its intangible assets, is
subject to the future profitability of the Group's operations and the evolution
of the business in accordance with its plans. In evaluating the recoverability
of its assets, the value and future benefits of the Group's operations are
periodically reviewed by management based on technological, regulatory and
market conditions. When certain operational and financial factors indicate an
impairment of value, the Group evaluates the carrying value of property, plant
and equipment as well as other assets including licenses and goodwill, in
relation to the operating performance, and future cash flows of the underlying
assets. When indicated, the impairment losses are measured based on the
difference between the estimated recoverable amount and the carrying amount of
the asset. Management's estimates of recoverable amounts for the individual
asset or, if not possible, the cash-generating unit, are based on prices of
similar assets, to the extent available in the circumstances, and the result of
valuation techniques. These include net present values of estimated future cash
flows and valuations based on market transactions in similar circumstances. For
new product launches where no comparable market information is available,
management bases its view on recoverability primarily on cash flow forecasts. In
addition to the evaluation of possible impairment to the assets' carrying value,
the foregoing analysis also evaluates the appropriateness of the expected useful
lives of the assets. In 2002, 2001 and 2000, management recorded a non-cash
charge related to the impairment of certain assets (Note 20).

     u)  Segment reporting

Business segments provide products or services that are subject to risks and
returns that are different from those of other business segments. Geographical
segments provide products or services within a particular economic environment
that is subject to risks and returns that are different from those of components
operating in other economic environments.

     v)  Comparatives

When necessary, and in particular in the consolidated income statement,
comparative figures have been adjusted to conform with changes in presentation
in the current year.

     w)   Equity compensation benefits

Share options are granted to management and key employees. Options are granted
at the market price of the shares on the date of the grant and are exercisable
at that price. Options are exercisable beginning three years from the date of
grant and have a contractual option term of six years. When the options are
exercised, the proceeds received net of any transaction costs are credited to
share capital (nominal value) and share premium. The Group does not make a
charge to staff costs in connection with share options.


                                     F-17
<PAGE>


Notes to the Consolidated Annual Accounts                 Millicom International
As of December 31, 2002 and 2001                                   Cellular S.A.
- --------------------------------------------------------------------------------


3.     JOINT VENTURES AND SUBSIDIARIES

     a)  Joint ventures

The following companies have been proportionally consolidated as joint ventures:

<TABLE>
                                                                      Holding         Holding
                                                                    December 31,   December 31,
Name of the company                         Country                     2002           2001
- -------------------------------------------------------------------------------------------------
                                                                  %   of   share %   of    share
                                                                  capital owned  capital owned
                                                                  -------------------------------
<S>                                         <C>                             <C>             <C>

Sanbao Telecom (Asia)
    Cam GSM Company Limited                 Cambodia                        58.4            58.4
    Royal Telecam International Limited     Cambodia                        57.0            57.0
                                            Lao People's
    Millicom Lao Co. Ltd. (i)               Democratic Republic             78.0               -
    Emtel Limited                           Mauritius                       50.0            50.0
    Express Telecommunications Co Inc (ii)  Philippines                        -            40.0

MIC Latin America
    Comunicaciones Celulares SA             Guatemala                       55.0            55.0
    Inversiones Rocafuerte SA               Honduras                        50.0            50.0

MIC Africa
                                            Democratic Republic
    Cellco sarl (iii)                       of Congo                           -            50.9
    MIC Tanzania Limited                    Tanzania                        57.0            57.0

Other
    Millicom Argentina SA                   Argentina                       65.0            65.0

</TABLE>

(i)  In January 2002, the Company was awarded a license to provide a GSM
     service. It is expected that services will commence in the first half of
     2003.

(ii) The Company had an additional beneficial ownership of 7.9% in Express
     Telecommunications Co. Inc. through intermediary holding companies, which
     is included in the consolidated results. In December 2002, MIC sold its
     interest in Express Telecommunications Co. Inc.

(iii) In September 2002, MIC disposed of its interest in Cellco sarl.


The Directors have determined the existence of joint control by reference to the
joint venture agreements, articles of association, structures and voting
protocols of the Boards of Directors, of the above ventures.

The following amounts have been consolidated into the Group accounts
representing the Group's share of assets, liabilities, income and expenses in
the above ventures, excluding divested operations.


                                     F-18
<PAGE>
Consolidated balance sheets                               Millicom International
As of December 31, 2002 and 2001                                   Cellular S.A.
- --------------------------------------------------------------------------------

<TABLE>
                                                          2002            2001            2000
                                                      -------------- --------------- ---------------
                                                        US$ `000        US$ `000        US$ `000
                                                      -------------- --------------- ---------------

<S>                                                      <C>             <C>             <C>
Revenues                                                 186,935         180,704         123,626
Total operating expenses                                (141,422)       (135,763)        (95,745)
Operating profit                                          45,513          44,941          27,881

Tangible assets                                          134,439         125,893         108,579
Fixed fee licenses, net                                      401             451           1,241
Deferred costs and other non-current assets, net           2,352           2,361           1,747
Total non-current assets                                 138,079         131,140         111,588
Current assets                                            71,237          58,841          48,273
Amounts due from joint ventures to MIC                   (14,053)        (14,827)         (7,763)
Non-current liabilities                                  (40,358)        (35,334)        (24,724)
Current liabilities                                      (65,875)        (82,804)        (70,957)

Cash flow:
  Cash generated from operating activities                46,791          34,251          43,650
  Cash flow from investing activities                    (30,879)        (32,103)         46,788
  Cash flow from financing activities                    (21,146)        (13,350)        (75,669)
</TABLE>













                                     F-19
<PAGE>
Consolidated balance sheets                               Millicom International
As of December 31, 2002 and 2001                                   Cellular S.A.
- --------------------------------------------------------------------------------


     b)  Subsidiary companies


The Group has the following significant subsidiary companies:

<TABLE>
                                                                        Holding          Holding
                                                                      December 31,    December 31,
Name of the company                                Country                2002            2001
- --------------------------------------------------------------------------------------------------
                                                                      % of share      % of share
                                                                    capital owned    capital owned
                                                                    ------------------------------
<S>                                                <C>                     <C>             <C>
  SANBAO Telecom (Asia)
    Celltel Lanka Limited                          Sri Lanka               99.9            99.9
    Comvik International (Vietnam) AB (i)          Vietnam                 80.0            90.0
    Pakcom Limited                                 Pakistan                61.3            61.3
   Paktel Limited                                  Pakistan                98.9            98.9
  MIC Latin America
    Telefonica Celular de Bolivia SA               Bolivia                100.0           100.0
    Celcaribe SA (ii)                              Colombia                95.4            92.7
    Telefonica Celular del Paraguay SA             Paraguay                96.0            96.0
  MIC Africa
    Millicom (Ghana) Limited (iii)                 Ghana                  100.0            70.0
    Sentel GSM                                     Senegal                 75.0            75.0
    Millicom Sierra Leone LTD                      Sierra Leone            70.0            70.0
  Other
     Cybertwiga Limited                            Tanzania               100.0           100.0
    GisMo SA (vi)                                  Luxembourg               -             100.0
    GisMo Finance SA (vi)                          Luxembourg               -             100.0
    Millicom Peru SA                               Peru                   100.0           100.0
     Liberty Broadband Limited (vii)               United Kingdom           -             100.0

  MIC Systems (v)
     Multinational Automated Clearing House SA     Luxembourg               -             100.0
     Magellan SA                                   Luxembourg               -             100.0
      Globalport SA                                Luxembourg               -             100.0
        Interfact SA                               Luxembourg               -             100.0
  Unallocated
     Millicom International Operations SA          Luxembourg             100.0           100.0
     MIC-USA Inc                                   United States          100.0           100.0
     Millicom Holding BV                           Netherlands            100.0           100.0
     Millicom International Operations BV          Netherlands            100.0           100.0
     Millicom  Telecommunications BV               Netherlands            100.0           100.0
     Millicom Telecommunications SA                Luxembourg             100.0           100.0
     MIC Systems BV (iv)                           Netherlands             83.0           100.0
     MIC Latin America BV                          Netherlands            100.0           100.0
Millicom International BV                          Netherlands            100.0           100.0
</TABLE>





                                     F-20
<PAGE>


 (i)  Comvik International (Vietnam) AB ("CIV"), a 80% owned subsidiary of the
      Company, and Vietnam Mobile Services Co. ("VMS") have entered into a
      revenue sharing agreement to operate a national cellular GSM system in
      Vietnam ("Mobifone"). This revenue sharing agreement, which had a ten year
      term starting July 1, 1995, provided that CIV would be entitled to receive
      50% of Mobifone's net revenues for the first five years of operation and
      40% thereafter. In October 2000, the revenue sharing agreement was amended
      and stated that MIC would continue to receive 50% of net revenue in years
      six through ten of the contract agreement. CIV initially contracted to
      invest $128 million in the venture. Such commitment has been met as of
      December 31, 2002. As part of the amendment in 2000, and a further
      amendment in 2001, CIV committed to invest an additional minimum of $65
      million, of which approximately $18 million has been disbursed as of
      December 31, 2002. At the time the revenue sharing agreement expires in
      2005, legal title to all equipment shall be transferred to VMS at a price
      of $1. Negotiations are ongoing to extend the life of the revenue sharing
      agreement for a significant period of time. In July 2002, MIC's partner
      exercised his right to acquire an additional 10% in the operation (Note
      20b).

 (ii) In 2002, the Company increased its ownership throughout the year to arrive
      at an ownership percentage of 95.4% as of December 31, 2002 (note 9 and
      note 17).

(iii) In November 2002, MIC purchased the remaining 30% interest in Millicom
      (Ghana) Limited.

 (iv) In May 2002, MIC sold a 17% interest in MIC Systems BV to Kinnevik BV.

 (v)  MIC sold its remaining 83% interest in the MIC Systems' companies in
      November 2002.

 (vi) These companies were liquidated in December 2002.

(vii) In September 2002, MIC sold its interest in Liberty Broadband Limited,
      formerly Tele2 (UK) Limited.

     c)  Associated companies

                                                  2002             2001
                                                -------------------------
                                                US$ `000         US$ `000
                                                -------------------------
At the beginning of year                          52,858                -
Share of results before tax                           62                -
Share of tax                                           -                -
                                                -------------------------
Share of results after tax                            62                -
                                                -------------------------
Exchange differences                                  34                -
Transfers (i)                                   (51,941)           52,858
                                                -------------------------

At end of year                                     1,013           52,858
                                                =========================


As at December 31, 2002, the principal associated company, which is unlisted,
is Navega S.A. (ii).

(i) As of May 2001, Group management determined that, due to a dispute with the
local shareholders, circumstances regarding its investment in 70% owned
operation in El Salvador had changed so that proportional consolidation was no
longer appropriate. Therefore, as of December 2001, the entity was accounted for
under the equity method and recorded in the balance sheet under the caption
"Investments in associated companies". As of December 31, 2002, this dispute has
still to be settled and management no longer feels it is able to exercise a
significant influence in the operation and therefore feels it is more
appropriate to show its investment as a long-term asset in the balance sheet
under the caption "Investment in securities".

(ii) As of December 31, 2001, MIC's interest in Navega SA was recorded as a
long-term investment in securities. During the course of 2002, the Group was
able to exercise significant influence in the operation and therefore
transferred the investment cost of $917,000 to investments in associated
companies.


                                     F-21
<PAGE>


Consolidated balance sheets                               Millicom International
As of December 31, 2002 and 2001                                   Cellular S.A.
- --------------------------------------------------------------------------------


4.     GOODWILL


The movements in goodwill, including negative goodwill, were as follows:

                                                 2002               2001
                                               -----------------------------
                                               US$ `000            US$ `000
                                               -----------------------------
Cost
Opening balance                                  70,431              64,982
Additions                                         2,268               8,091
Write-down in year (Note 20) (i)                (36,308)             (1,652)
Acquisition of negative goodwill                      -                (755)
Effect of change in ownership                      (829)               (235)
                                               --------            ---------
Closing balance                                  35,562              70,431
                                               ========            =========

Amortization
Opening balance                                 (17,856)            (10,001)
Charge for the year                              (7,865)             (8,090)
Effect of change in ownership                       331                 235
                                               --------            ---------
Closing balance                                 (25,390)            (17,856)
                                               ========            =========

Net book value
Closing balance                                  10,172              52,575
                                               ========            =========

Opening balance                                  52,575              54,981
                                               ========            =========

(i)   Accumulated write-downs at December 31, 2002 were $36,308,000 (2001:
      $1,030,000). These write-downs are mainly in respect of MIC's interest in
      Colombia. During 2002, the Group reversed $1,030,000 accumulated
      write-down as part of the divestment of its operation in the Philippines
      (Note 20).

Included in the gain from sale of subsidiaries and joint ventures in the year
ended December 31, 2002 was $498,000 of goodwill. This amount relates to the
disposal of MIC's operation in the Democratic Republic of Congo and is included
in the segment "MIC Africa". The amount of goodwill acquired in 2002 of
$2,268,000 is allocated to the following segment: $752,000 for MIC Latin
America, $1,110,000 for Sanbao Telecom and $406,000 for MIC Africa.


                                     F-22
<PAGE>


Consolidated balance sheets                               Millicom International
As of December 31, 2002 and 2001                                   Cellular S.A.
- --------------------------------------------------------------------------------


The movements in negative goodwill were as follows:

                                                 2002                  2001
                                           -----------------------------------
                                               US$ `000               US$ `000
                                           -----------------------------------
Cost
Opening balance                                 (11,483)               (10,728)
Additions                                             -                   (755)
Effect of change in ownership                        99                      -
                                           ------------            -----------
Closing balance                                 (11,384)               (11,483)
                                           ============            ===========

Amortization
Opening balance                                   2,147                    754
Charge for the year                               1,393                  1,393
Effect of change in ownership                       (99)                     -
                                           ------------            -----------
Closing balance                                   3,441                  2,147
                                           ============            ===========

Net book value
Closing balance                                  (7,943)                (9,336)
                                           ============            ===========
Opening balance                                  (9,336)                (9,974)
                                           ============            ===========


                                     F-23
<PAGE>


Consolidated balance sheets                               Millicom International
As of December 31, 2002 and 2001                                   Cellular S.A.
- --------------------------------------------------------------------------------


5.   LICENSES


Licenses comprise the amortized cost of purchased fixed fee licenses and other
licenses held by joint ventures and subsidiaries (Note 2c). The movements were
as follows:

                                               Total                   Total
                                                2002                    2001
                                           -------------------------------------
                                               US$ '000                US$ `000
                                           -------------------------------------
  Cost

  Opening balance                               284,519                 315,800
  Additions                                       3,962                   6,486
  Write-downs for the year (Note 20) (i)       (46,678)                (20,570)
  Effect of change in ownership
  percentage                                   (54,940)                (17,741)
  Transfers                                         404                       -
  Exchange rate movements                       (2,435)                     544
                                           ------------            ------------
  Closing balance                               184,832                 284,519
                                           ============            ============

  Amortization

  Opening balance                             (119,978)               (114,676)
  Charge for the year                          (16,726)                (18,703)
  Effect of change in ownership
  percentage                                     36,125                  13,397
  Transfers                                         120                       -
  Exchange rate movements                            98                       4
                                           ------------            ------------
  Closing balance                             (100,361)               (119,978)
                                           ============            ============

  Net book value
  Closing balance                                84,471                 164,541
                                           ============            ============

  Opening balance                               164,541                 201,124
                                           ============            ============

(i)  Accumulated write-downs as of December 31, 2002 were $ 46,678,000 (2001:
     $39,627,000; 2000: $33,020,000), including the disposal of $39,627,000
     accumulated write-downs as part of the divestment of the Group's interest
     in the Philippines and Liberty Broadband Ltd. (Note 20).

During the year, certain items have been reclassified in the balance sheet,
these are shown above as transfers.


The weighted-average amortization period of licenses acquired during 2002 is 10
years.



                                     F-24
<PAGE>



Consolidated balance sheets                               Millicom International
As of December 31, 2002 and 2001                                   Cellular S.A.
- --------------------------------------------------------------------------------

The estimated aggregate amortization expense for amortizable intangible assets
for each of the five succeeding fiscal years is shown the table below:

        --------------------------------------------------------------
        Estimated amortization expense                       U.S.$'000
        --------------------------------------------------------------
        For the year ended December 31, 2003                     5,833
        --------------------------------------------------------------
        For the year ended December 31, 2004                     4,428
        --------------------------------------------------------------
        For the year ended December 31, 2005                     3,578
        --------------------------------------------------------------
        For the year ended December 31, 2006                     2,881
        --------------------------------------------------------------
        For the year ended December 31, 2007                     2,852
        --------------------------------------------------------------


6.   DEFERRED COSTS AND OTHER NON-CURRENT ASSETS, NET

The movements in the year were as follows:

<TABLE>
                                      Software       Other
                                    development    non-current      Total       Total
                                       costs         assets         2002        2001
                                   -----------------------------------------------------
                                     US$ `000        US$ `000     US$ `000    US$ `000
                                   -----------------------------------------------------
<S>                                      <C>            <C>         <C>          <C>
 Opening balance, net                    8,820          6,865       15,685       19,492
 Additions                               3,331          1,300        4,631        7,177
 Disposals                                (266)        (4,213)      (4,479)      (1,702)
 Amortization for the year (i)          (5,087)        (1,125)      (6,212)      (6,424)
  Effect  of  change  in  ownership
 percentage                             (3,253)           (80)      (3,333)      (7,105)
 Transfers                                (856)             -         (856)       4,999
 Exchange rate movements                    19           (536)        (517)        (752)
                                   ----------------------------------------   ----------
 Closing balance, net                    2,708          2,211        4,919       15,685
                                   ========================================   ==========
</TABLE>

(i)  Accumulated amortization for software development costs and other
     non-current assets as of December 31, 2002 was $13,946,000 (2001:
     $23,099,000; 2000: $22,097,000).

During the year, certain items have been reclassified in the balance sheet,
these are shown above as transfers.

The Company does not hold major intangible assets not subject to amortization.




                                     F-25
<PAGE>




Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

7.   TANGIBLE ASSETS

The movements in the year were as follows:

<TABLE>
                             Land and                     Construction                    Total          Total
                            buildings      Networks       in progress      Other          2002           2001
                           ----------------------------------------------------------------------------------------
                             US$ '000      US$ '000        US$ '000       US$ '000      US$ '000        US$ '000
                           ----------------------------------------------------------------------------------------
<S>                            <C>          <C>              <C>           <C>           <C>             <C>
Cost
Opening balance                20,778       676,243          56,763        118,691       872,475         925,134

Additions                       1,556        65,476          27,005          3,737        97,774         179,521
Disposals                      (1,194)         (355)         (9,781)       (15,267)      (26,597)        (29,852)
Transfers                         672        33,951         (44,838)         9,111        (1,104)            (16)
Write-down of assets                -        (6,833)              -              -        (6,833)             -
Exchange rate movements
                               (2,054)      (32,594)         (3,211)        (3,940)      (41,799)        (50,819)
Effect of change in
ownership percentage             (618)      (11,719)         (1,788)        (7,864)      (21,989)       (151,493)
                           -------------------------------------------------------------------------  -------------
Closing balance                19,140       724,169          24,150        104,468       871,927         872,475
                           =========================================================================  =============

Depreciation
Opening balance                (5,630)     (288,065)              -        (66,544)     (360,239)       (347,633)

Charge for the year            (1,215)      (87,988)              -        (19,779)     (108,982)       (120,974)
Disposals                       1,283         8,858               -         16,448        26,589          15,845
Transfers                           -           459               -         (1,035)         (576)            126
Exchange rate movements
                                  358        16,994               -          2,280        19,632          20,232
Effect of change in
ownership percentage              301         5,407               -          4,874        10,582          72,165
                           -------------------------------------------------------------------------  -------------
Closing balance                (4,903)     (344,335)              -        (63,756)     (412,994)       (360,239)
                           =========================================================================  =============
Net book value
     Closing balance           14,237       379,834          24,150         40,712       458,933         512,236
                           =========================================================================  =============

     Opening balance           15,148       388,178          56,763         52,147       512,236         577,501
                           =========================================================================  =============

Leased assets included
in the above                    1,139             -               -            125         1,264           1,644
                           =========================================================================  =============
</TABLE>

During the year, certain items have been reclassified in the balance sheet,
these are shown above as transfers.



                                     F-26
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

8.   INVESTMENT IN SECURITIES

As of December 31, 2002 and 2001, MIC had the following available-for-sale
securities:

                                                      2002            2001
                                                 --------------  ---------------
                                                    US$ '000        US$ '000
                                                 --------------  ---------------

Non-current available-for-sale securities:
  Tele2 AB                                            164,031         659,440
   El Salvador                                         52,858               -
   Other investments                                    3,497          17,389
                                                 ==============  ===============
                                                      220,386         676,829
                                                 ==============  ===============

Current available-for-sale securities:
  Tele2 AB                                            101,540             -
                                                 ==============  ===============
                                                 ==============  ===============


Tele2 AB

Tele2 AB ("Tele2") is an alternative pan-European telecommunications company
offering fixed and mobile telephony, data network and Internet services in 22
countries. Tele2 is listed on the Stockholm Stock Exchange and the NASDAQ
National Market. In 2001, the Group classified its investment in Tele2 as
non-current as management considered it to be a strategic investment. However,
the Group sold certain of these shares during the course of 2002 in order to
meet liquidity needs and has re-classified that portion of its holding that is
not pledged against financing as a current asset in the consolidated balance
sheet as of December 31, 2002.



                                     F-27
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

Tele2 share transactions have been summarized in the table below:

<TABLE>
                                                                               Cash received/
                                                                                  (assets          Gain/
                                                                   Ownership     disposed of)      (loss)      Total
                                          Number of Shares held        %           US$'000         US$'000    US$'000
                                      ----------------------------------------------------------------------------------
                                         Tele2 A       Tele2 B

<S>                                     <C>          <C>             <C>           <C>            <C>          <C>
Balance as of December 31, 1999         1,384,316     4,607,228       5.77%                                    400,895

Sale of shares                                  -      (900,000)     (0.85)%        65,434         55,321      (10,113)

Exchange SEC shares for Tele2 AB        4,000,000    10,715,660       8.78%       (115,390)       609,941      725,331
shares

Unrealized change in market value               -             -          -               -       (316,043)    (316,043)
                                      ----------------------------------------------------------------------------------
Balance as of December 31, 2000         5,384,316    14,422,888      13.70%                                    800,070

Sale of shares                                  -    (3,513,000)     (3.60)%       125,195        (15,931)    (141,126)

Exchange of Shares for FORA assets              -     2,461,449       2.63%        (72,864)         6,693       79,557
(Note 20)

Unrealized change in market value               -             -       -                  -        (79,061)     (79,061)
                                      ----------------------------------------------------------------------------------
Balance as of December 31, 2001         5,384,316    13,371,337      12.73%                                    659,440

Sale of Tele2 AB shares                         -    (8,743,110)     (5.94)%       167,238       (168,818)    (336,056)

Exchange of A shares for B shares      (5,384,316)    5,384,316       -                  -              -            -

Unrealized change in market value               -             -       -                  -        (57,813)     (57,813)

Prolonged decline in value
transferred to profit and loss                  -             -       -                  -        (61,325)           -
                                      ----------------------------------------------------------------------------------
Balance as of December 31, 2002                 -    10,012,543       6.79%                                 265,571
                                      ==================================================================================
</TABLE>

The cost of the Tele 2 shares sold is determined on a average cost basis.

In December 2001, MIC entered into a credit facility up to an amount totaling
SEK 1,855 million (approximately $175 million as of December 31, 2001) from
Toronto-Dominion Bank. As of December 31, 2002 6,184,293 shares of Tele2 B
shares (2001: 9,115,479), with a fair value of $164,031,000 (2001:
$328,479,000), were pledged under this agreement (Note 17).

El Salvador
Note 3 (c)(i) explains that the Group no longer has control or significant
influence over Telemovil El Salvador, so the Group's investment is accounted for
as an available-for-sale financial asset in 2002. The shares of this investment
are not quoted on a public market and management has not


                                     F-28
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

been able to obtain reliable financial information since early 2001. Management
has made different estimates to value this investment using different valuation
techniques that have resulted in a wide range of fair values. Management has
therefore concluded that estimating a fair value in these conditions is
inappropriate. Consequently the investment is being carried at the carrying
amount as of December 31, 2001. The valuation exercise, however, produced
sufficient evidence for management to conclude that the investment has not been
impaired as of the balance sheet date.

Other available-for-sale securities
In January 2000, MIC invested $10,000,000 in Modern Holdings inc. ("Modern
Holdings"), formerly known as XSource Corporation (Note 27) in the form of
promissory notes. In February 2000, those notes were converted into 1,293,095
shares of common stock, representing 8.5% of the share capital of Modern
Holdings. As of December 31, 2002 and 2001 the shares of Modern Holdings are not
quoted on a public market. Following a restructuring of Modern Holdings and an
independent valuation, MIC recognized an impairment of $7,050,000 on its
investment in Modern Holdings. The carrying value of this investment was
$2,950,000 at December 31, 2002 (2001: $10,000,000). In addition, the Group
holds other available-for-sale securities for a total fair value of $547,000 as
of December 31, 2002 (2001: $2,362,000).

As indicated in Note 27, MIC does not consolidate its investment in Great
Universal and Modern Holdings as, due to the warrant holders' right to exercise,
it considers it does not control either company, and also that there exist
severe long-term restrictions which significantly impair the ability of Great
Universal and Modern Holdings to transfer funds to MIC.

During the course of 2002, management made an impairment on 100% of Great
Universal due to uncertainty concerning its recoverability.

9.   DERIVATIVES ARISING FROM BUSINESS COMBINATIONS

MIC or its partners have agreements to purchase or sell interests in certain
operations according to fixed conditions. These agreements qualify as
derivatives under the prescribed accounting treatment in IAS 39. Details of the
agreements are described as follows :-

Colombia - The holders of the Celcaribe Ordinary Share Trust Certificates
("Certificates") (Note 17) have an option to put their Certificates to the
Company at a price that provides the holders with an internal rate of return of
15%. The option may be exercised on March 15 and September 15 each year, subject
to the Company receiving 60 days' written notice, and expires on the earlier of
a public market for Celcaribe shares and/or Stock Trust Certificates or March
15, 2004. Should MIC sell its interest in Celcaribe, the Certificates require
the holders to sell their Certificates to the buyer on the same terms and
conditions. During the course of 2002, no options were put to the Company. In
2001, holders of the Share Trust Certificates put 6,320,262 shares to the Group
for a consideration of $20,108,895. The Group entered into a conditional
agreement to sell its interest in Celcaribe to Comcel S.A. in December 2002 and
at the same time gave notice to the holders of the Certificates that they would
be required to sell their Certificates. The Group was not relieved of its
obligation under the option until the sale of Celcaribe was finalized. However,
invoking the requirement that the holders must sell their Certificates to the
buyer, reduced the value of the option to nil as the sale was highly probable at
December 31, 2002 and occurred on February 13, 2003. The fair value of the
liability of the option as of December 31, 2002, was reduced to $nil (2001:
$14,414,000). The change in the fair value during the period to the date of the
conditional sale agreement of $6,684,000 (2001: $6,176,000) has been recorded in
the profit and loss statement under the caption "Fair value result on financial
instruments". The credit


                                     F-29
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

generated on the reduction of the liability, $21,098,000, has been recorded in
the profit and loss statement under the caption "General and administrative
expenses

El Salvador - Since 1997, International Finance Corporation ("IFC"), a
shareholder and lender to Telemovil, MIC's El Salvadorian operation, held a put
option which, when exercised, required the Company to purchase IFC's shares in
Telemovil at an agreed price. Additionally, the Company had a one-time right to
purchase IFC's shares in Telemovil at an agreed price. As of December 31, 2002
and 2001, there were no remaining rights or obligations by the Company to
repurchase shares as a result of the exercising of outstanding options during
2001. The settlement of the financial asset and liability resulted in a charge
of $3,348,000 recorded in "Fair value result on financial instruments" in 2001.
As of January 1, 2001, the fair value of the call option was $8,952,000 and the
fair value of the put option was $5,604,000.

Express Telecommunications Co. Inc - As part of the sale agreement for Express
Telecommunications Co. Inc. ("Extelcom"), MIC has been granted, for the price of
$1, the option to purchase 47,9% of the issued share capital of Extelcom at
various prices up to ten years after issuance. The exercise price is $1,000,000
if exercised within 12 months increasing by an additional $1,000,000 for each
year afterwards. If exercised between five and ten years after the option is
issued, the purchase price is $8,000,000. Due to the history of losses incurred
by the operation, management considers that the option has nil value. The option
is not exercisable in part. As of December 31, 2002, the option has not been
exercised.

Vietnam - The shareholders' agreement grants the Company's partner an option to
purchase an additional 10% equity interest in CIV by (i) paying an exercise
price equal to 10% of the Company's total capital contribution with interest at
a rate of LIBOR+2% and (ii) assuming a proportionate share of all financial
guarantees and loans made by the Company to CIV. This option expires on the
first anniversary of the date the term of the license is extended to at least 15
years. In July 2002, the option was put to the Company at an exercise price of
$24,000. As of December 31, 2001, the fair value of the option that had not been
put to the Company was $21,951,000 (2000: 21,561,000). The change in fair value
to the date of exercisement of $1,174,000 (2001: $390,000) has been recorded as
a "Fair value result on financial instruments" with the reversal of the
liability, $23,125,000, credited to the profit and loss as a "Gain from sale of
subsidiaries".


                                     F-30
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

10.  PLEDGED DEPOSITS

Pledged deposits represent interest bearing collateral for certain debts of
Group companies (Note 17).

                                          2002                 2001
                                      -------------------------------
                                        US$ '000             US$ '000
                                      -------------------------------

Pledged deposits                          37,762               58,523
Offset against borrowings (note 17)      (4,841)             (11,119)
                                      -------------------------------
                                          32,921               47,404
                                      ===============================

The effective interest rate on pledged deposits as at December 31, 2002, was
2.6% (2001: 7.3%).


                                     F-31
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

11.  INVENTORIES

The Group carries the following inventories, measured at lower of cost or net
realizable value:

                                          2002                 2001
                                      -------------------------------
                                        US$ '000             US$ '000
                                      -------------------------------

Trading inventories                       5,589               10,605
Non-trading inventories                   1,373                2,327
                                      -------------------------------
Total inventories                         6,962               12,932
                                      ===============================

12.  TRADE RECEIVABLES, NET

Trade receivables comprise:

                                          2002                 2001
                                      -------------------------------
                                        US$ '000             US$ '000
                                      -------------------------------
Trade receivables, gross
Opening balance                         162,697             172,455
Additions, net                            2,983              26,736
Write-offs                               (4,065)            (11,712)
Change in ownership                     (11,442)            (12,534)
Exchange rate movement                   (9,388)            (12,248)
                                      ------------       ------------
Closing balance                         140,785             162,697
                                      ============       ============

Impairment from doubtful receivables
Opening balance                         (26,619)            (35,773)
Impairment charge                        (6,624)             (9,066)
Write-offs                                4,065              11,712
Change in ownership                         635               4,204
Exchange rate movement                      979               2,304
                                      ------------       ------------
Closing balance                         (27,564)            (26,619)
                                      ============       ============

Trade receivables, net
     Closing balance                    113,221             136,078
                                      ============       ============

     Opening balance                    136,078             136,682
                                      ============       ============

Included in the net trade receivables' balance above is $82,356,000 (2001:
$92,834,000) related to amounts due from national telecommunication companies in
respect of interconnection.


                                     F-32
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

13. OTHER CURRENT ASSETS

Other current assets are comprised as follows:

                                           2002           2001
                                       --------------------------
                                         US$ '000       US$ '000
                                       --------------------------

Employment and other taxes                   9,758         9,943
Cash receivable from VMS, net (i)           11,503         8,924
Other current assets                        17,192        16,933
                                       --------------------------
                                            38,453        35,800
                                       ==========================

(i)  This reflects the net cash receivable under the revenue sharing agreement
     in Vietnam (Note 3 b (i)).

14.  TIME DEPOSITS

Time deposits as of December 31, 2002 of $16,200,000 (2001: $21,444,000)
represent cash deposits with banks which earn market rates of interest and have
maturity periods of between six and nine months.

As of December 31, 2002, the effective interest rate on short-term bank deposits
was approximately 4.6% (2001: 14.0%).

15.  CASH AND CASH EQUIVALENTS

Cash and cash equivalents are comprised as follows:

                                           2002           2001
                                       --------------------------
                                         US$ '000       US$ '000
                                       --------------------------

Cash and cash equivalents in US             42,252         23,517
dollars
Cash and cash equivalents in other          28,199         32,759
currencies
                                       --------------------------
Total cash and cash equivalents             70,451         56,276
                                       ==========================


                                     F-33
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

16.  SHAREHOLDERS' EQUITY

     a) Share capital and premium

The authorized capital of the Company totals 100,000,000 registered shares. At
December 31, 2002, the total subscribed and fully paid-in share capital and
premium amounts to $281,989,458 (2001: $281,989,458) consisting of 71,124,729
(2001: 71,124,729) registered common shares at a par value of $2 (2001: $2)
each.

As a result of the Merger (Note 1), 19,915,328 shares of MIC's common stock,
with a par value of $2 each, were issued to former Millicom stockholders on
December 31, 1993. In February 1994, under the terms of the Merger Agreement,
923,721 interim additional merger shares, with a par value of $2 each, were
issued to former Millicom stockholders and 211,864 shares of MIC's common
stock, with a par value of $2 each, were issued to Great Universal. Under the
terms of the Merger Agreement, the former Millicom shareholders also had the
non-transferable contingent right to receive a maximum of 808,047 final
additional merger shares of common stock, with a par value of $2 each, based on
the payment of certain tax liabilities of Millicom (the "Tax Liabilities").

In October 2001, the Group determined that the Tax Liabilities amounted to
$7,023,000. At the time of the Merger, the Group had recorded a provision of
$13,544,000 for the Tax Liabilities, resulting in a difference of $6,521,000.
That difference was settled by the final issuance of 374,521 shares, with a par
value of $2 each, and a realized gain of $3,521,000 (Note 21), corresponding to
the difference between the issuance price and the share price as of the date of
the transaction.

In February 2003, an Extraordinary General Meeting of the Company passed a
resolution approving a reverse share split whereby three existing shares of a
par value of $2 each would be exchanged for one new share with a par value of
$6 (Note 31).

     b) Treasury stock

As a result of the Merger, 21,647,096 shares of MIC's common stock, previously
held by Millicom, now held by subsidiaries of MIC-USA, are accounted for as
treasury stock for consolidated reporting purposes. In 2002, 386,350 (2001:
nil; 2000: nil) shares were acquired by the Company. Those acquired were
accounted for as treasury stock. In 2002, nil shares with a par value of $6
each (2001: 333 shares with a par value of $2 each; 2000: 149,989 with a par
value of $2 each) were issued from treasury stock under share option plans.

As of December 31, 2002, the total number of treasury shares held was 7,423,767
(2001: 21,884,954) MIC shares.

     c) Legal and consolidation reserves

On an annual basis, if the Company reports a net profit for the year,
Luxembourg law requires appropriation of an amount equal to at least 5% of the
annual net income to a legal reserve until such reserve equals 10% of the
issued share capital. This reserve is not available for dividend distribution.
A consolidation reserve will be required for consolidated profits that are not
available for distribution.

See Note 17 for other restrictions relating to dividend payments.


                                     F-34
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

     d) Options outstanding

The following table summarizes information about stock options outstanding at
December 31, 2002, which have been issued to officers and employees of the
Group. The Company has elected not to record the expense associated with the
issuance of stock options as permitted under IFRS.

<TABLE>
                        Options Outstanding                                    Options Exercisable
- ---------------------------------------------------------------------  ----------------------------------------
        Range                                   Weighted Average     Number exercisable      Weighted Average
         of              Number outstanding         Exercise                 at                  Exercise
  Exercise Prices $       at Dec. 31, 2002           Price $            Dec. 31, 2002             Price $
- ----------------------   --------------------  --------------------  --------------------   -------------------
<S>                               <C>                    <C>                  <C>                    <C>
             15.00                200,000                 15.00                     -                     -
             36.00                238,166                 36.00                30,555                 36.00
  67.125 to 81.375                219,683                 75.63               184,516                 74.52
  114.00 to 118.98                138,201                116.43               126,756                116.22
 127.50 to 146.625                259,200                132.63               147,222                136.53
- ----------------------   --------------------  --------------------  --------------------   -------------------
  15.00 to 146.625              1,055,250                 74.55               489,049                101.58
======================   ====================  ====================  ====================   ===================
</TABLE>

The following table summarizes the terms of options outstanding as of December
31, 2002:

<TABLE>
                                              Number of     Exercise price
               Date issued                     options             $                 Terms of option
- ------------------------------------------ --------------- ------------------- ----------------------------
<S>                                            <C>         <C>                 <C>
May 1994, May 1995, May 1996, May 1997,        560,266     15.00 - 146.625     Exercisable in tranches,
January 1998, May 1998, August 1999, May                                       for an indefinite period,
2000, December 2001 and December 2002                                          after one year from the
                                                                               date of issuance

May 1994, May 1995, May 1996, August           494,984     15.00 - 127.50      Exercisable in tranches,
1996, November 1996, March 1997, May                                           with a maximum exercise
1997, May 1998, August 1999, May 2000,                                         period of six years, after
June 2000, December 2001 and December                                          three years from the date
2002                                                                           of issuance
</TABLE>

A summary of the Company's stock options as of December 31, 2002, 2001 and
2000, and changes during the years then ended is as follows:

<TABLE>
                                       2002                        2001                     2000
                             ------------------------------------------------------------------------------
                                            Weighted                   Weighted                 Weighted
                                Number      average        Number      average      Number      average
                                  of        exercise         of        exercise       of        exercise
                               options      price $        options     price $      options     price $
                             ------------------------------------------------------------------------------
<S>                           <C>              <C>       <C>              <C>     <C>              <C>
Outstanding at beginning
  of year                     3,845,357        30.40     3,142,222        36.89   2,724,956        34.34
Effect of reverse stock      (2,563,573)       60.80             -            -           -            -
 split
Granted                         200,000        15.00     1,015,400        12.00     926,489         42.19
Exercised                             -            -          (333)       22.38    (164,055)        27.86
Forfeited                      (426,534)       96.72      (311,932)       36.15    (345,168)        35.22
                             ------------------------------------------------------------------------------
Outstanding at end of year    1,055,250        74.55     3,845,357        30.40   3,142,222        36.89
                             ------------------------------------------------------------------------------
Exercisable at end of year      489,049       101.58     1,542,278        36.91   1,170,217        36.74

Weighted  average fair value
 of options granted                             3.15                       7.05                    24.45
</TABLE>


                                     F-35
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

Shares issued from the exercise of stock options are granted using treasury
shares. Total treasury shares held as of December 31, 2002 amounted to
7,423,767 with a par value of $6 each (2001: 21,884,954 with a par value of $2
each).

Other options in subsidiary companies, outstanding at December 31, 2002, have
been issued to officers and employees of the Group as follows:

Liberty Broadband Limited - An option plan was established on July 1, 2000
authorizing certain employees and officers to purchase a total of 5% of the
share capital of Liberty Broadband Limited, formerly Tele2 (UK). The strike
price of these options is calculated as the corresponding share of MIC's
historic total investment in the relevant operation. These options are
exercisable in tranches with a maximum exercise period of six years from the
date of issuance. As of December 31, 2001, all of the options have been issued
under the option plan and none of the above options have been exercised. In
September 2002, the Group disposed of its interest in Liberty Broadband Limited
and the options were cancelled.

Millicom Argentina S.A. - An option plan was established on December 15, 2000
for certain employees and officers to purchase a total of 10% of the share
capital of Millicom Argentina S.A. The strike price of these options is
calculated as the corresponding share of MIC's historic total investment in the
relevant operation. These options are exercisable in tranches until December
31, 2004. As of December 31, 2001, 8.8% of the share capital had been issued
under the option plan. During 2002 the right to exercise options over 6.0% of
the share capital was cancelled. As of December 31, 2002, none of the above
options have been exercised.

Millicom International BV - An option plan was established on December 15, 2000
for certain employees and officers to purchase a total of 1.7% of the share
capital of Millicom International BV. The strike price of these options is
calculated as the corresponding share of MIC's historic total investment in the
relevant operation. These options are exercisable in tranches until December
31, 2004 and were all issued in 2000. During 2002 the right to exercise options
over 0.7% of the share capital was cancelled. As of December 31, 2002, none of
the above options have been exercised.


                                     F-36
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

17.  BORROWINGS

Borrowings comprise:

     (i) Borrowings due after more than one year:

<TABLE>
                                                         2002               2001
                                                     -------------------------------
                                                       US$ '000           US$ '000
                                                     -------------------------------

<S>                                                    <C>                 <C>
      Corporate subordinated debt, net of
      financing fees                                    912,539            954,601
                                                     =============     =============

      Other debt and financing:
      Secured equipment financing facilities             15,709              9,658
      Secured bank financing facilities                 207,941            398,070
                                                     -------------     -------------

      Total long-term other debt and financing          223,650            407,728
      Less: portion payable within one year             (64,280)           (60,253)
                                                     -------------     -------------

      Total other debt and financing due
         after more than one year                       159,370            347,475
                                                     =============     =============
</TABLE>

     (ii) Borrowings due within one year:

<TABLE>
                                                         2002               2001
                                                     -------------------------------
                                                       US$ '000           US$ '000
                                                     -------------------------------

<S>                                                    <C>                 <C>
     Other debt and financing:
        Secured equipment financing facilities           11,200             31,955
        Secured bank financing facilities                81,186             61,690
                                                     -------------     -------------
     Total short term other debt and financing           92,386             93,645

     Portion of long-term debt payable within one
        year                                             64,280             60,253
                                                     -------------     -------------
     Total other debt and financing due within
        one year                                        156,666            153,898
                                                     =============     =============
</TABLE>

     a)  Company borrowings

Borrowings mainly comprise notes, including corporate subordinated debt, term
loans and revolving credit facilities in various countries and are mainly
denominated in US dollars. Average interest on these facilities is
approximately 12.5% (2001: 12.9%; 2000: 11.3%). Average interest on short-term
borrowings is approximately 10.2% (2001: 10.3%; 2000: 10.8%). Also included in
debt and other financing is $456,000 (2001: $1,145,000) in respect of finance
leases (note 26).


                                     F-37
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

On April 25, 1996, the Group signed a seven-year $200,000,000 Bank Credit
Agreement (the "Original Bank Credit Agreement") arranged by ABN-Amro Bank and
ING Bank. The main part of the facility was used to refinance existing
short-term credit facilities at the Company level and for investments in
existing and new operations and for corporate and interest expenses. The
financing was subsequently amended in 1998 and 1999 and secured by a portion of
MIC's shares in Tele2 AB. The loan bears interest starting at LIBOR+1.75% but
decreasing to LIBOR+1% depending on the amount and value of the security put in
place. The facility was subject to the maintenance of various restrictive and
financial covenants such as not exceeding a certain ratio of certain
consolidated debt to earnings before interest, taxation, depreciation and
amortization. This facility was fully repaid on December 14, 2001.

In December 2001, the Group entered into an equity swap transaction with
Toronto-Dominion Bank for a maximum facility amount of SEK 1,855 million
(approximately $175 million as of December 31, 2001) to replace the Original
Bank Credit Agreement. In exchange for the facility, the Group has pledged
Tele2 AB 'B' shares. The number of shares pledged is adjusted on a monthly
basis based on Tele2 AB 'B' shares market value. The facility bears an annual
interest rate calculated using the current STIBOR one-month rate plus 2%
payable on a monthly basis, and must be fully repaid by November 2004. As of
December 31, 2002 $54,638,000 (2001: $173,365,000) was outstanding under this
facility collateralized by 6,184,293 (2001: 9,115,479) 'B' shares of Tele2 AB.
This transaction has been accounted for as a borrowing and the related Tele2 AB
'B' shares are recorded as pledged securities under the caption "Investment in
securities".

As of December 31, 2002, the Group had outstanding standby letters of credit
and guarantees of $25,303,000 and $106,606,000 respectively (2001: $31,838,000
and $148,854,000) securing debt and commitments in the Group. The Group's share
of this debt is included in the balance sheet under the caption "Other debt and
financing".

In the normal course of business, MIC has issued corporate guarantees to secure
the obligations of some of its operations under bank, lease and supplier's
financing agreements. The table below describes, for each operation, the
outstanding amount under the guarantees and the remaining terms of the
guarantees.


                                     F-38
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

<TABLE>
- -----------------------------------------------------------------------------------------------------------------
                                          Terms                     Terms                    Terms
                              Bank        as at        Lease        As at     Suppliers'     As at
                           Guarantees    December    guarantees    December   guarantees    December      Total
                             US$'000     31, 2002     US$'000      31, 2002    US$'000      31, 2002     US$'000
- -----------------------------------------------------------------------------------------------------------------
<S>                           <C>      <C>                <C>    <C>               <C>    <C>             <c>
MIC Latin America
- -----------------------------------------------------------------------------------------------------------------
Argentina                          -                      110    0 - 2 years         485   0 - 2 years       595
- -----------------------------------------------------------------------------------------------------------------
Bolivia                       40,891   0 - 4 years          -                          -                  40,891
- -----------------------------------------------------------------------------------------------------------------
Peru                               -                        -                      2,064   0 - 2 years     2,064
- -----------------------------------------------------------------------------------------------------------------
Colombia                           -                        -                        459   0 - 2 years       459
- -----------------------------------------------------------------------------------------------------------------
El Salvador (i)               12,500   0 - 1 year           -                          -                  12,500
- -----------------------------------------------------------------------------------------------------------------
Guatemala                        918   0 - 3 years          -                          -                     918
- -----------------------------------------------------------------------------------------------------------------

- -----------------------------------------------------------------------------------------------------------------
Sanbao Telecom (Asia)
- -----------------------------------------------------------------------------------------------------------------
Pakistan                      19,743   0 - 1 year           -                        248   0 - 1 year     19,991
- -----------------------------------------------------------------------------------------------------------------
Cambodia                       4,609   0 - 2 years          -                      1,223   0 - 1 year      5,832
- -----------------------------------------------------------------------------------------------------------------
Sri Lanka                     17,964   0 - 4 years          -                        559   0 - 1 year     18,523
- -----------------------------------------------------------------------------------------------------------------
Vietnam                            -                        -                      3,246   0 - 1 year      3,246
- -----------------------------------------------------------------------------------------------------------------
Lao People's Democratic
Republic                           -                        -                        826   0 - 3 years       826
- -----------------------------------------------------------------------------------------------------------------

- -----------------------------------------------------------------------------------------------------------------
MIC Africa
- -----------------------------------------------------------------------------------------------------------------
Ghana                            452   0 - 1 year           -                        87    0 - 1 year        539
- ----------------------------------------------------------------------------------------------------------------

- -----------------------------------------------------------------------------------------------------------------
Other                              -                        -                       222    0 - 2 years       222
- -----------------------------------------------------------------------------------------------------------------

- -----------------------------------------------------------------------------------------------------------------
Total guarantees              97,077          110                                 9,419                  106,606
- -----------------------------------------------------------------------------------------------------------------
</TABLE>

(i): As of December 31, 2002, this entity is accounted for as a non-current
investment

The Group's share of the book value of total pledged assets held by
subsidiaries and joint ventures securing Group debt is $97,204,000 (2001:
$52,320,000). The book value of pledged assets held by Corporate at December
31, 2002 is $164,031,000 (2001: $328,479,000). The Group has pledged 6,184,293
'B' shares of Tele2 AB (2001: 9,115,479). As of December 31, 2002, the Group
had $37,762,000 (2001: $58,523,000) of blocked deposits against borrowings. The
Group's share of total liabilities secured by either pledged assets, letters of
credit or company guarantees is $189,395,000 (2001: $226,195,000).

The total interest charged in the year is $185,959,000 (2001: $209,912,000;
2000: $196,002,000).

     b)  Corporate subordinated debt

On June 4, 1996, the Company raised approximately $483,433,000 (after deducting
discount and estimated expenses) through a private offering of 13,5% Senior
Subordinated Discount Notes due 2006 (the "Notes"). The Notes were issued at
52.075% of their principal amount of $962,000,000 and the purchase discount on
the Notes accretes from issuance until June 1, 2001. Cash interest began to
accrue on the Notes on June 1, 2001 at a rate of 13,5 % per annum, payable
semi-annually in arrears on June 1 and December 1, until maturity on June 1,
2006.


                                     F-39
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

During 2002, the Company re-purchased Notes to the value of $44,000,000 at
market prices at the time, realizing a gain of $28,676,000 which is recorded in
the profit and loss under the heading "Other Income". As of December 31, 2002,
MIC has offset $5,461,000 (2001: $7,399,000) of deferred financing fees against
the value of the Notes.

The fair value of the Notes at December 31, 2002, which has been determined
from their market value, was approximately $440,066,000 (2001: $630,110,000).

The Company undertook the offering of the Notes to fund the continued
construction and expansion of its cellular systems, working capital and
operating expenses. In addition, the net proceeds of the offering were also
used to fund the acquisition and development of additional licenses or systems
or to increase the Group's ownership in its existing systems.

The Notes contain provisions that allowed the early redemption of the Notes, in
whole or in part, at the option of the Company at any time on or after June 1,
2001 and prior to maturity at prices ranging from 106.75% of the principal
amount in 2001 to 100% in 2004 and thereafter, plus accrued interest. Upon the
occurrence of a Change of Control Triggering Event, defined as a rating decline
and change in control, holders of the Notes could have required the Company to
purchase all outstanding Notes at a purchase price of 101% of the accreted
value of the Notes on or before June 1, 2001 or 101% of the stated principal
amount of the Notes, plus accrued and unpaid interest, if any, on the Notes to
the date of purchase, after June 1, 2001.

The Notes are senior subordinated unsecured obligations of the Company, which
rank pari passu in right of payment with all senior subordinated unsecured
obligations of the Company. The Notes are subordinated in right of payment to
all Senior Debt (as defined in the Indenture with respect to the Notes) of the
Company.

The Indenture pursuant to which the Notes were issued contains certain
covenants that, among other things, limit the ability of the Group to: (i)
incur additional indebtedness; (ii) pledge or dispose of assets; (iii) make
distributions on and repurchases of its common stock or make certain
investments; (iv) make dividend or other payments to the Company; (v) engage in
transactions with affiliates, and includes certain cross default clauses. The
Indenture also limits the ability of the Group to merge or consolidate with or
transfer all or substantially all of its assets to another entity.


                                     F-40
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

     c)  Other debt and financing

Total other debt and financing analyzed by country is as follows:

                                             2002         2001
                                        ------------- ------------
                                           US$ '000     US$ '000
                                        ------------- ------------

     Argentina                                  337        2,471
     Bolivia  (i)                            46,660       48,703
     Cambodia                                 6,090       10,594
     Colombia  (ii)                          78,819      118,859
     Ghana                                      537       11,220
     Guatemala                               28,817       24,792
     Honduras                                 2,888        3,415
     India                                        -            5
     Luxembourg                                 529        1,765
     Lao People's Democratic Republic         1,289            -
     Mauritius                                4,533        5,171
     Pakistan (iii)                          45,373       31,488
     Paraguay                                 8,517        9,124
     Peru                                     1,009        1,511
     Philippines                                  -       11,918
     Senegal                                  8,078        7,774
     Sri Lanka  (iv)                         23,325       26,657
     Tanzania                                 2,565       10,345
     Vietnam                                  6,493      14,882
     less: pledged deposits                  (4,841)     (11,119)
                                        ------------- ------------
     Total                                  261,018      329,575

     Corporate                               55,018      171,798
                                        ------------- ------------

     Total other debt and financing         316,036      501,373
                                        ============= ============

     Of which:
         due within 1 year                  156,666      153,898
         due after more than 1 year         159,370      347,475
                                        ------------- ------------
                                            316,036      501,373
                                        ============= ============

At December 31, 2002, MIC was in breach of loan covenants for a total debt of
$22,459,000 (2001: $174,000), which is classified as short-term debt on the
balance sheet. None of the above facilities have been called by the banks
concerned. In the opinion of management, the outcome of discussions to resolve
these breaches will not materially impact the ability of these companies to
maintain adequate funding arrangements to support and develop future
operations.


                                     F-41
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

Significant individual financing facilities are described below:

     i)  Bolivia

In June 2001, Telefonica Celular de Bolivia SA signed an agreement for
additional financing in the amount of $25,000,000 with the IFC and $10,000,000
from the Nederlandse Financierings-Maatschappij Voor Ontwikkelingslanden, N.V.
(FMO), also known as the Netherlands Development Finance Company. This
financing bears interest at LIBOR+3.00% and is repayable in installments
starting in December 2002 until December 2006. Among other things, the
financing requires the company to maintain certain financial covenants such as
a debt ratio, long-term debt service coverage, and debt-to-equity ratio. As of
December 31, 2002, the company was in breach of certain covenants on the IFC
loan and the outstanding balances had been reclassified as short-term
financing. As of December 31, 2002, $31,030,000 was drawn down related to these
financings. Management considers this to be the fair value. These investments
will help to fund the expansion and further digitalization of the Group's
mobile cellular telecommunications network in Bolivia.

     ii) Colombia

MIC arranged financing during 1994 for Celcaribe SA, its operation in Colombia.
This financing consisted of units in a high yield note trust certificate
($82,504,129) and Celcaribe ordinary share trust certificates ($26,264,876) and
secured bank financing ($11,400,000). The high yield note trust certificate is
repayable in several tranches starting in March 2001 and ending in the year
2004 and bears interest at 14.5% per annum. The amount outstanding under this
financing as of December 31, 2002, was $67,700,000. The fair value of the
outstanding notes at December 31, 2002, based upon secondary market trading
information, was $48,067,000 (2001: $61,044,000).

In 2002 and 2001, Celcaribe repurchased $34,000,000 of the high yield note
trust certificates at market price at that time, realizing a gain of
$13,571,000 (2001: $8,075,000) which has been recorded as "Other income" in the
consolidated statement of profit and loss.

The high yield note and the supplier financing are both secured by a pledge of
the shares of Millicom de Colombia ("MdC"), MIC's 96.1% (2001: 96.1%) owned
company, which holds 4.8% of the share of Celcaribe, and certain other assets
of Celcaribe.

     iii) Pakcom

In November 2002, Pakcom signed a syndicated finance agreement for Rupees 800
million (approximately $13,700,000). For this agreement Faysal Bank Limited
acts as security agent and Standard Chartered Bank acts as facility agent. The
facility is repayable in monthly installments until December 31, 2004 and
attracts interest at State Bank of Pakistan discount rate plus 1.75%, with a
floor rate of 11.75%. As of December 31, 2002, $13,185,000 of this facility was
outstanding. Management considers this to be the fair value.

     iv) Sri Lanka

In September 2000, ABN-Amro arranged a seven-and-a-half-year syndicated loan of
LKR 1,534,000,000 ($20,000,000) for Celltel Lanka Limited, MIC's 99.9% owned
operation in Sri Lanka. This financing bears interest at 3% over the weighted
average Treasury Bill Rate and is repayable over 13 quarterly installments
commencing one year from signing. At December 31, 2001, the facility has been
fully drawn down. As of December 31, 2002, $13,418,000 was outstanding.
Management considers this to be the fair value.


                                     F-42
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

     d)  Analysis of borrowings by maturity

The total amount repayable at December 31, 2002 and 2001 is as follows:

<TABLE>
                        Company       Operations     Total           Company      Operations       Total
                          2002           2002         2002             2001          2001           2001
                     ----------------------------------------------------------------------------------------
                        US$ '000      US$ '000      US$ '000         US$ '000     US$ '000        US$ '000
                     ----------------------------------------------------------------------------------------

<S>                         <C>        <C>             <C>            <C>            <C>           <C>
Due within:
    1 year                    -       156,666         156,666           1,033       152,865        153,898
    1 - 2 years          57,536        65,435         122,971               -        78,433         78,433
    2 - 3 years             380        19,768          20,148         173,365        62,627        235,992
    3 - 4 years         918,000        10,666         928,666             380        20,693         21,073
    4 - 5 years               -         6,676           6,676         962,000        14,260        976,260

Due after 5 years             -         1,807           1,807               -           697            697
                     ------------------------------------------    ------------------------------------------

Total repayable         975,916       261,018       1,236,934       1,136,778       329,575      1,466,353
                     ------------------------------------------    ------------------------------------------

Unamortized
portion of
financing fees           (8,359)            -          (8,359)        (10,379)            -        (10,379)
                     ------------------------------------------    ------------------------------------------
Total debt, net         967,557       261,018       1,228,575       1,126,399       329,575      1,455,974
                     ==========================================    ==========================================

Of which
  subordinated (v)      918,000        67,700         985,700         962,000       101,740      1,063,740
                     ==========================================    ==========================================
</TABLE>

(v)  The subordinated debt shown above as Operations is in respect of the high
     yield note trust certificates in Colombia (Note 17 c (ii)).


                                     F-43
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

18.  ANALYSIS OF GROUP REVENUES AND COST OF REVENUES, SEGMENTAL REPORTING

The Group mainly operates in one reportable industry segment, telecommunications
services. The Group's revenues and cost of sales comprise the following:

<TABLE>
                                                2002                 2001               2000
                                         -----------------------------------------------------------
                                              US$ '000             US$ '000           US$ '000
                                         -----------------------------------------------------------
<S>                                            <C>                  <C>                <C>
Provision of telecom services                  581,321              600,315            526,494
Connection revenues                              7,982                9,567              7,009
Equipment revenues                              15,883               34,688             37,337
                                         -------------------- --------------------------------------
Total revenues                                 605,186              644,570            570,840
                                         ==================== ======================================
</TABLE>


The Group's cost of sales comprise the following:

<TABLE>
                                                2002                 2001               2000
                                         -----------------------------------------------------------
                                              US$ '000             US$ '000           US$ '000
                                         -----------------------------------------------------------
<S>                                            <C>                  <C>                <C>
  Costs from the provision of telecom
     Services                                 (235,986)            (227,970)          (241,293)
  Connection costs                              (5,818)              (6,213)            (4,762)
  Equipment costs                              (27,817)             (49,260)           (72,261)
                                         -------------------- --------------------------------------
  Total cost of sales                         (269,621)            (283,443)          (318,316)
                                         ==================== ======================================
</TABLE>

The segmental reporting by strategic operating entity is prepared on a
geographical basis and reflects the measures of segmental profit and loss and
financial position reviewed by management. The definition of strategic segment
is defined in notes 1 and 3. Other than financing arrangements, there are no
significant transactions between the segments. For the purposes of this
presentation, corporate expenses have been fully allocated to Unallocated.

SANBAO Telecom (Asia)                          2002       2001       2000
                                            ---------------------------------
                                             US$ '000   US$ '000   US$ '000
                                            ---------------------------------
Revenues                                      233,671    209,635    154,256
   of which divested                            1,113      5,878      9,533
Depreciation and amortization                 (47,023)   (45,041)   (35,199)
   of which divested                           (4,812)    (3,870)    (4,269)
Operating profit  (loss)                       71,547     50,559      3,656
   of which divested                           (5,601)    (4,048)    (3,666)
Non-cash expenses                                 199       (529)   (52,290)
   of which divested                                -          -    (33,639)
Profit (loss) before minority interest         47,207     23,297    (32,022)
   of which divested                          (13,318)   (11,450)   (17,083)
Assets                                        286,878    275,994
   of which divested                                -     12,568
Capital expenditure                            39,991     67,000
   of which divested                                4      1,984
Liabilities                                  (199,189)  (291,034)
   of which divested                                -    (52,490)


                                     F-44
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

MIC Latin America                              2002       2001       2000
                                            ---------------------------------
                                             US$ '000   US$ '000   US$ '000
                                            ---------------------------------
Revenues                                      277,554    315,321    313,842
   Of which El Salvador                             -     17,311     45,555
Depreciation and amortization                 (54,286)   (67,545)   (57,132)
   Of which El Salvador                             -     (2,992)    (5,658)
Operating (loss) profit                       (10,867)    63,424     54,353
   Of which El Salvador                             -      3,517     11,094
Share of net profit of investment in
associate company                                  62          -          -
Non-cash expenses                             (27,742)    (1,422)   (18,380)
(Loss) Profit before minority interest         (1,648)     9,897      2,043
   Of which El Salvador                             -      1,603      6,577
Assets                                        451,997    538,666
   Of which El Salvador                        52,858     52,858
Capital expenditure                            33,379     75,301
   Of which El Salvador                             -      1,944
Liabilities                                  (205,192)  (333,290)


MIC Africa                                     2002       2001       2000
                                            ---------------------------------
                                             US$ '000   US$ '000   US$ '000
                                            ---------------------------------
Revenues                                       52,080     45,323     33,897
Depreciation and amortization                  (8,883)    (6,928)    (5,399)
   of which divested                              (20)       (15)         -
Operating profit (loss)                         1,161      5,484      3,681
   of which divested                             (392)      (311)         -
Non-cash expenses                                (745)       (15)    (2,466)
Loss before minority interest                  (6,918)    (2,672)   (10,765)
   of which divested                             (500)      (378)         -
Assets                                         89,705     96,251
   of which divested                                -      9,894
Capital expenditure                            16,248     18,224
   of which divested                               12      2,065
Liabilities                                   (99,301)  (107,679)
   of which divested                                -    (10,018)


                                     F-45
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

Other                                          2002       2001       2000
                                            ---------------------------------
                                             US$ '000   US$ '000   US$ '000
                                            ---------------------------------
Revenues                                       15,671     11,945     3,798
   of which divested                            2,620      2,156     1,422
Depreciation and amortization                  (8,586)    (5,707)   (3,534)
   of which divested                           (1,080)    (2,628)   (2,673)
Operating loss                                (18,366)   (11,124)  (10,667)
   of which divested                          (11,954)    (8,091)   (7,097)
Loss from associated companies                      -          -   (43,178)
   of which divested                                -          -   (43,178)
Non-cash expenses                             (11,960)         -         -
   of which divested                           (6,833)         -         -
Loss before minority interest                 (24,483)   (16,634)  (55,681)
   of which divested                          (14,453)   (11,976)  (51,661)
Assets                                         15,604     38,151
   of which divested                                -     11,969
Capital expenditure                             7,217     10,489
   of which divested                            1,650      3,956
Liabilities                                   (14,485)   (58,606)
   of which divested                                -    (42,394)


MIC Systems (divested in 2002)                 2002       2001       2000
                                            ---------------------------------
                                             US$ '000   US$ '000   US$ '000
                                            ---------------------------------
Revenues                                       28,186     26,300     28,027
Depreciation and amortization                  (6,814)    (4,588)    (3,139)
Operating profit                                7,275      5,864      4,758
Non-cash expenses                                 (53)      (211)    (3,766)
Profit (loss) before minority interest          3,892      3,124     (1,816)
Assets                                              -     26,074
Capital expenditure                               774      1,184
Liabilities                                         -    (13,734)


FORA Telecom (divested 2001)                   2002       2001       2000
                                            ---------------------------------
                                             US$ '000   US$ '000   US$ '000
                                            ---------------------------------
Revenues                                            -     37,716     36,999
Depreciation and amortization                       -     (7,642)   (11,999)
Operating profit (loss)                             -      1,061    (39,115)
Non-cash expenses                                   -        214    (30,294)
Loss before minority interest                       -     (9,844)   (51,483)
Assets                                              -          -
Capital expenditure                                 -      7,238
Liabilities                                         -          -


                                     F-46
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

Unallocated items                              2002        2001       2000
                                            ---------------------------------
                                             US$ '000    US$ '000   US$ '000
                                            ---------------------------------
Revenues                                           41          15         21
Depreciation and amortization                  (5,861)     (7,633)   (12,849)
Operating profit (loss)                        71,564     (22,482)   (70,044)
   of which divested                           (1,410)     (440)      (1,624)
Loss from associated companies                      -      (3,112)         -
Non-cash expenses                              (9,865)    (19,453)    (2,436)
(Loss) profit before minority interest       (380,698)   (144,417)   501,544
   of which divested                           (6,914)     (1,009)    (2,043)
Assets                                      1,857,632   3,253,189
   of which divested                                -       3,247
Capital expenditure                               165          85
Liabilities                                (2,365,170) (3,344,803)
   of which divested                                -     (12,167)


INTER-SEGMENT ELIMINATIONS                     2002        2001       2000
                                            ---------------------------------
                                             US$ '000    US$ '000   US$ '000
                                            ---------------------------------
Revenues                                       (2,017)     (1,685)         -
   of which divested                             (463)       (378)         -
Operating loss                                      -           -          -
Profit before minority interest                     -           -          -
Assets                                     (1,498,697) (2,357,395)
Capital expenditure                                 -           -
Liabilities                                 1,408,692   2,357,372


TOTAL                                          2002        2001       2000
                                            ---------------------------------
                                             US$ '000    US$ '000   US$ '000
                                            ---------------------------------
Revenues                                      605,186     644,570    570,840
   of which divested                           31,456      71,672     75,981
Depreciation and amortization                (131,453)   (145,084)  (129,251)
   of which divested                          (12,726)    (18,743)   (22,080)
Operating profit (loss)                       122,313      92,786    (53,378)
   of which divested                          (12,082)     (5,965)   (46,744)
Profit (loss) from associated companies            62      (3,112)   (43,178)
Non-cash expenses                             (50,166)    (21,416)  (109,632)
   of which divested                           (6,886)          3    (67,699)
(Loss) profit before minority interest       (362,649)   (137,249)   351,820
   of which divested                          (31,293)    (31,533)  (124,086)
Assets                                      1,203,119   1,870,930
   of which divested                                -      63,752
Capital expenditure                            97,774     179,521
   of which divested                            2,440      16,427
Liabilities                                (1,474,645) (1,791,774)
   of which divested                                -    (130,803)

Non-cash expenses other than depreciation and amortization mainly comprise
write-downs of assets disclosed in note 20.


                                     F-47
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

19.  PERSONNEL CHARGES

The following personnel charges are included in sales and marketing expenses,
general and administrative expenses and other operating expenses:

                                    2002             2001             2000
                              ---------------- ----------------- ---------------
                                  US$ '000         US$ '000         US$ '000
                              ---------------- ----------------- ---------------

Wages and salaries
   Sales and marketing               8,761           12,073           10,375
   General and administrative       23,961           30,756           29,448
   Other operating expenses         10,609           10,625            8,498
                              ---------------- ----------------- ---------------
                                    43,331           53,454           48,321
                              ================ ================= ===============

Social security
   Sales and marketing                 948            1,468            1,367
   General and administrative        3,809            4,603            5,398
   Other operating expenses            111              264              190
                              ---------------- ----------------- ---------------
                                     4,868            6,335            6,955
                              ================ ================= ===============

                              ---------------- ----------------- ---------------
                                    48,199           59,789           55,276
                              ================ ================= ===============

The average number of permanent employees on a proportional basis during 2002
was 2,080 (2001: 3,032; 2000: 3,515).

Directors received payments of $1,711,000 (2001: $1,840,000; 2000: $2,277,000)
in respect of their services to the Group.

The Group does not have any material pension or post retirement plan
arrangements.

Stock-based compensation offered to officers and employees are disclosed in
Note 16.


                                     F-48
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

20.  GAIN AND LOSS ON EXCHANGE, DISPOSAL AND WRITE-DOWN OF ASSETS, NET

a)   Write-down of assets, net

During 2002, MIC entered into discussions concerning the sale of its cellular
operation, Celcaribe, in Colombia. Following the signing of a sale and purchase
agreement in December 2002, management recognized an impairment between the
recoverable amount and the carrying value of its intangibles in Celcaribe.
Other impairments have also been identified and recorded as disclosed in the
following table by reporting segment:

<TABLE>
                  ----------------------------------------------------------------------
                                                  2002
                  ----------------------------------------------------------------------
                    Licenses      Goodwill      Equipment       Other          Total
                      (ii)         (i)                           (ii)
                    US$ '000      US$ '000       US$ '000      US$ '000       US$ '000
                  ----------------------------------------------------------------------
<S>                    <C>             <C>          <C>            <C>          <C>
MIC Latin America     41,733        35,723              -         7,107         84,563
Sanbao Telecom             -             -              -         (199)           (199)
Africa                     -             -              -          745             745
MIC Systems                -             -              -           53              53
Unallocated                -             -              -          464             464
Other                  4,945           585          6,833          182          12,545
                  ----------------------------------------------------------------------
                      46,678        36,308          6,833        8,352          98,171
                  ======================================================================
</TABLE>

(i) Recorded under "Other operating expenses"
(ii) Recorded under "General and administrative expenses"


In December 2002, MIC invoked a drag-along clause on Celcaribe options,
resulting in a credit of $21,098,000 (note 9).

During 2001, management identified impairment of its license to operate
high-speed wireless data services in the UK due to initial market conditions
that have delayed profitable asset deployment. Therefore, an impairment was
measured as the difference between the recoverable amount, determined by
reference to discounted cash flows and the carrying value of the license at the
measurement date, resulting in a write-down of $20,074,000. Other impairments
have also been identified and recorded as disclosed in the following table by
geographic region:


                                     F-49
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

               -----------------------------------------------------------
                                          2001
               -----------------------------------------------------------
                 Licenses       Goodwill        Other           Total
                   (ii)            (i)           (ii)           (ii)
                  US$ '000       US$ '000      US$ '000        US$ '000
               -----------------------------------------------------------
Sanbao Telecom         350          1,030           179           1,559
FORA Telecom           146            622          (360)            408
Lama                     -              -         1,422           1,422
Africa                   -              -            15              15
MIC Systems              -              -           211             211
Unallocated              -              -          (655)           (655)
Other               20,074              -            34          20,108
               -----------------------------------------------------------
                    20,570          1,652           846          23,068
               ===========================================================

(i) Recorded under "Other operating expenses"
(ii) Recorded under "General and administrative expenses"


During 2000, management identified impairment of its analog fixed assets and
related licenses and intangibles due to the faster-than-expected migration of
its analog subscribers to digital platforms. This rapid migration created a
likely expectation that the analog assets would be decommissioned or disposed
of significantly before the end of their previously estimated useful life. As a
result of this rapid migration, the Company re-assessed the recoverability of
its investments in the third quarter of 2000. The analog assets will continue
to be held and used in the operations until migration to digital networks is
complete. However, the discounted cash flows projected to be generated from
analog assets have indicated that the recoverable amount of these assets is
lower than the carrying value. Therefore, impairment was measured as the
difference between the recoverable amount, determined by reference to
discounted cash flows, and the carrying value of the analog assets at the
measurement date. As a result, an impairment charge of $105,668,000 ($2.13 per
share on a diluted basis) was recognized in the consolidated income statement
and is included in the caption "General and administrative expenses". Following
is a detail of the impairment by geographical region:

<TABLE>
                  ----------------------------------------------------------------------
                                                  2002
                  ----------------------------------------------------------------------
                    Licenses      Goodwill      Equipment       Other          Total
                      (ii)         (i)                           (ii)
                    US$ '000      US$ '000       US$ '000      US$ '000       US$ '000
                  ----------------------------------------------------------------------
<S>                    <C>             <C>          <C>            <C>          <C>
Sanbao Telecom        19,203             -         33,087             -         52,290
MIC Latin America          -             -         18,379             -         18,379
FORA Telecom          10,046         2,239         20,248             -         32,533
MIC Africa                 -             -          2,466             -          2,466
MIC Systems                -             -              -         3,766          3,766
Unallocated                -             -              -         2,437          2,437
                  ----------------------------------------------------------------------
                      29,249         2,239         74,180         6,203        111,871
                  ======================================================================
</TABLE>

(i)  Recorded under "Other operating expenses"
(ii) Recorded under "General and administrative expenses"


                                     F-50
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

b) Gain (loss) from sale of subsidiaries and joint ventures, net

Year ended December 31, 2002 -

Following the sale of the Company's interest in FORA Telecom BV during 2001, as
described below, during 2002 MIC obtained the necessary GSM licenses and
therefore received the additional $30 million proceeds in cash. In addition,
certain loans for which MIC was liable were settled at less than their carrying
value. The credit realized on these less costs incurred in the acquisition of
the licenses, resulted in a net gain of $30,859,000 in 2002.

In July 2002, MIC's partner in its cellular operation in Vietnam exercised his
options to purchase 10% of the share capital of the company. MIC has recognized
a gain of $16,603,000 (note 9).

In September 2002, MIC sold its interest in its cellular operation in the
Democratic Republic of Congo recognizing a loss of $21,000.

Additionally, in September 2002, the Group sold its 100% interest in Liberty
Broadband Ltd. recognizing a loss of $10,294,000.

In May 2002, MIC sold 17% of its interest in MIC Systems BV, the direct parent
company of MACH SA, for $17,000,000 to Kinnevik BV. Further, in November 2002,
MIC Systems BV sold its 100% interest in Mach SA for a sum of Euro 95 million,
approximately $97,000,000. These two transactions resulted in the recognition
of a gain of $87,655,000 for the Group.

In December 2002, the Group completed the sale of its cellular operation in the
Philippines for a nominal sum, recognizing a loss of $35,988,000

Year ended December 31, 2001 -

In September 2001, the Company sold its 24.5% investment in SkyCell
Communications Limited, the Indian cellular company operating in Chennai
(formerly known as Madras), to Bharti Tele-Ventures Limited. The sale resulted
in a $28,354,000 gain on the disposal.

In November 2001, the Company sold 100% of its interest in FORA Telecom BV, its
Russian cellular telephony operations, to Tele2 AB. The agreement called for
$80 million of Tele2 AB class 'B' shares, (corresponding to 2,461,449 Tele2 AB
'B' shares), to be exchanged for the assets plus a maximum of $30 million in
cash or additional Tele2 AB "B" shares, depending on the outcome of GSM license
applications for three of MIC's existing cellular telephony operations in
Russia. Upon execution of the sale agreement, MIC agreed to assign deposits
held for loans by Banque Invik and to waive all intercompany balances between
the segment and the Group. The total disposal resulted in a $6,693,000 non-cash
gain recognized in 2001.

Year ended December 31, 2000 -

In May 2000, MIC sold a 20% interest in Millicom (Ghana) Limited to an existing
partner. The sale generated no gain or loss on disposal.

During 2000, the Group charged its profit and loss account with $2,755,000 in
respect of the impairment of the carrying value of investments in certain
start-up ventures.


                                     F-51
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

c)   (Loss) gain from investment securities

As of December 31, 2002, MIC holds a 6.8% interest in Tele2 AB ordinary shares
accounted for as both a current and non-current investment in securities. From
time to time MIC has sold parts of its investment in Tele2 AB and recognized a
loss or gain on the disposal. Losses or gains recognized in 2002, 2001, and
2000 are $(168,818,000), $(15,931,000) and $55,321,000, respectively (note 8).
Additionally, during 2002, MIC has recognized a significant and prolonged
decline in the value of its investment in Tele2 AB and, as a result, charged an
amount of $119,138,000 to the profit and loss account.

Also, during 2002, MIC made an impairment on its investment in Great Universal
for an amount of $5,027,000. In addition, MIC recognized an impairment on its
investment in Modern Holdings of $7,050,000 (note 8).

During 2002, the Group also disposed of its investment in Luxaviation SA,
previously held as an investment in securities, recognizing a gain of $70,000.

In September 2000, following the exchange offer of Tele2 AB, the Company
exchanged its 29.6% interest ownership in SEC realizing a gain of $609,941,000,
corresponding to the market value of the Tele2 AB shares obtained less the
value of SEC as recorded in the books of the Company.


                                     F-52
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

d) Disclosure on discontinuing operations

In May 2002 the Group publicly announced its intention to sell the MIC Systems
group of companies. These operations were sold on November 15, 2002 and are
reported in these financial statements as a discontinuing operation. The sales,
results, cash flows and net assets of the MIC Systems operations were as
follows:

<TABLE>
                                                             From January 01,
                                                             2002 to November       Year ended
                                                                 15, 2002        December 31, 2001
                                                             ----------------------------------------
                                                                  US$ '000            US$ '000
                                                             ----------------------------------------
<S>                                                                   <C>             <C>
Sales                                                                   27,723          25,921
Operating costs                                                       (20,911)        (20,423)
                                                             ----------------------------------------
Profit from operations                                                   6,812           5,498
Finance cost                                                           (1,969)         (1,521)
                                                             ----------------------------------------
Profit before tax                                                        4,843           3,977
Tax                                                                    (1,414)         (1,219)
                                                             ----------------------------------------
Profit after tax                                                         3,429           2,758
                                                             ========================================

Operating cash flows                                                   (1,088)           6,181
Investing cash flows                                                     4,499         (5,361)
Financing cash flows                                                     (281)             (4)
                                                             ----------------------------------------
Total cash flows                                                         3,130            816
                                                             ========================================

                                                                                    At December 31,
                                                               At Nov 15, 2002            2001
                                                             ----------------------------------------
                                                                  US$ '000            US$ '000
                                                             ----------------------------------------
Property, plant and equipment                                            2,293           2,297
Other non-current assets                                                 6,255           5,477
Current assets                                                          26,167          11,309
                                                             ----------------------------------------

Total assets                                                            34,715          19,083
Total liabilities                                                      (8,099)          (6,748)
                                                             ----------------------------------------
Net assets                                                              26,616          12,335
                                                             ========================================

The gain on disposal was determined as follows:
Net assets sold                                                         26,616
Proceeds from sale                                                     114,271
                                                             ------------------
Gain on disposal                                                        87,655
Tax thereon                                                                  -
                                                             ------------------

After-tax gain on disposal                                              87,655
                                                             ------------------

The net cash inflow on sale is determined as follows:
Proceeds from sale                                                     114,271
Less: cash and cash equivalents in subsidiary sold                     (4,125)
                                                             ------------------
Net cash inflow on sale                                                110,146
                                                             ==================
</TABLE>


                                     F-53
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

21.  TAXES

Group taxes are comprised of income taxes of subsidiaries and joint ventures.
As a Luxembourg commercial company, the Company is subject to all taxes
applicable to a Luxembourg Societe Anonyme. Due to losses incurred and brought
forward, no taxes based on Luxembourg-only income have been computed for 2002,
2001 or 2000.

The effective tax burden on profitable operations is approximately 25% (2001:
19%; 2000: 17%). The weighted average effective rate of tax has been reduced in
the years 1999 to 2001 largely due to the government in Paraguay creating a
foreign investment incentive program reducing the basic rate of income tax by
95% on the incremental profits generated by new capital investment. Currently
profitable operations are in jurisdictions with tax rates of 13% to 35% (2001:
8% to 40%; 2000: 14% to 40%). The utilization of tax loss carryforwards or
holidays had an impact of decreasing the effective tax rate on profitable
operations by approximately 1% in 2002 (2001: 1%; 2000: (1)%). The operations
currently incurring losses operate in tax jurisdictions with rates ranging from
25% to 35% (2001: 25% to 35%; 2000: 20% to 35%).

A reconciliation between the weighted average statutory rate applicable to
profitable operations and the effective weighted average tax rate is as
follows:

                                              2002         2001         2000
                                           -------------------------------------
                                               %            %            %
                                           -------------------------------------
Weighted average statutory rate                26           22           22
Investment incentive program (Paraguay)         -           (2)          (6)
Utilization of tax loss carryforwards          (1)          (1)           1
                                           ------------ ------------------------
Weighted average effective rate                25           19           17
                                           ============ ========================

The charge for income taxes is shown in the following table and recognizes that
revenue and expense items may affect the financial statements and tax returns
in different periods (temporary differences):

                                          2002            2001          2000
                                     --------------- ---------------------------
                                        US$ '000        US$ '000      US$ '000

Current income tax charge                 21,143          25,577        17,771
Deferred income tax charge (income)        1,591         (17,360)        8,493

                                     --------------- ---------------------------
Charge for taxes                          22,734           8,217        26,264
                                     =============== ===========================

Included in the above charge is $1,467,000 (2001: $3,323,000; 2000: $6,085,000)
in respect of divested operations and a charge of $77,000 (2001: credit of
$309,000; 2000: charge of $88,000) in respect of taxes relating to prior
periods.


                                     F-54
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

The tax effects of significant items comprising the Group's net deferred income
tax liability as of December 31, 2002 and 2001 are as follows:

                                                           2002         2001
                                                      --------------------------
                                                         US$ '000     US$ '000
                                                      --------------------------

Deferred income tax liabilities:
    Differences between book and tax
      basis of assets and liabilities                    (26,874)      (20,507)
                                                      ------------ -------------

Deferred income tax assets:
    Tax credit carryforwards                               2,734         3,110
    Temporary differences due to impairment charges        3,510             -
    Net operating and other loss carryforwards             2,226           675
                                                      ------------ -------------
Net deferred income tax assets                             8,470         3,785
                                                      ------------ -------------

Deferred income tax liability                            (18,404)      (16,722)
                                                      ============ =============

Amount included in balance sheet as non-current
  deferred tax liability                                 (26,874)      (20,507)
                                                      ============ =============

Amount included in balance sheet as non-current
  deferred taxation asset                                  8,470         3,785
                                                      ============ =============

Deferred income tax liabilities are comprised of $13,500,000 (2001:
$13,500,000) deferred US Federal income taxes and $13,374,000 (2001:
$7,007,000) deferred income taxes in other jurisdictions, reflecting temporary
differences between the carrying amounts of assets and liabilities for
financial reporting purposes and the amounts used for income tax purposes.
Deferred income tax assets are comprised of tax credit carryforwards and
operating losses in joint ventures and subsidiaries.

The Company has not recorded deferred income tax liabilities applicable to
undistributed earnings of foreign joint ventures and subsidiaries that will be
reinvested in foreign operations. Undistributed earnings amounted to
approximately $87,641,000 at December 31, 2002 (2001: $325,264,000; 2000:
$265,311,000).

Net operating and other loss carryforwards amounting to $189,080,000 (2001:
$108,069,000;2000: $84,269,000) are present in the Group. These have expiry
periods depending on their jurisdiction of greater than one year. $177,271,000
(2001: $107,394,000; 2000: $84,269,000) of these net operating and other loss
carryforwards are not anticipated to be used within expiry periods.

In October 2001, the Company determined that the Tax Liabilities, as defined by
the Merger Agreement, amounted to $7,023,000. At the time of the Merger, the
Group recorded a provision of $13,544,000 as a deferred tax liability for the
Tax Liabilities, resulting in a difference of $6,521,000 that was settled by
the final issuance of 374,521 shares and a realized gain of $3,521,000 (note
16) corresponding to the difference between the issuance price and the share
price as of the date of the transaction.

Concurrently, the Group reversed a deferred tax provision of $12,274,000. Such
amount has been recorded as a deduction to the tax provision for the year ended
December 31, 2001 as a deferred tax income.


                                     F-55
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

22.  CASH FLOW FROM OPERATING ACTIVITIES

<TABLE>
                                                                2002             2001           2000
                                                          ------------------------------------------------
                                                              US$ '000         US$ '000       US$ '000
                                                          ------------------------------------------------
<S>                                                          <C>               <C>            <C>
(Loss) profit after taxes for the year                       (385,143)         (138,053)      355,388
Adjustments for non-cash items:
   Depreciation and amortization                              141,754           154,191       143,329
   Decrease in discount on subordinated notes                       -            50,685       111,604
   Write-down of assets                                        78,167            23,998       112,719
   Loss (gain) on exchange and disposal of assets             (88,814)          (35,047)        2,755
   Loss (gain) from investment securities                     299,963            15,931      (665,262)
   Charge for financial instruments                             7,858             9,914             -
   (Profit) loss from operations in associate companies           (62)            3,112        43,178
   Increase in the impairment for doubtful debts                2,558             9,531           291
   Minority interest                                           22,494               804        (3,568)
   Other income                                               (42,247)          (11,596)            -
Adjustment to reconcile working capital:
   Increase (decrease) in trade debtors, prepaid and
     other current assets                                       5,790           (34,701)      (56,424)
   Decrease (increase) in inventories                           5,386             3,277        (5,532)
   Increase in trade and other payables                        30,732            58,347        70,938
   (Decrease) increase in accrued interest                     (8,841)            2,435         3,355
   Increase (decrease) in accrued taxation                      2,986            (8,859)       14,698
                                                          ---------------  -------------------------------
Net cash provided (used) by operating activities               72,581           103,969       127,469
                                                          ===============  ===============================
</TABLE>

Interest paid during the year amounted to $197,297,000 (2001: $208,029,000;
2000: $74,302,000). Taxes paid amounted to $21,582,000 (2001: $22,671,000;
2000: $5,552,000).

23.  ACQUISITION OF SUBSIDIARIES

The Group has, from time to time, acquired or increased its share in certain
subsidiaries and joint ventures. The fair value of the assets acquired and
liabilities assumed during the year were as follows:

<TABLE>
                                                                2002             2001           2000
                                                          ------------------------------------------------
                                                              US$ '000         US$ '000       US$ '000
                                                          ------------------------------------------------
<S>                                                          <C>               <C>            <C>
Tangible fixed assets                                               -            11,430        60,909
Goodwill                                                        2,268             8,091        30,560
Intangible fixed assets                                             -            12,851        30,632
Current assets                                                    390             3,742         6,609
Amounts due in more than one year                                   -           (1,691)      (42,966)
Amounts due in less than one year                                   -           (7,902)      (53,568)
Minority interest                                                (658)          (3,150)         (277)
                                                          ---------------  -------------------------------
Total purchase price                                            2,000            23,371        31,899
Less:     Cash acquired                                             -             (393)       (4,500)
                                                          ---------------  -------------------------------
Cash paid for acquisitions net of cash acquired                 2,000            22,978        27,399
                                                          ===============  ===============================
</TABLE>


                                     F-56
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

In 2002, the Company increased its ownership in Celcaribe throughout the year to
arrive at an ownership percentage of 95.4% as of December 31, 2002 (note 9). In
addition, in November 2002, MIC purchased the remaining 30% interest in Millicom
(Ghana) Limited. Both operations were fully consolidated at December 31, 2002
and 2001.

24.  DISPOSAL OF SUBSIDIARIES

The Group has, from time to time, disposed of or reduced its share in certain
subsidiaries and joint ventures. The impact of the change in consolidation
method and the fair value of the assets disposed of and liabilities assigned
during the year were as follows:

<TABLE>
                                                                2002             2001           2000
                                                          ------------------------------------------------
                                                              US$ '000         US$ '000       US$ '000
                                                          ------------------------------------------------
<S>                                                          <C>               <C>            <C>
Tangible fixed assets                                           11,396           36,419          2,231
Intangible fixed assets                                         26,332            9,503            780
Pledged deposits                                                30,989                -              -
Current assets                                                  72,553           60,596            845
Amounts due in more than one year                               (2,125)          (2,526)           (72)
Amounts due in less than one year                              (86,899)         (38,352)        (4,434)
Disposal of minority interest                                    5,594              (75)           650
                                                          ---------------  -------------------------------
                                                                57,840           65,565              -
Profit on sale                                                  57,955           35,047             17
                                                          ---------------  -------------------------------
Total sale price                                               115,795          100,612             17

Add:  Additional proceeds on sale of FORA less
        expenses incurred                                       27,547                -              -
Less: Cash                                                      (8,271)          (1,803)             -
        Available-for-sale securities received                      -          (79,558)              -
                                                          ---------------  -------------------------------
Cash flow on disposal net of cash                              135,071           19,251             17
                                                          ===============  ===============================
</TABLE>

The results, assets and liabilities of divested operations are summarized in
note 18.

25.  NON-CASH INVESTING AND FINANCING ACTIVITIES

<TABLE>
                                                                2002             2001           2000
                                                          ------------------------------------------------
                                                              US$ '000         US$ '000       US$ '000
                                                          ------------------------------------------------
<S>                                                          <C>               <C>            <C>
Investing activities:
    Revaluation of marketable securities                       (57,813)         (79,061)      (316,043)
    Non-cash capital expenditure, net                           28,935           12,657         26,113
    Change in consolidation method                                   -           25,464              -
      Disposal of joint ventures                                     -          (72,865)             -
    Acquisition of available-for-sale                                -          79,557              -
      securities

Financing activities:
    Increase of debt and other financing                             -           50,685        111,604
    Repayment of debt                                          (35,753)               -              -
    Issuance of capital                                              -            2,999              -
</TABLE>


                                     F-57
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

26.  COMMITMENTS AND CONTINGENCIES

The Company and its operations are contingently liable with respect to lawsuits
and other matters that arise in the normal course of business. As of December
31,2002, MIC's consolidated share of these matters that have not been provided
totaled $16,381,000. Management is of the opinion that while it is impossible
to ascertain the ultimate legal and financial liability with respect to these
contingencies, the ultimate outcome of these contingencies is not anticipated
to have a material effect on the Group's financial position and operations.

   Mach

In November 2002, MIC completed the sale of MACH SA for Euro 95 million.
Following examination of the books and records of Mach SA subsequent to
purchase, the buyers have claimed a reduction of approximately $4,550,000 in
the purchase price to reflect a claimed lower balance sheet value, as per the
terms of the purchase agreement. MIC's management is currently examining this
claim but does not expect there to be any material adjustment.

   Debt pledges, guarantees and commitments

Details of debt pledges, guarantees and commitments are contained in notes 17
and 27.

   Letters of support

In the normal course of business, the Company issues letters of support to
various companies and joint ventures within the Group.

   Operational environment

MIC has operations in emerging markets, namely Asia, Latin America and Africa,
where the regulatory, political, technological and economic environments are
evolving. As a result, there are uncertainties that may affect future
operations, the ability to conduct business, foreign exchange transactions and
debt repayments and which may impact upon agreements with other parties. In the
normal course of business, MIC is involved in discussions regarding taxation,
interconnect and tariffing arrangements, which can have a significant impact on
the long-term economic viability of its operations. In management's opinion,
the current status and anticipated evolution of the regulatory, political,
technological and economic environments as well as its business arrangements
with third parties in countries in which MIC has operations will not materially
negatively impact MIC's financial position or operations.

   Lease commitments

Operating Leases:

The Group has the following annual operating lease commitments as of December
31, 2002 and 2001 maturing at various dates through 2048.


                                     F-58
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

                                                2002             2001
                                          ----------------------------------
Minimum lease commitments                     US$ '000         US$ '000
                                          ----------------------------------

Within:    One year                                246            1,120
Between:   One - two years                         228              500
           Two - three years                       199              309
           Three - four years                      167              247
           Four - five years                       128              205
After:     Five years                              196            1,109
                                          ---------------- -----------------
Total                                            1,164            3,490
                                          ================ =================

Operating lease expense was approximately $5,018,000 in 2002 (2001: $3,466,000;
2000: $10,594,000).

Finance leases:

Future minimum payments on the finance leases are as follows:

                                                2002             2001
                                          ----------------------------------
Finance lease repayments                      US$ '000         US$ '000
                                          ----------------------------------

Within:    One year                                290              737
Between:   One - two years                         138              229
           Two - three years                        26              156
           Three - four years                        2               23
           Four - five years                         -                -

After:     Five years                                -                -
                                          ---------------- -----------------
Total                                              456               1,145
                                          ================ =================

The finance leases are comprised mainly of lease agreements relating to
vehicles used by the Group.

   Capital commitments

The Company and its joint ventures have a fixed commitment to purchase network
equipment, land and buildings and other fixed assets with a value of
$11,867,000 (2001: $56,436,000) from a number of suppliers within one year.

Included in the above commitments are those related to Comvik International
(Vietnam) AB for an amount of $9,619,000. As part of the 2000 and 2001
amendments (note 3), the operation still needs to disburse approximately $47
million before the end of the revenue sharing agreement in 2005.

   Dividends

The ability of the Company to make dividend payments is subject to, among other
things, the terms of the indebtedness, local legal restrictions and the ability
to repatriate funds from MIC's various joint ventures.


                                     F-59
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

27.  RELATED PARTY TRANSACTIONS

The Company's principal shareholder is Industriforvaltnings AB Kinnevik
("Kinnevik"). Kinnevik is a Swedish holding company with interests in the
telecommunications, media, publishing and paper industries.

On December 31, 1995, MIC acquired 17.7% of MACH from Kinnevik. The
consideration, which was to have a minimum present value of $5,000,000 at
December 31, 1995, consisted of (i) an initial payment of $1,000,000 plus
interest, at the ruling market rate, for the month of January 1996, (ii) seven
additional payments for each of the financial years 1996 to 2002, calculated as
17.7% of MACH's pre-tax profit for the relevant year and payable in April of
the following year, and (iii) a final payment payable in April 2003, calculated
as the higher of (a) the sum of the seven additional payments multiplied by a
factor of 1.3 minus the initial payment or (b) the amount required to make the
present value of all payments at December 31, 1995 equal to $5,000,000. The
final payment is to be made in common stock of MIC using a share price of
$30.50 per share. An amount of $3,958,000 (2001: $7,042,000), equal to the
estimated remaining purchase payment for this transaction based on the results
of MACH to date, is included in the balance sheet under the heading "Amounts
due to shareholders". In 1996 the remaining 2.7% of MACH was purchased from the
remaining unrelated shareholder giving MIC a 100% interest.

In May 2002, MIC sold a 17% interest in MIC Systems BV, the parent company of
MACH, to Kinnevik BV for $17,000,000.

As of December 31, 2002, MIC owed $63,000 (2001: $116,000) to Kinnevik for
additional charges.

During 2002, Kinnevik purchased MIC Notes (note 17) on the open market with a
face value of $44,000,000. MIC then exchanged these for $1,500,000 cash and
672,016 Tele2 AB shares at market prices.

During the course of 2002, MIC sold an additional 6,177,369 Tele2 AB 'B' shares
at market prices to Kinnevik for a value of $104,295,000.

On September 27, 2000, following an exchange offer made by Tele2 AB, the
Company exchanged its SEC shares into Tele2 AB shares.

In November 2001, the Company sold 100% of its interests in FORA Telecom BV,
its Russian Cellular telephony operations to Tele2 AB. The agreement called for
$80 million in Tele2 AB class 'B' shares to be exchanged for the assets plus a
maximum equivalent of $30 million in cash or additional Tele2 AB "B" shares,
depending on the outcome of GSM license applications for three of MIC's
existing cellular telephony operations in Russia. The sale resulted in a
$6,693,000 gain on the disposal in 2001 (note 20). During 2002, MIC obtained
the necessary GSM licenses referred to above and therefore received the
additional $30 million proceeds in cash. In addition, certain loans for which
MIC was liable were settled at less than their carrying value. The credit
realized on these, less costs incurred in the acquisition of the licenses,
resulted in a net gain of $30,859,000 in 2002.

The Group maintains corporate bank accounts at Banque Invik through which it
makes payments and receives monies in the normal course of business. As of
December 31, 2002, the Group had current accounts, time deposits and blocked
deposits at Banque Invik.


                                     F-60
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

MIC charged $nil (2001: $280,000; 2000: 800,000) to related parties for
services rendered.

During the course of the year, directors received payments in respect of their
services to the Group (note 19).

     Great Universal

As of December 31, 1998, the Group, through its subsidiary MIC-USA inc.
("MIC-USA"), had a 100% temporary and restricted shareholding in Great
Universal. On December 31, 1999, MIC-USA transferred its 100% ownership and
related rights in Great Universal to Great Universal LLC 1999 Trust for a
consideration of $5,027,000, corresponding to the net book value of MIC's
investment in Great Universal. This amount is recorded in Investment in
securities. During 2002, management made an impairment for 100% of this asset
due to uncertainty concerning its recoverability. Following the reorganization
described below, the rights and obligations of MIC-USA toward Great Universal
were assigned to Great Universal LLC. Great Universal continues to indemnify
MIC against certain contingent liabilities of Millicom. Great Universal is
currently engaged in the communications, information technology, teleservices
and media industries primarily in the United States.

In June 1999, Great Universal effected a reorganization of Great Universal and
its subsidiaries, in which Great Universal was merged with and into Great
Universal LLC and operations were spun off into two separate businesses, being
Great Universal and Modern Holdings. Great Universal Inc. holds the
subsidiaries in teleservices, television and media and specialized electronics
industries, and Modern Holdings holds the subsidiaries in the integrated
network services industries. Great Universal LLC holds 100% of common shares in
Great Universal Inc. and 53% of common shares in Modern Holdings. MIC does not
consolidate its investment in Great Universal as, due to the warrant holders'
right to exercise, it considers it does not control Great Universal and also
that there exist severe long-term restrictions that significantly impair the
ability of Great Universal to transfer funds to MIC.

In January 2000, Modern Holdings sold its 100% interest in MACH USA to MACH SA
for a total consideration of $1,800,000. Due to the loss situation of MACH USA
and the low expected development of MACH USA, the Company's management decided
to close the activities of MACH USA and to write down the investment.

In January 2000, MIC invested $10,000,000 in Modern Holdings in the form of
promissory notes. In February 2000, those notes were converted into 1,293,095
shares of common stock, representing 8.5% of the share capital of Modern
Holdings. This investment is recorded as a non-current available-for-sale
security (note 8).

The largest single shareholder in the Company is Kinnevik, with a direct
interest of 36%. The following purchases and outstanding balances occurred with
companies affiliated to Kinnevik. All transactions were conducted on commercial
terms and conditions at market prices. The services supplied covered fraud
detection, network and IT support, acquisition of assets and customer care
systems.


                                     F-61
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

As of December 31, 2002 and 2001, MIC had the following payables and purchases
to related parties:

                                Purchases in year           Amount payable at
                                                              December 31,
                                2002         2001           2002         2001
                           -----------------------------------------------------
                              US$ '000     US$ '000       US$ '000     US$ '000
                           -----------------------------------------------------
Bassett                            669        1,222             23          101
Great Universal                      -            -             25           39
Netcom Consultants                 157          554              9           56
Procure-it-right                   839          962            100            1
Applied Sales Management           110          100              -            -
Applied Value                    2,009          484            252            -
Praesidium                         204           70              -            3
Lothar Systems                      10        1,601            288          508
Ephibian                            38            -              -            -
Shared Value                       656          477             23            -
YXK Systems                         28            -              -            -
Search Value                       489          189              -            -
Banque Invik                       638          438             44            -
Tele2                               50           25          5,723       10,596
                           -------------------------- --------------------------
                                 5,897        6,122          6,487       11,304
                           ========================== ==========================

As of December 31, 2002 and 2001, MIC had the following receivables from
Kinnevik and other related parties:

                                           2002        2001
                                     --------------------------
                                         US$ '000    US$ '000
                                     --------------------------
Kinnevik                                    1,976       2,581
Modern Times Group                            752         281
Metro                                         734         256
Lothar                                        922          29
Tele2                                         359       4,216
Modern Holdings                             1,825       1,633
Netcom                                         64         100
Shared Value                                   18           6
Stonebrook Enterprises                        156         156
                                     --------------------------
                                            6,806       9,258
                                     ==========================


                                     F-62
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

28.  OTHER CURRENT LIABILITIES

Other current liabilities are comprised as follows:

                                           2002        2001
                                     --------------------------
                                         US$ '000    US$ '000
                                     --------------------------

Taxes payable                              25,530      26,189
Deferred revenue                            8,389      10,771
Subscriber deposits                         6,463       8,500
Prepayment cards                           11,180       7,733
Other current liabilities                  23,436      39,553
                                     --------------------------
                                           74,998      92,746
                                     ==========================

29.  (LOSS) EARNINGS PER COMMON SHARE

 (Loss) earnings per common share is comprised as follows:

<TABLE>
                                                             2002          2001           2000
                                                        -------------------------------------------
<S>                                                        <C>           <C>             <C>
Basic and diluted (loss) earnings (US $'000's)             (385,143)     (138,053)       355,388
                                                        ===========================================

Weighted average number of shares outstanding
  during the period (in 000's)                                16,318       16,314         16,273
                                                        ===========================================

Effect of dilutive securities                                      -            -            227

Weighted average number of diluted shares outstanding
  during the period (in 000's)                                16,318       16,314         16,500
                                                        ===========================================

Basic (loss) earnings per common share (US$)                  (23.60)       (8.46)         21.84
                                                        ===========================================

Diluted (loss) earnings per common share (US$)                (23.60)       (8.46)         21.54
                                                        ===========================================
</TABLE>

At December 31, 2002, the Group had nil (2001: nil; 2000: 235,000) stock
options that were not included in the computation of diluted earnings per share
because to do so would have been anti-dilutive for the period presented.


                                     F-63
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

30.  RECONCILIATION TO U.S. GAAP

     The consolidated financial statements of the Group have been prepared in
accordance with International Financial Reporting Standards ("IFRS"). If the
consolidated financial statements had been prepared under accounting principles
generally accepted in the United States ("U.S. GAAP") the following principal
differences would arise:

1.   Under IFRS, the Company's interests in joint ventures are proportionally
     consolidated. Under U.S. GAAP, interests in joint ventures should be
     reflected in the consolidated financial statements using the equity
     method. The results of the reclassification of balance sheet captions are
     illustrated in the balance sheet reconciliation on the following pages.
     Information on the Group's share of income and expenses and cash flows
     contributed on a proportional basis under IFRS are included in Note 3 to
     the consolidated financial statements.

2.   Under the equity method of consolidation, if an investor's share of losses
     of an associate equals or exceeds the carrying amount of an investment
     plus advances made by the investor, the investor ordinarily discontinues
     including its share of losses and the investment is reported at nil value.
     If the investee subsequently reports net income, the investor should
     resume applying the equity method only after its share of that net income
     equals the share of net losses not recognized during the period the equity
     method was suspended. Additional losses are provided for when the investor
     has guaranteed obligations of the investee or is otherwise committed to
     provide further financial support for the investee. Losses recognized in
     excess of the investor's total investment due to a commitment to provide
     further financial support are recorded as a liability.

     Over the years, a number of joint ventures have incurred sufficient losses
     to reduce the value of the investment below MIC's total investment value
     in the joint venture, including loans, pledged deposits, obligations and
     guarantees. Under IFRS, MIC's proportional share of these losses are
     included in the Company's losses for the year. Summarized below are the
     adjustments to the profit and loss account that would have been recorded
     under U.S. GAAP for a) discontinuing MIC's share of losses on certain
     joint ventures in excess of MIC's total investment in the joint venture,
     and b) additional losses recorded by MIC above those recorded for IFRS due
     to MIC's commitment to provide further financial support to the joint
     venture. Furthermore, an adjustment was made to either increase or
     decrease the gain recorded for IFRS on the sale of the FORA joint
     ventures, due to the joint ventures having a lower net asset value under
     U.S. GAAP.

<TABLE>
                                                                             2001              2000
                                                          2002            (Restated)        (Restated)
                                                      -------------     -------------     -------------
                                                        U.S.$'000          U.S.$'000         U.S.$'000
                                                      -------------     -------------     -------------
<S>                                                          <C>                 <C>            <C>
     Discontinued share of losses...............             (416)               119            (1,990)

     Additional losses in excess of investment
        value...................................           (3,805)            (2,126)           (9,013)
     Increase (decrease) in gain on sale of
     FORA joint ventures........................                -             18,710                 -
                                                      -------------     -------------     -------------
                                                           (4,221)            16,703           (11,003)
                                                      =============     =============     =============
</TABLE>

3.   The value of cellular properties contributed by the shareholders of
     certain of the Company's joint ventures, upon formation, were not recorded
     at the contributing shareholder's carryover basis under IFRS. Rather, the
     value of such properties were stepped-up to reflect their fair value. The
     incremental value recorded for these properties was recorded as an
     intangible asset, attributable to franchises and licenses, for
     $58,628,000. Following the implementation of IFRS 38, the step-up in value
     of the properties has been amortized through the profit and loss account.
     The amount of


                                     F-64
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

     amortization expense recorded in 2002 was $2,273,000 (2001: $2,273,000;
     2000: $3,742,000). Under U.S. GAAP, the contributed properties would have
     been recorded at the contributing shareholder's carryover basis, thus no
     intangible asset and no amortization expense would have been recorded.
     Accordingly, this adjustment reverses the amortization expense recorded
     for IFRS, and the stepped-up value recorded in the balance sheet.

     Additionally, in 2000, the Company recorded an impairment charge for its
     cellular license in the Philippines. Upon formation of the Philippines
     joint venture, the value of the license was stepped-up in value, as
     described above. Because the value of this license was not stepped-up for
     U.S. GAAP, the impairment charge was reversed under U.S. GAAP for an
     amount of $9,502,000.

4.   In September 2000, the Company exchanged its shareholding in SEC for
     shares in Tele2 AB, realizing a gain of $609,941,000, corresponding to the
     market value of the Tele2 AB shares obtained less the value of SEC as
     recorded in the books of the Company. Under U.S. GAAP, the book value of
     the SEC investment would have been adjusted to reflect differences between
     IFRS and U.S. GAAP accounting resulting in a higher gain on the disposal
     of SEC in the amount of $41,575,000.

5.   Under U.S. GAAP, the accounting treatment of the options described in Note
     9 of the consolidated financial statements is as follows: (1) the
     Colombian and El Salvadoran written put options, which when exercised
     required the Company to purchase additional shares in the respective
     operations, were recorded at inception as liabilities at their fair
     values, with subsequent changes in their fair values being recorded in the
     profit and loss account; (2) the call option held by the Company which
     gave the Company the right to purchase additional shares in the El
     Salvadoran operation, was recorded as an asset at its fair value as of the
     date of its inception, and subsequently carried at the lower of the
     option's cost or fair value; and (3) the written call option giving the
     holder the right to acquire from the Company shares in the Company's
     Vietnamese subsidiary was recorded at inception as a liability at its fair
     value, with subsequent book value losses of the option being recorded in
     the profit and loss account to reflect any loss that the Company would
     realize upon the exercise of the option.

     Until January 2001, the various options' values were not recorded under
     IFRS. Therefore, the adjustment to reconcile IFRS net income to U.S. GAAP
     net income in 2000 includes charges of $22,643,000, $4,284,000, and
     $1,414,000, to recognize the change in the fair values of the Colombian
     and El Salvadoran options, and the change in the book value losses of the
     Vietnamese option, respectively. As at January 1, 2001, the Company
     adopted IFRS 39. Since adopting IFRS 39, these options have been carried
     at their fair values, with the change in fair value reflected as a
     non-operating income or expense in the statement of profit and loss.
     Therefore, the adjustments to reconcile IFRS net loss to U.S.GAAP net loss
     in 2001, includes (1) an increase to net loss of $2,125,000 for the
     Vietnamese option to adjust the change in fair value of the option
     recorded for IFRS to the change in the book value losses of the option
     recorded for U.S. GAAP and (2) a decrease to net loss of $8,533,000 for
     the El Salvadoran call option to remove the change in fair value under
     IFRS and to record the option at its cost for U.S. GAAP. The adjustment to
     reconcile stockholders' equity in 2001 between IFRS and U.S. GAAP
     considers the cumulative adjustment in retained earnings of $45,264,000
     recorded by the Company, upon adoption of IFRS 39.

     During 2002, the holder of the Vietnamese call option exercised its right
     to acquire an additional 10% of the shares of the Company's operation in
     Vietnam. The resulting adjustments to reconcile the IFRS accounts, as
     described in Note 9, and the U.S. GAAP accounts are as follows: (i) a
     decrease of $16,817,000 to the retained loss brought forward,
     corresponding to the difference, as at December 31, 2001, between the fair
     value and book value losses on the written call option, (ii)


                                     F-65
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

     an increase of $295,000 to the net loss for 2002 due to the excess of the
     option's book value losses over the fair value of the option, recorded for
     IFRS, and (iii) a reversal of the gain realized on the sale of the
     subsidiary of $16,522,000 for IFRS, to reflect a gain of $nil for U.S.
     GAAP.

     As described in Note 9 of the consolidated financial statements, the fair
     value of the Colombian option, as of December 31, 2002, was reduced to
     $nil (2001: $14,414,000). The U.S. GAAP accounting treatment of this
     option is consistent with IFRS. As described in Note 9, the Company
     recorded the gain on the reduction of the Colombian option liability in
     2002 under the caption "General and administrative expenses". For U.S.
     GAAP, this gain would have been recorded to non-operating income.

     Summarized below are the adjustments to net (loss) profit under U.S. GAAP:

<TABLE>
                                                           2002                2001              2000
                                                      ----------------    ---------------   ---------------
                                                         U.S.$'000          U.S.$'000         U.S.$'000
                                                      ----------------    ---------------   ---------------
<S>                                                        <C>                  <C>             <C>
     Fair value result of financial instruments:                                    -
       Colombia put option.......................                                   -           (22,643)
       El Salvadoran put option..................                -              8,533            (4,284)
       Vietnamese put option.....................             (295)            (2,125)           (1,414)
     Reduction from gain on sale of Vietnamese
        subsidiary                                         (16,522)
                                                      ----------------    ---------------   ---------------
                                                           (16,817)             6,408           (28,341)
                                                      ================    ===============   ===============
</TABLE>

     The following table shows the change in liabilities recorded in the
     balance sheet under U.S. GAAP from IFRS :

<TABLE>
                                                            2002                2001
                                                      -----------------    ----------------
                                                         U.S.$'000            U.S.$'000
                                                      -----------------    ----------------
<S>                                                                             <C>
      Vietnamese put option....................                  -              (16,817)
                                                      -----------------    ----------------
      Total decrease in liabilities..............                -              (16,817)
                                                      =================    ================
</TABLE>

6.   Under IFRS, no compensation expense is recorded for stock based
     compensation described in Note 16(d) of the consolidated financial
     statements. Under U.S. GAAP, the Company accounts for stock compensation
     under Accounting Principles Board Opinion No. 25, "Accounting for Stock
     Issued to Employees" (APB 25).

     As described in Note 16(d), stock options have been granted by the Company
     to certain employees in Liberty Broadband Limited, Millicom Argentina S.A.
     and Millicom International B.V. Because either the exercise price or the
     number of shares granted under the option plans is not known at the grant
     date, compensation expense for these plans under APB 25 is recalculated,
     based on the intrinsic value of this stock based compensation, at each
     balance sheet date. Recalculated compensation expense is recognized over
     the vesting period. Such plans are referred to as "variable plans".
     Options granted to employees of Millicom Argentina S.A, do not qualify as
     options granted to employees in accordance with APB 25, since Millicom
     Argentina S.A. is accounted for as an equity investment for U.S. GAAP.
     Accordingly, such options are accounted for on a mark to market basis. An
     adjustment of $1,308,000 (2001: $5,315,000; 2000: $(8,155,000)) has been
     recorded in the U.S. GAAP reconciliation of net profit or loss to reflect
     these options.


                                     F-66
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

     As also described in Note 16(d), the Company grants stock options to
     employees and directors for a fixed number of shares with a fixed exercise
     price. The grant date intrinsic value of such options is amortized over
     the vesting periods of the options. Such plans are referred to as "fixed
     plans". Because the exercise price of such options granted by the Company
     equals their fair market value at the date of the grant, the options have
     no intrinsic value. Accordingly, no compensation expense has been recorded
     for the Company's fixed plans.

     At December 31, 2002, a cumulative amount of $6,707,000 (2001:
     $12,021,000) has been recorded in the Company's retained loss brought
     forward, share capital and premium for prior years' compensation expense,
     under U.S. GAAP.

7.   Under IFRS, the Company recognizes revenues for initial connection fees
     when the customer is connected and able to use the service. The Company
     recognizes revenues from the sale of handsets at the time of sale.

     In December 1999, the Securities and Exchange Commission (SEC) issued
     Staff Accounting Bulletin No. 101, Revenue recognition in Financial
     Statements (SAB 101). SAB 101 outlines the SEC's view on applying
     generally accepted accounting principles to revenue recognition in
     financial statements. Specifically, the bulletin provides guidance as to
     the periods in which companies should recognize revenues. Effective
     January 1, 2000, for U.S. GAAP purposes, the Company evaluates each
     element of a customer arrangement to determine the appropriate period for
     recognition of revenues. Revenues on connection fees are deferred and
     recognized as revenues on a pro rata basis over the estimated life of the
     customer relationship which is, based on management estimates, one year.
     Revenues from handsets sales are recognized immediately if a fair value
     can be attributed to the separate element of the contract and use of the
     telephone is not dependant on the customer's continued use of network
     services. If telephone sales do not meet these conditions, the revenues
     are deferred and amortized over the estimated life of the customer
     relationship.

     Cost of sales, which include direct incremental expenses related to
     connection fees and handset sales, are deferred and amortized over the
     same period that revenues are recognized. Certain customer acquisition
     costs such as dealer commissions and handset subsidies have been
     classified as sales and marketing expenses under IFRS. Under U.S. GAAP
     these costs would have been classified as cost of sales in the same
     periods.

     Upon adoption of SAB 101 on January 1, 2000, the Company recorded a
     decrease in net profit of $3,141,000 for U.S. GAAP. The adjustment to
     defer revenue on connection fees for U.S. GAAP results in a decrease in
     revenue in 2002 of $145,000 (2001: increase of $263,000; 2000: increase of
     $397,000) and the adjustment to defer incremental cost on connection fees
     in 2002 for U.S. GAAP results in an increase in cost of sales of $192,000
     (2001: decrease of $239,000; 2000: decrease of $513,000) resulting in a
     net increase of $337,000 to the Company's 2002 net loss (2001: decrease of
     $502,000 of the net loss; 2000: increase of $910,000 of the net profit).

8.   In 2000, under IFRS, the Company recognized an impairment of its analogue
     fixed assets and related licenses and intangibles. This impairment was
     measured as the difference between the recoverable amount, determined by
     reference to discounted cash flows projected to be generated from these
     assets, and the carrying value of the analogue assets at the measurement
     date. Prior to January 1, 2002, the Company applied Statement of Financial
     Accounting Standard No. 121 (SFAS 121), Accounting for the Impairment of
     Long-Lived Assets and for Long-Lived Assets to Be Disposed Of. Under SFAS
     121, a long-lived asset or asset group was tested whenever events or
     changes in circumstances indicated its carrying amount may not be
     recoverable, i.e. a triggering event occurred. If such a triggering event
     occurred, the book value of the asset was compared to


                                     F-67
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

     the undiscounted cash flows forecast from the asset. If the undiscounted
     cash flows forecast to be generated from the asset was less than the
     asset's book value, the carrying value of the asset was regarded as not
     recoverable. When such a determination was made, impairment was measured
     as the excess of the carrying value above the asset's fair value,
     typically determined by a discounted cash flow projection of the asset.
     Therefore, the impairment charge recorded on the analogue assets of some
     of MIC's operations in an amount of $10,441,000 was reversed for U.S. GAAP
     purposes.

     During the course of 2001, certain assets of the FORA business that were
     previously impaired under IFRS were sold. Because the assets sold had a
     higher value under U.S. GAAP than IFRS, a reduction of the gain on the
     sale of the assets of $5,216,000 was recorded for U.S. GAAP purposes.
     Additionally in 2001, incremental depreciation expense of $1,373,000 for
     U.S. GAAP was recorded on the remaining assets that were previously
     impaired under IFRS.

     In 2002, the Company adopted Statement of Financial Accounting Standard
     No. 144 (SFAS 144) Accounting for the Impairment or disposal of long-lived
     assets, which requires the same two-step impairment evaluation required
     under SFAS 121. As of December 31, 2002, analogue assets belonging to
     MIC's Colombian operations, which were impaired under IFRS in 2000 but not
     under U.S. GAAP, were deemed to be impaired in connection with the
     Colombian operation being classified as a discontinued operation, as
     described in U.S. GAAP item 13 hereafter. Accordingly, the assets'
     increased net value under U.S. GAAP of $2,571,000, after incremental
     depreciation expense for the year of $936,000, has been charged to the
     profit and loss of the year as an additional impairment.

     Under IFRS, as at December 31, 2002, the Company recorded an impairment
     charge of $2,234,000 on the license value of its operation in Peru. This
     impairment was measured as the difference between the recoverable amount
     of the asset, which was determined by reference to the discounted cash
     flows projected to be generated from this asset, and its carrying value at
     the measurement date. Since the recoverable amount of the license,
     determined by reference to an undiscounted cash flow model, as required by
     SFAS 144, was higher than its carrying value, the impairment recorded
     under IFRS has been reversed for U.S. GAAP purposes.

     Summarized below are the adjustments to the Company's IFRS profit and loss
     that have been made due to the application of SFAS 121 (2001 and 2000) and
     SFAS 144 (2002):

<TABLE>
                                                        2002          2001           2000
                                                   -------------  -------------  -------------
                                                     U.S.$'000      U.S.$'000      U.S.$'000
                                                   -------------  -------------  -------------
<S>                                                     <C>           <C>            <C>
     Reversal of impairment recorded for IFRS....       2,234              -         10,441

     Increased depreciation charge...............        (936)        (1,373)          (345)

     Impairment charge on Colombian assets.......      (2,571)             -              -
     Decreased gain on sale of FORA assets.......           -         (5,216)             -
                                                   -------------  -------------  -------------
     Total adjustment to (loss)/profit in year...      (1,273)        (6,589)        10,096
                                                   =============  =============  ==============
</TABLE>

9.   With the adoption of IFRS 39, the Company began recording its debt net of
     un-amortized financing fees incurred to acquire the debt. Under U.S. GAAP,
     these financing fees should be capitalized as a deferred charge. The
     amount that would be reclassified as an asset in the balance sheet as of
     December 31, 2002, is $8,359,000 (2001: $10,379,000).

10.  In June 2001, the Financial Accounting Standards Board approved Statement
     of Financial Accounting Standard No. 142 (SFAS 142), Goodwill and Other
     Intangible Assets. SFAS 142


                                     F-68
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

     requires companies to cease amortizing goodwill, which existed at June 30,
     2001. Accordingly, for U.S. GAAP purposes, the Company ceased amortization
     of existing goodwill on December 31, 2001. Additionally, under U.S. GAAP,
     the Company has reversed $7,865,000 of amortization on goodwill charged
     during 2002 under IFRS. In accordance with Statement of Financial
     Accounting Standard No. 141 (SFAS 141), Business Combinations, negative
     goodwill in the amount of $9,336,000 as of December 31, 2001, has been
     written-off as a cumulative effect of change in accounting principle in
     the first quarter of 2002, upon adoption of SFAS 141. The Company did not
     generate additional negative goodwill during 2002.

     Reported net (loss) profit under U.S. GAAP before extraordinary items and
     accounting change was $(174,766,000) and $373,714,000 in 2001 and 2000,
     respectively. Goodwill amortization, net of tax was $9,483,000 and
     $9,692,000 in 2001 and 2000, respectively. Negative goodwill amortization,
     net of tax was $1,393,000 and $755,000 in 2001 and 2000, respectively.
     Adjusted net (loss) profit before extraordinary items and accounting
     change was $(166,676,000) and $382,651,000 in 2001 and 2000, respectively.

     The table below shows MIC's adjusted U.S. GAAP net (loss) profit as if
     goodwill amortization had ceased from January 1, 2000, together with a
     reconciliation of the adjusted net (loss) profit with the reported net
     (loss) profit:

                                                        2001           2000
                                                      ---------     ---------
                                                      U.S.$'000     U.S.$'000
                                                      ---------     ---------

      Reported (loss) profit under U.S. GAAP          (174,766)       370,573
      Reversal of goodwill amortization                   9,483         9,692
      Reversal of negative goodwill amortization        (1,393)         (755)
                                                    ----------------------------
      Adjusted net (loss) profit under U.S. GAAP      (166,676)       379,510
                                                    ============================

      The following tables present the impact on MIC's basic and diluted
      earnings per share as if goodwill amortization had ceased on January 1,
      2000:

<TABLE>
                                                                        2002          2001         2000
      Basic (loss) earnings per share                                              (restated)   (restated)
                                                                  ----------------------------------------
<S>                                                                    <C>          <C>            <C>
      Reported basic (loss) earnings per share under U.S. GAAP         $(20.15)     $(10.71)       $22.77
      Reversal of goodwill amortization                                       -        $0.58        $0.60
      Reversal of negative goodwill amortization                              -      $(0.09)      $(0.05)
      Adjusted basic (loss) earnings per share under U.S. GAAP         $(20.15)     $(10.22)       $23.32
      Weighted average number of shares outstanding in the year
      (in '000)                                                          16,318       16,314       16,273


                                                                                      2001          2000
      Diluted earnings per share                                        2002       (restated)   (restated)
                                                                  ----------------------------------------
      Reported diluted (loss) earnings per share under U.S.            $(20.15)      $(10.71)      $22.46
      GAAP
      Reversal of goodwill amortization                                       -        $0.58        $0.59
      Reversal of negative goodwill amortization                              -       $(0.09)      $(0.05)
      Adjusted diluted (loss) earnings per share under U.S.
      GAAP                                                             $(20.15)      $(10.22)      $23.00
      Weighted average number of shares and diluted potential
      common shares (in '000)                                            16,318       16,314       16,500
</TABLE>


                                     F-69
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

     SFAS 142 also establishes a method of testing goodwill for impairment on
     an annual basis or on an interim basis if an event occurs or circumstances
     change that would reduce the fair value of a reporting unit below its
     carrying value. In addition, SFAS 142 requires transitional impairment
     testing as of January 1, 2002. As a result, the Company tested its
     goodwill for impairment under this new standard both as of January 1,
     2002, and December 31, 2002. The transitional testing that MIC performed
     as of January 1, 2002 concluded that no impairment was required under U.S.
     GAAP. As a result of classifying the Company's Colombian operation as a
     discontinued operation in 2002 (see U.S. GAAP item 13), the Company
     performed an impairment test on the goodwill generated on the acquisition
     of the Colombian operation. This impairment test indicated that the
     goodwill was fully impaired. Under IFRS, the carrying value of this
     goodwill was set to $nil through the recording of an impairment charge of
     $35,723,000. Following the cessation of the amortization, as described
     under SFAS 142, MIC incurred an additional impairment charge of $3,136,000
     under U.S. GAAP related to the impairment write-down of goodwill on the
     Colombian operation.

11.  During 2002, MIC purchased part of its Senior Subordinated Discount Notes
     (see Note 17) at market prices for an amount of $44,000,000, realizing a
     gain of $28,676,000. Under U.S. GAAP, this gain was recognized as an
     extraordinary item.

12.  MIC holds shares in Tele2 AB recorded as investment in securities, which
     have declined in value since their acquisition dates. As of December 31,
     2001, the management of MIC did not consider that the decline in share
     price of Tele2 AB met the criteria of impairment under IFRS 39 and
     recorded the decline in the revaluation reserve. However, taking into
     account the factors discussed in Staff Accounting Bulletin 59, the
     management of MIC considered, under U.S. GAAP, the decline in its
     investment in Tele2 AB to be other than temporary and therefore recorded a
     charge for an amount of $61,325,000 in 2001. As of December 31, 2002,
     taking into account the significant and prolonged decline in value of the
     Tele2 AB shares and the losses realized on their disposals, MIC recorded
     the change in fair value of these securities of $119,138,000 to the profit
     and loss for IFRS, in accordance with the Company's policies, and for U.S.
     GAAP, since the continued decline in value was determined to be other than
     temporary. Consequently, in 2002 MIC recorded an adjustment to reverse
     $61,325,000 from net loss for the year to retained loss brought forward,
     under U.S. GAAP.

13.  As at December 31, 2002, MIC classified its investment in its Colombian
     subsidiary as an asset held for sale in accordance with SFAS 144. During
     2002, MIC entered into discussions concerning the sale of the Colombian
     operation and, in December 2002, signed a sale and purchase agreement. The
     sale was completed in February 2003. The Colombian operation's net selling
     price of $9,876,000 was considered to be the fair value of all the assets
     and liabilities of the entity. Accordingly, the Company recorded an
     impairment charge of $41,733,000 on the license value of the Colombian
     operation. This amount has been recorded under the caption 'General and
     administrative expenses' for IFRS. Additionally, other disposals made by
     the Company during the year qualify as discontinued operations in
     accordance with FAS 144. Presented below is a reconciliation of loss from
     discontinued operations:


                                     F-70
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

<TABLE>
     Net profit (loss) from component qualifying as discontinued operations:


                                                                Year ended December 31,       Segment in which
                                                               2002      2001       2000           reported
                                                         ----------- ----------  -----------   -----------------
                                                          U.S.$'000   U.S.$'000   U.S.$'000
                                                         ----------- ----------  -----------
<S>                                                        <C>          <C>
       Colombian operations                                (63,484)    (18,868)    (37,381)    MIC Latin America
       MIC Systems                                          89,960       2,758      (1,816)          MIC Systems
       Liberty Broadband Ltd.                              (24,939)    (32,476)    (11,047)               Other
                                                         ----------- ----------  -----------
     Net profit reported from discontinued operations       1,537      (48,586)    (50,244)
                                                         =========== ==========  ==========

</TABLE>

14.  In August 2001, the Financial Accounting Standards Board ("FASB") issued
     Statement of Financial Accounting Standard No.143 (SFAS 143), Accounting
     for Asset Retirement Obligations. SFAS 143 applies to all entities and
     addresses financial accounting and reporting for legal obligations
     associated with the retirement of long-lived assets that result from the
     acquisition, construction, development and (or) the normal operation of a
     long-lived asset, except for certain obligations of lessees. SFAS 143 is
     effective from January 2003 and requires obligations associated with the
     retirement of a tangible long-lived asset to be recorded as a liability
     upon acquisition of the asset. The Company is in the process of evaluating
     the impact of SFAS 143 on the consolidated financial statements.

     The FASB issued Statement of Financial Accounting Standard No. 145 (SFAS
     145), Rescission of FASB Statements No. 4, 44, and 64, Amendment of FASB
     Statement No. 13, and Technical Corrections, effective for fiscal years
     beginning May 15, 2002 or later that rescinds FASB Statement No. 4,
     Reporting Gains and Losses from Extinguishment of Debt, FASB Statement No.
     64, Extinguishments of Debt made to satisfy sinking-fund requirement, and
     FASB Statement No. 44, Accounting for Intangible Assets of Motor Carriers.
     This Statement amends FAS No. 4 and FAS No. 13, Accounting for Leases, to
     eliminate an inconsistency between the required accounting for
     sale-leaseback transactions. This Statement also amends other existing
     authoritative pronouncements to make various technical corrections,
     clarify meanings or describe their applicability under changed conditions.
     By adopting SFAS 145 in fiscal year 2003, MIC expects to reclassify gains
     on the extinguishment of debt recorded in 2002, which are not sinking fund
     payments, of $28,676,000 from extraordinary to ordinary gains.

     In July 2002, the FASB issued Statement of Financial Accounting Standard
     146 (SFAS 146), Accounting for Costs Associated with Exit or Disposal
     Activities. SFAS 146 addresses financial accounting and reporting for
     costs associated with exit or disposal activities and nullifies Emerging
     Issues Task Force (EITF) Issue No. 94-3, "Liability Recognition for
     Certain Employee Termination Benefits and Other Costs to Exit an Activity
     (including Certain Costs Incurred in a Restructuring)". SFAS 146 is
     effective for disposal activities initiated after December 31, 2002. As
     the Company has not currently commenced exit or disposal activities as
     defined in SFAS 146, adoption of the Standard is not expected to have a
     material impact on its consolidated financial statements.

     In December 2002, the FASB issued Statement of Financial Accounting
     Standard 148 (SFAS 148), Accounting for Stock-Based Compensation -
     Transition and Disclosure - an Amendment of SFAS No. 123. SFAS 148
     provides alternative methods of transition for a voluntary change to the
     fair value based method of accounting for stock-based employee
     compensation. In addition, SFAS 148 amends the disclosure requirements of
     SFAS 123, "Accounting for Stock-Based Compensation", to require prominent
     disclosures in both annual and interim financial statements about the
     method of accounting for stock-based employee compensation and the effect
     of the method used on reported results. SFAS 148 does not change the fair
     value measurement principles of SFAS 123. As MIC has elected to continue
     to account for stock compensation in accordance with APB 25, the adoption
     of the Standard is not expected to have a material impact on its


                                     F-71
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

     consolidated financial statements. However, the Company has already
     adopted the disclosure requirements of SFAS 148.

     In April 2003, the FASB issued Statement of Financial Accounting Standard
     No. 149 (SFAS 149), Amendment of Statement 133 on Derivative Instruments
     and Hedging Activities. SFAS No. 149 amends and clarifies financial
     accounting and reporting for derivative instruments, including certain
     derivative instruments embedded in other contracts (collectively, referred
     to as derivatives) and for hedging activities under SFAS No. 133. This
     Statement is effective for contracts entered into or modified after June
     30, 2003, and for hedging relationships designated after June 30, 2003.
     The Company does not consider that SFAS 149 will have a material impact on
     its consolidated financial statements.

     In May 2003, the FASB issued Statement of Financial Accounting Standard
     No. 150 (SFAS 150), Accounting For Certain Financial Instruments with
     Characteristics of both Liabilities and Equity. SFAS No. 150 establishes
     standards for how a company classifies and measures certain financial
     instruments with characteristics of both liabilities and equity. It
     requires that a company classify a financial instrument that is within its
     scope as a liability (or an asset in some circumstances). Many of those
     instruments were previously classified as equity. This Statement is
     effective for financial instruments entered into or modified after May 31,
     2003, and otherwise is effective for the first fiscal period beginning
     after December 15, 2003. The Company does not consider that SFAS 150 will
     have a material impact on its consolidated financial statements.

     In November 2002, the FASB issued Financial Interpretation No. 45 (FIN
     45), Guarantor's Accounting and Disclosure Requirements for Guarantees,
     Including Indirect Guarantees of Indebtedness of Others. Under this
     interpretation, a guarantor must recognize the fair value of the
     obligation it assumes under the guarantee, upon issuance of a guarantee.
     Additionally, FIN 45 requires that the guarantor determine and disclose
     its policy for subsequently re-measuring the guarantor's liability. The
     initial recognition and initial measurement provisions of FIN 45 are
     applicable on a prospective basis to guarantees issued or modified after
     December 31, 2002. The Company is currently assessing the impact that FIN
     45 will have on its consolidated financial statements. The disclosure
     requirements of FIN 45 are applicable for financial statements that end
     after December 15, 2002. Accordingly, such disclosures are included in
     Note 17 of the consolidated financial statements.

     In January 2003, the FASB issued Financial Interpretation No. 46 (FIN 46),
     Consolidation of Variable Interest Entities. FIN 46 generally applies to
     all business enterprises and all arrangements used by business
     enterprises, and it requires that a business enterprise identify all its
     Variable Interest Entities ("VIEs"). VIEs are those entities possessing
     certain characteristics, which indicate either a lack of equity investment
     to cover expected losses of the entity or a lack of controlling financial
     interest by an investor. The party that absorbs a majority of the entity's
     expected losses, receives a majority of its expected residual returns, or
     both, as a result of holding variable interests is deemed to be the
     Primary Beneficiary and must consolidate the VIE. The measurement
     principles of this interpretation apply to all VIEs created after January
     31, 2003 and to all VIEs in which an enterprise obtains an interest after
     that date. Additionally, the measurement principles of FIN 46 for all VIEs
     held by MIC prior to January 31, 2003 will be effective for MIC's 2004
     financial statements. However, MIC has determined that it is reasonably
     possible that MIC will either consolidate or disclose information about
     its operation in Argentina and its other joint ventures (see Note 3) when
     FIN 46 becomes effective.

15.  Under IFRS 27 a subsidiary should be excluded from consolidation if it
     operates under severe long-term restrictions that significantly impair its
     ability to transfer funds to the parent. In addition,


                                     F-72
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

     Standing Interpretations Committee ("SIC") No. 33 states that potential
     voting rights that are presently exercisable or presently convertible must
     be considered when, in substance, they provide the capability to exercise
     control. As discussed in Note 27, under IFRS, MIC does not consolidate its
     investment in Great Universal ("GU") and Modern Holdings ("Modern") since
     the restrictions on their ability to distribute dividends is considered a
     severe long-term restriction that significantly impairs their ability to
     transfer funds to MIC. Further, the warrants, which enable the holders to
     obtain 100% of GU and 53% of Modern, are presently exercisable and provide
     the capability, to the warrant holders, to control GU and Modern.

     Under U.S. GAAP an entity should consolidate all enterprises in which it
     has a controlling financial interest. The usual condition for a
     controlling financial interest is ownership of a majority of the
     outstanding voting shares. Accordingly, absent a reason that GU and Modern
     should not be consolidated they should be consolidated. The restriction on
     the ability of GU and Modern to distribute dividends would not preclude
     consolidation under U.S. GAAP. In addition, under U.S. GAAP, potential
     voting rights are generally not considered in determining whether an
     entity should be consolidated. Accordingly, under U.S. GAAP, both GU and
     Modern are consolidated. The line items of MIC's consolidated income
     statement for the years ended December 31, 2002, 2001 and 2000 and
     consolidated balance sheet for the years ended December 31, 2002 and 2001,
     which are materially impacted by the consolidation of GU and Modern, are
     disclosed in a separate table at the bottom of the U.S. GAAP
     reconciliation of (loss) profit after taxes and of the U.S. GAAP balance
     sheet reconciliation.

16.  The Company's U.S. GAAP net income and shareholders' equity as of, and for
     the years ended December 31, 2001 and 2000 have been restated to reflect
     the correction of certain errors as detailed below. The effects of these
     corrections are as follows:

<TABLE>
                                                                                 2001           2000
                                                                            ------------------------------
                                                                  Note        U.S.$'000      U.S.$'000
                                                                            ------------------------------
<S>                                                                            <C>             <C>
Net (loss) profit in accordance with U.S. GAAP as previously
reported:                                                                      (201,811)       375,545
Adjustment to line item "Application of equity method of
accounting"                                                        a.            28,108        (14,271)
Adjustment to line item "Adjustments to initial step-up in the
value of the licenses"                                             b.            (1,063)         9,299
Reclassification of line item "Extraordinary items - Early
extinguishment of debt"                                            c.                 -              -
                                                                            ------------------------------
Restated net (loss) profit in accordance with U.S. GAAP                        (174,766)       370,573
                                                                            ==============================

Net (loss) profit per share data:
Basic net (loss) profit per share as previously reported:                       $(12.37)        $23.08
Effect of adjustments reported above                                              $1.66         $(0.31)
Restated Basic net (loss) profit per share                                      $(10.71)        $22.77
Weighted average number of shares outstanding in the year (in
'000)                                                                            16,314         16,273

Diluted net (loss) profit per share as previously reported:                     $(12.37)        $22.76
Effect of adjustments reported above                                              $1.66         $(0.30)
Restated diluted net (loss) profit per share                                    $(10.71)        $22.46
Weighted average number of shares and diluted potential common
shares (in '000)                                                                 16,314         16,500
</TABLE>


                                     F-73
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

<TABLE>
<S>                                                                                 <C>           <C>
Shareholders' equity in accordance with U.S GAAP as previously
reported:                                                                           66,669        302,033
Adjustment to line item "Application of equity method of
accounting"                                                        a.              (2,126)       (30,234)
Adjustment to line item "Adjustments to initial step-up in the
value of the licenses"                                             b.                8,235          9,299
                                                                            ------------------------------
Restated shareholders' equity in accordance with U.S GAAP:                        72,778          281,098
                                                                            ==============================
</TABLE>

a.   In 2001 and 2000, $2,126,000 and $30,234,000 ($14,271,000 on the profit of
     the year and $15,963,000 on prior years' profit or loss), respectively, of
     additional losses on certain joint ventures should have been recognized by
     MIC due to either a) additional investment, including guarantees, by MIC
     in the venture that was not taken into account, or b) MIC's commitment to
     providing funding to the joint venture, in excess of its investment.
     Additionally, an adjustment of $25,081,000 has been recorded in 2001, to
     reflect the impact of these adjustments on the gain recognized by MIC on
     the sale of its FORA joint ventures.

b.   In 2000 and 2001, $203,000 and $1,063,000 respectively, of amortization
     expense related to the stepped-up value on cellular licenses was
     incorrectly included in the determination of U.S. GAAP net loss. In 2000,
     an impairment charge of $9,502,000, recorded for IFRS, related to the
     stepped-up value of a cellular license in the Philippines, was incorrectly
     not reversed for U.S. GAAP.

c.   In 2001, a gain of $8,075,000 was recorded as an extraordinary gain for
     U.S. GAAP. As this gain relates to the extinguishment of debt due to
     sinking fund payments, such gain should not have been reported as an
     extraordinary item.

Reconciliation of (Loss) Profit after Taxes:

The above items give rise to the following difference in net (loss) profit from
continuing operations recorded under U.S. GAAP:

<TABLE>
                                                                                 2001           2000
                                                       Item          2002     (restated)     (restated)
                                                      ------       ---------   ---------      ---------
                                                                   U.S.$'000   U.S.$'000      U.S.$'000
                                                                   ---------   ---------      ---------
<S>                                                      <C>         <C>          <C>           <C>
(Loss) profit for the year reported under IFRS....                 (385,143)    (138,053)       355,388
Items decreasing (increasing) reported loss or
   (decreasing) increasing reported profit:
  Application of equity method of accounting......       2           (4,221)      16,703        (11,003)
  Adjustments to initial step-up in the value of
     licenses.....................................       3            2,273        2,273         13,244
  Increased gain on disposal of SEC...............       4                -            -         41,575
  Valuation of stock options......................       5          (16,817)       6,408        (28,341)
  Compensation cost for stock options granted to
     employees....................................       6            1,308        5,315         (8,155)
  Recognition of connection fees and related costs       7             (337)         502            910
  Reduced impairment of tangible and intangible
     assets.......................................       8           (1,273)      (6,589)        10,096
  Reversal of goodwill amortization...............      10            7,865             -             -
</TABLE>


                                     F-74
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

<TABLE>
                                                                                 2001           2000
                                                       Item          2002     (restated)     (restated)
                                                      ------       ---------   ---------      ---------
                                                                   U.S.$'000   U.S.$'000      U.S.$'000
                                                                   ---------   ---------      ---------
<S>                                                      <C>         <C>          <C>           <C>
   Additional goodwill impairment.................      10           (3,136)           -              -
   Extraordinary items - Early extinguishment of
   debt...........................................      11          (28,676)           -              -
    Impairment in securities, other than temporary      12           61,325      (61,325)             -
                                                                   ---------   ---------      ---------
(Loss) profit after taxes, before extraordinary
   items and cumulative effect of change in
   accounting principle under U.S. GAAP...........                 (366,832)    (174,766)       373,714
                                                                   ---------   ---------      ---------
Extraordinary items - Early extinguishment of debt      11           28,676            -              -
                                                                   ---------   ---------      ---------
(Loss) profit after taxes and extraordinary items
   and before cumulative effect of change in
   accounting principle ..........................                 (338,156)    (174,766)       373,714
                                                                   ========    =========      =========
Cumulative effect of change in accounting
   principle......................................     7, 10          9,336            -         (3,141)
                                                                   ---------   ---------      ---------
Net (Loss) profit under U.S. GAAP.................                 (328,820)    (174,766)       370,573
                                                                   ========    =========      =========
Presented as:
Net (loss) income from continuing operations......      13         (368,369)    (126,180)       423,958
Discontinued operations:
    Loss from discontinued operations, net of
    taxes(a)......................................                  (75,824)     (48,586)       (50,244)
    Gain on disposal, net of taxes(a).............                   77,361            -              -
                                                                   ---------   ---------      ---------
Loss from discontinued operations.................                    1,537      (48,586)       (50,244)
                                                                   ---------   ---------      ---------
(Loss) profit after taxes, before cumulative effect
   of change in accounting principle and before
   extraordinary items under U.S. GAAP                             (366,832)    (174,766)       373,714
                                                                   ========    =========      =========
Extraordinary items - Early extinguishment of
   debt(a)........................................      11           28,676            -
Cumulative effect of change in accounting
   principle(a)...................................      10            9,336            -         (3,141)
                                                                   ---------   ---------      ---------
Net loss (income) under U.S.GAAP....................
   (328,820)    (174,766)       370,573
                                                                   ========    =========      =========
</TABLE>

<TABLE>
                                                                                  2001           2000
Basic and Diluted (loss) profit per Common Share                     2002      (restated)     (restated)
                                                                   ---------   ---------      ---------
<S>                                                                 <C>           <C>            <C>
Basic (loss) profit per common share under
U.S. GAAP:
     - from continuing operations                                   $(22.57)      $(7.73)        $26.05
     - from discontinuing operations                                  $0.09       $(2.98)        $(3.09)
Basic (loss) profit per common share after taxes,
   before cumulative effect of change in
   accounting principle and extraordinary items...                  $(22.48)     $(10.71)        $22.96

   Impact of extraordinary items..................                    $1.76            -             -
   Impact of cumulative effect of change in
   accounting principle...........................                    $0.57            -         $(0.19)
</TABLE>


                                     F-75
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

<TABLE>
<S>                                                                 <C>          <C>             <C>
Basic (loss) profit per common share under U.S.
GAAP..............................................                  $(20.15)     $(10.71)        $22.77
                                                                ===========  ===========     ==========
Weighted average number of shares outstanding in
   the year (in '000)                                                16,318       16,314         16,273
                                                                ===========  ===========     ==========
Diluted (loss) profit per common share under U.S.
   GAAP:
      -from continuing operations                                   $(22.57)      $(7.73)        $25.69
     - from discontinuing operations                                  $0.09       $(2.98)        $(3.04)
   Diluted (loss) profit per common after taxes,
   before cumulative effect of change in
   accounting principle and extraordinary items...                  $(22.48)     $(10.71)        $22.65
   Impact of extraordinary items..................                    $1.76            -              -
   Impact of cumulative effect of change in
   accounting principle...........................                    $0.57            -         $(0.19)
Diluted (loss) profit per common share under U.S.
GAAP..............................................                  $(20.15)     $(10.71)        $22.46
                                                                ===========  ===========     ==========
Weighted average number of shares and diluted
   potential common shares (in '000)..............                   16,318       16,314         16,500
                                                                ===========  ===========     ==========

(a) The tax impact on these items is $nil (2001: $nil; 2000: $nil).
</TABLE>

     Impact of consolidation of Great Universal

As explained in adjustment item No. 15, under U.S. GAAP, both Great Universal
("GU") and Modern Holdings ("Modern") should be consolidated. Presented in the
table below are the main line items of MIC's consolidated income statement for
the years ended December 31, 2002, 2001 and 2000 that would be materially
impacted had GU and Modern been consolidated.

<TABLE>
- ---------------------------------------------------------------------------------------------------
                                                      2002              2001               2000
- ---------------------------------------------------------------------------------------------------
                                                   U.S.$'000          U.S.$'000          U.S.$'000
- ---------------------------------------------------------------------------------------------------
<S>                                                  <C>                <C>                <C>
Consolidated revenues under U.S. GAAP
before the effect of the consolidation of
Great Universal and Modern                           418,251            419,542            571,237
- ---------------------------------------------------------------------------------------------------
Impact of consolidation                               97,287            112,966            142,624
- ---------------------------------------------------------------------------------------------------
Consolidated revenues under U.S. GAAP
after the effect of the consolidation of
Great Universal and Modern                           515,538            532,508            713,861
- ---------------------------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------------------------
Consolidated expenses under U.S. GAAP
before the effect of the consolidation of
Great Universal and Modern                          (362,549)          (405,603)          (606,909)
- ---------------------------------------------------------------------------------------------------
Impact of consolidation                              (99,034)          (119,799)          (174,727)
- ---------------------------------------------------------------------------------------------------
Consolidated expenses under U.S. GAAP
after the effect of the consolidation of
Great Universal and Modern                          (461,583)          (525,402)          (781,636)
- ---------------------------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------------------------
Consolidated other income (expense) under
U.S. GAAP before the effect of the
consolidation of Great Universal and
Modern                                              (252,503)           (72,406)               594
- ---------------------------------------------------------------------------------------------------
Impact of consolidation                               (5,665)            10,881                235
- ---------------------------------------------------------------------------------------------------
Consolidated other income (expense) under
U.S. GAAP after the effect of the
consolidation of Great Universal and
Modern                                              (258,168)           (61,525)               829
- ---------------------------------------------------------------------------------------------------
</TABLE>


                                     F-76
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

<TABLE>
- ---------------------------------------------------------------------------------------------------
<S>                                                   <C>                <C>              <C>
Consolidated operating (loss) profit
under U.S. GAAP before the effect of the
consolidation of Great Universal and
Modern                                                55,702             13,939            (35,672)
- ---------------------------------------------------------------------------------------------------
Impact of consolidation                               (1,747)            (6,833)           (32,103)
- ---------------------------------------------------------------------------------------------------
Consolidated operating (loss) profit
under U.S. GAAP after the effect of the
consolidation of Great Universal and
Modern                                                53,955              7,106            (67,775)
- ---------------------------------------------------------------------------------------------------
</TABLE>

 Balance Sheet Reconciliation:

The following significant balance sheet differences arise under U.S. GAAP:

<TABLE>
                                                                                    Held
                                                      Proportional                for sale
                                                      Consolidation              assets and      Under
Balance sheet as of December 31,          Per Balance   Adjustment     Other     liabilities   U.S. GAAP
2002                               Item   Sheet Group (Items 1 & 2)  Adjustments  (Item 13)      Group
- --------------------------------  ------  ----------- -------------  ----------- ----------    ---------
                                           U.S.$'000    U.S.$'000     U.S.$'000   U.S.$'000    U.S.$'000
                                           ---------    ---------     ---------   ---------    ---------
<S>                                <C>       <C>                        <C>                      <C>
Non-Current Assets
Goodwill, net ................     10        10,172            -        14,065           -       24,237
Licenses, net ................     3,8       84,471       (4,083)       (7,911)    (52,070)      20,407
Deferred costs and other
   non-current assets, net ...      9         4,919       (2,351)        8,359          (9)      10,918
Tangible assets, net..........              458,933     (135,699)            -     (36,862)     286,372
Investment in securities......              220,386          (21)            -           -      220,365
Investments in associated                                                    -           -
   companies..................                1,013      110,609                                111,622
Pledged deposits..............               32,921            -             -        (508)      32,413
Deferred taxation.............                8,470       (1,165)            -           -        7,305
                                          ---------    ---------     ---------   ---------    ---------
   Total Non-Current Assets...              821,285      (32,710)       14,513     (89,449)     713,639
                                          ---------    ---------     ---------   ---------    ---------
Current Assets
Investment in securities......              101,540            -             -           -      101,540
Inventories...................                6,962       (3,209)            -         (56)       3,697
Trade receivables, net........              113,221      (27,629)            -     (14,019)      71,573
Amounts due from joint                                                                 (33)
   ventures...................               14,053        6,647             -                   20,667
Amounts due from other
   related parties............                6,806         (351)            -           -        6,455
Prepaid and accrued income....      7        14,148       (4,882)        1,328      (2,164)       8,430
Other current assets..........               38,453       (6,592)            -       4,734       36,595
Time deposits.................               16,200       (1,428)            -      (1,111)      13,661
Cash and cash equivalents.....               70,451      (25,612)            -      (1,988)      42,851
                                          ---------    ---------     ---------   ---------    ---------
   Total Current Assets.......              381,834      (63,056)        1,328     (14,637)     305,469
                                          ---------    ---------     ---------   ---------    ---------
Total Assets from disposal
   group classified as held
   for sale...................     13             -            -             -     104,086      104,086
                                          ---------    ---------     ---------   ---------    ---------
Total Assets..................            1,203,119      (95,766)       15,841           -    1,123,194
                                          =========    =========     =========   =========    =========
Shareholders' Equity and
   Liabilities
Share capital and premium.....      6       281,989            -         5,398           -      287,387
Treasury stock ...............              (54,521)           -             -           -      (54,521)
Legal reserve.................                4,256            -             -           -        4,256
Retained loss brought forward.              (57,719)      (1,710)       (3,226)          -      (62,655)
Profit for the year, after
   cumulative effect of
   change in accounting
   principle..................             (385,143)      (4,221)       60,544                 (328,820)
Currency translation reserve .              (84,121)           -             -           -      (84,121)
Excess of contribution over
   assets acquired ...........      3             -            -       (58,628)          -      (58,628)
                                          ---------    ---------     ---------   ---------    ---------
</TABLE>


                                     F-77
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

<TABLE>
                                                                                    Held
                                                      Proportional                for sale
                                                      Consolidation              assets and      Under
Balance sheet as of December 31,          Per Balance   Adjustment     Other     liabilities   U.S. GAAP
2002                               Item   Sheet Group (Items 1 & 2)  Adjustments  (Item 13)      Group
- --------------------------------  ------  ----------- -------------  ----------- ----------    ---------
                                           U.S.$'000    U.S.$'000     U.S.$'000   U.S.$'000    U.S.$'000
                                           ---------    ---------     ---------   ---------    ---------
<S>                                <C>       <C>                        <C>                      <C>
Total Shareholders' Equity....             (295,259)      (5,931)        4,088                 (297,102)
                                          ---------    ---------     ---------   ---------    ---------
   Minority Interest..........               23,733            -             -           -       23,733
                                          ---------    ---------     ---------   ---------    ---------
Liabilities
Non-Current liabilities
   Other non-current                                                                     -
   liabilities................               26,874      (12,831)            -                   14,043
   Corporate subordinated debt      9       912,539            -         5,461           -      918,000
   Other debt and financing...      9       159,370      (26,803)        2,898     (33,765)     101,700
                                          ---------    ---------     ---------   ---------    ---------
   Total Non-Current
       Liabilities............            1,098,783      (39,634)        8,359     (33,765)   1,033,743
                                          ---------    ---------     ---------   ---------    ---------
Current liabilities
   Other debt and financing...              156,666      (20,244)            -     (45,064)      91,358
   Trade payable..............               90,945       (5,043)            -      (6,216)      79,686
   Amounts due to shareholders                4,021            -             -           -        4,021

   Amounts due to other
   related parties ...........                6,487          472             -          (8)       6,951
   Accrued interest and other
   expenses...................      7        42,745      (10,547)        3,394      (3,389)      32,203
   Other current liabilities..               74,998      (14,839)            -      (3,468)      56,691
                                          ---------    ---------     ---------   ---------    ---------
                                            375,862      (50,201)        3,394     (58,145)     270,910
                                          ---------    ---------     ---------   ---------    ---------
Total Liabilities from
   disposal group classified
   as held for sale...........                    -            -             -      91,910       91,910
                                          ---------    ---------     ---------   ---------    ---------
Total Shareholders' Equity
   and Liabilities............            1,203,119      (95,766)       15,841           -    1,123,194
                                          =========    =========     =========   =========    =========
</TABLE>

     The following significant balance sheet differences arise under U.S. GAAP:

<TABLE>
                                                             Proportional
                                                             Consolidation                Under
Balance sheet as of December 31,                 Per Balance   Adjustment     Other     U.S. GAAP
2001 (Restated)                           Item   Sheet Group (Items 1 & 2)  Adjustments   Group
- --------------------------------         ------  ----------- -------------  ----------- ---------
                                                  U.S.$'000    U.S.$'000     U.S.$'000  U.S.$'000
                                                  ---------    ---------     ---------  ---------
<S>                                       <C>       <C>                        <C>        <C>
Non-Current Assets
Goodwill, net ........................               52,575        (982)            -      51,593
Licenses, net ........................      3       164,541     (14,214)      (12,417)    137,910
Deferred costs and other non-current
   assets, net .......................      9        15,685      (2,378)       10,379      23,686
Tangible assets, net..................      8       512,236    (139,067)        3,507     376,676
Investment in securities .............              676,829        (964)            -     675,865
Investments in associated companies...      2        52,858      78,758             -     131,616
Pledged deposits......................               47,404         (71)            -      47,333
Deferred taxation.....................                3,785           -             -       3,785
                                                  ---------   ---------     ---------   ---------
   Total Non-Current Assets...........            1,525,913     (78,918)        1,469   1,448,464
                                                  ---------   ---------     ---------   ---------
Current Assets
Inventories...........................               12,932      (4,560)            -       8,372
Trade receivables, net................              136,078     (33,668)            -     102,410
Amounts due from joint ventures.......               46,001       4,640             -      50,641
Amounts due from other related parties                9,258           -             -       9,258
</TABLE>


                                     F-78
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

<TABLE>
                                                             Proportional
                                                             Consolidation                Under
Balance sheet as of December 31,                 Per Balance   Adjustment     Other     U.S. GAAP
2001 (Restated)                           Item   Sheet Group (Items 1 & 2)  Adjustments   Group
- --------------------------------         ------  ----------- -------------  ----------- ---------
                                                  U.S.$'000    U.S.$'000     U.S.$'000  U.S.$'000
                                                  ---------    ---------     ---------  ---------
<S>                                       <C>       <C>                        <C>        <C>
Prepaid and accrued income............      7        27,228      (5,027)        1,521      23,722
Other current assets..................               35,800     (10,107)            -      25,693
Time deposits.........................               21,444      (1,649)            -      19,795
Cash and cash equivalents.............               56,276     (20,192)            -      36,084
                                                  ---------   ---------     ---------   ---------
   Total Current Assets...............              345,017     (70,563)        1,521     275,975
                                                  ---------   ---------     ---------   ---------
Total Assets..........................            1,870,930    (149,481)        2,990   1,724,439

Shareholders' Equity and Liabilities
Share capital and premium.............      6       281,989           -         6,707     288,696
Treasury stock .......................              (52,033)          -             -     (52,033)
Legal reserve.........................                4,256           -             -       4,256
Retained profit brought forward.......               80,334     (18,413)       50,190     112,111
Profit for the year, after cumulative                                                            )
   effect of change in accounting
   principle..........................             (138,053)     16,703       (53,416)   (174,766
Revaluation reserve ..................     12       (61,325)          -        61,325           -
Currency translation reserve .........              (46,274)       (584)            -     (46,858)
Excess of contribution over assets                                                               )
   acquired ..........................      3             -           -       (58,628)    (58,628
                                                  ---------   ---------     ---------   ---------
Total Shareholders' Equity............               68,894      (2,294)        6,178      72,778
                                                  ---------   ---------     ---------   ---------
   Minority interest..................               10,262           -             -      10,262
                                                  ---------   ---------     ---------   ---------
Liabilities
Non-Current Liabilities
   Other non-current liabilities......               20,507      (2,136)            -      18,371
   Corporate subordinated debt........      9       954,601           -         7,399     962,000
   Other debt and financing...........      9       347,475     (28,738)        2,980     321,717
                                                  ---------   ---------     ---------   ---------
                                                  1,322,583     (30,874)       10,379   1,302,088
                                                  ---------   ---------     ---------   ---------
Current Liabilities
   Other debt and financing...........              153,898     (43,321)            -     110,577
   Trade payables.....................              109,739     (26,464)            -      83,275
   Amounts due to shareholders........                7,158           -             -       7,158
   Amounts due to other related
   parties ...........................               11,304           -             -      11,304
   Financial liabilities..............      5        36,365           -       (16,817)     19,548
   Accrued interest and other expenses      7        57,981     (17,416)        3,250      43,815
   Other current liabilities..........               92,746     (29,112)            -      63,634
                                                  ---------   ---------     ---------   ---------
                                                    469,191    (116,313)      (13,567)    339,311
                                                  ---------   ---------     ---------   ---------

Total Liabilities.....................            1,791,774    (147,187)       (3,188)  1,641,399
                                                  ---------   ---------     ---------   ---------
Total Shareholders' Equity and
   Liabilities........................            1,870,930    (149,481)        2,990   1,724,439
                                                  =========   =========     =========   =========
</TABLE>

     Impact of consolidation of Great Universal

As explained in adjustment item No. 15, under U.S. GAAP, both Great Universal
("GU") and Modern Holdings ("Modern") should be consolidated. Presented in the
table below are the main line items of MIC's


                                     F-79
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

consolidated balance sheet as of December 31, 2002 and 2001 that would be
materially impacted had GU and Modern been consolidated.

- -------------------------------------------------------------------------------
                                                     2002              2001
                                                                    (restated)
- -------------------------------------------------------------------------------
                                                   U.S.$'000        U.S.$'000
- -------------------------------------------------------------------------------
Consolidated total assets under U.S. GAAP            928,633        1,724,439
- -------------------------------------------------------------------------------
Impact of consolidation                               71,592           90,782
- -------------------------------------------------------------------------------
Consolidated total assets after consolidation      1,000,225        1,815,221
- -------------------------------------------------------------------------------

- -------------------------------------------------------------------------------
Consolidated total shareholders' equity under U.S.
GAAP                                                (297,102)          72,778
- -------------------------------------------------------------------------------
Impact of consolidation                               (8,611)          (6,814)
- -------------------------------------------------------------------------------
Consolidated total shareholders' equity after
consolidation                                       (305,713)          65,964
- -------------------------------------------------------------------------------

     Comprehensive Income:

The Company's statement of comprehensive income under U.S.GAAP for the
three-year period ended December 31, 2002, is as follows:

<TABLE>
                                                                                                 2001           2000
                                                                                   2002       (restated)     (restated)
                                                                                ---------      ---------      ---------
                                                                                U.S.$'000      U.S.$'000      U.S.$'000
                                                                                ---------      ---------      ---------
<S>                                                                              <C>            <C>             <C>
Net (loss) profit under U.S. GAAP......................................          (328,820)      (174,766)       370,573
                                                                                ---------      ---------      ---------
Other comprehensive income (loss):
   Holding gain (loss) excluding effect of sale of marketable securities
     sold during the year, net of tax(b)...............................           (37,422)       (35,616)      (265,790)

   Holding gain for securities sold during the year, net of tax(b).....          (131,396)         1,949          5,069

   Reclassification adjustment for net gain realized on sale of
     marketable securities, net of tax(b)..............................           168,818         15,931        (55,321)

Foreign CTA............................................................           (37,263)       (13,510)         2,445
                                                                                ---------      ---------      ---------
Other comprehensive income (loss)......................................           (37,263)       (31,246)      (313,597)
                                                                                ---------      ---------      ---------
Comprehensive (loss) income under U.S. GAAP............................          (366,083)      (206,012)        56,976
                                                                                =========      =========      =========
(b)  The tax impact on these items is $nil (2001: $nil; 2000: $nil).
</TABLE>

     Additional Stock Option Disclosure:

As described above, under U.S. GAAP, the Company accounts for stock options
under APB25. Had compensation costs been determined in accordance with SFAS 123,
the Company's net income and earnings per share would have been reduced to the
following pro forma amounts.

                                                    Year ended December 1,
                                              2002           2001        2000
                                                          (restated)  (restated)
                                            ---------     ---------    ---------
                                            U.S.$'000     U.S.$'000    U.S.$'000
                                            ---------     ---------    ---------
Net income, as reported .................   (328,820)     (174,766)     370,573

Deduct:  total stock-based employee
expense determined under fair value
based method for all awards, net of
related tax effects......................     16,275        (5,728)      (5,066)
                                            ---------     ----------   ---------
Pro forma net income.....................   (312,545)     (180,494)     365,507
                                            ---------     ----------   ---------
Earnings per share:
    As reported (basic) - $..............     (20.15)       (10.71)       22.77
    Pro forma (basic) - $................     (19.15)       (11.06)       22.46

    As reported (diluted) - $............     (20.15)       (10.71)       22.16
    Pro forma (diluted) - $..............     (19.15)       (11.06)       22.15


                                     F-80
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

     The fair value of the options granted was estimated on the date of grant
using the Black-Scholes option pricing model with the following assumptions:
risk free interest rates of 4.4% (2001: 4.4%), expected lives of 6 years, no
dividends and expected volatility of 58.4% (2001: 58.4%).

31.  SUBSEQUENT EVENTS (Unaudited)

     On January 21, 2003, MIC made an exchange offer and consent solicitation
to bondholders of the 13.5% Senior Subordinated Notes due 2006 (the "Notes").
On May 8, 2003, MIC announced the closing of this offer with the tendering of
approximately 85% of the Notes.


                                     F-81
<PAGE>


Notes to the Consolidated Annual Accounts                Millicom International
As of December 31, 2002 and 2001                                  Cellular S.A.
- -------------------------------------------------------------------------------

     On January 21, 2003, MIC announced that it had received written
confirmation from The Nasdaq Stock Market Inc. that it would be de-listed from
the Nasdaq National Market ("Nasdaq") unless its equity was raised to at least
$10 million or it were able to maintain its minimum bid price per share at $3
for a period of at least ten consecutive trading days on or before February 17,
2003. As a consequence of this, a resolution was passed at an Extraordinary
General Meeting held on February 17, 2003, for a reverse stock split of the
Company's issued shares, exchanging three existing shares of a par value of $2
each for one new share with a par value of $6. The new shares commenced trading
on the Nasdaq on February 20, 2003. On March 6, 2003, the Company received
confirmation from Nasdaq that it now complied with all the current listing
requirements and that de-listing was no longer necessary.

     On February 13, 2003, the Group announced the successful completion of the
sale of Celcaribe, its cellular operation in Colombia.

     In January 2003, MIC sold an additional 44,129 Tele2 AB shares to Kinnevik
at market price in settlement of an amount payable. In addition, MIC has sold a
further 1,000,000 Tele2 AB shares to third parties. Total proceeds from these
sales were approximately $34 million.



                                     F-82
<PAGE>


                                 EXHIBIT INDEX


Exhibit No.    Description
- -----------    -----------

    1.1        Memorandum and Articles of Association and bylaws of Millicom
               International Cellular S.A.

    4.1        Indenture dated May 8, 2003, between the Company and The Bank
               of New York, as trustee, relating to $562,219,000 11% Senior
               Subordinated Notes due 2006

    4.2        Indenture dated May 8, 2003, between the Company and The Bank
               of New York, as trustee, relating to $63,714,000 2% Senior
               Convertible PIK Notes due 2006.

    4.3        Supplemental indenture dated May 23, 2003, between the Company
               and The Bank of New York, as trustee, relating to the 13 1/2%
               Senior Subordinated Notes due 2006

    7.1        Explanation of the calculation of earnings per share

   99.1        Section 906 Certifications


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-1.1
<SEQUENCE>3
<FILENAME>jun2703_ex0101.txt
<TEXT>
                                                                    EXHIBIT 1.1




Exhibit 1.1 Memorandum and Articles of Association and bylaws of Millicom
International Cellular S.A.

                      MILLICOM INTERNATIONAL CELLULAR S.A.
                                societe anonyme
                 Siege social : Bertrange, 75, route de Longwy
                          R.C. Luxembourg : B - 40.630
                               STATUTS COORDONNES
               --------------------------------------------------


CHAPTER I.- FORM, NAME, REGISTERED OFFICE, OBJECT, DURATION

Article 1. Form, Name

     There is hereby established among the subscribers and all those who may
become owners of the shares hereafter created a Company in the form of a societe
anonyme which will be governed by the laws of the Grand Duchy of Luxembourg
("Luxembourg") and by the present Articles as may be amended from time to time.

     The Company will exist under the name of "MILLICOM INTERNATIONAL CELLULAR
S.A.".

Article 2. Registered Office

     The Company will have its registered office in Bertrange (Luxembourg).

     The registered office may be transferred to any other place within
Luxembourg by a resolution of the board of directors.

     In the event the board of directors determine that extraordinary political,
economic or social developments have occurred or are imminent that would
interfere with the normal activities of the Company at its registered office or
with the ease of communications with such office or between such office and
persons abroad, the registered office may be temporarily transferred abroad
until the complete cessation of these abnormal circumstances. Such temporary
measures will have no effect on the nationality of the Company, which,
notwithstanding the temporary transfer of the registered office, will remain a
Luxembourg Company. Such temporary measures will be taken and notified to any
interested parties by one of the bodies or persons entrusted with the daily
management of the Company.

Article 3. Purposes

     The purposes for which the Company is formed are to engage in all
transactions pertaining directly or indirectly to the acquisition of
participating interests in any business enterprise, including but not limited
to, the administration, management, control and development of any such
enterprise, and to engage in all other transactions in which a company created
under the laws of Luxembourg may engage.

Article 4. Duration

     The Company is formed for an unlimited duration.



                                      E-1
<PAGE>


CHAPTER II.- CAPITAL, SHARES

Article 5. Corporate Capital

     The Company has an authorized capital of one hundred ninety-nine million
nine hundred ninety-nine thousand eight hundred United States Dollars (U.S.$
199,999,800) divided into thirty-three million three hundred thirty three
thousand three hundred (33,333,300) shares with a par value of six United States
Dollars (U.S.$ 6) per share.

     The Company has an issued capital of one hundred forty-two million two
hundred forty-nine thousand four hundred fifty-eight United States Dollars
(U.S.$ 142,249,458) divided into twenty-three million seven hundred eight
thousand two hundred firty-three (23,708,243) shares with a par value of six
United States Dollars (U.S.$ 6) per share, fully paid-in.

     The capital of the Company may be increased or reduced by a resolution of
the shareholders adopted in the manner required by the laws of Luxembourg for
amendment of these Articles of Incorporation.

     The board of directors is authorized and empowered to:

     o    realize any increase of the corporate capital within the limits of
          the authorized capital in one or several successive tranches, by the
          issuing of new shares, against payment in cash or in kind, by
          conversion of claims or in any other manner;

     o    determine the place and date of the issue or the successive issues,
          the issue price, the terms and conditions of the subscription of and
          paying up on the new shares; and

     o    remove or limit the preferential subscription right of the
          shareholders in case of issue of shares against payment in cash.

     This authorization is valid for a period of 5 (five) years from the date of
publication of the present deed and it may be renewed by a general meeting of
shareholders for those shares of the authorized corporate capital which up to
then will not have been issued by the board of directors.

     Following each increase of the corporate capital realized and duly stated
in the form provided for by law, the second paragraph of this article 5 will be
modified so as to reflect the actual increase; such modification will be
recorded in authentic form by the board of directors or by any person duly
authorized and empowered by it for this purpose.

Article 6. Shares

     The shares will be in the form of registered shares.

     Every holder of shares shall be entitled, without payment, to receive one
registered certificate for all such shares or to receive several certificates
for one or more of such shares upon payment for every certificate after the
first of such reasonable out-of-pocket expenses as the board of directors may
from time to time determine. A registered holder who has transferred part of the
shares comprised in his registered holding shall be entitled to a certificate
for the balance without charge.

     Share certificates shall be signed by two directors. Both such signatures
may be either manual, or printed, or by facsimile. The Company may issue
temporary share certificates in such form as the board of directors may from
time to time determine.

     Shares of the Company shall be registered in the register of shareholders
which shall be kept by the Company or by one or more persons designated
therefore by the Company; such register shall contain the



                                      E-2
<PAGE>


name of each holder, his residence or elected domicile and the number of shares
held by him. Every transfer and devolution of a share shall be entered in the
register of shareholders.

     The shares shall be freely transferable.

     Transfer of shares shall be effected by delivering the certificate or
certificates representing the same to the Company along with an instrument of
transfer satisfactory to the Company or by written declaration of transfer
inscribed in the register of shareholders, dated and signed by the transferor,
or by persons holding suitable powers of attorney to act therefor.

     Every shareholder must provide the Company with an address to which all
notices and announcements from the Company may be sent. Such address will also
be entered in the register of shareholders.

     In the event that such shareholder does not provide such an address, the
Company may permit a notice to this effect to be entered in the register of
shareholders and the shareholder's address will be deemed to be at the
registered office of the Company, or such other address as may be so entered by
the Company from time to time, until another address shall be provided to the
Company by such shareholder. The shareholder may, at any time, change his
address as entered in the register of shareholders by means of a written
notification to the Company at its registered office, or at such other address
as may be set by the Company from time to time and notice thereof given to the
shareholders.

     The Company will recognize only one holder of a share of the Company. In
the event of joint ownership, the Company may suspend the exercise of any right
deriving from the relevant share until one person shall have been designated to
represent the joint owners vis-a-vis the Company.

     If any shareholder can prove to the satisfaction of the Company that his
share certificate has been mislaid, lost, stolen or destroyed, then, at his
request, a duplicate certificate may be issued under such conditions as the
Company may determine subject to applicable provisions of law.

     Mutilated share certificates may be exchanged for new ones on the request
of any shareholder. The mutilated certificates shall be delivered to the Company
and shall be annulled immediately.

     The Company may repurchase its own shares. A shareholder wishing to have
all or part of his shares repurchased shall notify the Board of Directors in
writing ("the Repurchase Request") specifying the number of shares that he
wishes to have repurchased. The Board shall at its own discretion decide if the
Company shall repurchase the shares offered for repurchase within thirty (30)
days from receipt of the Repurchase Request notifying the requesting shareholder
of its decision and, if applicable, the price which the Board of Directors
determines to be "the fair market value" as of the last day of the calendar
quarter immediately preceding the date of the Repurchase Request. The Board of
Directors may at its discretion decide to have the fair market value determined
by an appraisal carried out by an internationally recognized investment bank.

     The requesting shareholder shall within fifteen (15) days from reception of
the Company's response to the Repurchase Request notify the Board of Directors
if the shareholder wishes to proceed with the repurchase at the price determined
by the Board of Directors. If the shareholder wishes to proceed with the
repurchase the shareholder must, together with a written notice to this effect,
deliver to the Company at its registered office any share certificate, if
issued, evidencing ownership of the shares to be repurchased, duly endorsed for
transfer to the Company.

     The repurchase shall be deemed to have been effected on the date on which
the Company shall have received the notice and certificate(s), if applicable,
("the Repurchase Date"). All shares repurchased by the Company shall no longer
be deemed to be outstanding and any rights with respect to such shares, other
than the right to receive the repurchase price thereon, shall cease to exist.
The Company shall pay to the shareholder the repurchase price for the shares
offered for repurchase within thirty (30) days after the Repurchase Date.


                                      E-3
<PAGE>


     For the purpose of this Article, the repurchase price shall be the price
determined by the board of directors as a "fair market value". The fair market
value of the shares tendered for repurchase may at the discretion of the board
of directors be determined by an independent appraisal as of the last day of the
calendar quarter of the Company immediately preceding the Repurchase Date, which
appraisal shall be carried out by an internationally recognized investment bank
mutually agreed by the board of directors and the shareholder. The determination
of the investment bank shall be final and binding on both parties, provided,
however, that the shareholder may, in his sole discretion, cancel the exercise
of the repurchase if the repurchase price so determined is unacceptable to the
shareholder for any reason.

CHAPTER III.- BOARD OF DIRECTORS, STATUTORY AUDITORS

Article 7. Board of Directors

     The Company will be administered by a board of directors composed of at
least 6 (six) members. Members of the board of directors need not be
shareholders of the Company.

     The directors will be elected by the shareholders' meeting, which will
determine their number, for a period not exceeding 6 (six) years, and they will
hold office until their successors are elected. They are re-eligible, but they
may be removed at any time, with or without cause, by a resolution of the
shareholders' meeting.

     In the event of a vacancy on the board of directors, the remaining
directors may meet and may elect by majority vote a director to fill such
vacancy until the next meeting of shareholders.

Article 8. Meetings of the Board of Directors

     The board of directors will choose from among its members a chairman. It
may also choose a secretary, who need not be a director, who will be responsible
for keeping the minutes of the meetings of the board of directors and of the
shareholders.

     The board of directors will meet upon call by the chairman. A meeting of
the board must be convened if any two directors so require.

     The chairman will preside at all meetings of shareholders and of the board
of directors, but in his absence the general meeting or the board will appoint
another person as chairman pro tempore by vote of the majority present at such
meeting.

     Except in cases of urgency or with the prior consent of all those entitled
to attend, at least 3 (three) days' written notice of board meetings shall be
given. Any such notice shall specify the time and place of the meeting and the
nature of the business to be transacted....

     The notice may be waived by the consent in writing or by telefax, cable,
telegram or telex of each director. No separate notice is required for meetings
held at times and places specified in a schedule previously adopted by
resolution of the board of directors.

     Every board meeting shall be held in Luxembourg or at such other place as
the board may from time to time determine.

     Any director may act at any meeting of the board of directors by appointing
in writing or by telefax, cable, telegram or telex another director as his
proxy.

     A quorum of the board shall be the presence of 4 (four) of the directors
holding office.

     Decisions will be taken by the affirmative votes of a simple majority of
the directors present or represented.


                                      E-4
<PAGE>


     In case of urgency, a written decision, signed by all the directors, is
proper and valid as though it had been adopted at a meeting of the board of
directors which was duly convened and held. Such a decision can be documented in
a single document or in several separate documents having the same content.

     One or more members of the board may participate in a meeting by means of a
conference telephone or similar communications equipment allowing all persons
participating in the meeting to hear each other at the same time. Participation
by such means shall constitute presence in person at the meeting.

Article 9. Minutes of meetings of the Board of Directors

     The minutes of any meeting of the board of directors will be signed by the
chairman of the meeting. Any proxies will remain attached thereto.

     Copies or extracts of such minutes which may be produced in judicial
proceedings or otherwise will be signed by the chairman or by any two members of
the board of directors.

Article 10. Powers of the Board of Directors

     The board of directors is vested with the broadest powers to perform all
acts necessary or useful for accomplishing the corporate object of the Company.
All powers not expressly reserved by law or by the present articles to the
general meeting of shareholders are in the competence of the board of directors.

Article 11. Delegation of Powers

     The board of directors may delegate the daily management of the Company and
the representation of the Company within such daily management to one or more
directors, officers, executives, employees or other persons who may but need not
be shareholders, or delegate special powers or proxies, or entrust determined
permanent or temporary functions to persons or agents chosen by it.

     Delegation of daily management to a member of the board is subject to
previous authorization by the general meeting of shareholders.

Article 12. Directors' Remuneration

     Each of the directors will be entitled to fees for acting as such at such
rate as may from time to time be determined by resolution of the general meeting
of shareholders. Any director to whom is delegated daily management or who
otherwise holds executive office will also be entitled to receive such
remuneration (whether by way of salary, participation in profits or otherwise
and including pension salary and including pension contributions) as the board
of directors may from time to time decide.

Article 13. Conflict of Interests

     No contract or other transaction between the Company and any other company
or firm shall be affected or invalidated by the fact that any one or more of the
directors or officers of the Company has a personal interest in, or is a
director, associate, officer or employee of such other company or firm. Subject
to the following provisions of this Article, any director or officer of the
Company who serves as a director, associate, officer or employee of any company
or firm with which the Company shall contract or otherwise engage in business
shall not, by reason of such affiliation with such other company or firm, be
prevented from considering and voting or acting upon any matters with respect to
such contract or other business.

     In the event that any director or officer of the Company may have any
personal interest in any transaction of the Company, he shall make known to the
board such personal interest and shall not consider or vote on any such
transaction, and such transaction and such director's or officer's interest
therein shall be reported to the next general meeting of shareholders.


                                      E-5
<PAGE>


     The Company shall indemnify any director or officer and his heirs,
executors and administrators, against expenses reasonably incurred by him in
connection with any action, suit or proceeding to which he may be made a party
by reason of his being or having been a director or officer of the Company, or,
at the request of the Company, of any other company of which the Company is a
shareholder or creditor, except in relation to matters as to which he shall be
finally adjudged in such action, suit or proceeding to be liable for gross
negligence or willful misconduct; in the event of a settlement, indemnification
shall be provided only in connection with such matters covered by the settlement
as to which the Company is advised by its legal counsel that the person to be
indemnified did not commit such a breach of duty. The foregoing right of
indemnification shall not exclude other rights to which he may be entitled.

Article 14. Representation of the Company

     The Company will be bound towards third parties by the joint signatures of
any two directors or by the individual signature of the person to whom the daily
management of the Company has been delegated, within such daily management, or
by the joint signatures or single signature of any persons to whom such
signatory power has been delegated by the board, but only within the limits of
such power.

Article 15. Auditors

     The supervision of the operations of the Company is entrusted to one or
more auditors who need not be share-holders.

     The auditors will be elected by the shareholders' meeting by a simple
majority of the votes present or represented at such meeting, which will
determine their number, for a period not exceeding (6) six years. They will hold
office until their successors are elected. They are re-eligible, but they may be
removed at any time, with or without cause, by a resolution adopted by a simple
majority of the shareholders present or represented at a meeting of
shareholders.

CHAPTER IV.- MEETINGS OF SHAREHOLDERS

Article 16. Powers of the meeting of shareholders

     Any regularly constituted meeting of shareholders of the Company represents
the entire body of shareholders. It has the powers conferred upon it by law.

Article 17.

     The board of directors will determine in the convening notice the
formalities to be observed by each shareholder for admission to a general
meeting of the shareholders.

Article 18. Annual General Meeting

     The annual general meeting will be held in the Grand-Duchy of Luxembourg,
at the registered office of the Company or at such other place as may be
specified in the notice convening the meeting on the last Tuesday of May of each
year, at 4.00 p.m., and for the first time in 1993. If such day is a public
holiday, the meeting will be held on the next following business day.

Article 19. Other General Meetings

     The board of directors may convene other general meetings. Such meetings
must be convened if shareholders representing at least 1/5 (one fifth) of the
Company's capital so require.

     Shareholders' meetings, including the annual general meeting, may be held
abroad if, in the judgment of the board of directors, which is final,
circumstances of force majeure so require.


                                      E-6
<PAGE>


Article 20. Procedure, Vote

     Shareholders will meet upon call by the board of directors or the auditor
or the auditors made in the forms provided for by law. The notice will contain
the agenda of the meeting.

     If all the shareholders are present or represented at a shareholders'
meeting and if they state that they have been informed of the agenda of the
meeting, the meeting may be held without prior notice.

     A shareholder may act at any meeting of the shareholders by appointing as
his proxy by instrument in writing or by telefax, cable, telegram or telex
another person who need not be a shareholder.

     The board of directors may determine all other conditions that must be
fulfilled in order to take part in a shareholders' meeting.

     The shareholders of the Company shall be entitled at each meeting of the
shareholders to one vote for every share.

     Except as otherwise required by law, a simple majority of the votes present
or represented at a general meeting is needed to adopt a resolution.

     Except as otherwise required by these statutes or by law, a majority of
three quarters (3/4) of the votes present or represented at a meeting of the
shareholders shall be necessary to authorize any corporate action to be taken by
vote of the shareholders, PROVIDED, however, that in addition a quorum of
presence of two-thirds (2/3) of the holder of the issued shares of the Company
shall be required to approve the following proposed actions: (i) to amend these
articles concerning the purpose and form of the Company, (ii) to liquidate or
dissolve the Company, (iii) to merge or consolidate the Company with any other
entity or (iv) to sell shares in an initial Public Offering. Unless required by
these statutes or determined by the chairman of the meeting to be advisable, the
vote on any question other than the election of directors need not be by ballot,
provided that each shareholder is entitled to request a vote by secret ballot.
On a vote by ballot, each ballot shall be signed by the shareholder voting, or
by proxy, if there be such proxy, and shall state the number of shares held.

     "Public Offering" means the sale to the public of the Company's voting
stock, if, immediately following such sale, such voting stock is quoted on a
recognized securities exchange or traded over-the-counter, and the shares sold
to the public have a market value (based on the closing price on the date of
commencement of such trading) in excess of U.S.$ 5,000,000 (five million United
States Dollars).

     Copies or extracts of the minutes of the meeting to be produced in judicial
proceedings or otherwise will be signed by the chairman or by any two members of
the board of directors.

CHAPTER V. FINANCIAL YEAR, DISTRIBUTION OF PROFITS

Article 21. Financial Year

     The Company's financial year begins on the first day of January and ends on
the last day of December in every year, except that the first financial year
will begin on the date of formation of the Company and will end on the last day
of December 1992.

     The board of directors shall prepare annual accounts in accordance with the
requirements of Luxembourg law and accounting practice.


                                      E-7
<PAGE>


Article 22. Appropriation of Profits

     From the annual net profits of the Company, five per cent (5%) shall be
allocated to the reserve required by law. That allocation will cease to be
required as soon and for as long as such reserve amounts to ten per cent (10%)
of the aggregate par value of the issued capital of the Company.

     Upon recommendation of the board of directors, the general meeting of
shareholders determines how the remainder of the annual net profits will be
disposed of. It may decide to allocate the whole or part of the remainder to a
reserve or to a provision reserve, to carry it forward to the next following
financial year or to distribute it to the shareholders as dividend.

     Subject to the conditions fixed by law, the board of directors may pay out
an advance payment on dividends. The board fixes the amount and the date of
payment of any such advance payment.

     Dividends may also be paid out of unappropriated net profit brought forward
from prior years. Dividends shall be paid in United States Dollars or by free
allotment of shares of the Company or otherwise in specie as the directors may
determine, and may be paid at such times as may be determined by the board of
directors. Payment of dividends shall be made to holders of shares at their
addresses in the register of shareholders. No interest shall be due against the
Company on dividends declared but unclaimed.

     Shareholders are entitled to share in the profits of the Company pro rata
to the paid up par value of their shareholding.

CHAPTER VI.- DISSOLUTION, LIQUIDATION

Article 23. Dissolution, Liquidation

     The Company may be dissolved by a decision taken in a meeting of
shareholders resolving at the same conditions as to quorum of presence and
majority as those imposed by Article 20.

     Should the Company be dissolved, the liquidation will be carried out by one
or more liquidators appointed by the general meeting of shareholders, which will
determine their powers and their compensation.

     The shares carry a right to a repayment (from the assets available for
distribution to shareholders) of the nominal capital paid up in respect of such
shares and the right to share in surplus assets on a winding up of the Company
pro rata to the par value paid up on such shares.

CHAPTER VII.- APPLICABLE LAW

Article 24. Applicable Law

     All matters not governed by these articles of incorporation shall be
determined in accordance with the Luxembourg law of August 10th, 1915 on
commercial companies, as amended.


                                      E-8

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4.1
<SEQUENCE>4
<FILENAME>jun2703_ex0401.txt
<TEXT>

================================================================================


                                                                     EXHIBIT 4.1



                      MILLICOM INTERNATIONAL CELLULAR S.A.

                                                                          Issuer

                                       TO

                              THE BANK OF NEW YORK

                                                                         Trustee

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

                                   Indenture

                            Dated as of May 8, 2003

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



                                  $562,219,000

                                11% SENIOR NOTES

                                    Due 2006






================================================================================


<PAGE>

                      MILLICOM INTERNATIONAL CELLULAR S.A.

                 Certain Sections of this Indenture relating to
                         Sections 310 through 318 of the
                          Trust Indenture Act of 1939:

Trust Indenture Act
    Section                                               Indenture Section

ss. 310(a)(1)        ................................         6.09
       (a)(2)        ................................         6.09
       (a)(3)        ................................         Not Applicable
       (a)(4)        ................................         Not Applicable
       (a)(5)        ................................         6.09
       (b)           ................................         6.08
                                                              6.10
ss. 311(a)           ................................         6.13
       (b)           ................................         6.13
ss. 312(a)           ................................         7.01
                                                              7.02(a)
       (b)           ................................         7.02(b)
       (c)           ................................         7.02(c)
ss. 313(a)           ................................         7.03(a)
       (b)           ................................         7.03(a)
       (c)           ................................         7.03(a)
       (d)           ................................         7.03(b)
ss. 314(a)           ................................         7.04
       (a)(4)        ................................         1.01
                                                              10.04
       (b)           ................................         Not Applicable
       (c)(1)        ................................         1.02
       (c)(2)        ................................         1.02
       (c)(3)        ................................         Not Applicable
       (d)           ................................         Not Applicable
       (e)           ................................         1.02
ss. 315(a)           ................................         6.01
       (b)           ................................         6.02
       (c)           ................................         6.01
       (d)           ................................         6.01
       (e)           ................................         5.14
ss. 316(a)           ................................         1.01
       (a)(1)(A)     ................................         5.12
       (a)(1)(B)     ................................         5.02, 5.13

- --------------------------
Note:     This reconciliation and tie shall not, for any purpose, be deemed to
          be a part of the Identure.

<PAGE>

       (a)(2)        ................................         Not Applicable
       (b)           ................................         5.08
       (c)           ................................         1.04(c)
ss. 317(a)(1)        ................................         5.03
       (a)(2)        ................................         5.04
       (b)           ................................         10.03
ss. 318(a)           ................................         1.07

- --------------------------
Note:     This reconciliation and tie shall not, for any purpose, be deemed to
          be a part of the Identure.

<PAGE>


                                TABLE OF CONTENTS

                                                                            Page

Parties .......................................................................1
Recitals of the Company .......................................................1


                                  ARTICLE ONE

DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION........................1

     SECTION 1.01.     Definitions.............................................1
                       Acquired Debt...........................................2
                       Act.....................................................2
                       Additional Step-Up......................................2
                       Affiliate...............................................2
                       Agent Member............................................2
                       Amortization Payment....................................2
                       Amortization Payment Date...............................2
                       Applicable Procedures...................................2
                       Asset Disposition.......................................2
                       Authenticating Agent....................................3
                       Board of Directors......................................3
                       Board Resolution........................................3
                       Business Day............................................3
                       Capital Lease Obligation................................3
                       Capital Stock...........................................4
                       Cash Equivalents........................................4
                       Cellular Operating Income...............................4
                       Change of Control.......................................5
                       Commission..............................................5
                       Common Stock............................................5
                       Company.................................................5
                       Company Request or Company Order........................5
                       Consolidated Corporate and License Acquisition Expense..5
                       Consolidated Income Tax Expense.........................5
                       Consolidated Interest Expense...........................5
                       Consolidated Net Income.................................6
                       Corporate Trust Office..................................6
                       corporation.............................................6
                       Credit Facility.........................................6
                       Debt....................................................6
                       Debt Coverage Ratio.....................................7
                       Default Amount..........................................7

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Note:     This table of contents shall not, for any purpose, be deemed to be a
          part of the Indenture.

<PAGE>

                       Defaulted Interest......................................7
                       Depository..............................................7
                       Event of Default........................................8
                       Exchange Act............................................8
                       Expiration Date.........................................8
                       Global Security.........................................8
                       Government Securities...................................8
                       Gradation...............................................8
                       Guarantee...............................................8
                       Holder..................................................8
                       Incur...................................................9
                       Indenture...............................................9
                       Interest Payment Date...................................9
                       Interest Rate, Currency or Commodity Price Agreement....9
                       Investment..............................................9
                       Investment Grade........................................9
                       Lien....................................................9
                       Maturity...............................................10
                       Minority Owned Affiliate...............................10
                       Moody's................................................10
                       Net Available Proceeds.................................10
                       Offer to Purchase......................................10
                       Officer's Certificate..................................12
                       Opinion of Counsel.....................................13
                       Other Securities.......................................13
                       Outstanding............................................13
                       Paying Agent...........................................13
                       Permitted Holder.......................................13
                       Permitted Interest Rate, Currency or
                       Commodity Price Agreement..............................14
                       Permitted Investments..................................14
                       Person.................................................15
                       Predecessor Security...................................15
                       Preferred Dividends....................................15
                       Preferred Stock........................................15
                       Pro Rata Portion.......................................15
                       Purchase Date..........................................16
                       Rating Agencies........................................16
                       Rating Category........................................16
                       Receivables............................................16
                       Receivables Sale.......................................16
                       Redeemable Stock.......................................16
                       Redemption Date........................................16
                       Redemption Price.......................................16

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Note:     This table of contents shall not, for any purpose, be deemed to be a
          part of the Indenture.

<PAGE>

                       Registration Rights Agreement..........................17
                       Regular Record Date....................................17
                       Regulation S...........................................17
                       Regulation S Global Security...........................17
                       Regulation S Legend....................................17
                       Regulation S Securities................................17
                       Related Assets.........................................17
                       Related Business.......................................17
                       Related Person.........................................17
                       Resale Registration Statement..........................17
                       Responsible Officer....................................17
                       Restricted Affiliate...................................18
                       Restricted Global Security.............................18
                       Restricted Group.......................................18
                       Restricted Securities..................................18
                       Restricted Securities Certificate......................18
                       Restricted Securities Legend...........................18
                       Restricted Period......................................18
                       Restricted Subsidiary..................................18
                       S&P....................................................18
                       Securities Act.........................................18
                       Security Register and Security Registrar...............19
                       Senior Debt............................................19
                       Significant Restricted Group Member....................19
                       Special Interest.......................................19
                       Special Record Date....................................19
                       Stated Maturity........................................19
                       Step-Down Date.........................................19
                       Step-Up................................................20
                       Strategic Investor.....................................20
                       Subsidiary.............................................20
                       Successor Security.....................................20
                       Trustee................................................20
                       Trust Indenture Act....................................20
                       Unrestricted Affiliate.................................20
                       Unrestricted Subsidiary................................20
                       Vice President.........................................21
                       Voting Stock...........................................21
                       Weighted Average Life to Maturity......................21
                       Wholly Owned Restricted Subsidiary.....................21
                       13-1/2% Notes..........................................21
     SECTION 1.02.     Compliance Certificates and Opinions...................22
     SECTION 1.03.     Form of Documents Delivered to Trustee.................22

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Note:     This table of contents shall not, for any purpose, be deemed to be a
          part of the Indenture.

<PAGE>

     SECTION 1.04.     Acts of Holders; Record Dates..........................23
     SECTION 1.05.     Notices, Etc., to Trustee and Company..................24
     SECTION 1.06.     Notice to Holders; Waiver..............................24
     SECTION 1.07.     Conflict with Trust Indenture Act......................24
     SECTION 1.08.     Effect of Headings and Table of Contents...............25
     SECTION 1.09.     Successors and Assigns.................................25
     SECTION 1.10.     Separability Clause....................................25
     SECTION 1.11.     Benefits of Indenture..................................25
     SECTION 1.12.     Governing Law..........................................25
     SECTION 1.13.     Submission to Jurisdiction.............................25
     SECTION 1.14.     Legal Holidays.........................................26

                                   ARTICLE TWO

SECURITY FORMS................................................................26

     SECTION 2.01.     Forms Generally; Initial Forms of Securities...........26
     SECTION 2.02.     Form of Face of Security...............................27
     SECTION 2.03.     Form of Reverse of Security............................31
     SECTION 2.04.     Form of Trustee's Certificate of Authentication........34

                                  ARTICLE THREE

THE SECURITIES................................................................34

     SECTION 3.01.     Title and Terms........................................34
     SECTION 3.02.     Denominations..........................................35
     SECTION 3.03.     Execution, Authentication, Delivery and Dating.........35
     SECTION 3.04.     Temporary Securities...................................36
     SECTION 3.05.     Global Securities......................................36
     SECTION 3.06.     Registration, Registration of Transfer Generally; Certa
                       Transfers and Exchanges................................37
     SECTION 3.07.     Mutilated, Destroyed, Lost and Stolen Securities.......42
     SECTION 3.08.     Payment of Interest; Interest Rights Preserved.........43
     SECTION 3.09.     Persons Deemed Owners..................................44
     SECTION 3.10.     Cancellation...........................................44
     SECTION 3.11.     Computation of Interest................................44
     SECTION 3.12.     CUSIP Numbers..........................................44

                                  ARTICLE FOUR

SATISFACTION AND DISCHARGE....................................................45

     SECTION 4.01.     Satisfaction and Discharge of Indenture................45

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Note:     This table of contents shall not, for any purpose, be deemed to be a
          part of the Indenture.

<PAGE>

     SECTION 4.02.     Application of Trust Money.............................46

                                  ARTICLE FIVE

REMEDIES......................................................................46

     SECTION 5.01.     Events of Default......................................46
     SECTION 5.02.     Acceleration of Maturity; Rescission and Annulment.....48
     SECTION 5.03.     Collection of Indebtedness and Suits for Enforcement by
                       Trustee................................................49
     SECTION 5.04.     Trustee May File Proofs of Claim.......................50
     SECTION 5.05.     Trustee May Enforce Claims Without Possession of
                       Securities.............................................50
     SECTION 5.06.     Application of Money Collected.........................50
     SECTION 5.07.     Limitation on Suits....................................51
     SECTION 5.08.     Unconditional Right of Holders to Receive Principal,
                       Premium and Interest...................................51
     SECTION 5.09.     Restoration of Rights and Remedies.....................52
     SECTION 5.10.     Rights and Remedies Cumulative.........................52
     SECTION 5.11.     Delay or Omission Not Waiver...........................52
     SECTION 5.12.     Control by Holders.....................................52
     SECTION 5.13.     Waiver of Past Defaults................................52
     SECTION 5.14.     Undertaking for Costs..................................53
     SECTION 5.15.     Waiver of Stay or Extension Laws.......................53

                                   ARTICLE SIX

THE TRUSTEE...................................................................53

     SECTION 6.01.     Certain Duties and Responsibilities....................53
     SECTION 6.02.     Notice of Defaults.....................................54
     SECTION 6.03.     Certain Rights of Trustee..............................55
     SECTION 6.04.     Not Responsible for Recitals or Issuance of Securities.56
     SECTION 6.05.     May Hold Securities....................................56
     SECTION 6.06.     Money Held in Trust....................................57
     SECTION 6.07.     Compensation and Reimbursement.........................57
     SECTION 6.08.     Disqualification; Conflicting Interests................57
     SECTION 6.09.     Corporate Trustee Required; Eligibility................58
     SECTION 6.10.     Resignation and Removal; Appointment of Successor......58
     SECTION 6.11.     Acceptance of Appointment by Successor.................59
     SECTION 6.12.     Merger, Conversion, Consolidation or Succession to
                       Business...............................................59
     SECTION 6.13.     Preferential Collection of Claims Against Company......60
     SECTION 6.14.     Appointment of Authenticating Agent....................60

- --------------------------
Note:     This table of contents shall not, for any purpose, be deemed to be a
          part of the Indenture.

<PAGE>


                                  ARTICLE SEVEN

HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY.............................61

     SECTION 7.01.     Company to Furnish Trustee Names and Addresses of
                       Holders................................................61
     SECTION 7.02.     Preservation of Information; Communications to Holders.62
     SECTION 7.03.     Reports by Trustee.....................................62
     SECTION 7.04.     Reports by Company.....................................62
     SECTION 7.05.     Officer's Certificate with Respect to Change in Interest
                       Rates..................................................63

                                  ARTICLE EIGHT

CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE..........................63

     SECTION 8.01.     Company May Consolidate, Etc., Only on Certain Terms...63
     SECTION 8.02.     Successor Substituted..................................64

                                  ARTICLE NINE

SUPPLEMENTAL INDENTURES.......................................................64

     SECTION 9.01.     Supplemental Indentures Without Consent of Holders.....64
     SECTION 9.02.     Supplemental Indentures with Consent of Holders........65
     SECTION 9.03.     Execution of Supplemental Indentures...................66
     SECTION 9.04.     Effect of Supplemental Indentures......................66
     SECTION 9.05.     Conformity with Trust Indenture Act....................67
     SECTION 9.06.     Reference in Securities to Supplemental Indentures.....67

                                   ARTICLE TEN

COVENANTS.....................................................................67

     SECTION 10.01.    Payment of Principal (including Amortization Payments),
                       Premium and Interest...................................67
     SECTION 10.02.    Maintenance of Office or Agency........................67
     SECTION 10.03.    Money for Security Payments to Be Held in Trust........68
     SECTION 10.04.    Statement by Officers as to Default; Compliance
                       Certificates...........................................69
     SECTION 10.05.    Existence..............................................69
     SECTION 10.06.    Maintenance of Properties..............................69
     SECTION 10.07.    Payment of Taxes and Other Claims......................69
     SECTION 10.08.    Limitation on Debt.....................................70
     SECTION 10.09.    Limitation on Restricted Payments......................72
     SECTION 10.10.    Limitation on Dividend and Other Payment Restrictions
                       Affecting Subsidiaries.................................74

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Note:     This table of contents shall not, for any purpose, be deemed to be a
          part of the Indenture.

<PAGE>

     SECTION 10.11.    [RESERVED].............................................76
     SECTION 10.12.    Limitation on Liens Securing Company Subordinated Debt.76
     SECTION 10.13.    Limitation on Guarantees of Company Subordinated Debt..76
     SECTION 10.14.    Limitation on Asset Dispositions.......................76
     SECTION 10.15.    Transactions with Affiliates and Related Persons.......78
     SECTION 10.16.    Change of Control......................................79
     SECTION 10.17.    Provision of Financial Information.....................80
     SECTION 10.18.    Limitation on Lines of Business........................80
     SECTION 10.19.    Payment of Additional Amounts..........................80
     SECTION 10.20.    Guarantee..............................................81
     SECTION 10.21.    Waiver of Certain Covenants............................81

                                 ARTICLE ELEVEN

REDEMPTION OF SECURITIES......................................................81

     SECTION 11.01.    Right of Redemption....................................81
     SECTION 11.02.    Applicability of Article...............................82
     SECTION 11.03.    Election to Redeem; Notice to Trustee..................82
     SECTION 11.04.    Selection by Trustee of Securities to Be Redeemed......82
     SECTION 11.05.    Notice of Redemption...................................82
     SECTION 11.06.    Deposit of Redemption Price and Amortization Payments..83
     SECTION 11.07.    Securities Payable on Redemption Date..................83
     SECTION 11.08.    Securities Redeemed in Part............................84

                                 ARTICLE TWELVE

AMORTIZATION PAYMENTS.........................................................84

     SECTION 12.01.    Amortization Payments..................................84

                                ARTICLE THIRTEEN

DEFEASANCE AND COVENANT DEFEASANCE............................................85

     SECTION 13.01.    Company's Option to Effect Defeasance or Covenant
                       Defeasance.............................................85
     SECTION 13.02.    Company's Option to Effect Defeasance or Covenant
                       Defeasance.............................................85
     SECTION 13.03.    Covenant Defeasance....................................85
     SECTION 13.04.    Conditions to Defeasance or Covenant Defeasance........86
     SECTION 13.05.    Deposited Money and U.S. Government Obligations to Be
                       Held in Trust; Other Miscellaneous Provisions..........87
     SECTION 13.06.    Reinstatement..........................................88


- --------------------------
Note:     This table of contents shall not, for any purpose, be deemed to be a
          part of the Indenture.

<PAGE>

                  INDENTURE, dated as of May 8, 2003, between Millicom
International Cellular S.A., a corporation duly organized and existing under the
laws of the Grand Duchy of Luxembourg (herein called the "Company"), having its
principal office at 75 Route de Longwy, Box 23, L-8080 Bertrange, Luxembourg and
The Bank of New York, a New York banking corporation, as Trustee (herein called
the "Trustee").

                             RECITALS OF THE COMPANY

                  The Company has duly authorized the execution and delivery of
this Indenture to provide for the issuance from time to time of its 11% Senior
Notes due 2006 (herein called the "Securities"), to be issued in one series as
herein set forth.

                  All things necessary to make the Securities, when executed by
the Company and authenticated and delivered hereunder and duly issued by the
Company, the valid obligations of the Company and to make this Indenture a valid
agreement of the Company, in accordance with their and its terms, have been
done.

                  NOW, THEREFORE, THIS INDENTURE WITNESSETH:

                  For and in consideration of the premises and the purchase of
the Securities by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Securities, as follows:

                                  ARTICLE ONE

             Definitions and Other Provisions of General Application

SECTION 1.01.     Definitions.

                  For all purposes of this Indenture, except as otherwise
expressly provided or unless the context otherwise requires:

(1)       the terms defined in this Article have the meanings assigned to them
in this Article and include the plural as well as the singular;

(2)       all other terms used herein which are defined in the Trust Indenture
Act, either directly or by reference therein, have the meanings assigned to them
therein;

(3)       all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted International Financial
Reporting Standards and, except as otherwise herein expressly provided, the term
"International Financial Reporting Standards", with respect to any computation
required or permitted hereunder shall mean such accounting principles as are
generally accepted at the date of this Indenture; and

(4)       the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.

                  "Acquired Debt" means Debt of any Person at the time it
becomes a Restricted Subsidiary of the Company, a Restricted Affiliate or a
Restricted Subsidiary of a Restricted Affiliate; provided that the Debt Coverage
Ratio of the Company and its Restricted Group, after giving pro forma effect to
the transaction or transactions by which such Person becomes a Restricted
Subsidiary of the Company, Restricted Affiliate or Restricted Subsidiary of a
Restricted Affiliate, would be not more than such ratio of the Company and its
Restricted Group before giving effect to such transactions.

                  "Act", when used with respect to any Holder, has the meaning
specified in Section 1.04.

                  "Additional Step-Up" has the meaning set forth in the form of
the Security contained in Section 2.02.

                  "Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.

                  "Agent Member" means any member of, or participant in, the
Depository.

                  "Amortization Payment" has the meaning set forth in Section
12.01.

                  "Amortization Payment Date" means each of June 1, 2004,
December 1, 2004, June 1, 2005 and December 1, 2005, respectively.

                  "Applicable Procedures" means, with respect to any transfer or
transaction involving a Global Security or beneficial interest therein, the
rules and procedures of the Depository for such Security, Euroclear and
Clearstream, in each case to the extent applicable to such transaction and as in
effect from time to time.

                  "Asset Disposition" means any transfer, conveyance, sale,
lease or other disposition by the Company, any Restricted Subsidiary of the
Company, any Restricted Affiliate or any Restricted Subsidiary of a Restricted
Affiliate (including a consolidation or merger or other sale of any such
Restricted Subsidiary of the Company, Restricted Affiliate or Restricted
Subsidiary of a Restricted Affiliate with, into or to another Person in a
transaction in which such Restricted Subsidiary of the Company, Restricted
Affiliate or Restricted Subsidiary of a Restricted Affiliate ceases to be a
Restricted Subsidiary of the Company, Restricted Affiliate or Restricted
Subsidiary of a Restricted Affiliate, but excluding a disposition by a
Restricted Subsidiary of the Company, Restricted Affiliate or Restricted
Subsidiary of a Restricted Affiliate to the Company or a Restricted Subsidiary
which is an 80% or more owned Subsidiary of the Company, by the Company to a
Restricted Subsidiary of the Company which is an 80% or more owned Subsidiary of
the Company, by any Restricted Subsidiary of a Restricted Affiliate to such
Restricted Affiliate or an 80% or more owned Restricted Subsidiary of such
Restricted Affiliate or by a Restricted Affiliate to a Restricted Subsidiary of
such Restricted Affiliate which is an 80% or more owned Subsidiary of such
Restricted Affiliate) of (i) shares of Capital Stock (other than directors'
qualifying shares) or other ownership interests of a Restricted Subsidiary of
the Company, Restricted Affiliate or Restricted Subsidiary of a Restricted
Affiliate, (ii) substantially all of the assets of the Company, any Restricted
Subsidiary of the Company, any Restricted Affiliate or any Restricted Subsidiary
of a Restricted Affiliate representing a division or line of business or (iii)
other assets or rights of the Company, any Restricted Subsidiary of the Company,
any Restricted Affiliate or any Restricted Subsidiary of a Restricted Affiliate
outside of the ordinary course of business (other than Receivables Sales),
provided in each case that the aggregate consideration for such transfer,
conveyance, sale, lease or other disposition is equal to $10 million or more;
provided further that the term "Asset Disposition" shall not include (x) any
transaction subject to, and permitted under Section 10.09 or (y) any Permitted
Investment.

                  "Authenticating Agent" means any Person authorized by the
Trustee pursuant to Section 6.14 to act on behalf of the Trustee to authenticate
Securities.

                  "Board of Directors" means either the board of directors of
the Company or any duly authorized committee of that board.

                  "Board Resolution" means a copy of a resolution certified by
the President, Chief Executive Officer, any Director or the Secretary of the
Board of Directors of the Company to have been duly adopted by the Board of
Directors or a committee thereof and to be in full force and effect on the date
of such certification, and delivered to the Trustee.

                  "Business Day" means each Monday, Tuesday, Wednesday, Thursday
and Friday which is not a day on which banking institutions in the Borough of
Manhattan, the City of New York, in London, England or in Luxembourg are
authorized or obligated by law or executive order to close.

                  "Capital Lease Obligation" of any Person means the obligation
to pay rent or other payment amounts under a lease of real or personal property
of such Person which is required to be classified and accounted for as a capital
lease on the face of a balance sheet of such Person in accordance with
International Financial Reporting Standards. The stated maturity of such
obligation shall be the date of the last payment of rent or any other amount due
under such lease prior to the first date upon which such lease may be terminated
by the lessee without payment of a penalty. The principal amount of such
obligation shall be the capitalized amount thereof that would appear on the face
of a balance sheet of such Person in accordance with International Financial
Reporting Standards.

                  "Capital Stock" of any Person means any and all shares,
interests, participation or other equivalents (however designated) of corporate
stock or other equity participation, including partnership interests, whether
general or limited, of such Person.

                  "Cash Equivalents" means, with respect to any Person, (i)
Government Securities, (ii) certificates of deposit and eurodollar time deposits
and money market deposits, bankers' acceptances and overnight bank deposits, in
each case issued by or with a bank or trust company which is organized under the
laws of the United States of America, any state thereof or any foreign country
recognized by the United States, and which bank or trust company has capital,
surplus and undivided profits aggregating in excess of $100 million (or the
foreign currency equivalent thereof) and has outstanding debt which is rated "A"
(or such similar equivalent rating) or higher by at least one nationally
recognized statistical rating organization (as defined in Rule 436 under the
Securities Act) or any money-market fund sponsored by a registered broker dealer
or mutual fund distributor, (iii) repurchase obligations with a term of not more
than seven days for underlying securities of the types described in clauses (i)
and (ii) entered into with any financial institution meeting the qualifications
specified in clause (ii) above, (iv) commercial paper having the highest rating
obtainable from Moody's or S&P and in each case maturing within six months after
the date of acquisition, (v) with respect to any Person organized under the laws
of, or having its principal business operations in, a jurisdiction outside
Luxembourg or the United States, those investments that are comparable to
clauses (i), (ii), (iii) and (iv) in the country in which such Person is
organized or conducting business; and (vi) up to $2 million in aggregate of
other Investments held by Restricted Subsidiaries of the Company, Restricted
Affiliates or Restricted Subsidiaries of Restricted Affiliates.

                  "Cellular Operating Income" for any period means the
Consolidated Net Income of the Company and its Restricted Group for such period
increased by the sum of (i) Consolidated Interest Expense of the Company and its
Restricted Group for such period, plus (ii) Consolidated Income Tax Expense of
the Company and its Restricted Group for such period, plus (iii) the
consolidated depreciation and amortization expense included in the income
statement of the Company and its Restricted Group for such period, plus (iv)
Consolidated Corporate and License Acquisition Expense of the Company and its
Restricted Group for such period; provided, however, that for purposes of any
determination pursuant to the provisions of Section 10.09(3)(a)(x), there shall
be excluded therefrom the Cellular Operating Income (if positive) of any
Restricted Subsidiary of the Company, Restricted Affiliate or Restricted
Subsidiary of such Restricted Affiliate (calculated separately for such Person
in the same manner as provided above for the Company and its Restricted Group)
that is subject to a restriction to the extent it would have prevented the
payment of dividends or the making of distributions to the Company or another
Restricted Subsidiary of the Company, Restricted Affiliate or Restricted
Subsidiary of a Restricted Affiliate to the extent of such restriction; provided
further that, in the event any of the Company, Restricted Affiliates or
Restricted Subsidiaries of Restricted Affiliates have made Asset Dispositions or
acquisitions of assets not in the ordinary course of business (including
acquisitions of other Persons by merger, consolidation or purchase of Capital
Stock) during or after such period, Cellular Operating Income shall be
calculated on a pro forma basis as if the Asset Dispositions or acquisitions had
taken place on the first day of such period.

                  "Change of Control" has the meaning set forth in Section
10.16.

                  "Commission" means the Securities and Exchange Commission, as
from time to time constituted, created under the Securities Exchange Act of
1934, or, if at any time after the execution of this instrument such Commission
is not existing and performing the duties now assigned to it under the Trust
Indenture Act, then the body performing such duties at such time.

                  "Common Stock" of any Person means Capital Stock of such
Person that does not rank prior, as to the payment of dividends or as to the
distribution of assets upon any voluntary or involuntary liquidation,
dissolution or winding up of such Person, to shares of Capital Stock of any
other class of such Person.

                  "Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.

                  "Company Request" or "Company Order" means a written request
or order signed in the name of the Company by its President, Chairman of the
Board, any Vice Chairman of the Board, any Director, its President, its Chief
Executive Officer, its Chief Operating Officer, any Senior Vice President or the
Secretary of the Board of the Company, and delivered to the Trustee.

                  "Consolidated Corporate and License Acquisition Expense"
means, with respect to the Company, (i) costs of head office personnel salaries,
rent, and other head office expenses and (ii) costs (other than capitalized
costs) incurred in seeking new licenses.

                  "Consolidated Income Tax Expense" for any period means the
consolidated provision for income taxes of the Company and its Restricted Group
for such period calculated on a consolidated basis in accordance with
International Financial Reporting Standards.

                  "Consolidated Interest Expense" means for any period the
consolidated interest expense included in a consolidated income statement
(without deduction of interest income) of the Company and its Restricted Group
for such period calculated on a consolidated basis in accordance with
International Financial Reporting Standards, including without limitation or
duplication (or, to the extent not so included, with the addition of), (i) the
amortization of Debt discounts; (ii) any payments or fees with respect to
letters of credit, bankers' acceptances or similar facilities; (iii) fees with
respect to interest rate swap or similar agreements or foreign currency hedge,
exchange or similar agreements; (iv) Preferred Stock dividends (other than with
respect to Redeemable Stock) declared and paid or payable; (v) accrued
Redeemable Stock dividends, whether or not declared or paid; (vi) interest on
Debt guaranteed by the Company and any member of its Restricted Group; and (vii)
the portion of any rental obligation allocable to interest expense.

                  "Consolidated Net Income" for any period means the
consolidated net income (or loss) of the Company and its Restricted Group for
such period determined on a consolidated basis in accordance with International
Financial Reporting Standards; provided that there shall be excluded therefrom
(without duplication) (a) the net income (or loss) of any Person acquired by the
Company or a member of its Restricted Group in a pooling-of-interests
transaction for any period prior to the date of such transaction, (b) the net
income (or loss) of any Person that is not a member of the Restricted Group of
the Company except to the extent of the amount of dividends or other
distributions actually paid to the Company or a member of its Restricted Group
by such Person during such period, (c) gains or losses on Asset Dispositions by
the Company or any member of its Restricted Group, (d) all extraordinary gains
and extraordinary losses, (e) the cumulative effect of changes in accounting
principles, (f) non-cash gains or losses resulting from fluctuations in currency
exchange rates and (g) the tax effect of any of the items described in clauses
(a) through (f) above.

                  "Corporate Trust Office" means the principal office of the
Trustee at which at any particular time its corporate trust business shall be
principally administered, which office as of the date of the execution of this
Indenture is located at The Bank of New York, One Canada Square, London E14 5AL,
England, Attention: Corporate Trust Administration, or such other address as the
Trustee may designate from time to time by notice to the Holders and the
Company.

                  "corporation" means a corporation, association, company,
limited liability company, joint-stock company or business trust.

                  "Credit Facility" means the equity swap facility dated as of
December 7, 2001, between The Toronto-Dominion Bank, London Branch and Millicom
Telecommunications S.A. including the ISDA Master Agreement, dated as of
December 7, 2001, the Schedule to the ISDA Master Agreement, dated as of
December 7, 2001, the Confirmation of an Equity Swap Transaction, dated December
7, 2001, the Amendment Confirmation of an Equity Swap Transaction, dated
December 12, 2001, the Side Letter to Amendment Confirmation, dated December 18,
2001, the Notice of the Initial Exchange Amount for the Amendment Confirmation
of an Equity Swap Transaction, dated December 12, 2001, the Notice of the
Initial Exchange Amount for the Amendment Confirmation of an Equity Swap
Transaction, dated December 17, 2001, the ISDA Credit Support Deed, dated
December 7, 2001, and the Side Letter regarding hedging and disposal of shares,
dated December 7, 2001, all of which are between The Toronto-Dominion Bank,
London Branch and Millicom Telecommunications S.A. and the Custody Agreement
between The Toronto-Dominion Bank, London Branch, Millicom Telecommunications
S.A. and Nordea Bank Sweden AB, dated December 7, 2001.

                  "Debt" means (without duplication), with respect to any
Person, whether recourse is to all or a portion of the assets of such Person and
whether or not contingent, (i) every obligation of such Person for money
borrowed, (ii) every obligation of such Person evidenced by bonds, debentures,
notes or other similar instruments, including obligations incurred in connection
with the acquisition of property, assets or businesses, (iii) every
reimbursement obligation of such Person with respect to letters of credit,
bankers' acceptances or similar facilities issued for the account of such
Person, (iv) every obligation of such Person issued or assumed as the deferred
purchase price of property or services (including securities repurchase
agreements but excluding trade accounts payable or accrued liabilities arising
in the ordinary course of business which are not overdue or which are being
contested in good faith), (v) every Capital Lease Obligation of such Person,
(vi) all Receivables Sales of such Person, together with any obligation of such
Person to pay any discount, interest, fees, indemnities, penalties, recourse,
expenses or other amounts in connection therewith, (vii) all Redeemable Stock
issued by such Person, (viii) every obligation under Interest Rate, Currency or
Commodity Price Agreements of such Person and (ix) every obligation of the type
referred to in clauses (i) through (viii) of another Person and all dividends of
another Person the payment of which, in either case, such Person has Guaranteed
or is responsible or liable, directly or indirectly, as obligor, Guarantor or
otherwise. The "amount" or "principal amount" of Debt at any time of
determination as used herein represented by (a) any Debt issued at a price that
is less than the principal amount at maturity thereof, shall be the amount of
the liability in respect thereof determined in accordance with International
Financial Reporting Standards, (b) any Receivables Sale, shall be the amount of
the unrecovered capital or principal investment of the purchaser (other than the
Company or a Wholly Owned Restricted Subsidiary of the Company) thereof,
excluding amounts representative of yield or interest earned on such investment,
and (c) any Redeemable Stock, shall be the maximum fixed redemption or
repurchase price in respect thereof.

                  "Debt Coverage Ratio", when used in connection with any
Incurrence (or deemed Incurrence) of Debt, means the ratio of (i) the
consolidated principal amount of Debt of the Company and its Restricted Group
outstanding as of the most recent available quarterly or annual balance sheet,
after giving pro forma effect to (a) the Incurrence of such Debt and any other
Debt Incurred since such balance sheet date, (b) the receipt and application of
the proceeds thereof and (c) (without duplication) the repayment, redemption or
repurchase of any other Debt since such balance sheet date, to (ii) four times
Cellular Operating Income for the full fiscal quarter next preceding the
Incurrence of such Debt for which consolidated financial statements are
available, determined on a pro forma basis as if any such Debt had been Incurred
and the proceeds thereof had been applied, or such other Debt had been repaid,
redeemed or repurchased, as applicable, at the beginning of such fiscal quarter.
In the case of any such Incurrence of Debt by a Restricted Subsidiary of the
Company, Restricted Affiliate or Restricted Subsidiary of a Restricted
Affiliate, the amount of Debt Incurred or repaid, redeemed or repurchased, as
applicable, for purposes of the foregoing computation, will be deemed to be the
greater of (i) the Company's Pro Rata Portion of such Debt and (ii) the amount
of any Guarantee of such Debt by the Company.

                  "Default Amount" means, in respect to any particular Security,
as of any particular date, the principal amount of such Security. "Defaulted
Interest" has the meaning set forth in Section 3.08.

                  "Depository" means, with respect to the Securities issuable or
issued in whole or in part in the form of one or more Global Securities, The
Depository Trust Company ("DTC") for so long as it shall be a clearing agency
registered under the Exchange Act, or such successor as the Company shall
designate from time to time in an Officer's Certificate delivered to the
Trustee.

                  "Event of Default" has the meaning set forth in Section 5.01.

                  "Exchange Act" means the Securities Exchange Act of 1934, as
amended (or any successor act) and the rules and regulations thereunder.

                  "Expiration Date" has the meaning set forth in the definition
of "Offer to Purchase" in this Section 1.01.

                  "Global Security" means a Security that evidences all or part
of the Securities and bears the legend set forth in the third paragraph of
Section 2.02 and includes, as the context may require, any or all of the
Regulation S Global Security and the Restricted Global Security.

                  "Government Securities" means direct obligations of, or
obligations guaranteed by, the United States of America for the payment of which
obligations or guarantee the full faith and credit of the United States is
pledged and which have a remaining weighted average life to maturity of not more
than one year from the date of Investment therein.

                  "Gradation" means a gradation within a Rating Category or a
change to another Rating Category, which shall include: (i) "+" and "-" in the
case of S&P's current Rating Categories (e.g., a decline from BB+ to BB would
constitute a decrease of one gradation), (ii) 1, 2 and 3 in the case of Moody's
current Rating Categories (e.g., a decline from Ba1 to Ba2 would constitute a
decrease of one gradation), or (iii) the equivalent in respect of successor
Rating Categories of S&P or Moody's or Rating Categories used by Rating Agencies
other than S&P and Moody's.

                  "Guarantee" by any Person means any obligation, contingent or
otherwise, of such Person guaranteeing, or having the economic effect of
guaranteeing, any Debt of any other Person (the "primary obligor") in any
manner, whether directly or indirectly, and including, without limitation, any
obligation of such Person, (i) to purchase or pay (or advance or supply funds
for the purchase or payment of) such Debt or to purchase (or to advance or
supply funds for the purchase of) any security for the payment of such Debt,
(ii) to purchase property, securities or services for the purpose of assuring
the holder of such Debt of the payment of such Debt, or (iii) to maintain
working capital, equity capital or other financial statement condition or
liquidity of the primary obligor so as to enable the primary obligor to pay such
Debt (and "Guaranteed", "Guaranteeing" and "Guarantor" shall have meanings
correlative to the foregoing); provided, however, that the Guarantee by any
Person shall not include endorsements by such Person for collection or deposit,
in either case, in the ordinary course of business.

                  "Holder" means a Person in whose name a Security is registered
in the Security Register.

                  "Incur" means, with respect to any Debt or other obligation
of any Person, to create, issue, incur (by conversion, exchange or otherwise),
assume, Guarantee or otherwise become liable in respect of such Debt or other
obligation, including by acquisition of Subsidiaries (the Debt of any other
Person becoming a Subsidiary of such Person being deemed for this purpose to
have been incurred at the time such other Person becomes a Subsidiary), or the
recording, as required pursuant to generally accepted accounting principles or
otherwise, of any such Debt or other obligation on the balance sheet of such
Person (and "Incurrence", "Incurred", "Incurrable" and "Incurring" shall have
meanings correlative to the foregoing); provided, however, that a change in
generally accepted accounting principles that results in an obligation of such
Person that exists at such time becoming Debt shall not be deemed an Incurrence
of such Debt.

                  "Indenture" means this instrument as originally executed or as
it may from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
including, for all purposes of this instrument and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this instrument and any such supplemental indenture,
respectively.

                  "Interest Payment Date" means the Stated Maturity of an
installment of interest on the Securities.

                  "Interest Rate, Currency or Commodity Price Agreement" of any
Person means any forward contract, futures contract, swap, option or other
financial agreement or arrangement (including, without limitation, caps, floors,
collars and similar agreements) relating to, or the value of which is dependent
upon, interest rates, currency exchange rates or commodity prices or indices
(excluding contracts for the purchase or sale of goods in the ordinary course of
business).

                  "Investment" by any Person means any direct or indirect loan,
advance or other extension of credit or capital contribution (by means of
transfers of cash or other property to others or payments for property or
services for the account or use of others, or otherwise) to, or purchase or
acquisition of Capital Stock, bonds, notes, debentures or other securities or
evidence of Debt issued by, any other Person, including any payment on a
Guarantee of any obligation of such other Person, but shall not include trade
accounts receivable in the ordinary course of business on credit terms made
generally available to the customers of such Person.

                  "Investment Grade" means (i) BBB- or above in the case of S&P
(or its equivalent under any successor Rating Categories of S&P), (ii) Baa3 or
above, in the case of Moody's (or its equivalent under any successor Rating
Categories of Moody's), and (iii) the equivalent in respect of the Rating
Categories of any Rating Agencies substituted for S&P or Moody's.

"Lien" means, with respect to any property or assets, any
mortgage, pledge, security interest, lien, charge, encumbrance, priority or
other security agreement or preferential arrangement of any kind or nature
whatsoever on or with respect to such property or assets (including, without
limitation, any conditional sale or other title retention agreement having
substantially the same economic effect as any of the foregoing).

                  "Maturity", when used with respect to any Security, means the
date on which the principal of such Security becomes due and payable as therein
or herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption or otherwise.

                  "Minority Owned Affiliate" of any specified Person means any
other Person in which an Investment has been made by the specified  Person other
than a direct or indirect Subsidiary of the specified Person.

                  "Moody's" means Moody's Investor Service, Inc. and its
successors.

                  "Net Available Proceeds" from any Asset Disposition means cash
or readily marketable cash equivalents received (including by way of sale or
discounting of a note, installment receivable or other receivable, but excluding
any other consideration received in the form of assumption by the acquiror of
Debt or other obligations relating to such properties or assets) therefrom by
the Company or any Restricted Subsidiary of the Company, Restricted Affiliate or
Restricted Subsidiary of a Restricted Affiliate, net of (i) all legal, title and
recording tax expenses, commissions and other fees and expenses Incurred and all
federal, state, provincial, foreign and local taxes required to be accrued as a
liability as a consequence of such Asset Disposition, (ii) all payments made by
the Company or any Restricted Subsidiary of the Company, Restricted Affiliate or
Restricted Subsidiary of a Restricted Affiliate, on any Debt which is secured by
such assets in accordance with the terms of any Lien upon or with respect to
such assets or which must by the terms of such Debt or Lien, or in order to
obtain a necessary consent to such Asset Disposition or by applicable law, be
repaid out of the proceeds from such Asset Disposition, (iii) all distributions
and other payments made to other equity holders in Restricted Subsidiaries of
the Company, Restricted Affiliates or Restricted Subsidiaries of Restricted
Affiliates, or joint ventures as a result of such Asset Disposition and (iv)
appropriate amounts to be provided by the Company or any Restricted Subsidiary
of the Company, Restricted Affiliate or Restricted Subsidiary of a Restricted
Affiliate, as the case may be, as a reserve in accordance with International
Financial Reporting Standards, against any liabilities associated with such
assets and retained by the Company or any Restricted Subsidiary of the Company,
Restricted Affiliate or Restricted Subsidiary of a Restricted Affiliate, as the
case may be, after such Asset Disposition, including, without limitation,
liabilities under any indemnification obligations and severance and other
employee termination costs associated with such Asset Disposition, in each case
as determined by the Board of Directors, in its reasonable good faith judgment
evidenced by a resolution of the Board of Directors filed with the Trustee;
provided, however, that any reduction in such reserve within twelve months
following the consummation of such Asset Disposition will be treated for all
purposes of the Indenture and the Securities as a new Asset Disposition at the
time of such reduction with Net Available Proceeds equal to the amount of such
reduction.

                  "Offer to Purchase" means a written offer (the "Offer") sent
by the Company by first class mail, postage prepaid, to each Holder at his
address appearing in the Security Register on the date of the Offer offering to
purchase up to the principal amount of Securities specified in such Offer at the
purchase price specified in such Offer (as determined pursuant to the
Indenture). Unless otherwise required by applicable law, the Offer shall specify
an expiration date (the "Expiration Date") of the Offer to Purchase which shall
be, subject to any contrary requirements of applicable law, not less than 30
days or more than 60 days after the date of such Offer and a settlement date
(the "Purchase Date") for purchase of Securities within five Business Days after
the Expiration Date. The Company shall notify the Trustee at least 15 Business
Days (or such shorter period as is acceptable to the Trustee) prior to the
mailing of the Offer of the Company's obligation to make an Offer to Purchase,
and the Offer shall be mailed by the Company or, at the Company's request, by
the Trustee in the name and at the expense of the Company. The Offer shall
contain information concerning the business of the Company which the Company in
good faith believes will enable such Holders to make an informed decision with
respect to the Offer to Purchase (which at a minimum will include (i) the most
recent annual and quarterly financial statements and "Management's Discussion
and Analysis of Financial Condition and Results of Operations" contained in the
documents required to be filed with the Trustee pursuant to this Indenture
(which requirements may be satisfied by delivery of such documents together with
the Offer), (ii) a description of material developments in the Company's
business subsequent to the date of the latest of such financial statements
referred to in clause (i) (including a description of the events requiring the
Company to make the Offer to Purchase), (iii) if applicable, appropriate pro
forma financial information concerning the Offer to Purchase and the events
requiring the Company to make the Offer to Purchase and (iv) any other
information required by applicable law to be included therein. The Offer shall
contain all instructions and materials necessary to enable such Holders to
tender Securities pursuant to the Offer to Purchase. The Offer shall also state:

                  (a)      the Section of this Indenture pursuant to which the
         Offer to Purchase is being made;

                  (b)      the Expiration Date and the Purchase Date;

                  (c)      the aggregate principal amount of the Outstanding
         Securities offered to be purchased by the Company pursuant to the Offer
         to Purchase (including, if less than 100%, the manner by which such has
         been determined pursuant to the Section hereof requiring the Offer to
         Purchase) (the "Purchase Amount");

                  (d)      the purchase price to be paid by the Company for each
         $1,000 aggregate principal amount of Securities accepted for payment
         (as specified pursuant to the Indenture) (the "Purchase Price");

                  (e)      that the Holder may tender all or any portion of the
         Securities registered in the name of such Holder and that any portion
         of a Security tendered must be tendered in an integral multiple of
         $1,000 principal amount;

                  (f)      the place or places where Securities are to be
         surrendered for tender pursuant to the Offer to Purchase;

                  (g)      that interest on any Security not tendered or
         tendered but not purchased by the Company pursuant to the Offer to
         Purchase will continue to accrue;

                  (h)      that on the Purchase Date the Purchase Price will
         become due and payable upon each Security being accepted for payment
         pursuant to the Offer to Purchase and that interest thereon shall cease
         to accrue on and after the Purchase Date;

                  (i)      that each Holder electing to tender a Security
         pursuant to the Offer to Purchase will be required to surrender such
         Security at the place or places specified in the Offer prior to the
         close of business on the Expiration Date (such Security being, if the
         Company or the Trustee so requires, duly endorsed by, or accompanied by
         a written instrument of transfer in form satisfactory to the Company
         and the Trustee duly executed by, the Holder thereof or his attorney
         duly authorized in writing);

                  (j)      that Holders will be entitled to withdraw all or any
         portion of Securities tendered if the Company (or their Paying Agent)
         receives, not later than the close of business on the Expiration Date,
         a telegram, telex, facsimile transmission or letter setting forth the
         name of the Holder, the principal amount of the Security the Holder
         tendered, the certificate number of the Security the Holder tendered
         and a statement that such Holder is withdrawing all or a portion of his
         tender;

                  (k)      that (a) if Securities in an aggregate principal
         amount less than or equal to the Purchase Amount are duly tendered and
         not withdrawn pursuant to the Offer to Purchase, the Company shall
         purchase all such Securities and (b) if Securities in an aggregate
         principal amount in excess of the Purchase Amount are tendered and not
         withdrawn pursuant to the Offer to Purchase, the Company shall purchase
         Securities having an aggregate principal amount equal to the Purchase
         Amount on a pro rata basis (with such adjustments as may be deemed
         appropriate so that only Securities in denominations of $1,000 or
         integral multiples thereof shall be purchased); and

                  (l)      that in the case of any Holder whose Security is
         purchased only in part, the Company shall execute, and the Trustee
         shall authenticate and deliver to the Holder of such Security without
         service charge, a new Security or Securities, of any authorized
         denomination as requested by such Holder, in an aggregate principal
         amount equal to and in exchange for the unpurchased portion of the
         Security so tendered.

Any Offer to Purchase shall be governed by and effected in accordance with the
Offer for such Offer to Purchase.

                  "Officer's Certificate" means a certificate signed by the
President, Chairman of the Board, any Vice Chairman of the Board, any Director,
the Chief Executive Officer, the Chief Operating Officer, any Senior Vice
President, or the Secretary of the Board of the Company, and delivered to the
Trustee. An officer signing an Officer's Certificate given pursuant to Section
10.04 shall be the principal executive, financial or accounting officer of the
Company.

                  "Opinion of Counsel" means a written opinion of counsel, who
may be counsel for the Company, and who shall be acceptable to the Trustee.

                  "Outstanding", when used with respect to Securities, means, as
of the date of determination, all Securities theretofore authenticated and
delivered under this Indenture, except:

                  (i)      Securities theretofore cancelled by the Trustee or
         delivered to the Trustee for cancellation;

                  (ii)     Securities for whose payment or redemption money in
         the necessary amount has been theretofore deposited with the Trustee or
         any Paying Agent (other than the Company) in trust or set aside and
         segregated in trust by the Company (if the Company shall act as its own
         Paying Agent) for the Holders of such Securities; provided that, if
         such Securities are to be redeemed, notice of such redemption has been
         duly given pursuant to this Indenture or provision therefor
         satisfactory to the Trustee has been made; and

                  (iii)    Securities which have been paid pursuant to Section
         3.07 or in exchange for or in lieu of which other Securities have been
         authenticated and delivered pursuant to this Indenture, other than any
         such Securities in respect of which there shall have been presented to
         the Trustee proof satisfactory to it that such Securities are held by a
         bona fide purchaser in whose hands such Securities are valid
         obligations of the Company;

provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Securities owned
by the Company or any other obligor upon the Securities or any Affiliate of the
Company or of such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be protected
in relying upon any such request, demand, authorization, direction, notice,
consent or waiver, only Securities which the Trustee knows to be so owned shall
be so disregarded. Securities so owned which have been pledged in good faith may
be regarded as Outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee's right so to act with respect to such Securities and that
the pledgee is not the Company or any other obligor upon the Securities or any
Affiliate of the Company or of such other obligor.

                  "Paying Agent" means any Person authorized by the Company to
pay the principal of (and premium, if any) or interest on any Securities on
behalf of the Company.

                  "Permitted Holder" means Industriforvaltnings AB Kinnevik,
Kinnevik B.V. and each of their Affiliates and the estate, spouse, ancestors,
and lineal descendants of Jan H. Stenbeck, the legal representatives of any of
the foregoing and the trustee of any bona fide trust of which the foregoing are
the sole beneficiaries or the grantors, or any Person of which the foregoing
"beneficially owns" (within the meaning of Rule 13d-3 and 13d-5 under the
Exchange Act or any successor provision thereto) voting securities representing
at least 66 2/3% of the total voting power of all classes of Capital Stock of
such Person (exclusive of any matters as to which class voting rights exist).

                  "Permitted Interest Rate, Currency or Commodity Price
Agreement" of any Person means any Interest Rate, Currency or Commodity Price
Agreement entered into with one or more financial institutions in the ordinary
course of business that is designed to protect such Person against fluctuations
in interest rates or currency exchange rates with respect to Debt Incurred and
which shall have a notional amount no greater than the payments due with respect
to the Debt being hedged thereby, or in the case of currency or commodity
protection agreements, against currency exchange rate or commodity price
fluctuations in the ordinary course of business relating to then existing
financial obligations or then existing or sold production and not for purposes
of speculation.

                  "Permitted Investments" means:

                  (1)      Investments in Cash Equivalents;

                  (2)      Investments by the Company or any Restricted
         Subsidiary of the Company in a Restricted Subsidiary of the Company
         that is primarily engaged in a Related Business, or Investments by any
         Restricted Affiliate or any Restricted Subsidiary of such Restricted
         Affiliate in a Restricted Subsidiary of such Restricted Affiliate that
         is primarily engaged in a Related Business;

                  (3)      Investments by the Company or any Restricted
         Subsidiary of the Company in a Person, if as a result of such
         Investment (i) such Person becomes a Restricted Subsidiary of the
         Company that is primarily engaged in a Related Business or (ii) such
         Person is merged, consolidated or amalgamated into, or transfers or
         conveys all or substantially all of its assets to, or is liquidated
         into, the Company or a Restricted Subsidiary of the Company that is
         primarily engaged in a Related Business;

                  (4)      Investments by a Restricted Affiliate or any
         Restricted Subsidiary of such Restricted Affiliate in a Person, if as a
         result of such Investment (i) such Person becomes a Restricted
         Subsidiary of such Restricted Affiliate that is primarily engaged in a
         Related Business or (ii) such Person is merged, consolidated or
         amalgamated into, or transfers or conveys all or substantially all of
         its assets to, or is liquidated into such Restricted Affiliate or a
         Restricted Subsidiary of such Restricted Affiliate that is primarily
         engaged in a Related Business;

                  (5)      Investments by the Company or any of its Restricted
         Subsidiaries in any Minority Owned Affiliate that has been properly
         designated as a Restricted Affiliate and that is primarily engaged in a
         Related Business, provided that as of fiscal year end, not less than
         60% of the Company's Pro Rata Portion of the aggregate cumulative
         direct and indirect investment in all members of the Company's
         Restricted Group since the date of the Indenture shall be in the form
         of debt of such members of the Company's Restricted Group, provided
         further that any such Investment shall cease to be a Permitted
         Investment pursuant to this clause (5) if and for so long as such
         Restricted Affiliate ceases to observe any of the provisions of the
         covenants that are applicable to such Restricted Affiliate;

                  (6)      Investments acquired as consideration as permitted
         under Section 10.14; and

                  (7)      Other Investments in Persons primarily engaged in
         Related Businesses, in an aggregate cumulative amount not to exceed
         $50 million.

                  For purposes of the foregoing clause (7), only the Company's
Pro Rata Portion of any Investment will be counted in determining the amount of
Investments permitted to be made under such clause. In the event of any change
in the Company's Pro Rata Portion of any such Investment, such calculation shall
be recomputed as of the date of such change.

                  "Person" means any individual, corporation, partnership,
limited liability company, joint venture, trust, unincorporated organization or
government or any agency or political subdivision thereof or any other entity.

                  "Predecessor Security" of any particular Security means every
previous Security evidencing all or a portion of the same debt as that evidenced
by such particular Security; and, for the purposes of this definition, any
Security authenticated and delivered under Section 3.07 in exchange for or in
lieu of a mutilated, destroyed, lost or stolen Security shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Security.

                  "Preferred Dividends" for any Person means for any period the
quotient determined by dividing the amount of dividends and distributions paid
or accrued (whether or not declared) on Preferred Stock of such Person during
such period calculated in accordance with International Financial Reporting
Standards, by one (1) minus the actual combined Federal, state, local and
foreign income tax rate of the Company on a consolidated basis (expressed as a
decimal).

                  "Preferred Stock" of any Person means Capital Stock of such
Person of any class or classes (however designated) that ranks prior, as to the
payment of dividends or as to the distribution of assets upon any voluntary or
involuntary liquidation, dissolution or winding up of such Person, to shares of
Capital Stock of any other class of such Person.

                  "Pro Rata Portion" means, when applied to the Company for
purposes of determining the amount of Net Available Proceeds from an Asset
Disposition required to be applied pursuant to Section 10.14 or for purposes of
determining the amount of an Investment that will be deemed to be outstanding or
the amount of Debt that will be deemed to be Incurred under a particular
covenant or definition, that portion of such Net Available Proceeds or
Investment or Debt as corresponds to the Company's direct or indirect percentage
ownership interest in the profits of the Person who engaged in the Asset
Disposition or the Person in whom the Investment was made or the Person which
Incurred the Debt, as applicable (which would be 100% in the case of any
Investments made or Debt Incurred by the Company directly). The Pro Rata Portion
of the Net Available Proceeds from an Asset Disposition shall be determined in
good faith by the Company's Board of Directors in connection with such Asset
Disposition. The Pro Rata Portion of an Investment or amount of Debt as of any
date shall be determined in good faith either by the Company's Board of
Directors or in accordance with procedures established as to such Investment or
Debt by the Company's Board of Directors.

                  "Purchase Date" has the meaning set forth in the definition of
"Offer to Purchase".

                  "Rating Agencies" means (i) S&P and Moody's or (ii) if S&P or
Moody's or both of them are not making ratings of the Securities publicly
available, a nationally recognized U.S. rating agency or agencies, as the case
may be, selected by the Company, which will be substituted for S&P or Moody's or
both, as the case may be.

                  "Rating Category" means (i) with respect to S&P, any of the
following categories (any of which may include a "+" or "-"): AAA, AA, A, BBB,
BB, B, CCC, CC, C, R, SD and D (or equivalent successor categories); (ii) with
respect to Moody's, any of the following categories (any of which may include a
"1", "2" or "3"): Aaa, Aa, A, Baa, Ba, B, Caa, Ca, and C (or equivalent
successor categories), and (iii) the equivalent of any such categories of S&P or
Moody's used by another Rating Agency, if applicable.

                  "Receivables" means receivables, chattel paper, instruments,
documents or intangibles evidencing or consisting of the right to payment of
money for goods sold or services rendered.

                  "Receivables Sale" of any Person means any sale of Receivables
of such Person (pursuant to a purchase facility or otherwise), other than in
connection with a disposition of the business operations of such Person relating
thereto or a disposition of defaulted Receivables for purpose of collection and
not as a financing arrangement.

                  "Redeemable Stock" of any Person means any Capital Stock of
such Person that by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable) or otherwise (including upon the
occurrence of an event) matures or is required to be redeemed (pursuant to any
sinking fund obligation or otherwise) or is convertible into or exchangeable for
Debt or is redeemable at the option of the holder thereof, in whole or in part,
at any time prior to the final Stated Maturity of the Securities.

                  "Redemption Date", when used with respect to any Security to
be redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.

                  "Redemption Price", when used with respect to any Security to
be redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.

                  "Registration Rights Agreement ", means the Registration
Rights Agreement attached as Annex F to this Indenture, which is being made a
part hereof. Any Holder of Securities pursuant to this Indenture, by virtue of
holding such Securities, is deemed to have accepted and agreed and being made
subject to the terms and obligations and is entitled to the rights under the
Registration Rights Agreement as set forth therein.

                  "Regular Record Date" for the interest payable on any Interest
Payment Date means the May 15 or November 15 (whether or not a Business Day), as
the case may be, next preceding such Interest Payment Date.

                  "Regulation S" means Regulation S under the Securities Act (or
any successor provision), as it may be amended from time to time.

                  "Regulation S Global Securities" has the meaning specified in
Section 2.01. "Regulation S Legend" means a legend substantially in the form of
the legend required in the form of Security set forth in Section 2.02 to be
placed upon a Regulation S Global Security.

                  "Regulation S Securities" means all Securities required
pursuant to Section 3.06(c) to bear a Regulation S Legend. Such term includes
the Regulation S Global Security.

                  "Related Assets" means all assets, rights (contractual or
otherwise) and properties, whether tangible or intangible, used or intended for
use in connection with a Related Business.

                  "Related Business" means any business in which the Company,
its Subsidiaries or Minority Owned Affiliates are engaged, directly or
indirectly, that consist primarily of, or are related to, operating, acquiring,
developing and constructing any telecommunications services and related
businesses.

                  "Related Person" of any Person means any other Person directly
or indirectly owning (a) 5% or more of the outstanding Common Stock of such
Person (or, in the case of a Person that is not a corporation, 5% or more of the
equity interest in such Person) or (b) 5% or more of the combined voting power
of the Voting Stock of such Person.

                  "Resale Registration Statement" means a shelf registration
statement under the Securities Act filed by the Company, if required by, and
meeting the requirements of, the Registration Rights Agreement in respect of the
Company's securities covered thereby.

                  "Responsible Officer" means any Vice President, Assistant Vice
President, Secretary, Assistant Secretary, Treasurer or Assistant Treasurer of
the Trustee assigned by the Trustee to administer this Indenture, or any other
officer customarily performing functions similar to those performed by any of
the above designated officers and also, with respect to a particular matter any
other officer to whom such matter is referred.

                  "Restricted Affiliate" means any direct or indirect Minority
Owned Affiliate of the Company or a Restricted Subsidiary of the Company that
has been designated in a Board Resolution as a Restricted Affiliate based on a
determination by the Board of Directors that (i) the Company has, directly or
indirectly, the requisite control over such Minority Owned Affiliate to prevent
it from incurring any Debt, or taking any other action at any time, in
contravention of any of the provisions of the Indenture that are applicable to
Restricted Affiliates or (ii) the Minority Owned Affiliate is a joint venture
with at least one or more Strategic Investors. The Company will be required to
deliver an Officer's Certificate to the Trustee, including a copy of the Board
Resolution, upon designating any Minority Owned Affiliate as a Restricted
Affiliate.

                  "Restricted Global Security" has the meaning specified in
Section 2.01.

                  "Restricted Group", when used in respect of the Company, means
the Company, the Restricted Subsidiaries and Restricted Affiliates of the
Company, and the Restricted Subsidiaries of such Restricted Affiliates, taken
together on a consolidated basis.

                  "Restricted Securities" means all Securities required pursuant
to Section 3.06(c) to bear a Restricted Securities Legend. Such term includes
the Regulation S Global Security and the Restricted Global Security.

                  "Restricted Securities Certificate" means a certificate
substantially in the form set forth in Annex B.

                  "Restricted Securities Legend" means a legend substantially in
the form of the legend required in the form of Security set forth in Section
2.02 to be placed upon a Restricted Security.

                  "Restricted Period" means the period of 41 consecutive days
beginning on and including the day on which Securities are first offered to
persons other than distributors (as defined in Regulation S) in reliance on
Regulation S.

                  "Restricted Subsidiary" means any Subsidiary other than an
Unrestricted Subsidiary.

                  "S&P" means Standard & Poor's Ratings Group, a division of
McGraw Hill, Inc., a New York corporation and its successors.

                  "Securities Act" means the Securities Act of 1933 (or any
successor statute), as it may be amended from time to time.

                  "Security Register" and "Security Registrar" have the
respective meanings specified in Section 3.06.

                  "Senior Debt" means the principal of (and premium, if any) and
interest (including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to the Company whether or not such
claim for post-petition interest is allowed in such proceeding) on, or other
amount of, (i) Debt for money borrowed of the Company, and any other obligations
of the Company, contingent or otherwise, created pursuant to the Credit
Facility, (ii) Debt for money borrowed of the Company, whether incurred on or
prior to the date of the Indenture or thereafter incurred, other than the
Securities, (iii) Debt evidenced by bonds, debentures, notes or other similar
instruments, including Debt Incurred in connection with the acquisition of
property, assets or businesses, (iv) matured and unmatured reimbursement or
other obligations of the Company with respect to letters of credit, bankers'
acceptances or similar facilities issued for the account of the Company, (v)
obligations of the Company under interest rate swaps, caps, collars and similar
arrangements, (vi) Capital Lease Obligations of the Company, (vii) Guarantees by
the Company of Debt for money borrowed and (viii) amendments, renewals,
extensions, modifications, refinancings and refundings of any such Debt;
provided, however, the following shall not constitute Senior Debt: (A) any Debt
owed to a Person when such Person is a Subsidiary of the Company, (B) any Debt
which by the terms of the instrument creating or evidencing the same is pari
passu or subordinated in right of payment to the Securities (including the
13-1/2% Notes, if any), (C) any Debt Incurred in violation of the Indenture or
(D) any Debt which is subordinated in right of payment in any respect to any
other Debt of the Company.

                  "Significant Restricted Group Member" means any Restricted
Subsidiary of the Company, Restricted Affiliate or Restricted Subsidiary of a
Restricted Affiliate which, for each of the two most recently completed fiscal
years for which financial statements are available, accounted for 17-1/2% or
more of Cellular Operating Income of the Company and its Restricted Group for
such period (determined on a consolidated basis in accordance with International
Financial Reporting Standards).

                  "Special Interest" has the meaning specified in the form of
the Securities set forth in Section 2.02.

                  "Special Record Date" for the payment of any Defaulted
Interest means a date fixed by the Trustee pursuant to Section 3.08.

                  "Stated Maturity", when used with respect to any Security or
any installment of interest thereon, means the date specified in such Security
as the fixed date on which the principal of such Security or such installment of
interest is due and payable.

                  "Step-Down Date" has the meaning set forth in the form of the
Security contained in Section 2.02.

                  "Step-Up" has the meaning set forth in the form of the
Security contained in Section 2.02.

                  "Strategic Investor" means a corporation, partnership or other
entity engaged in one or more telecommunications businesses that has, or is a
Subsidiary of a Person that has, an equity market capitalization in excess of
$2.0 billion or book equity in excess of $1.0 billion.

                  "Subsidiary" of any Person means (i) a corporation more than
50% of the combined voting power of the outstanding Voting Stock of which is
owned, directly or indirectly, by such Person or by one or more other
Subsidiaries of such Person or by such Person and one or more Subsidiaries
thereof or (ii) any other Person (other than a corporation) in which such
Person, or one or more other Subsidiaries of such Person or such Person and one
or more other Subsidiaries thereof, directly or indirectly, has at least a
majority ownership and power to direct the policies, management and affairs
thereof.

                  "Successor Security" of any particular Security means every
Security issued after, and evidencing all or a portion of the same debt as that
evidenced by, such particular Security; and, for the purposes of this
definition, any Security authenticated and delivered under Section 3.07 in
exchange for or in lieu of a mutilated, destroyed, lost or stolen Security shall
be deemed to evidence the same debt as the mutilated, destroyed, lost or stolen
Security.

                  "Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean such successor Trustee.

                  "Trust Indenture Act" means the Trust Indenture Act of 1939 as
in force at the date as of which this instrument was executed or, if this
Indenture is qualified under such Act after the issuance of the Securities, as
in effect at the date of such qualification; provided, however, that in the
event the Trust Indenture Act of 1939 is amended after such date, "Trust
Indenture Act" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.

                  "Unrestricted Affiliate" means any Minority Owned Affiliate of
the Company which is not a Restricted Affiliate.

                  "Unrestricted Subsidiary" means (1) any Subsidiary of the
Company (other than Millicom International Operations, B.V.) or a Restricted
Affiliate designated as such by the Board of Directors as set forth below where
no default with respect to any Debt of such Subsidiary or any Subsidiary of such
Subsidiary (including any right which the holders thereof may have to take
enforcement action against such Subsidiary) would permit (upon notice, lapse of
time or both) any holder of any other Debt of the Company and its Subsidiaries
(other than another Unrestricted Subsidiary) or any Restricted Affiliate or any
Restricted Subsidiary of a Restricted Affiliate to declare a default on such
other Debt or cause the payment thereof to be accelerated or payable prior to
its final scheduled maturity and (2) any Subsidiary of an Unrestricted
Subsidiary. The Board of Directors may designate any Subsidiary of the Company
or a Restricted Affiliate to be an Unrestricted Subsidiary unless such
Subsidiary owns any Capital Stock of, or owns or holds any Lien on any property
of, any other Subsidiary of the Company or such Restricted Affiliate which is
not a Subsidiary of the Subsidiary to be so designated or otherwise an
Unrestricted Subsidiary, provided that either (x) the Subsidiary to be so
designated has total assets of $100,000 or less or (y) immediately after giving
effect to such designation, the Company could Incur at least $1.00 of additional
Debt pursuant to the first paragraph under Section 10.08 and provided further,
that the Company could make a Restricted Payment in an amount equal to the
Company's Pro Rata Portion of the greater of the fair market value and book
value of such Subsidiary pursuant to Section 10.09 and such amount is thereafter
treated as a Restricted Payment for the purpose of calculating the aggregate
amount available for Restricted Payments thereunder. For the avoidance of doubt,
Millicom International Operations, B.V ., may not be designated an Unrestricted
Subsidiary for as long as the Securities remain Outstanding.

                  "Vice President", when used with respect to the Company, or
the Trustee, means any vice president, whether or not designated by a number or
a word or words added before or after the title "vice president".

                  "Voting Stock" of any Person means Capital Stock of such
Person which ordinarily has voting power for the election of directors (or
persons performing similar functions) of such Person, whether at all times or
only so long as no senior class of securities has such voting power by reason of
any contingency.

                  "Weighted Average Life to Maturity" means, when applied to any
Debt or Preferred Stock at any date, the number of years obtained by dividing
(a) the then outstanding principal amount of such Debt or liquidation preference
of such Preferred Stock, as the case may be, into (b) the total of the product
obtained by multiplying (x) the amount of each then remaining installment,
sinking fund, serial maturity or other required payments of principal or upon
mandatory redemption, including payment at final maturity, in respect thereof,
by (y) the number of years (calculated to the nearest one-twelfth) that will
elapse between such date and the making of such payment.

                  "Wholly Owned Restricted Subsidiary" of any Person means a
Restricted Subsidiary of such Person all of the outstanding Capital Stock or
other ownership interests of which (other than directors' qualifying shares)
shall at the time be owned by such Person or by one or more Wholly Owned
Restricted Subsidiaries of such Person or by such Person and one or more Wholly
Owned Restricted Subsidiaries of such Person.

                  "13-1/2% Notes"" means the Company's 13-1/2% Senior
Subordinated Discount Notes Due 2005, as the same may be Outstanding from time
to time.

SECTION 1.02.     Compliance Certificates and Opinions.

         Upon any application or request by the Company to the Trustee to take
any action under any provision of this Indenture, the Company shall furnish to
the Trustee such certificates and opinions as may be required under the Trust
Indenture Act. Each such certificate or opinion shall be given in the form of an
Officer's Certificate, if to be given by an officer of the Company, or an
Opinion of Counsel, if to be given by counsel, and shall comply with the
requirements of the Trust Indenture Act and any other requirement set forth in
this Indenture.

         Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include

         (1)      a statement that each individual signing such
    certificate or opinion has read such covenant or condition and the
    definitions herein relating thereto;

         (2)      a brief statement as to the nature and scope of the
    examination or investigation upon which the statements or opinions contained
    in such certificate or opinion are based;

         (3)      a statement that, in the opinion of each such
    individual, he has made such examination or investigation as is
    necessary to enable him to express an informed opinion as to whether or
    not such covenant or condition has been complied with; and

         (4)      a statement as to whether, in the opinion of each such
    individual, such condition or covenant has been complied with.

SECTION 1.03.     Form of Documents Delivered to Trustee.

                  In any case where several matters are required to be certified
by, or covered by an opinion of, any specified Person, it is not necessary that
all such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.

                  Any certificate or opinion of an officer of the Company may be
based, insofar as it relates to legal matters, upon a certificate or opinion of,
or representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or opinion of counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.

                  Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consolidated
and form one instrument.

SECTION 1.04.     Acts of Holders; Record Dates.

         (a)      Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Indenture to be given or taken
by Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are received
by the Trustee and, where it is hereby expressly required, by the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for any purpose of this
Indenture and (subject to Section 6.01) conclusive in favor of the Trustee, and
the Company, if made in the manner provided in this Section.

         (b)      The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which the Trustee deems sufficient.

         (c)      The Company may, by or pursuant to a Board Resolution, in the
circumstances permitted by the Trust Indenture Act, fix any day as the record
date for the purpose of determining the Holders entitled to give or take any
request, demand, authorization, direction, notice, consent, waiver or other
action, or to vote on any action, authorized or permitted to be given or taken
by Holders. If not set by the Company prior to the first solicitation of a
Holder made by any Person in respect of any such action, or, in the case of any
such vote, prior to such vote, the record date for any such action or vote shall
be the 30th day (or, if later, the date of the most recent list of Holders
required to be provided pursuant to Section 7.01) prior to such first
solicitation or vote, as the case may be. With regard to any record date, only
the Holders on such date (or their duly designated proxies) shall be entitled to
give or take, or vote on, the relevant action.

         (d)      The ownership of Securities shall be proved by the Security
Register.

         (e)      Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Security shall bind every
future Holder of the same Security and the Holder of every Security issued upon
the registration of transfer thereof or in exchange therefor or in lieu thereof
in respect of anything done, omitted or suffered to be done by the Trustee, or
the Company in reliance thereon, whether or not notation of such action is made
upon such Security.

SECTION 1.05.     Notices, Etc., to Trustee and Company.

                  Any request, demand, authorization, direction, notice,
consent, waiver or Act of Holders or other document provided or permitted by
this Indenture to be made upon, given or furnished to, or filed with,

         (1)      the Trustee by any Holder or by the Company shall be
    sufficient for every purpose hereunder if made, given, furnished or filed in
    writing in the manner specified in this Indenture to or with the Trustee at
    its Corporate Trust Office; or

         (2)      the Company by the Trustee or by any Holder shall be
    sufficient for every purpose hereunder (unless otherwise herein expressly
    provided) if in writing and mailed, first-class postage prepaid, to the
    Company addressed to it at the address of its principal office specified in
    the first paragraph of this instrument or at any other address previously
    furnished in writing to the Trustee by the Company.

SECTION 1.06.     Notice to Holders; Waiver.

                  Where this Indenture provides for notice to Holders of any
event, such notice shall be sufficiently given (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage prepaid, to
each Holder affected by such event, at his address as it appears in the Security
Register, not later than the latest date (if any), and not earlier than the
earliest date (if any), prescribed for the giving of such notice. In any case
where notice to Holders is given by mail, neither the failure to mail such
notice, nor any defect in any notice so mailed, to any particular Holder shall
affect the sufficiency of such notice with respect to other Holders. Where this
Indenture provides for notice in any manner, such notice may be waived in
writing by the Person entitled to receive such notice, either before or after
the event, and such waiver shall be the equivalent of such notice. Waivers of
notice by Holders shall be filed with the Trustee, but such filing shall not be
a condition precedent to the validity of any action taken in reliance upon such
waiver.

                  In case by reason of the suspension of regular mail service or
by reason of any other cause it shall be impracticable to give such notice by
mail, then such notification as shall be made with the approval of the Trustee
shall constitute a sufficient notification for every purpose hereunder.

SECTION 1.07.     Conflict with Trust Indenture Act.

                  If any provision hereof limits, qualifies or conflicts with a
provision of the Trust Indenture Act that is required under such Act to be a
part of and govern this Indenture, the latter provision shall control. If any
provision of this Indenture modifies or excludes any provision of the Trust
Indenture Act that may be so modified or excluded, the latter provision shall be
deemed to apply to this Indenture as so modified or to be excluded, as the case
may be. Until such time as this Indenture shall be qualified under the Trust
Indenture Act, this Indenture, the Company and the Trustee shall be deemed for
all purposes hereof to be subject to and governed by the Trust Indenture Act to
the same extent as would be the case if this Indenture were so qualified on the
date hereof.

SECTION 1.08.     Effect of Headings and Table of Contents.

                  The Article and Section headings herein and the Table of
Contents are for convenience only and shall not affect the construction hereof.

SECTION 1.09.     Successors and Assigns.

                  All covenants and agreements in this Indenture by the Company
shall bind its successors and assigns, whether so expressed or not.

SECTION 1.10.     Separability Clause.
                  In case any provision in this Indenture or in the Securities
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.

SECTION 1.11.     Benefits of Indenture.

                  Nothing in this Indenture or in the Securities, express or
implied, shall give to any Person, other than the parties hereto and their
successors hereunder and the Holders of Securities, any benefit or any legal or
equitable right, remedy or claim under this Indenture.

SECTION 1.12.     Governing Law.

                  This Indenture and the Securities shall be governed by and
construed in accordance with the laws of the State of New York.

SECTION 1.13.     Submission to Jurisdiction.

                  The Company irrevocably (i) agrees that any legal suit, action
or proceeding against the Company brought by any Holder or the Trustee arising
out of or based upon this Indenture may be instituted in any State or Federal
court in the Borough of Manhattan, The City of New York, (ii) waives, to the
fullest extent it may effectively do so, any objection which it may now or
hereafter have to the laying of venue of any such proceeding and (iii) submits
to the exclusive jurisdiction of such courts in any such suit, action or
proceeding. The Company has appointed CT Corporation, 111 Eighth Avenue, New
York, New York 10011 as its authorized agent (the "Authorized Agent") upon whom
process may be served in any such action arising out of or based on this
Indenture which may be instituted in any State or Federal court in the Borough
of Manhattan, The City of New York, expressly consents to the jurisdiction of
any such court in respect of any such action, and waives any other requirements
of or objections to personal jurisdiction with respect thereto. Such appointment
shall be irrevocable. The Company represents and warrants that the Authorized
Agent has agreed to act as such agent for service of process and agrees to take
any and all action, including the filing of any and all documents and
instruments, that may be necessary to continue such appointment in full force
and effect as aforesaid. Service of process upon the Authorized Agent and
written notice of such service to the Company shall be deemed, in every respect,
effective service of process upon the Company.

SECTION 1.14.     Legal Holidays.

                  In any case where any Interest Payment Date, Amortization
Payment Date, Redemption Date or Stated Maturity of any Security shall not be a
Business Day, then (notwithstanding any other provision of this Indenture or of
the Securities) payment of interest or principal (and premium, if any) need not
be made on such date, but may be made on the next succeeding Business Day with
the same force and effect as if made on the Interest Payment Date, Amortization
Payment Date, or Redemption Date, or at the Stated Maturity, provided that no
interest shall accrue for the period from and after such Interest Payment Date,
Amortization Payment Date, Redemption Date or Stated Maturity, as the case may
be.

                                  ARTICLE TWO

                                 Security Forms

SECTION 2.01.     Forms Generally; Initial Forms of Securities.

                  The Securities and the Trustee's certificates of
authentication shall be in substantially the forms set forth in this Article or
in such other form as shall be established pursuant to a Board Resolution or in
one or more supplemental indentures, in each case, with such appropriate
insertions, omissions, substitutions and other variations as are required or
permitted by this Indenture, and may have such letters, numbers or other marks
of identification and such legends or endorsements placed thereon as may be
required to comply with the rules of any securities exchange or as may,
consistently herewith, be determined by the officers executing such Securities,
as evidenced by their execution of the Securities. If the form of Securities of
any series is established by action taken pursuant to a Board Resolution, a copy
of an appropriate record of such action shall be certified by the President, the
Chief Executive Officer, any Director or the Secretary of the Board of Directors
of the Company and delivered to the Trustee at or prior to the delivery of the
Company Order contemplated by Section 3.03 for the authentication and delivery
of such Securities.

                  The definitive Securities shall be printed, lithographed or
engraved or produced by any combination of these methods on steel engraved
borders or may be produced in any other manner permitted by the rules of any
securities exchange on which the Securities may be listed, all as determined by
the officers executing such Notes, as evidenced by their execution whether in
original or facsimile form, of such Securities.

                  Upon their original issuance, Initial Regulation S Securities
shall be issued in the form of one or more Global Securities registered in the
name of DTC, as Depository, or its nominee and deposited with the Trustee, as
custodian for DTC, for credit by DTC to the respective accounts of beneficial
owners of the Securities represented thereby (or such other accounts as they may
direct), provided that upon such deposit all such Securities shall be credited
to or through accounts maintained at DTC by or on behalf of Euroclear or
Clearstream. Such Global Securities, together with their Successor Securities
which are Global Securities other than the Restricted Global Security, are
collectively herein called the "Regulation S Global Securities".

                  Upon their original issuance, Securities (other than
Regulation S Securities) shall be issued in the form of one or more Global
Securities registered in the name of DTC, as Depository, or its nominee and
deposited with the Trustee, as custodian for DTC, for credit by DTC to the
respective accounts of beneficial owners of the Securities represented thereby
(or such other accounts as they may direct). Such Global Securities, together
with their Successor Securities which are Global Securities, are collectively
herein called the "Restricted Global Security".

SECTION 2.02.     Form of Face of Security.

                  THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933 (THE "SECURITIES ACT") AND MAY NOT BE OFFERED, SOLD,
PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A) BY THE HOLDER THEREOF (1) TO A
PERSON WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER
WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT ACQUIRING FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE TRANSACTION COMPLYING
WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (3) PURSUANT
TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144
THEREUNDER (IF AVAILABLE) OR (4) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT AND (B) BY SUBSEQUENT INVESTORS AS SET FORTH IN (A)
ABOVE OR TO AN INSTITUTIONAL ACCREDITED INVESTOR IN A TRANSACTION EXEMPT FROM
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, IN EACH CASE (A) AND (B) IN
ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED
STATES AND OTHER JURISDICTIONS.

                  [If the Security is a Regulation S Security, then insert --
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933 (THE
"SECURITIES ACT") AND MAY NOT BE OFFERED, SOLD, OR DELIVERED IN THE UNITED
STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, ANY U.S. PERSON, UNLESS THIS
SECURITY IS REGISTERED UNDER THE SECURITIES ACT OR AN EXEMPTION FROM THE
REGISTRATION REQUIREMENTS THEREOF IS AVAILABLE.]

                  [If the Security is a Global Security, then insert -- THIS
SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER
REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A NOMINEE THEREOF.
THIS SECURITY MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A SECURITY
REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY BE
REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITORY OR A NOMINEE
THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.]

                  [If the Security is a Global Security and The Depository Trust
Company is to be the Depository therefor, then insert -- UNLESS THIS CERTIFICATE
IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A
NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF
TRANSFER, 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 INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.]

CUSIP NO.

                      MILLICOM INTERNATIONAL CELLULAR S.A.

                            11% Senior Notes due 2006

No. ___________                                                 $_______________

                  Millicom International Cellular S.A., a corporation duly
organized and existing under the laws of the Grand-Duchy of Luxembourg (herein
called the "Company", which term includes any successor Person under the
Indenture hereinafter referred to), for value received, hereby promises to pay
to _____________, or registered assigns, the principal sum of ______________
(less any Amortization Payments previously paid in accordance with the
Indenture) on June 1, 2006, and to pay interest thereon, accruing in the first
instance from December 1, 2002 to June 1, 2003 (the first interest payment date)
and continuing to accrue thereafter and payable semi-annually on June 1 and
December 1 in each year, at the rate of 11% per annum, until the principal
hereof is paid or made available for payment, provided, however, that if (i) the
Company has not filed a shelf registration statement on Form F-3 under the
Securities Act of 1933, as amended (or, in the event that Form F-3 is
unavailable to the Company, a registration statement on such other SEC Form that
is available to the Company), (the "Resale Registration Statement") covering the
resale of this Security by the holder thereof (subject to the conditions and
qualifications set forth in the Registration Rights Agreement) and the Resale
Registration Statement has not become or been declared effective by December 4,
2003, or (ii) the Resale Registration Statement is filed and declared effective
but shall thereafter cease to be effective (except as specifically permitted
pursuant to the agreement referred to below) without being succeeded immediately
by an additional registration statement filed and declared effective, in each
case (i) and (ii) upon the terms and conditions set forth in the Registration
Rights Agreement (each such event referred to in Clauses (i) and (ii), a
"Registration Default"), provided, however, that no such Registration Default
shall have occurred (x) with respect to any Holder who has not provided the
Company with information for inclusion in the Resale Registration Statement or
(y) if the Company is not required to file a Resale Registration Statement
because less than 50% of the Holders have provided such information, in each
case (x) and (y) as is required by the Registration Rights Agreement,) then
additional interest will accrue (the "Step-Up") at a rate of 0.25% per annum,
determined daily, on the principal amount of the Securities, for the first
90-day period immediately following the occurrence of the Registration Default
until such time (the "Step-Down Date") as no Registration Default is in effect
and, provided, further, that for each additional 90-day period that the
Registration Default continues, the per annum rate of such Special Interest (as
defined below) shall increase (each such increase, an "Additional Step-Up") by
an additional 0.25% per annum up to a maximum aggregate amount of 1.00% per
annum rate of Special Interest (i.e. for the combined Step-Up and any Additional
Step-Up) until the Step-Down Date (after which the interest rate will be
restored to its initial rate). The Company shall provide the Trustee with
written notice of the date of any Registration Default and the Step-Down Date,
and, in connection with each Step-Up, an Officer's Certificate specifying the
principal Outstanding as of the date of such Step-Up. Interest accruing as a
result of the Step-Up or the Additional Step-Up is referred to herein as
"Special Interest." Special Interest, if any, shall be paid in cash
semi-annually in arrears on June 1 and December 1 in each year; and the amount
of accrued Special Interest shall be determined on the basis of the number of
days actually elapsed.

                  The interest so payable, and punctually paid or duly provided
for, on any Interest Payment Date will, as provided in such Indenture, be paid
to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest, which shall be the May 15 or November 15 (whether or not a
Business Day), as the case may be, next preceding such Interest Payment Date.
Any such interest not so punctually paid or duly provided for will forthwith
cease to be payable to the Holder on such Regular Record Date and may either be
paid to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on a Special Record Date for
the payment of such Defaulted Interest to be fixed by the Trustee, notice
whereof shall be given to Holders of Securities not less than 10 days prior to
such Special Record Date, or be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on which the
Securities may be listed, and upon such notice as may be required by such
exchange, all as more fully provided in said Indenture.

                  Payment of the principal of (and premium, if any) and interest
on this Security will be made at the office or agency of the Company maintained
for that purpose in the Borough of Manhattan, The City of New York, in such coin
or currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts; provided, however, that at the
option of the Company payment of interest may be made by check mailed to the
address of the Person entitled thereto as such address shall appear in the
Security Register.

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

                  Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual signature,
this Security shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.

                  IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed.


Dated:

                                     MILLICOM INTERNATIONAL CELLULAR S.A.


                                     By
                                          --------------------------------------
                                          Name:
                                          Title:

Attest:

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




                                     By
                                          --------------------------------------
                                          Name:
                                          Title:

Attest:

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


<PAGE>

SECTION 2.03.     Form of Reverse of Security.

                  This Security is one of a duly authorized issue of Securities
of the Company designated as its 11% Senior Notes due 2006 (herein called the
"Securities"), issued and to be issued under an Indenture, dated as of May 8,
2003 (herein called the "Indenture"), between the Company, and The Bank of New
York, as Trustee (herein called the "Trustee", which term includes any successor
trustee under the Indenture), to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Company, the
Trustee and the Holders of the Securities and of the terms upon which the
Securities are, and are to be, authenticated and delivered.

                  The Securities are subject to redemption upon not less than 30
nor more than 60 days' notice by mail, to each Holder of Securities to be
redeemed at such Holder's address appearing in the Security Register, in amounts
of $1,000 or an integral multiple of $1,000 at any time prior to maturity, as a
whole or in part, at the election of the Company, at a Redemption Price of
102.25% if such redemption occurs prior to June 1, 2004 and on June 1, 2004 and
thereafter at a Redemption Price equal to 100% of the principal amount, together
in the case of any such redemption with accrued interest to the Redemption Date,
but interest installments whose Stated Maturity is on or prior to such
Redemption Date will be payable to the Holders of such Securities, or one or
more Predecessor Securities, of record at the close of business on the relevant
Record Dates referred to on the face hereof, all as provided in the Indenture.

                  The Securities have the benefit of any guarantee issued
specifically for the benefit of the Securities in accordance with the terms of
the Indenture (including the guarantee issued by Millicom International
Operations, B.V., dated May 7, 2003).

                  Subject to the terms and in accordance with this Indenture,
this Security is subject to mandatory redemption by way of its pro-rata share in
four semi-annual Amortization Payments of $17,500,000 each, on the total
principal amount of the Securities, payable on each Amortization Date,
commencing with the Amortization Payment scheduled to be paid on June 1, 2004.
As used in this Security and in the Indenture, the terms "Amortization Date"
means each of June 1, 2004, December 1, 2004, June 1, 2005 and December 1, 2005.

                  The Indenture provides that, subject to certain conditions, if
(i) a Change of Control occurs or (ii) certain Net Available Proceeds are
available to the Company as a result of any Asset Disposition, the Company shall
be required to make an Offer to Purchase for all or a specified portion of the
Securities.

                  In the event of redemption or purchase pursuant to an Offer to
Purchase of this Security in part only, a new Security or Securities of like
tenor for the unredeemed or unpurchased portion hereof will be issued in the
name of the Holder hereof upon the cancellation hereof.

                  If an Event of Default shall occur and be continuing, the
principal of all the Securities may be declared due and payable in the manner
and with the effect provided in the Indenture.

                  The Indenture contains provisions for defeasance at any time
of (i) the entire indebtedness of this Security, or (ii) certain restrictive
covenants and Events of Default with respect to this Security, in each case upon
compliance with certain conditions set forth therein.

                  Unless the context otherwise requires, the Securities (as
defined in the Indenture) shall constitute one series for all purposes under the
Indenture, including without limitation, amendments, waivers, redemptions and
Offers to Purchase.

                  The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Securities under
the Indenture at any time by the Company and the Trustee with the consent of the
Holders of a majority in aggregate principal amount of the Securities at the
time Outstanding. The Indenture also contains provisions permitting the Holders
of specified percentages in aggregate principal amount of the Securities at the
time Outstanding, on behalf of the Holders of all the Securities, to waive
compliance by the Company with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Security shall be conclusive and binding upon such
Holder and upon all future Holders of this Security and of any Security issued
upon the registration of transfer hereof or in exchange herefor or in lieu
hereof, whether or not notation of such consent or waiver is made upon this
Security.

                  No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of (including
Amortization Payments and premium, if any) and interest (including Special
Interest) on this Security at the times, place and rate, and in the coin or
currency, herein prescribed.

                  As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Security is registrable in
the Security Register, upon surrender of this Security for registration of
transfer at the office or agency of the Company in the Borough of Manhattan, the
City of New York duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Company and the Security Registrar duly
executed by, the Holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Securities, of authorized denominations and for the
same aggregate principal amount, will be issued to the designated transferee or
transferees.

                  The Securities are issuable only in registered form without
coupons in denominations of $1,000 and any integral multiple thereof. As
provided in the Indenture and subject to certain limitations therein set forth,
Securities are exchangeable for a like aggregate principal amount of Securities
of a different authorized denomination, as requested by the Holder surrendering
the same.

                  No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.

                  Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.

                  Interest on this Security shall be computed on the basis of a
360-day year of twelve 30-day months; provided, however, that Special Interest
shall be computed on the basis of a 365- or 366-day year, as the case may be,
and the number of days actually elapsed.

                  All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.

                  The Indenture and this Security shall be governed by and
construed in accordance with the laws of the State of New York.

                       OPTION OF HOLDER TO ELECT PURCHASE

                  If you want to elect to have this Security purchased in its
entirety by the Company pursuant to Section 10.14 or 10.16 of the Indenture,
check the box:

                                ______

                  If you want to elect to have only a part of this Security
purchased by the Company pursuant to Section 10.14 or 10.16 of the Indenture,
state the amount: $_______________

Dated:  ____________________        Your Signature:_____________________________
                                                   (Sign exactly as name appears
                                                    on the other side of this
                                                    Security)

Signature Guarantee:  __________________________________________________________

                      Notice: Signature(s) must be guaranteed by an "eligible
                      guarantor institution" meeting the requirements of the
                      Trustee, which requirements will include membership or
                      participation in STAMP or such other "signature guarantee
                      program" as may be determined by the Trustee in addition
                      to, or in substitution for STAMP, all in accordance with
                      the Securities Exchange Act of 1934, as amended.



<PAGE>




SECTION 2.04.     Form of Trustee's Certificate of Authentication.

         Dated:

  This is one of the Securities referred to in the within-mentioned Indenture.

                                                           THE BANK OF NEW YORK,
                                                                      as Trustee


                                           By:
                                           -------------------------------------
                                           Authorized Signatory


                                 ARTICLE THREE

                                 The Securities

SECTION 3.01.     Title and Terms.

                  The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is unlimited.

                  The Securities shall be known and designated as the "11%
Senior Notes due 2006" of the Company. Their Stated Maturity shall be June 1,
2006, and they shall bear interest at the rate of 11% per annum, accruing in the
first instance from December 1, 2002 to June 1, 2003 (the first Interest Payment
Date) and continuing to accrue thereafter and payable semi-annually on June 1
and December 1, until the principal thereof is paid or made available for
payment; provided, however, with respect to Securities, if there has been a
Registration Default, then additional interest will accrue (the "Step-Up") at a
rate of 0.25% per annum, determined daily, on the principal amount of the
Securities, for the first 90-day period immediately following the occurrence of
the Registration Default until such time (the "Step-Down Date") as no
Registration Default is in effect and, provided, further, that for each
additional 90-day period that the Registration Default continues, the per annum
rate of such Special Interest shall increase (each such increase, an "Additional
Step-Up") by an additional 0.25% per annum up to a maximum aggregate amount of
1.00% per annum rate of Special Interest (i.e., for the combined Step-Up and any
Additional Step-Up) until the Step-Down Date (after which the interest rate will
be restored to its initial rate). Accrued Special Interest, if any, shall be
paid in cash in arrears semi-annually on June 1 and December 1 in each year, the
amount of accrued Special Interest shall be determined on the basis of the
number of days actually elapsed and computed as provided in Section 3.11.

                  The principal of (and premium, if any) and interest on the
Securities shall be payable at the office or agency of the Company in the
Borough of Manhattan, the City of New York maintained for such purpose and at
any other office or agency maintained by the Company for such purpose; provided,
however, that at the option of the Company payment of interest may be made by
check mailed to the address of the Person entitled thereto as such address shall
appear in the Security Register.

                  The Securities shall be subject to repurchase by the Company
pursuant to an Offer to Purchase as provided in Sections 10.14 and 10.16.

                  The Securities shall be redeemable as provided in Article
Eleven (and Article Twelve, with respect to Amortization Payments).

                  The Securities shall be subject to Amortization Payments as
provided in Article Twelve.

                  The Securities shall be subject to defeasance at the option of
the Company as provided in Article Thirteen.

                  The Securities shall have the benefit of any guarantees issued
specifically for the benefit of these Securities in accordance with Section
10.20 (including the guarantee issued by Millicom International Operations,
B.V., dated May 8, 2003 attached to this Indenture as Annex E).

                  Unless the context otherwise requires, the Securities issued
hereunder shall constitute one series for all purposes under the Indenture,
including with respect to any amendment, waiver, acceleration or other Act of
Holders, redemption or Offer to Purchase.

SECTION 3.02.     Denominations.

                  The Securities shall be issuable only in registered form
without coupons and only in denominations of $1,000 and any integral multiple
thereof.

SECTION 3.03.     Execution, Authentication, Delivery and Dating.

                  The Securities shall be executed on behalf of the Company by
any two Directors of the Company. The signature of any of these officers on the
Securities may be manual or facsimile.

                  Securities bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company shall bind
the Company, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery of such Securities or
did not hold such offices at the date of such Securities.

                  At any time and from time to time after the execution and
delivery of this Indenture, the Company may deliver Securities executed by the
Company to the Trustee for authentication, together with a Company Order for the
authentication and delivery of such Securities; and the Trustee in accordance
with such Company Order shall authenticate and deliver such Securities as in
this Indenture provided and not otherwise.

                  In authenticating the Securities pursuant to this Section, and
accepting the additional responsibilities under this Indenture in relation to
such Securities, the Trustee shall be entitled to receive, and (subject to
Section 6.01) shall be fully protected in relying upon, an Opinion of Counsel
stating, that such Securities have been duly and validly issued in accordance
with the terms of the Indenture, and are entitled to all the rights and benefits
set forth herein.

                  Each Security shall be dated the date of its authentication.

                  No Security shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose unless there appears on such
Security a certificate of authentication substantially in the form provided for
herein executed by the Trustee by manual signature, and such certificate upon
any Security shall be conclusive evidence, and the only evidence, that such
Security has been duly authenticated and delivered hereunder.

SECTION 3.04.     Temporary Securities.

                  Pending the preparation of definitive Securities, the Company
may execute, and upon Company Order the Trustee shall authenticate and deliver,
temporary Securities which are printed, lithographed, typewritten, mimeographed
or otherwise produced, in any authorized denomination, substantially of the
tenor of the definitive Securities in lieu of which they are issued and with
such appropriate insertions, omissions, substitutions and other variations as
the officers executing such Securities may determine, as evidenced by their
execution of such Securities.

                  If temporary Securities are issued, the Company will cause
definitive Securities to be prepared without unreasonable delay. After the
preparation of definitive Securities, the temporary Securities shall be
exchangeable for definitive Securities upon surrender of the temporary
Securities at any office or agency of the Company designated pursuant to Section
10.02, without charge to the Holder. Upon surrender for cancellation of any one
or more temporary Securities the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a like principal amount of
definitive Securities of authorized denominations. Until so exchanged the
temporary Securities shall in all respects be entitled to the same benefits
under this Indenture as definitive Securities.

SECTION 3.05.     Global Securities.

         (a)      Each Global Security authenticated under this Indenture shall
be registered in the name of the Depository designated by the Company for such
Global Security or a nominee thereof and delivered to such Depository or a
nominee thereof or custodian therefor, and each such Global Security shall
constitute a single Security for all purposes of this Indenture.

         (b)      Notwithstanding any other provision in this Indenture, no
Global Security may be exchanged in whole or in part for Securities registered,
and no transfer of a Global Security in whole or in part may be registered, in
the name of any Person other than the Depository for such Global Security or a
nominee thereof unless (i) such Depository (A) has notified the Company that it
is unwilling or unable to continue as Depository for such Global Security or (B)
has ceased to be a clearing agency registered as such under the Exchange Act,
(ii) there shall have occurred and be continuing an Event of Default with
respect to such Global Security, (iii) the Company executes and delivers to the
Trustee a Company Order stating that all Global Securities shall be exchanged in
whole for Securities that are not Global Securities (in which case such exchange
shall be effected by the Trustee) or (iv) pursuant to the following sentence.
Subject to any other applicable provisions hereof, all or any portion of a
Global Security may be exchanged for a Security that has a like aggregate
principal amount and is not a Global Security, upon 20 days' prior request made
by the Depository or its authorized representative to the Trustee.

         (c)      If any Global Security is to be exchanged for other Securities
or cancelled in whole, it shall be surrendered by or on behalf of the Depository
or its nominee to the Trustee, as Security Registrar, for exchange or
cancellation as provided in this Article Three. If any Global Security is to be
exchanged for other Securities or cancelled in part, or if another Security is
to be exchanged in whole or in part for a beneficial interest in any Global
Security, then either (i) such Global Security shall be so surrendered for
exchange or cancellation as provided in this Article Three or (ii) the principal
amount thereof shall be reduced or increased by an amount equal to the portion
thereof to be so exchanged or cancelled, or equal to the principal amount of
such other Security to be so exchanged for a beneficial interest therein, as the
case may be, by means of an appropriate adjustment made on the records of the
Trustee, as Security Registrar, whereupon the Trustee, in accordance with the
Applicable Procedures, shall instruct the Depository or its authorized
representative to make a corresponding adjustment to its records. Upon any such
surrender or adjustment of a Global Security, the Trustee shall, subject to
Section 3.05(b) and as otherwise provided in this Article Three, authenticate
and deliver any Securities issuable in exchange for such Global Security (or any
portion thereof) to or upon the order of, and registered in such names as may be
directed by, the Depository or its authorized representative. Upon the request
of the Trustee in connection with the occurrence of any of the events specified
in the preceding paragraph, the Company shall promptly make available to the
Trustee a reasonable supply of Securities that are not in the form of Global
Securities. The Trustee shall be entitled to rely upon any order, direction or
request of the Depository or its authorized representative which is given or
made pursuant to this Article Three if such order, direction or request is given
or made in accordance with the Applicable Procedures.

         (d)      Every Security authenticated and delivered upon registration
of transfer of, or in exchange for or in lieu of, a Global Security or any
portion thereof, whether pursuant to this Article Three, Section 9.06, 10.14 or
10.16 or otherwise, shall be authenticated and delivered in the form of, and
shall be, a Global Security, unless such Security is registered in the name of a
Person other than the Depository for such Global Security or a nominee thereof.

         (e)      The Depository or its nominee, as registered owner of a Global
Security, shall be the Holder of such Global Security for all purposes under the
Indenture and the Securities, and owners of beneficial interests in a Global
Security shall hold such interests pursuant to the Applicable Procedures.
Accordingly, any such owner's beneficial interest in a Global Security will be
shown only on, and the transfer of such interest shall be effected only through,
records maintained by the Depository or its nominee or its Agent Members.

SECTION 3.06.     Registration, Registration of Transfer Generally; Certain
                  Transfers and Exchanges.

         (a)      Registration, Registration of Transfer and Exchange Generally.
The Company shall cause to be kept at the Corporate Trust Office of the Trustee
a register (the register maintained in such office and in any other office or
agency designated pursuant to Section 10.02 being herein sometimes collectively
referred to as the "Security Register") in which, subject to such reasonable
regulations as it may prescribe, the Company shall provide for the registration
and transfer of Securities. The Trustee is hereby appointed "Security Registrar"
for the purpose of registering Securities and transfers of Securities as herein
provided.

                  Upon surrender for registration of transfer or exchange of any
Security at an office or agency of the Company designated pursuant to Section
10.02 for such purpose, the Company shall execute, and the Trustee shall
authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Securities of any authorized denominations and of a
like aggregate principal amount and bearing such restrictive legends as may be
required by this Indenture.

                  Subject to Section 3.06(b), at the option of the Holder,
Securities may be exchanged for other Securities of any authorized denominations
and of a like aggregate principal amount, upon surrender of the Securities to be
exchanged at such office or agency. Whenever any Securities are so surrendered
for exchange, the Company shall execute, and the Trustee shall authenticate and
deliver, the Securities which the Holder making the exchange is entitled to
receive.

                  All Securities issued upon any registration of transfer of or
exchange for Securities shall be the valid obligations of the Company,
evidencing the same debt, and entitled to the same benefits under this
Indenture, as the Securities surrendered upon such registration of transfer or
exchange.

                  Every Security presented or surrendered for registration of
transfer or for exchange shall (if so required by the Company or the Trustee) be
duly endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Security Registrar duly executed, by the
Holder thereof or his attorney duly authorized in writing.

                  No service charge shall be made for any registration of
transfer or exchange of Securities, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any registration of transfer or exchange of Securities, other
than exchanges pursuant to Section 3.04, 9.06 or 11.08 or in accordance with any
Offer to Purchase pursuant to Section 10.14 or 10.16 not involving any transfer.

                  The Company shall not be required (i) to issue or register the
transfer of any Security during a period beginning at the opening of business 15
days before the day of the mailing of a notice of redemption of Securities
selected for redemption under Section 11.04 and ending at the close of business
on the day of such mailing, or (ii) to register the transfer of any Security so
selected for redemption in whole or in part, except the unredeemed portion of
any Security being redeemed in part.

         (b)      Certain Transfers and Exchanges. Notwithstanding any other
provision of this Indenture or the Securities, transfers or exchanges of
Securities and beneficial interests in a Global Security of the kinds specified
in this Section 3.06(b) shall be made only in accordance with this Section
3.06(b).

         (i)      Restricted Global Security to Regulation S Global Security.
    If the owner of a beneficial interest in the Restricted Global Security
    wishes at any time to transfer such interest to a Person who wishes to
    take delivery thereof in the form of a beneficial interest in the
    Regulation S Global Security, such transfer may be effected only in
    accordance with the provisions of this Clause (b)(i) and Clause (b)(vii)
    below and subject to the Applicable Procedures.  Upon receipt by the
    Trustee, as Security Registrar, of (A) an order given by the Depository or
    its authorized representative directing that a beneficial interest in the
    Regulation S Global Security in a specified principal amount be credited to
    a specified Agent Member's account and that a beneficial interest in the
    Restricted Global Security in an equal principal amount be debited from
    another specified Agent Member's account and (B) a Regulation S Certificate,
    satisfactory to the Trustee and duly executed by the owner of such
    beneficial interest in the Restricted Global Security or his attorney in
    fact duly authorized in writing, then the Trustee, as Security Registrar but
    subject to Clause (b)(vii) below, shall reduce the principal amount of
    the Restricted Global Security and increase the principal amount of the
    Regulation S Global Security by such specified principal amount as
    provided in Section 3.05(c).

         (ii)     Regulation S Global Security to Restricted Global Security.
    If the owner of a beneficial interest in the Regulation S Global Security
    wishes at any time to transfer such interest to a Person who wishes to take
    delivery thereof in the form of a beneficial interest in the Restricted
    Global Security, such transfer may be effected only in accordance with this
    Clause (b)(ii) and subject to the Applicable Procedures.  Upon receipt by
    the Trustee, as Security Registrar, of (A) an order given by the Depository
    or its authorized representative directing that a beneficial interest in the
    Restricted Global Security in a specified principal amount be credited to a
    specified Agent Member's account and that a beneficial interest in the
    Regulation S Global Security in an equal principal amount be debited from
    another specified Agent Member's account and (B) if such transfer is to
    occur during the Restricted Period, a Restricted Securities Certificate,
    satisfactory to the Trustee and duly executed by the owner of such
    beneficial interest in the Regulation S Global Security or his attorney in
    fact duly authorized in writing, then the Trustee, as Security Registrar,
    shall reduce the principal amount of the Regulation S Global Security and
    increase the principal amount of the Restricted Global Security by such
    specified principal amount as provided in Section 3.05(c).  If transfers
    under this Section 3.06(b)(ii) occur after the Restricted Period, no
    Restricted Securities Certificates will be required.

         (iii)    Restricted Non-Global Security to Restricted Global Security
    or Regulation S Global Security.  If the Holder of a Restricted Security
    (other than a Global Security) wishes at any time to transfer all or any
    portion of such Security to a Person who wishes to take delivery thereof in
    the form of a beneficial interest in the Restricted Global Security or the
    Regulation S Global Security, such transfer may be effected only in
    accordance with the provisions of this Clause (b)(iii) and Clause (b)(vii)
    below and subject to the Applicable Procedures.  Upon receipt by the
    Trustee, as Security Registrar, of (A) such Security as provided in Section
    3.06(a) and instructions satisfactory to the Trustee directing that a
    beneficial interest in the Restricted Global Security or Regulation S Global
    Security in a specified principal amount not greater than the principal
    amount of such Security be credited to a specified Agent Member's account
    and (B) a Restricted Securities Certificate, if the specified account is to
    be credited with a beneficial interest in the Restricted Global Security, or
    a Regulation S Certificate, if the specified account is to be credited with
    a beneficial interest in the Regulation S Global Security, in either case
    satisfactory to the Trustee and duly executed by such Holder or his attorney
    duly authorized in writing, then the Trustee, as Security Registrar but
    subject to Clause (b)(vii) below, shall cancel such Security (and issue a
    new Security in respect of any untransferred portion thereof) as provided in
    Section 3.06(a) and increase the principal amount of the Restricted Global
    Security or the Regulation S Global Security, as the case may be, by the
    specified principal amount as provided in Section 3.05(c).

         (iv)     Regulation S Non-Global Security to Restricted Global Security
    or Regulation S Global Security.  If the Holder of a Regulation S Security
    (other than a Regulation S Global Security) wishes at any time to transfer
    all or any portion of such Security (other than a Global Security) to a
    Person who wishes to take delivery thereof in the form of a beneficial
    interest in the Restricted Global Security or the Regulation S Global
    Security, such transfer may be effected only in accordance with this Clause
    (b)(iv) and Clause (b)(vii) below and subject to the Applicable Procedures.
    Upon receipt by the Trustee, as Security Registrar, of (A) such Security as
    provided in Section 3.06(a) and instructions satisfactory to the Trustee
    directing that a beneficial interest in the Restricted Global Security or
    Regulation S Global Security in a specified principal amount not greater
    than the principal amount of such Security be credited to a specified Agent
    Member's account and (B) if the transfer is to occur during the Restricted
    Period and the specified account is to be credited with a beneficial
    interest in the Restricted Global Security, a Restricted Securities
    Certificate satisfactory to the Trustee and duly executed by such Holder or
    his attorney duly authorized in writing, then the Trustee, as Security
    Registrar but subject to Clause (b)(vii) below, shall cancel such Security
    (and issue a new Security in respect of any untransferred portion thereof)
    as provided in Section 3.06(a) and increase the principal amount of the
    Restricted Global Security or the Regulation S Global Security, as the case
    may be, by the specified principal amount as provided in Section 3.05(c).

         (v)      Non-Global Security to Non-Global Security.  A Security that
    is not a Global Security may be transferred, in whole or in part, to a
    Person who takes delivery in the form of another Security that is not a
    Global Security as provided in Section 3.06(a), provided that, if the
    Security to be transferred in whole or in part is a Restricted Security, and
    the transfer is to occur during the Restricted Period, then the Trustee
    shall have received (A) a Restricted Securities Certificate, satisfactory
    to the Trustee and duly executed by the transferor Holder or his attorney
    duly authorized in writing, in which case the transferee Holder shall take
    delivery in the form of a Restricted Security, or (B) a Regulation S
    Certificate, satisfactory to the Trustee and duly executed by the transferor
    Holder or his attorney duly authorized in writing, in which case the
    transferee Holder shall take delivery in the form of a Regulation S Security
    (subject in each case to Section 3.06(c)).

         (vi)     Exchanges between Global Security and Non-Global Security. A
    beneficial interest in a Global Security may be exchanged for a Security
    that is not a Global Security as provided in Section 3.05, provided that, if
    such interest is a beneficial interest in the Restricted Global Security,
    then such interest shall be exchanged for a Restricted Security (subject in
    each case to Section 3.06(c)). A Security that is not a Global Security may
    be exchanged for a beneficial interest in a Global Security only if such
    exchange occurs in connection with a transfer effected in accordance with
    Clause (b)(iii) or (iv) above.

         (vii)    Regulation S Global Security to be Held Through Euroclear or
    Clearstream during Restricted Period.  The Company shall use its best
    efforts to cause the Depository to ensure that, until the expiration of the
    Restricted Period, beneficial interests in the Regulation S Global Security
    may be held only in or through accounts maintained at the Depository by
    Euroclear or Clearstream (or by Agent Members acting for the account
    thereof), and no person shall be entitled to effect any transfer or exchange
    that would result in any such interest being held otherwise than in or
    through such an account; provided that this Clause (b)(vii) shall not
    prohibit any transfer or exchange of such an interest in accordance with
    Clause (b)(ii) or (vi) above.

                  The Company shall notify the Trustee promptly of the
expiration of the Restricted Period. Such notification shall be in the form of
Annex D hereto.

         (c)      Securities Act Legends.  Securities shall bear a Restricted
Securities Legend and Regulation S Securities shall bear a Regulation S Legend,
subject to the following:

         (i)      subject to the following Clauses of this Section 3.06(c), a
    Security or any portion thereof which is exchanged, upon transfer or
    otherwise, for a Global Security or any portion thereof shall bear the
    Securities Act Legend borne by such Global Security while represented
    thereby;

         (ii)     subject to the following Clauses of this Section 3.06(c), a
    new Security which is not a Global Security and is issued in exchange for
    another Security (including a Global Security) or any portion thereof, upon
    transfer or otherwise, shall bear the Securities Act Legend borne by such
    other Security, provided that, if such new Security is required pursuant to
    Section 3.06(b)(v) or (vi) to be issued in the form of a Restricted
    Security, it shall bear a Restricted Securities Legend and, if such new
    Security is so required to be issued in the form of a Regulation S Security,
    it shall bear a Regulation S Legend;

         (iii)    after a date that is two years from issuance, a new Security
    which does not bear a Securities Act Legend may be issued in exchange for or
    in lieu of a Security or any portion thereof which bears such a legend if
    the Trustee has received an Unrestricted Securities Certificate,
    satisfactory to the Trustee and duly executed by the Holder of such legended
    Security or his attorney duly authorized in writing, and after such date and
    receipt of such certificate, the Trustee shall authenticate and deliver such
    a new Security in exchange for or in lieu of such other Security as provided
    in this Article Three;

         (iv)     a new Security which does not bear a Securities Act Legend
    (other than a Global Security) may be issued in exchange for or in lieu of a
    Security or any portion thereof which bears such a legend if, in the
    Company's judgment, placing such a legend upon such new Security is not
    necessary to ensure compliance with the registration requirements of the
    Securities Act, and the Trustee, at the direction of the Company, shall
    authenticate and deliver such a new Security as provided in this Article
    Three; and

         (v)      notwithstanding the foregoing provisions of this Section
    3.06(c), a Successor Security of a Security that does not bear a particular
    form of Securities Act Legend shall not bear such form of legend unless the
    Company has reasonable cause to believe that such Successor Security is a
    "restricted security" within the meaning of Rule 144, in which case the
    Trustee, at the direction of the Company, shall authenticate and deliver a
    new Security bearing a Restricted Securities Legend in exchange for such
    Successor Security as provided in this Article Three.

SECTION 3.07.     Mutilated, Destroyed, Lost and Stolen Securities.

                  If any mutilated Security is surrendered to the Trustee, the
Company shall execute and the Trustee shall authenticate and deliver in exchange
therefor a new Security of like tenor and principal amount and bearing a number
not contemporaneously outstanding.

                  If there shall be delivered to the Company and the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any Security
and (ii) such security or indemnity as may be required by them to save each of
them and any agent of either of them harmless, then, in the absence of notice to
the Company or the Trustee that such Security has been acquired by a bona fide
purchaser, the Company shall execute and the Trustee shall authenticate and
deliver, in lieu of any such destroyed, lost or stolen Security, a new Security
of like tenor and principal amount and bearing a number not contemporaneously
outstanding.

                  In case any such mutilated, destroyed, lost or stolen Security
has become or is about to become due and payable, the Company in its discretion
may, instead of issuing a new Security, pay such Security.

                  Upon the issuance of any new Security under this Section, 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 Trustee) connected therewith.

                  Every new Security issued pursuant to this Section in lieu of
any destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities duly issued hereunder.

                  The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Securities.

SECTION 3.08.     Payment of Interest; Interest Rights Preserved.

                  Interest on any Security which is payable, and is punctually
paid or duly provided for, on any Interest Payment Date shall be paid to the
Person in whose name that Security (or one or more Predecessor Securities) is
registered at the close of business on the Regular Record Date for such
interest.

                  Any interest on any Security which is payable, but is not
punctually paid or duly provided for, on any Interest Payment Date (herein
called "Defaulted Interest") shall forthwith cease to be payable to the Holder
on the relevant Regular Record Date by virtue of having been such Holder, and
such Defaulted Interest may be paid by the Company, at its election in each
case, as provided in Clause (1) or (2) below:

         (1)      The Company may elect to make payment of any Defaulted
    Interest to the Persons in whose names the Securities (or their respective
    Predecessor Securities) are registered at the close of business on a Special
    Record Date for the payment of such Defaulted Interest, which shall be fixed
    in the following manner. The Company shall notify the Trustee in writing of
    the amount of Defaulted Interest proposed to be paid on each Security and
    the date of the proposed payment, and at the same time the Company shall
    deposit with the Trustee an amount of money equal to the aggregate amount
    proposed to be paid in respect of such Defaulted Interest or shall make
    arrangements satisfactory to the Trustee for such deposit prior to the date
    of the proposed payment, such money when deposited to be held in trust for
    the benefit of the Persons entitled to such Defaulted Interest as in this
    Clause provided. Thereupon the Trustee shall fix a Special Record Date for
    the payment of such Defaulted Interest which shall be not more than 15 days
    and not less than 10 days prior to the date of the proposed payment and not
    less than 10 days after the receipt by the Trustee of the notice of the
    proposed payment. The Trustee shall promptly notify the Company of such
    Special Record Date and, in the name and at the expense of the Company,
    shall cause notice of the proposed payment of such Defaulted Interest and
    the Special Record Date therefor to be mailed, first-class postage prepaid,
    to each Holder at his address as it appears in the Security Register, not
    less than 10 days prior to such Special Record Date. Notice of the proposed
    payment of such Defaulted Interest and the Special Record Date therefor
    having been so mailed, such Defaulted Interest shall be paid to the Persons
    in whose names the Securities (or their respective Predecessor Securities)
    are registered at the close of business on such Special Record Date and
    shall no longer be payable pursuant to the following Clause (2).

         (2)      The Company may make payment of any Defaulted Interest in any
    other lawful manner not inconsistent with the requirements of any securities
    exchange on which the Securities may be listed, and upon such notice as may
    be required by such exchange, if, after notice given by the Company to the
   Trustee of the proposed payment pursuant to this Clause, such manner of
   payment shall be deemed practicable by the Trustee.

                  Subject to the foregoing provisions of this Section, each
Security delivered under this Indenture upon registration of transfer of or in
exchange for or in lieu of any other Security shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Security.

SECTION 3.09.     Persons Deemed Owners.

                  Prior to due presentment of a Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name such Security is registered as the owner of
such Security for the purpose of receiving payment of principal of (and premium,
if any) and (subject to Section 3.08) interest on such Security and for all
other purposes whatsoever, whether or not such Security be overdue, and neither
the Company, the Trustee nor any agent of the Company or the Trustee shall be
affected by notice to the contrary.

SECTION 3.10.     Cancellation.

                  All Securities surrendered for payment, redemption,
registration of transfer, exchange or pursuant to any Offer to Purchase pursuant
to Section 10.14 or 10.16 shall, if surrendered to any Person other than the
Trustee, be delivered to the Trustee and shall be promptly cancelled by it. The
Company may at any time deliver to the Trustee for cancellation any Securities
previously authenticated and delivered hereunder which the Company may have
acquired in any manner whatsoever, and all Securities so delivered shall be
promptly cancelled by the Trustee. No Securities shall be authenticated in lieu
of or in exchange for any Securities cancelled as provided in this Section,
except as expressly permitted by this Indenture. All cancelled Securities held
by the Trustee shall be disposed of as directed by a Company Order; provided,
however, that the Trustee may, but shall not be required to destroy cancelled
Securities.

SECTION 3.11.     Computation of Interest.

                  Interest on the Securities shall be computed on the basis of a
360-day year of twelve 30-day months; provided, however, that Special Interest
on Securities shall be computed on the basis of a 365- or 366-day year, as the
case may be, and the number of days actually elapsed.

SECTION 3.12.     CUSIP Numbers.

                  The Company shall in issuing the Securities use CUSIP numbers,
and the Trustee shall use the applicable CUSIP number in notices of redemption
or exchange as a convenience to the Holders; provided, that any such notice may
state that no representation is made as to the accuracy or correctness of the
CUSIP number or numbers printed in the notice or on the certificates
representing the Securities and that reliance may be placed only on the other
identification numbers printed on the certificates representing the Securities.

                                  ARTICLE FOUR

                           Satisfaction and Discharge

SECTION 4.01.     Satisfaction and Discharge of Indenture.

                  This Indenture shall cease to be of further effect (except as
to any surviving rights of registration of transfer or exchange of Securities
herein expressly provided for), and the Trustee, on demand of and at the expense
of the Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when

         (1)      either

                  (A)   all Securities theretofore authenticated and delivered
         (other than (i) Securities which have been destroyed, lost or stolen
         and which have been replaced or paid as provided in Section 3.07 and
         (ii) Securities for whose payment money has theretofore been deposited
         in trust or segregated and held in trust by the Company and thereafter
         repaid to the Company or discharged from such trust, as provided in
         Section 10.03) have been delivered to the Trustee for cancellation; or

                  (B)   all such Securities not theretofore delivered to the
         Trustee for cancellation

                        (i)      have become due and payable, or

                        (ii)     will become due and payable at their Stated
                  Maturity within one year, or

                        (iii)    are to be called for redemption within one year
                  under arrangements satisfactory to the Trustee for the giving
                  of notice of redemption by the Trustee in the name, and at the
                  expense, of the Company, and the Company, in the case of (i),
                  (ii) or (iii) above, has deposited or caused to be deposited
                  with the Trustee as trust funds in trust for the purpose an
                  amount sufficient to pay and discharge the entire indebtedness
                  on such Securities not theretofore delivered to the Trustee
                  for cancellation, for principal (including Amortization
                  Payments and premium, if any) and interest to the date of such
                  deposit (in the case of Securities which have become due and
                  payable) or to the Stated Maturity or Redemption Date, as the
                  case may be;

         (2)      the Company has paid or cause to be paid all other sums
    payable hereunder by the Company; and

         (3)      the Company has delivered to the Trustee an Officer's
    Certificate and an Opinion of Counsel, each stating that all conditions
    precedent herein provided for relating to the satisfaction and discharge of
    this Indenture have been complied with.

                  Notwithstanding the satisfaction and discharge of this
Indenture pursuant to this Article Four, the obligations of the Company to the
Trustee under Section 6.07, the obligations of the Trustee to any Authenticating
Agent under Section 6.14 and, if money shall have been deposited with the
Trustee pursuant to subclause (B) of Clause (1) of this Section, the obligations
of the Trustee under Section 4.02 and the last paragraph of Section 10.03 shall
survive.

SECTION 4.02.     Application of Trust Money.

                  Subject to the provisions of the last paragraph of Section
10.03, all money deposited with the Trustee pursuant to Section 4.01 shall be
held in trust and applied by it, in accordance with the provisions of the
Securities and this Indenture, to the payment, either directly or through any
Paying Agent (including the Company acting as its own Paying Agent) as the
Trustee may determine, to the Persons entitled thereto, of the principal
(including Amortization Payments and premium, if any) and interest for whose
payment such money has been deposited with the Trustee.

                                  ARTICLE FIVE

                                    Remedies

SECTION 5.01.     Events of Default.

                  "Event of Default", wherever used herein, means any one of the
following events (whatever the reason for such Event of Default and whether it
shall be voluntary or involuntary or be effected by operation of law or pursuant
to any judgment, decree or order of any court or any order, rule or regulation
of any administrative or governmental body):

         (1)      default in the payment  of the principal of (including
    Amortization Payments and premium, if any, on) any Security on any
    Amortization Payment Date or at its Maturity; or

         (2)      default in the payment of any interest upon any Security
    (including Additional Amounts and Special Interest, if any) when it becomes
    due and payable, and continuance of such default for a period of 30 days; or

         (3)      default in the payment of principal and interest upon any
    Security required to be purchased pursuant to an Offer to Purchase pursuant
    to Section 10.14 or 10.16; or

         (4)      default in the performance, or breach, of Section 8.01; or

         (5)       default in the performance, or breach, of any covenant or
    warranty of the Company in this Indenture (other than a covenant or warranty
    a default in whose performance or whose breach is elsewhere in this Section
    specifically dealt with), and continuance of such default or breach for a
    period of 60 days after there has been given, by registered or certified
    mail, to the Company by the Trustee or to the Company and the Trustee by the
    Holders of at least 25% in aggregate principal amount of the Outstanding
    Securities a written notice specifying such default or breach and requiring
    it to be remedied and stating that such notice is a "Notice of Default"
    hereunder; or

         (6)      a default or defaults under any bond(s), debenture(s), note(s)
    or other evidence(s) of Debt by the Company or any Significant Restricted
    Group Member or under any mortgage(s), indenture(s) or instrument(s) under
    which there may be issued or by which there may be secured or evidenced any
    Debt of such type by the Company or any Significant Restricted Group Member
    with a principal amount then outstanding, individually or in the aggregate,
    in excess of $10 million, whether such Debt now exists or shall hereafter be
    created, which default or defaults shall constitute a failure to pay such
    Debt when due at the final maturity thereof, or shall have resulted in such
    Debt becoming or being declared due and payable prior to the date on which
    it would otherwise have become due and payable; or

         (7)      a final judgment or final judgments (not subject to appeal)
    for the payment of money are entered against the Company or any Significant
    Restricted Group Member in an aggregate amount in excess of $10 million
    by a court or courts of competent jurisdiction, which judgments remain
    undischarged or unstayed for a period (during which execution shall not be
    effectively stayed) of 45 days after the right to appeal all such judgments
    has expired; or

         (8)      the entry by a court having jurisdiction in the premises of
    (A) a decree or order for relief in respect of the Company or any
    Significant Restricted Group Member in an involuntary case or proceeding
    under any applicable Federal, State or foreign bankruptcy, insolvency,
    reorganization or other similar law or (B) a decree or order adjudging the
    Company or any Significant Restricted Group Member a bankrupt or insolvent,
    or approving as properly filed a petition seeking reorganization,
    arrangement, adjustment or composition of or in respect of the Company or
    any Significant Restricted Group Member under any applicable Federal, State
    or foreign law, or appointing a custodian, receiver, liquidator, assignee,
    trustee, sequestrator or other similar official of the Company or any
    Significant Restricted Group Member or of any substantial part of its
    property, or ordering the winding up or liquidation of its affairs, and the
    continuance of any such decree or order for relief or any such other decree
    or order unstayed and in effect for a period of 60 consecutive days; or

         (9)      the commencement by the Company or any Significant Restricted
    Group Member of a voluntary case or proceeding under any applicable Federal,
    State or foreign bankruptcy, insolvency, reorganization or other similar law
    or of any other case or proceeding to be adjudicated a bankrupt or
    insolvent, or the consent by it to the entry of a decree or order for relief
    in respect of the Company, or any Significant Restricted Group Member in an
    involuntary case or proceeding under any applicable Federal, State or
    foreign bankruptcy, insolvency, reorganization or other similar law or to
    the commencement of any bankruptcy or insolvency case or proceeding against
    it, or the filing by it of a petition or answer or consent seeking
    reorganization or relief under any applicable Federal, State or foreign law,
    or the consent by it to the filing of such petition or to the appointment of
    or taking possession by a custodian, receiver, liquidator, assignee,
    trustee, sequestrator or other similar official of the Company, or any
    Significant Restricted Group Member or of any substantial part of its
    property, or the making by it of an assignment for the benefit of creditors,
    or the admission by it in writing of its inability to pay its debts
    generally as they become due, or the taking of corporate action by the
    Company, or any Significant Restricted Group Member in furtherance of any
    such action.

SECTION 5.02.     Acceleration of Maturity; Rescission and Annulment.

                  If an Event of Default (other than an Event of Default
specified in Section 5.01(8) or (9) with respect to the Company) occurs and is
continuing, then and in every such case the Trustee or the Holders of not less
than 25% in aggregate principal amount of the Outstanding Securities may declare
the Default Amount of all the Securities to be due and payable immediately, by a
notice in writing to the Company (and to the Trustee if given by Holders), and
upon any such declaration the Default Amount and any accrued interest, together
with all other amounts due under this Indenture, shall become immediately due
and payable. If an Event of Default specified in Section 5.01(8) or (9) occurs
with respect to the Company, then the Default Amount of, and any accrued
interest on, the Securities then Outstanding, together with all other amounts
due under this Indenture, shall ipso facto become immediately due and payable
without any declaration or other action on the part of the Trustee or any
Holder.

                  At any time after such a declaration of acceleration has been
made and before a judgment or decree for payment of the money due has been
obtained by the Trustee as hereinafter in this Article provided, the Holders of
a majority in principal amount of the Outstanding Securities, by written notice
to the Company and the Trustee, may rescind and annul such declaration and its
consequences if

         (1)      the Company has paid or deposited with the Trustee a sum
    sufficient to pay

                  (A)   all overdue interest on all Securities,

                  (B)   the principal of (and premium, if any, on) any
         Securities which have become due otherwise (including, but not limited
         to, any overdue Amortization Payments) than by such declaration of
         acceleration (including any Securities required to have been purchased
         on the Purchase Date pursuant to an Offer to Purchase made by the
         Company) and interest thereon at the rate borne by the Securities,

                  (C)   to the extent that payment of such interest is lawful,
         interest upon overdue interest at the rate borne by the Securities, and

                  (D)   all sums paid or advanced by the Trustee hereunder and
         the reasonable compensation, expenses, disbursements and advances of
         the Trustee, its agents and counsel;

    and

         (2)      all Events of Default, other than the non-payment of the
         principal of Securities which have become due solely by such
         declaration of acceleration, have been cured or waived as provided in
         Section 5.13.

                  No such rescission shall affect any subsequent default or
impair any right consequent thereon.

SECTION 5.03.     Collection of Indebtedness and Suits for Enforcement by
                  Trustee.

                  The Company covenants that if

         (1)      default is made in the payment of any interest on any Security
    when such interest becomes due and payable and such default continues for a
    period of 30 days, or

         (2)      default is made in the payment of the principal of (or
    premium, if any, on) any Security at the Maturity thereof or at any
    Amortization Payment Date, or, with respect to any Security required to have
    been purchased pursuant to an Offer to Purchase made by the Company at the
    Purchase Date thereof,

the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities, the whole amount then due and payable on such
Securities for principal, including Amortization Payments, (and premium, if any)
and interest, and, to the extent that payment of such interest shall be legally
enforceable, interest on any overdue principal, including Amortization Payments,
(and premium, if any) and on any overdue interest, at the rate borne by the
Securities, and, in addition thereto, such further amount as shall be sufficient
to cover the costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel.

                  If the Company fails to pay such amounts forthwith upon such
demand, the Trustee, in its own name and as trustee of an express trust, may
institute a judicial proceeding for the collection of the sums so due and
unpaid, may prosecute such proceeding to judgment or final decree, and may
enforce the same against the Company or any other obligor upon the Securities
and collect the moneys adjudged or decreed to be payable in the manner provided
by law out of the property of the Company or any other obligor upon the
Securities, wherever situated.

                  If an Event of Default occurs and is continuing, the Trustee
may in its discretion proceed to protect and enforce its rights and the rights
of the Holders by such appropriate judicial proceedings as the Trustee shall
deem most effectual to protect and enforce any such rights, whether for the
specific enforcement of any covenant or agreement in this Indenture or in aid of
the exercise of any power granted herein, or to enforce any other proper remedy.

SECTION 5.04.     Trustee May File Proofs of Claim.

                  In case of any judicial proceeding relative to the Company,
Millicom International Operations B,V, as guarantor of the Securities (or any
other obligor upon the Securities), its property or its creditors, the Trustee
shall be entitled and empowered, by intervention in such proceeding or
otherwise, to take any and all actions authorized under the Trust Indenture Act
in order to have claims of the Holders and the Trustee allowed in any such
proceeding. In particular, the Trustee shall be authorized to collect and
receive any moneys or other property payable or deliverable on any such claims
and to distribute the same; and any custodian, receiver, assignee, trustee,
liquidator, sequestrator or other similar official in any such judicial
proceeding is hereby authorized by each Holder to make such payments to the
Trustee and, in the event that the Trustee shall consent to the making of such
payments directly to the Holders, to pay to the Trustee any amount due it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 6.07.

                  No provision of this Indenture shall be deemed to authorize
the Trustee to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Securities or the rights of any Holder thereof or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.

SECTION 5.05.     Trustee May Enforce Claims Without Possession of Securities.

                  All rights of action and claims under this Indenture or the
Securities may be prosecuted and enforced by the Trustee without the possession
of any of the Securities or the production thereof in any proceeding relating
thereto, and any such proceeding instituted by the Trustee shall be brought in
its own name as trustee of an express trust, and any recovery of judgment shall,
after provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Securities in respect of which such
judgment has been recovered.

SECTION 5.06.     Application of Money Collected.

                  Any money collected by the Trustee pursuant to this Article
shall be applied in the following order, at the date or dates fixed by the
Trustee and, in case of the distribution of such money on account of principal,
including Amortization Payments, (or premium, if any) or interest, upon
presentation of the Securities and the notation thereon of the payment if only
partially paid and upon surrender thereof if fully paid:

                  FIRST:          To the payment of all amounts due the
         Trustee under Section 6.07; and

                  SECOND:         To the payment of the amounts then due and
         unpaid for principal, including Amortization Payments, of (and premium,
         if any) and interest on the Securities in respect of which or for the
         benefit of which such money has been collected, ratably, without
         preference or priority of any kind, according to the amounts due and
         payable on such Securities for principal (and premium, if any) and
         interest, respectively.

SECTION 5.07.     Limitation on Suits.

                  No Holder of any Security shall have any right to institute
any proceeding, judicial or otherwise, with respect to this Indenture, or for
the appointment of a receiver or trustee, or for any other remedy hereunder,
unless

         (1)      such Holder has previously given written notice to the Trustee
    of a continuing Event of Default;

         (2)      the Holders of not less than 25% in principal amount of the
    Outstanding Securities shall have made written request to the Trustee to
    institute proceedings in respect of such Event of Default in its own name as
    Trustee hereunder;

         (3)      such Holder or Holders have offered to the Trustee reasonable
    indemnity against the costs, expenses and liabilities to be incurred in
    compliance with such request;

         (4)      the Trustee for 60 days after its receipt of such notice,
    request and offer of indemnity has failed to institute any such proceeding;
    and

         (5)      no direction inconsistent with such written request has been
    given to the Trustee during such 60-day period by the Holders of a majority
    in principal amount of the Outstanding Securities;

it being understood and intended that no one or more Holders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this Indenture to affect, disturb or prejudice the rights of any other Holders,
or to obtain or to seek to obtain priority or preference over any other Holders
or to enforce any right under this Indenture, except in the manner herein
provided and for the equal and ratable benefit of all the Holders.

SECTION 5.08.     Unconditional Right of Holders to Receive Principal, Premium
                  and Interest.

                  Notwithstanding Section 5.07 or any other provision in this
Indenture, the Holder of any Security shall have the right, which is absolute
and unconditional, to receive payment of the principal of, including
Amortization Payments, (and premium, if any) and (subject to Section 3.08)
interest on such Security on the respective Stated Maturities and Amortization
Payment Dates expressed in such Security (or, in the case of redemption, on the
Redemption Date or, in the case of an Offer to Purchase made by the Company, on
the Purchase Date) and to institute suit for the enforcement of any such payment
and such rights shall not be impaired without the consent of such Holder.

SECTION 5.09.     Restoration of Rights and Remedies.

                  If the Trustee or any Holder has instituted any proceeding to
enforce any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case, subject to any
determination in such proceeding, the Company, the Trustee and the Holders shall
be restored severally and respectively to their former positions hereunder and
thereafter all rights and remedies of the Trustee and the Holders shall continue
as though no such proceeding had been instituted.

SECTION 5.10.     Rights and Remedies Cumulative.

                  Except as otherwise provided with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities in the last
paragraph of Section 3.07, no right or remedy herein conferred upon or reserved
to the Trustee or to the Holders is intended to be exclusive of any other right
or remedy, and every right and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right or remedy.

SECTION 5.11.     Delay or Omission Not Waiver.

                  No delay or omission of the Trustee or of any Holder of any
Security to exercise any right or remedy accruing upon any Event of Default
shall impair any such right or remedy or constitute a waiver of any such Event
of Default or an acquiescence therein. Every right and remedy given by this
Article or by law to the Trustee or to the Holders may be exercised from time to
time, and as often as may be deemed expedient, by the Trustee or by the Holders,
as the case may be.

SECTION 5.12.     Control by Holders.

                  The Holders of a majority in principal amount of the
Outstanding Securities shall have the right to direct the time, method and place
of conducting any proceeding for any remedy available to the Trustee or
exercising any trust or power conferred on the Trustee, provided that

         (1)      such direction shall not be in conflict with any rule of law
    or with this Indenture, and

         (2)      the Trustee may take any other action deemed proper by the
    Trustee which is not inconsistent with such direction.

SECTION 5.13.     Waiver of Past Defaults.

                  The Holders of not less than a majority in principal amount of
the Outstanding Securities may on behalf of the Holders of all the Securities
waive any past default hereunder and its consequences, except a default

         (1)      in the payment of the principal of, including Amortization
    Payments, (or premium, if any) or interest on any Security (including any
    Security which is required to have been purchased pursuant to an Offer to
    Purchase made by the Company), or

         (2)      in respect of a covenant or provision hereof which under
    Article Nine cannot be modified or amended without the consent of the Holder
    of each Outstanding Security affected.

                  Upon any such waiver, such default shall cease to exist, and
any Event of Default arising therefrom shall be deemed to have been cured, for
every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other default or impair any right consequent thereon.

SECTION 5.14.     Undertaking for Costs.

                  In any suit for the enforcement of any right or remedy under
this Indenture, or in any suit against the Trustee for any action taken,
suffered or omitted by it as Trustee, a court may require any party litigant in
such suit to file an undertaking to pay the costs of such suit, and may assess
costs against any such party litigant, in the manner and to the extent provided
in the Trust Indenture Act; provided, that neither this Section nor the Trust
Indenture Act shall be deemed to authorize any court to require such an
undertaking or to make such an assessment in any suit instituted by the Company.

SECTION 5.15.     Waiver of Stay or Extension Laws.

                  The Company covenants (to the extent that it may lawfully do
so) that it will not at any time insist upon, or plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay or extension law
wherever enacted, now or at any time hereafter in force, which may affect the
covenants or the performance of this Indenture; and the Company (to the extent
that it may lawfully do so) hereby expressly waives all benefit or advantage of
any such law and covenants that it will not hinder, delay or impede the
execution of any power herein granted to the Trustee, but will suffer and permit
the execution of every such power as though no such law had been enacted.

                                  ARTICLE SIX

                                   The Trustee

SECTION 6.01.     Certain Duties and Responsibilities.

         (a)      Except during the continuance of an Event of Default,

         (1)      the Trustee undertakes to perform such duties and only such
    duties as are specifically set forth in this Indenture, and no implied
    covenants or obligations shall be read into this Indenture against the
    Trustee; and

         (2)      in the absence of bad faith on its part, the Trustee may
    conclusively rely, as to the truth of the statements and the correctness of
    the opinions expressed therein, upon certificates or opinions furnished to
    the Trustee and conforming to the requirements of this Indenture; but in the
    case of any such certificates or opinions which by any provision hereof are
    specifically required to be furnished to the Trustee, the Trustee shall be
    under a duty to examine the same to determine whether or not they conform to
    the requirements of this Indenture (but need not confirm or investigate the
    accuracy of mathematical calculations or other facts stated therein).

         (b)      In case an Event of Default has occurred and is continuing,
the Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in their exercise, as a
prudent man would exercise or use under the circumstances in the conduct of his
own affairs.

         (c)      No provision of this Indenture shall be construed to relieve
the Trustee from liability for its own negligent action, its own negligent
failure to act, or its own willful misconduct, except that

         (1)      this Subsection shall not be construed to limit the effect of
    Subsection (a) of this Section;

         (2)      the Trustee shall not be liable for any error of judgment made
    in good faith by a Responsible Officer, unless it shall be proved that the
    Trustee was negligent in ascertaining the pertinent facts; and

         (3)      the Trustee shall not be liable with respect to any action
    taken or omitted to be taken by it in good faith in accordance with the
    direction of the Holders of a majority in principal amount of the
    Outstanding Securities, relating to the time, method and place of conducting
    any proceeding for any remedy available to the Trustee, or exercising any
    trust or power conferred upon the Trustee, under this Indenture.

                  Notwithstanding the foregoing, no provision of this Indenture
shall require the Trustee to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties hereunder, or in the
exercise of any of its rights or powers, if it shall have reasonable grounds for
believing that repayment of such funds or adequate indemnity against such risk
or liability is not reasonably assured to it. Whether or not therein expressly
so provided, every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section.

SECTION 6.02.     Notice of Defaults.

                  The Trustee shall give the Holders notice of any default
hereunder actually known by the Trustee as and to the extent provided by the
Trust Indenture Act; provided, however, that in the case of any default of the
character specified in Section 5.01(5), no such notice to Holders shall be given
until at least 60 days after the occurrence thereof. For the purpose of this
Section, the term "default" means any event which is, or after notice or lapse
of time or both would become, an Event of Default.

SECTION 6.03.     Certain Rights of Trustee.

                  Subject to the provisions of Section 6.01:

         (a)      the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document believed by it
to be genuine and to have been signed or presented by the proper party or
parties;

         (b)      any request or direction of the Company mentioned herein shall
be sufficiently evidenced by a Company Request or Company Order and any
resolution of the Board of Directors may be sufficiently evidenced by a Board
Resolution;

         (c)      whenever in the administration of this Indenture the Trustee
shall deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other evidence
be herein specifically prescribed) may, in the absence of bad faith on its part,
rely conclusively upon an Officer's Certificate;

         (d)      the Trustee may consult with counsel of its selection and the
written advice of such counsel or any Opinion of Counsel shall be full and
complete authorization and protection in respect of any action taken, suffered
or omitted by it hereunder in good faith and in reliance thereon;

         (e)      the Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Indenture at the request or direction
of any of the Holders pursuant to this Indenture, unless such Holders shall have
offered to the Trustee reasonable security or indemnity against the costs,
expenses and liabilities which might be incurred by it in compliance with such
request or direction;

         (f)      the Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or document, but
the Trustee, in its discretion, may make such further inquiry or investigation
into such facts or matters as it may see fit, and, if the Trustee shall
determine to make such further inquiry or investigation, it shall be entitled to
examine the books, records and premises of the Company, personally or by agent
or attorney;

         (g)      the Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder;

         (h)      the rights, privileges, protections, immunities and benefits
given to the Trustee, including, without limitation, its right to be
indemnified, are extended to, and shall be enforceable by, the Trustee in each
of its capacities hereunder, and each agent, custodian and other Person employed
to act hereunder;

         (i)      the Trustee may request that the Company deliver an Officers'
Certificate setting forth the names of individuals and/or titles of officers
authorized at such time to take specified actions pursuant to this Indenture,
which Officers' Certificate may be signed by any person authorized to sign an
Officers' Certificate, including any person specified as so authorized in any
such certificate previously delivered and not superseded;

         (j)      in no event shall the Trustee be responsible or liable for
special, indirect or consequential loss or damage of any kind whatsoever
(including, but not limited to, loss of profit) irrespective of whether the
Trustee has been advised of the likelihood of such loss or damage and regardless
of the form of action;

         (k)      in no event shall the Trustee be responsible or liable for any
failure or delay in the performance of its obligations under this Indenture
arising out of or caused by, directly or indirectly, forces beyond its control,
including without limitation strikes, work stoppages, accidents, acts of war or
terrorism, civil or military disturbances, nuclear or natural catastrophes or
acts of God, and interruptions, loss or malfunctions of utilities,
communications or computer (software and hardware) services; it being understood
that the Trustee shall use reasonable efforts which are consistent with accepted
practices in the banking industry to resume performance as soon as practicable
under the circumstances; and

         (l)      the Trustee shall not be deemed to have notice of any Default
or Event of Default unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless written notice of any event which is in fact such a
default is received by the Trustee at the Corporate Trust Office of the Trustee,
and such notice references the Securities and this Indenture.

SECTION 6.04.     Not Responsible for Recitals or Issuance of Securities.

                  The recitals contained herein and in the Securities, except
the Trustee's certificates of authentication, shall be taken as the statements
of the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this
Indenture or of the Securities. The Trustee shall not be accountable for the use
or application by the Company of Securities or the proceeds thereof.

SECTION 6.05.     May Hold Securities.

                  The Trustee, any Authenticating Agent, any Paying Agent, any
Security Registrar or any other agent of the Company, in its individual or any
other capacity, may become the owner or pledgee of Securities and, subject to
Sections 6.08 and 6.13, may otherwise deal with the Company with the same rights
it would have if it were not Trustee, Authenticating Agent, Paying Agent,
Security Registrar or such other agent.

SECTION 6.06.     Money Held in Trust.

                  Money held by the Trustee in trust hereunder need not be
segregated from other funds except to the extent required by law. The Trustee
shall be under no liability for interest on any money received by it hereunder
except as otherwise agreed with the Company.

SECTION 6.07.     Compensation and Reimbursement.

                  The Company agrees

         (1)      to pay to the Trustee from time to time such compensation as
    the Company and the Trustee shall from time to time agree for all services
    rendered by it hereunder (which compensation shall not be limited by any
    provision of law in regard to the compensation of a trustee of an express
    trust);

         (2)      except as otherwise expressly provided herein, to reimburse
    the Trustee upon its request for all reasonable expenses, disbursements and
    advances incurred or made by the Trustee in accordance with any provision of
    this Indenture (including the reasonable compensation and the expenses and
    disbursements of its agents and counsel), except any such expense,
    disbursement or advance as may be attributable to its negligence or bad
    faith; and

         (3)      to indemnify the Trustee and its officers and agents for, and
    to hold them harmless against, any loss, liability, damage, claims or
    expense incurred without negligence or bad faith on its part, arising out of
    or in connection with the acceptance or administration of this trust,
    including the costs and expenses of defending itself against any claim or
    liability in connection with the exercise or performance of any of its
    powers or duties hereunder.

                  When the Trustee incurs expenses or renders services in
connection with an Event of Default specified in Section 5.01(8) or Section
5.01(9), the expenses (including the reasonable charges and expenses of its
counsel) and the compensation for the services are intended to constitute
expenses of administration under any applicable Federal or state bankruptcy,
insolvency or other similar law.

                  The provisions of this Section shall survive the termination
of this Indenture and the resignation or removal of the Trustee.

SECTION 6.08.     Disqualification; Conflicting Interests.

                  If the Trustee has or shall acquire a conflicting interest
within the meaning of the Trust Indenture Act, the Trustee shall either
eliminate such interest or resign, to the extent and in the manner provided by,
and subject to the provisions of, the Trust Indenture Act and this Indenture.

SECTION 6.09.     Corporate Trustee Required; Eligibility.

                  There shall at all times be a Trustee hereunder which shall be
a Person that is eligible pursuant to the Trust Indenture Act to act as such and
has a combined capital and surplus of at least $50,000,000 and its Corporate
Trust Office in The City of New York, New York. If such Person publishes reports
of condition at least annually, pursuant to law or to the requirements of said
supervising or examining authority, then for the purposes of this Section, the
combined capital and surplus of such Person shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. If at any time the Trustee shall cease to be eligible in accordance
with the provisions of this Section, it shall resign immediately in the manner
and with the effect hereinafter specified in this Article.

SECTION 6.10.     Resignation and Removal; Appointment of Successor.

         (a)      No resignation or removal of the Trustee and no appointment of
a successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee under Section 6.11.

         (b)      The Trustee may resign at any time by giving written notice
thereof to the Company. If an instrument of acceptance by a successor Trustee
shall not have been delivered to the Trustee within 30 days after the giving of
such notice of resignation, the resigning Trustee may petition any court of
competent jurisdiction for the appointment of a successor Trustee.

         (c)      The Trustee may be removed at any time by Act of the Holders
of a majority in principal amount of the Outstanding Securities, delivered to
the Trustee and to the Company.

         (d)      If at any time:

         (1)      the Trustee shall fail to comply with Section 6.08 after
    written request therefor by the Company or by any Holder who has been a bona
    fide Holder of a Security for at least six months, or

         (2)      the Trustee shall cease to be eligible under Section 6.09 and
    shall fail to resign after written request therefor by the Company or by any
    such Holder, or

         (3)      the Trustee shall become incapable of acting or shall be
    adjudged a bankrupt or insolvent or a receiver of the Trustee or of its
    property shall be appointed or any public officer shall take charge or
    control of the Trustee or of its property or affairs for the purpose of
    rehabilitation, conservation or liquidation,

then, in any such case, (i) the Company by a Board Resolution may remove the
Trustee, or (ii) subject to Section 5.14, any Holder who has been a bona fide
Holder of a Security for at least six months may, on behalf of himself and all
others similarly situated, petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor Trustee.

         (e)      If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause, the
Company, by a Board Resolution, shall promptly appoint a successor Trustee. If,
within one year after such resignation, removal or incapability, or the
occurrence of such vacancy, a successor Trustee shall be appointed by Act of the
Holders of a majority in principal amount of the Outstanding Securities
delivered to the Company and the retiring Trustee, the successor Trustee so
appointed shall, forthwith upon its acceptance of such appointment, become the
successor Trustee and supersede the successor Trustee appointed by the Company.
If no successor Trustee shall have been so appointed by the Company or the
Holders and accepted appointment in the manner hereinafter provided, any Holder
who has been a bona fide Holder of a Security for at least six months may, on
behalf of himself and all others similarly situated, petition any court of
competent jurisdiction for the appointment of a successor Trustee.

         (f)      The Company shall give notice of each resignation and each
removal of the Trustee and each appointment of a successor Trustee to all
Holders in the manner provided in Section 1.06. Each notice shall include the
name of the successor Trustee and the address of its Corporate Trust Office.

SECTION 6.11.     Acceptance of Appointment by Successor.

                  Every successor Trustee appointed hereunder shall execute,
acknowledge and deliver to the Company and to the retiring Trustee an instrument
accepting such appointment, and thereupon the resignation or removal of the
retiring Trustee shall become effective and such successor Trustee, without any
further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee; but, on request of the
Company, or the successor Trustee, such retiring Trustee shall, upon payment of
its charges, execute and deliver an instrument transferring to such successor
Trustee all the rights, powers and trusts of the retiring Trustee and shall duly
assign, transfer and deliver to such successor Trustee all property and money
held by such retiring Trustee hereunder. Upon request of any such successor
Trustee, the Company shall execute any and all instruments for more fully and
certainly vesting in and confirming to such successor Trustee all such rights,
powers and trusts.

                  No successor Trustee shall accept its appointment unless at
the time of such acceptance such successor Trustee shall be qualified and
eligible under this Article.

SECTION 6.12.     Merger, Conversion, Consolidation or Succession to Business.

                  Any corporation into which the Trustee may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Trustee shall be a
party, or any corporation succeeding to all or substantially all the corporate
trust business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise qualified and eligible under this
Article, without the execution or filing of any paper or any further act on the
part of any of the parties hereto. In case any Securities shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such Securities.

SECTION 6.13.     Preferential Collection of Claims Against Company.

                  If and when the Trustee shall be or become a creditor of the
Company (or any other obligor upon the Securities), the Trustee shall be subject
to the provisions of the Trust Indenture Act regarding the collection of claims
against the Company (or any such other obligor).

SECTION 6.14.     Appointment of Authenticating Agent.

                  The Trustee may appoint an Authenticating Agent or Agents
which shall be authorized to act on behalf of the Trustee to authenticate
Securities issued upon original issue and upon exchange, registration of
transfer or partial redemption or pursuant to Section 3.06, and Securities so
authenticated shall be entitled to the benefits of this Indenture and shall be
valid and obligatory for all purposes as if authenticated by the Trustee
hereunder. Wherever reference is made in this Indenture to the authentication
and delivery of Securities by the Trustee or the Trustee's certificate of
authentication, such reference shall be deemed to include authentication and
delivery on behalf of the Trustee by an Authenticating Agent and a certificate
of authentication executed on behalf of the Trustee by an Authenticating Agent.
Each Authenticating Agent shall be acceptable to the Company and shall at all
times be a corporation organized and doing business under the laws of the United
States of America, any State thereof or the District of Columbia, authorized
under such laws to act as Authenticating Agent, having a combined capital and
surplus of not less than $50,000,000 and subject to supervision or examination
by Federal or State authority. If such Authenticating Agent publishes reports of
condition at least annually, pursuant to law or to the requirements of said
supervising or examining authority, then for the purposes of this Section, the
combined capital and surplus of such Authenticating Agent shall be deemed to be
its combined capital and surplus as set forth in its most recent report of
condition so published. If at any time an Authenticating Agent shall cease to be
eligible in accordance with the provisions of this Section, such Authenticating
Agent shall resign immediately in the manner and with the effect specified in
this Section.

                  Any corporation into which an Authenticating Agent may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which such
Authenticating Agent shall be a party, or any corporation succeeding to the
corporate agency or corporate trust business of an Authenticating Agent, shall
continue to be an Authenticating Agent, provided such corporation shall be
otherwise eligible under this Section, without the execution or filing of any
paper or any further act on the part of the Trustee or the Authenticating Agent.

                  An Authenticating Agent may resign at any time by giving
written notice thereof to the Trustee and to the Company. The Trustee may at any
time terminate the agency of an Authenticating Agent by giving written notice
thereof to such Authenticating Agent and to the Company. Upon receiving such a
notice of resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall mail written notice of
such appointment by first-class mail, postage prepaid, to all Holders as their
names and addresses appear in the Security Register. Any successor
Authenticating Agent upon acceptance of its appointment hereunder shall become
vested with all the rights, powers and duties of its predecessor hereunder, with
like effect as if originally named as an Authenticating Agent. No successor
Authenticating Agent shall be appointed unless eligible under the provisions of
this Section.

                  The Trustee agrees to pay to each Authenticating Agent from
time to time reasonable compensation for its services under this Section, and
the Trustee shall be entitled to be reimbursed for such payments, subject to the
provisions of Section 6.07.

                  If an appointment is made pursuant to this Section, the
Securities may have endorsed thereon, in addition to the Trustee's certificate
of authentication, an alternative certificate of authentication in the following
form:

Dated:

   This is one of the Securities described in the within-mentioned Indenture.


                                  THE BANK OF NEW YORK,
                                    As Trustee

                                  By
                                    --------------------------------------------
                                       As Authenticating Agent
                                  By
                                    --------------------------------------------
                                       Authorized Signatory



                                 ARTICLE SEVEN

                Holders' Lists and Reports by Trustee and Company

SECTION 7.01.     Company to Furnish Trustee Names and Addresses of Holders.

                  The Company will furnish or cause to be furnished to the
Trustee

         (a)      semi-annually, not more than 15 days after each Regular Record
Date, a list, in such form as the Trustee may reasonably require, of the names
and addresses of the Holders as of such Regular Record Date, and

         (b)      at such other times as the Trustee may request in writing,
within 30 days after the receipt by the Company of any such request, a list of
similar form and content as of a date not more than 15 days prior to the time
such list is furnished;

excluding from any such list names and addresses received by the Trustee in its
capacity as Security Registrar.

SECTION 7.02.     Preservation of Information; Communications to Holders.

         (a)      The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders contained in the most
recent list furnished to the Trustee as provided in Section 7.01 and the names
and addresses of Holders received by the Trustee in its capacity as Security
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 7.01 upon receipt of a new list so furnished.

         (b)      The rights of Holders to communicate with other Holders with
respect to their rights under this Indenture or under the Securities, and the
corresponding rights and duties of the Trustee, shall be as provided by the
Trust Indenture Act.

         (c)      Every Holder of Securities, by receiving and holding the same,
agrees with the Company, and the Trustee that neither the Company nor the
Trustee nor any agent of either of them shall be held accountable by reason of
any disclosure of information as to names and addresses of Holders made pursuant
to the Trust Indenture Act.

SECTION 7.03.     Reports by Trustee.

         (a)      The Trustee shall transmit to Holders such reports concerning
the Trustee and its actions under this Indenture as may be required pursuant to
the Trust Indenture Act at the times and in the manner provided pursuant
thereto. If required by Section 3.13(a) of the Trust Indenture Act, the Trustee
shall, within 60 days after each May 15 following the date of this Indenture
deliver to Holders a brief report, dated as of such May 15, which complies with
the provisions of such Section 3.13(a).

         (b)      A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Trustee with each stock exchange upon
which the Securities are listed, with the Commission and with the Company. The
Company will notify the Trustee when the Securities are listed on any stock
exchange.

SECTION 7.04.     Reports by Company.

                  The Company shall file with the Trustee and the Commission,
and transmit to Holders, such information, documents and other reports, and such
summaries thereof, as may be required pursuant to the Trust Indenture Act at the
times and in the manner provided pursuant to such Act; provided that any such
information, documents or reports required to be filed with the Commission
pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 shall be
filed with the Trustee within 15 days after the same is so required to be filed
with the Commission. Delivery of such reports, information and documents to the
Trustee is for informational purposes only and the Trustee's receipt of such
shall not constitute constructive notice of any information contained therein,
including the Company's compliance with any of its covenants hereunder (as to
which the Trustee is entitled to rely exclusively on Officer's Certificates).

SECTION 7.05.     Officer's Certificate with Respect to Change in Interest Rates

                  Within five days after any Step-Up or Additional Step-Up or
Step-Down Date, the Company shall deliver an Officer's Certificate to the
Trustee stating the interest rate thereupon in effect for the Outstanding
Securities (if any are Outstanding) and the date on which such rate became
effective.

                                 ARTICLE EIGHT

              Consolidation, Merger, Conveyance, Transfer or Lease

SECTION 8.01.     Company May Consolidate, Etc., Only on Certain Terms.

                  The Company shall not consolidate with or merge into any other
Person or convey, transfer or lease its properties and assets substantially as
an entirety to any Person, and the Company shall not permit any Person to
consolidate with or merge into the Company or convey, transfer or lease its
properties and assets substantially as an entirety to the Company, unless:

                  (1)   in a transaction in which the Company does not survive
         or in which the Company sells, leases or otherwise disposes of all or
         substantially all of its assets, the successor entity to the Company
         (A) shall expressly assume, by a supplemental indenture executed and
         delivered to the Trustee in form satisfactory to the Trustee, all of
         the Company's obligations under the Indenture and (B) is organized
         under the laws of (x) Luxembourg or (y) the United States of America or
         any State thereof or the District of Columbia or (z) any other country
         if such successor entity undertakes, in such supplemental indenture, to
         pay such additional amounts in respect of principal (and premium, if
         any) and interest as may be necessary in order that the net amounts
         paid pursuant to the Securities after deduction or withholding of any
         present or future withholding taxes, levies, imports or charges
         whatsoever imposed by or for the account of such country or any
         political subdivision or taxing authority thereof or therein shall
         equal the respective amounts of principal (and premium, if any) and
         interest specified in the Securities;

                  (2)   immediately after giving effect to such transaction and
         treating any Debt which becomes an obligation of the Company or a
         Restricted Subsidiary of the Company, Restricted Affiliate or
         Restricted Subsidiary of a Restricted Affiliate as a result of such
         transaction as having been Incurred by the Company or such Restricted
         Subsidiary of the Company, Restricted Affiliate or Restricted
         Subsidiary of a Restricted Affiliate at the time of such transaction,
         no Event of Default, and no event that with the passing of time or the
         giving of notice or both would constitute an Event of Default, shall
         have occurred and be continuing; and

                  (3)   immediately after giving effect to such transaction, and
         treating any Debt which becomes an obligation of the Company or a
         Restricted Subsidiary of the Company, Restricted Affiliate or
         Restricted Subsidiary of a Restricted Affiliate as a result of such
         transaction as having been Incurred by the Company or such Restricted
         Subsidiary of the Company, Restricted Affiliate or Restricted
         Subsidiary of a Restricted Affiliate at the time of the transaction,
         the Company (including any successor entity to the Company) could Incur
         at least $1.00 of additional Debt pursuant to the provisions of the
         first paragraph of Section 10.08; provided, however, that this Clause
         (3) will not apply if, in the good faith determination of the Board of
         Directors of the Company, whose determination shall be evidenced by a
         Board Resolution, the principal purpose of such transaction is to
         change the jurisdiction of incorporation of the Company;

                  (4)   if, as a result of any such consolidation or merger or
         such conveyance, transfer or lease, properties or assets of the Company
         would become subject to a mortgage, pledge, lien, security interest or
         other encumbrance which would not be permitted by Section 10.12, the
         Company or such successor Person, as the case may be, shall take such
         steps as shall be necessary effectively to secure the Securities
         equally and ratably with (or prior to) all indebtedness secured
         thereby; and

                  (5)   the Company has delivered to the Trustee an Officer's
         Certificate and an Opinion of Counsel, each stating that such
         consolidation, merger, conveyance, transfer or lease and, if a
         supplemental indenture is required in connection with such transaction,
         such supplemental indenture comply with this Article and that all
         conditions precedent herein provided for relating to such transaction
         have been complied with.

SECTION 8.02.     Successor Substituted.

                  Upon any consolidation of the Company with, or merger of the
Company into, any other Person or any conveyance, transfer or lease of the
properties and assets of the Company substantially as an entirety in accordance
with Section 8.01, the successor Person formed by such consolidation or into
which the Company is merged or to which such conveyance, transfer or lease is
made shall succeed to, and be substituted for, and may exercise every right and
power of, the Company under this Indenture with the same effect as if such
successor Person had been named as the Company herein, and thereafter, except in
the case of a lease, the predecessor Person shall be relieved of all obligations
and covenants under this Indenture and the Securities.

                                  ARTICLE NINE

                             Supplemental Indentures

SECTION 9.01.     Supplemental Indentures Without Consent of Holders.

                  Without the consent of any Holders, the Company, when
authorized by a Board Resolution, and the Trustee, at any time and from time to
time, may enter into one or more indentures supplemental hereto, in form
satisfactory to the Trustee, for any of the following purposes:

                  (1)   to evidence the succession of another Person to the
         Company and the assumption by any such successor of the covenants of
         the Company herein and in the Securities; or

                  (2)   to add to the covenants of the Company for the benefit
         of the Holders, or to surrender any right or power herein conferred
         upon the Company; or

                  (3)   to secure the Securities pursuant to the requirements of
         Section 10.12 or otherwise; or

                  (4)   to modify, eliminate or add to the provisions of this
         Indenture to such extent as shall be necessary to comply with any
         requirement of the Commission in order to effect qualification of this
         Indenture under the Trust Indenture Act in connection with the Resale
         Registration Statement or thereafter to maintain the qualification of
         this Indenture under the Trust Indenture Act; or

                  (5)   to cure any ambiguity, to correct or supplement any
         provision herein which may be inconsistent with any other provision
         herein, or to make any other provisions with respect to matters or
         questions arising under this Indenture which shall not be inconsistent
         with the provisions of this Indenture, provided that such action
         pursuant to this Clause (5) shall not adversely affect the interests of
         the Holders in any material respect; or

                  (6)   to modify, eliminate or add to Article Three and other
         provisions of this Indenture regarding registration, transfer and
         exchange of securities to such extent as may be necessary to issue
         additional Securities in order to comply with applicable law; or

                  (7)   to modify, eliminate or add to the provisions of this
         Indenture to permit or facilitate the issuance of Global Securities and
         matters related thereto, provided that such action pursuant to this
         Clause (7) shall not adversely affect the interests of the Holders in
         any material respect.

SECTION 9.02.     Supplemental Indentures with Consent of Holders.

                  With the consent of the Holders of not less than majority in
aggregate principal amount of the Outstanding Securities, by Act of said Holders
delivered to the Company and the Trustee, the Company, when authorized by a
Board Resolution, and the Trustee may enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture or of
modifying in any manner the rights of the Holders under this Indenture
(including, without limitation, any modification to the provisions of this
Indenture with respect to any Offer to Purchase, provided such modifications are
effected prior to the mailing to any Holder of an Offer Document with respect to
such Offer to Purchase); provided, however, that no such supplemental indenture
shall, without the consent of the Holder of each Outstanding Security affected
thereby,

                  (1)   change the Stated Maturity of the principal of, or any
         installment of interest on, any  Security, or reduce the principal
         amount thereof (including the amount of any Amortization Payment) or
         the rate of interest thereon or any premium payable upon the redemption
         thereof, or change the place of payment where, or the coin or currency
         in which, any Security or any premium or interest thereon is payable,
         or impair the right to institute suit for the enforcement of any such
         payment on or after the Stated Maturity thereof (or, in the case of
         redemption, on or after the Redemption Date or Amortization Payment
         Date, as applicable, or, in the case of an Offer to Purchase which has
         been made, on or after the applicable Purchase Date), or

                  (2)   reduce the percentage in principal amount of the
         Outstanding Securities, the consent of whose Holders is required for
         any such supplemental indenture, or the consent of whose Holders is
         required for any waiver (of compliance with certain provisions of this
         Indenture or certain defaults hereunder and their consequences)
         provided for in this Indenture, or

                  (3)   modify any of the provisions of this Section, Section
         5.13 or Section 10.19, except to increase any such percentage or to
         provide that certain other provisions of this Indenture cannot be
         modified or waived without the consent of the Holder of each
         Outstanding Security affected thereby, or

                  (4)   following the mailing to a Holder of an Offer Document
         with respect to an Offer to Purchase and until the Expiration Date of
         such Offer to Purchase, modify the provisions of this Indenture with
         respect to such Offer to Purchase in a manner adverse to such Holder.

                  It shall not be necessary for any Act of Holders under this
Section to approve the particular form of any proposed supplemental indenture,
but it shall be sufficient if such Act shall approve the substance thereof.

SECTION 9.03.     Execution of Supplemental Indentures.

                  In executing, or accepting the additional trusts created by,
any supplemental indenture permitted by this Article or the modifications
thereby of the trusts created by this Indenture, the Trustee shall be entitled
to receive, and (subject to Section 6.01) shall be fully protected in relying
upon, an Opinion of Counsel stating that the execution of such supplemental
indenture is authorized or permitted by this Indenture. The Trustee may, but
shall not be obligated to, enter into any such supplemental indenture which
affects the Trustee's own rights, duties or immunities under this Indenture or
otherwise.

SECTION 9.04.     Effect of Supplemental Indentures.

                  Upon the execution of any supplemental indenture under this
Article, this Indenture shall be modified in accordance therewith, and such
supplemental indenture shall form a part of this Indenture for all purposes; and
every Holder of Securities theretofore or thereafter authenticated and delivered
hereunder shall be bound thereby.

SECTION 9.05.     Conformity with Trust Indenture Act.

                  Every supplemental indenture executed pursuant to this Article
shall conform to the requirements of the Trust Indenture Act.

SECTION 9.06.     Reference in Securities to Supplemental Indentures.

                  Securities authenticated and delivered after the execution of
any supplemental indenture pursuant to this Article may, and shall if required
by the Trustee, bear a notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. If the Company shall so determine,
new Securities so modified as to conform, in the opinion of the Trustee and the
Company, to any such supplemental indenture may be prepared and executed by the
Company and authenticated and delivered by the Trustee in exchange for
Outstanding Securities.

                                  ARTICLE TEN

                                   Covenants

SECTION 10.01.    Payment of Principal (including Amortization Payments),
                  Premium and Interest.

                  The Company will duly and punctually pay the principal of,
including Amortization Payments, (and premium, if any) and interest (including
Special Interest, if any) on the Securities in accordance with the terms of the
Securities and this Indenture.

SECTION 10.02.    Maintenance of Office or Agency.

                  The Company will maintain in the Borough of Manhattan, the
City of New York an office or agency where Securities may be presented or
surrendered for payment, where Securities may be surrendered for registration of
transfer or exchange, where Securities may be surrendered for conversion and
where notices and demands to or upon the Company in respect of the Securities
and this Indenture may be served. The Company will give prompt written notice to
the Trustee of the location, and any change in the location, of such office or
agency. If at any time the Company shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Trustee, and the Company hereby appoints the
Trustee as its agent to receive all such presentations, surrenders, notices and
demands.

                  The Company may also from time to time designate one or more
other offices or agencies (in or outside the Borough of Manhattan, City of New
York) where the Securities may be presented or surrendered for any or all such
purposes and may from time to time rescind such designations; provided, however,
that no such designation or rescission shall in any manner relieve the Company
of its obligation to maintain an office or agency in the Borough of Manhattan,
City of New York for such purposes. The Company will give prompt written notice
to the Trustee of any such designation or rescission and of any change in the
location of any such other office or agency.

SECTION 10.03.    Money for Security Payments to Be Held in Trust.

                  If the Company shall at any time act as its own Paying Agent,
it will, on or before each due date of the principal of, including Amortization
Payments, (and premium, if any) or interest on any of the Securities, segregate
and hold in trust for the benefit of the Persons entitled thereto a sum
sufficient to pay the principal, including Amortization Payments, (and premium,
if any) or interest so becoming due until such sums shall be paid to such
Persons or otherwise disposed of as herein provided and will promptly notify the
Trustee of its action or failure so to act.

                  Whenever the Company shall have one or more Paying Agents, it
will, prior to each due date of the principal of, including Amortization
Payments, (and premium, if any) or interest on any Securities, deposit with a
Paying Agent a sum sufficient to pay such amount, such sum to be held as
provided by the Trust Indenture Act, and (unless such Paying Agent is the
Trustee) the Company will promptly notify the Trustee of its action or failure
so to act.

                  The Company will cause each Paying Agent other than the
Trustee to execute and deliver to the Trustee an instrument in which such Paying
Agent shall agree with the Trustee, subject to the provisions of this Section,
that such Paying Agent will (i) comply with the provisions of the Trust
Indenture Act applicable to it as a Paying Agent and (ii) during the continuance
of any default by the Company (or any other obligor upon the Securities) in the
making of any payment in respect of the Securities, upon the written request of
the Trustee, forthwith pay to the Trustee all sums held in trust by such Paying
Agent as such.

                  The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee,
such Paying Agent shall be released from all further liability with respect to
such money.

                  Any money deposited with the Trustee or any Paying Agent, or
then held by the Company, in trust for the payment of the principal of,
including Amortization Payments, (and premium, if any) or interest on any
Security and remaining unclaimed for two years after such principal (and
premium, if any) or interest has become due and payable shall be paid to the
Company on Company Request, or (if then held by the Company) shall be discharged
from such trust; and the Holder of such Security shall thereafter, as an
unsecured general creditor, look only to the Company for payment thereof, and
all liability of the Trustee or such Paying Agent with respect to such trust
money, and all liability of the Company as trustee thereof, shall thereupon
cease; provided, however, that the Trustee or such Paying Agent, before being
required to make any such repayment, may at the expense of the Company cause to
be published once, in a newspaper published in the English language, customarily
published on each Business Day and of general circulation in the Borough of
Manhattan, The City of New York, notice that such money remains unclaimed and
that, after a date specified therein, which shall not be less than 30 days from
the date of such publication, any unclaimed balance of such money then remaining
will be repaid to the Company.

SECTION 10.04.    Statement by Officers as to Default; Compliance Certificates.

         (a)      The Company will deliver to the Trustee, within 90 days after
the end of each fiscal year of the Company ending after the date of this
Indenture an Officer's Certificate, stating whether or not to the best knowledge
of the signers thereof the Company is in default in the performance and
observance of any of the terms, provisions and conditions of this Indenture
(without regard to any period of grace or requirement of notice provided
hereunder) and, if the Company shall be in default, specifying all such defaults
and the nature and status thereof of which they may have knowledge.

         (b)      The Company shall deliver to the Trustee, as soon as possible
and in any event within 30 days after the Company becomes aware of the
occurrence of an Event of Default or an event which, with notice or the lapse of
time or both, would constitute an Event of Default, an Officer's Certificate
setting forth the details of such Event of Default or default, and the action
which the Company proposes to take with respect thereto.

SECTION 10.05.    Existence.

                  Subject to Article Eight, the Company will do or cause to be
done all things necessary to preserve and keep in full force and effect its
existence, rights (charter and statutory) and franchises; provided, however,
that the Company shall not be required to preserve any such right or franchise
if the Board of Directors shall determine that the preservation thereof is no
longer desirable in the conduct of the business of the Company and that the loss
thereof is not disadvantageous in any material respect to the Holders.

SECTION 10.06.    Maintenance of Properties.

                  The Company will cause all properties used or useful in the
conduct of its business or the business of any Subsidiary to be maintained and
kept in good condition, repair and working order and supplied with all necessary
equipment and will cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the judgment of
the Company may be necessary so that the business carried on in connection
therewith may be properly and advantageously conducted at all times; provided,
however, that nothing in this Section shall prevent the Company from
discontinuing the operation or maintenance of any of such properties if such
discontinuance is, in the judgment of the Company, desirable in the conduct of
its business or the business of any Restricted Subsidiary and not
disadvantageous in any material respect to the Holders.

                  The Company shall, and shall cause the Restricted Subsidiaries
of the Company to, keep at all times all of their properties which are of an
insurable nature insured against loss or damage with insurers believed by the
Company to be responsible to the extent that property of similar character is
usually so insured by corporations similarly situated and owning like properties
in accordance with good business practice.

SECTION 10.07.    Payment of Taxes and Other Claims.

                  The Company will pay or discharge or cause to be paid or
discharged, before the same shall become delinquent, (1) all taxes, assessments
and governmental charges levied or imposed upon the Company or any Restricted
Subsidiary or upon the income, profits or property of the Company or any
Restricted Subsidiary, and (2) all lawful claims for labor, materials and
supplies which, if unpaid, might by law become a lien upon the property of the
Company or any Restricted Subsidiary; provided, however, that the Company shall
not be required to pay or discharge or cause to be paid or discharged any such
tax, assessment, charge or claim whose amount, applicability or validity is
being contested in good faith by appropriate proceedings.

SECTION 10.08.    Limitation on Debt.

                  The Company may not, and may not permit any Restricted
Subsidiary of the Company, Restricted Affiliate or Restricted Subsidiary of a
Restricted Affiliate to Incur any Debt, unless the Debt Coverage Ratio for the
most recently completed fiscal quarter for which financial statements are
available would be less than 7.0 to 1.

                  Notwithstanding the foregoing limitation, the following Debt
may be Incurred:

                  (1)   Debt Incurred under the Credit Facility in an aggregate
         principal amount at any one time not to exceed $200 million, and any
         renewal, extension, refinancing, refunding, substitution or replacement
         thereof in an amount which, together with any amount remaining
         outstanding or committed under the Credit Facility or any successor
         agreement, does not exceed the amount outstanding or committed under
         the Credit Facility or such successor agreement immediately prior to
         such renewal, extension, refinancing, refunding, substitution or
         replacement;

                  (2)   the original issuance by the Company of the Debt
         evidenced by the Securities;

                  (3)   Debt (other than Debt described in another clause of
         Section 10.08) outstanding, committed or mandated on the date of the
         Indenture, including but not limited to the 13-1/2% Notes;

                  (4)   Debt owed by the Company to any Wholly Owned Restricted
         Subsidiary of the Company or Debt owed by a Restricted Subsidiary of
         the Company, Restricted Affiliate or Restricted Subsidiary of a
         Restricted Affiliate to the Company, a Restricted Subsidiary of the
         Company or a Restricted Affiliate or, in the case of Debt of a
         Restricted Subsidiary of a Restricted Affiliate, to another Restricted
         Subsidiary of such Restricted Affiliate; provided, however, that upon
         either (A) the transfer or other disposition by the Company or such
         Restricted Subsidiary, Restricted Affiliate or Restricted Subsidiary of
         a Restricted Affiliate of any Debt so permitted to a Person other than
         the Company or another Restricted Subsidiary of the Company or
         Restricted Affiliate or Restricted Subsidiary of a Restricted Affiliate
         or (B) such Restricted Subsidiary, Restricted Affiliate or Restricted
         Subsidiary of a Restricted Affiliate ceasing to be a Restricted
         Subsidiary of the Company, Restricted Affiliate or Restricted
         Subsidiary of a Restricted Affiliate, the provisions of this clause (4)
         shall no longer be applicable to such Debt and such Debt shall be
         deemed to have been Incurred at the time of such transfer or other
         disposition;

                  (5)   Guarantees by the Company of Debt of a Subsidiary or
         Minority Owned Affiliate of the Company; provided that the Company then
         holds cash or Cash Equivalents not subject to any pledge, security
         interest or other encumbrance in an aggregate amount equal to not less
         than 100% of the amount of all such Guarantees then outstanding;
         provided further, that if any such Guarantee relates to Debt incurred
         in reliance on one or more of clauses (1) through (4) above or clauses
         (6) through (10) below, the amount of such cash or Cash Equivalents
         held by the Company may be reduced by an amount equal to the amount of
         such Guaranteed Debt Incurred in reliance on such clause or clauses and
         provided further, that if at any time the aggregate amount of such
         Guarantees Incurred in reliance on this clause (5) exceeds the
         aggregate amount of such cash or Cash Equivalents so held by the
         Company (plus the amount of any reduction pursuant to the foregoing
         provision), the provisions of this clause (5) shall no longer be
         applicable to such Guarantees to the extent of such excess and an
         amount of such Guarantees equal to the amount of such excess shall be
         deemed to have been Incurred at the time such deficiency arose (this
         third proviso shall be applied successively whenever the amount of such
         cash and Cash Equivalents decreases);

                  (6)   Acquired Debt;

                  (7)   Debt consisting of Permitted Interest Rate, Currency or
         Commodity Price Agreements;

                  (8)   Debt of the Company, a Restricted Subsidiary of the
         Company, a Restricted Affiliate or a Restricted Subsidiary of a
         Restricted Affiliate which is exchanged for or the proceeds of which
         are used to refinance or refund, or any extension or renewal of,
         outstanding Debt of the same entity (each of the foregoing, a
         "refinancing") in an aggregate principal amount not to exceed the
         principal amount of the Debt so refinanced plus the amount of any
         premium required to be paid in connection with such refinancing
         pursuant to the terms of the Debt so refinanced or the amount of any
         premium reasonably determined by the issuer thereof as necessary to
         accomplish such refinancing by means of a tender offer or privately
         negotiated repurchase, plus the expenses of the issuer thereof incurred
         in connection with such refinancing; provided, however, that (A) Debt
         the proceeds of which are used to refinance the Securities or Debt
         which is pari passu with or subordinate in right of payment to the
         Securities shall only be permitted if (x) in the case of any
         refinancing of the Securities or Debt which is pari passu to the
         Securities, the refinancing Debt is Incurred by the Company and made
         pari passu to the Securities or subordinated to the Securities, and (y)
         in the case of any refinancing of Debt which is subordinated to the
         Securities, the refinancing Debt is Incurred by the Company and is so
         subordinated at least to the same extent; (B) the refinancing Debt by
         its terms, or by the terms of any agreement or instrument pursuant to
         which such Debt is issued, (x) has a Weighted Average Life to Maturity
         longer than the Weighted Average Life to Maturity of the Debt being
         refinanced and (y) does not permit redemption or other retirement
         (including pursuant to an offer to purchase) of such Debt at the option
         of the holder thereof prior to the earlier of the final stated maturity
         or time of comparable redemption or retirement with respect to the Debt
         being refinanced, other than a redemption or other retirement at the
         option of the holder of such Debt (including pursuant to an offer to
         purchase) which is conditioned upon provisions substantially similar to
         those described in Sections 10.14 and 10.16;

                  (9)   Debt in an aggregate amount not exceeding $200 million
         Incurred for the purpose of funding, and the net proceeds of which are
         applied to fund, capital expenditures of the Company or any of its
         Subsidiaries or Minority Owned Affiliates; and

                  (10)  Debt not otherwise permitted to be Incurred pursuant to
         clauses (1) through (9) above, which, together with any other
         outstanding Debt Incurred pursuant to this clause (10), has an
         aggregate principal amount not in excess of $75 million at any time
         outstanding.

                  For purposes of the foregoing clauses (1) through (10), in
case of any Incurrence of Debt by a Restricted Subsidiary of the Company,
Restricted Affiliate or Restricted Subsidiary of a Restricted Affiliate, the
amount of Debt Incurred by such entity will be deemed to be the Company's Pro
Rata Portion of such Debt.

SECTION 10.09.    Limitation on Restricted Payments.

                  The Company may not, and may not permit any Restricted
Subsidiary of the Company, Restricted Affiliate or Restricted Subsidiary of a
Restricted Affiliate to, directly or indirectly, (i) declare or pay any dividend
or make any distribution in respect of the Capital Stock of the Company or to
the holders thereof, excluding any dividends or distributions by the Company
payable solely in shares of its Capital Stock (other than Redeemable Stock) or
in options, warrants or other rights to acquire its Capital Stock (other than
Redeemable Stock), (ii) purchase, redeem, or otherwise acquire or retire for
value (a) any Capital Stock of the Company or any Related Person of the Company
or (b) any options, warrants or other rights to acquire shares of Capital Stock
of the Company or any Related Person of the Company or any securities
convertible or exchangeable into shares of Capital Stock of the Company or any
Related Person of the Company, (iii) redeem, repurchase, defease or otherwise
acquire or retire for value prior to any scheduled maturity, repayment or
sinking fund payment Debt of the Company which is subordinate in right of
payment to the Securities, or (iv) make any Investment, other than Permitted
Investments (each of clauses (i) through (iv) being a "Restricted Payment") if:

                  (1)   an Event of Default, or an event that with the passing
         of time or the giving of notice, or both, would constitute an Event of
         Default, shall have occurred and is continuing or would result from
         such Restricted Payment, or

                  (2)   after giving pro forma effect to such Restricted Payment
         as if such Restricted Payment had been made at the beginning of the
         applicable fiscal-quarter period, the Company could not Incur at least
         $1.00 of additional Debt pursuant to the provisions of the first
         paragraph of Section 10.08, or

                  (3)   upon giving effect to such Restricted Payment, the
         aggregate of all Restricted Payments from the date of the Indenture
         (including for this purpose, in respect of any Investment, only the
         Company's Pro Rata Portion of such Investment), excluding those made
         pursuant to the further proviso below or pursuant to clause (ii) or
         (vi) of the next paragraph, exceeds the sum of:  (a) the difference of
         (x) 100% of  cumulative Cellular Operating Income from March 31, 1996,
         through the last day of the last full fiscal quarter ending immediately
         preceding the date of such Restricted Payment for which quarterly or
         annual financial statements are available minus (y) the product of 1.5
         times cumulative Consolidated Interest Expense from March 31, 1996,
         through the last day of the last full fiscal quarter immediately
         preceding such Restricted Payment for which quarterly or annual fiscal
         statements of the Company are available; plus (b) $10 million; plus (c)
         100% of the Company's Pro Rata Portion of the net reduction in
         Investments in any Unrestricted Subsidiary or Unrestricted Affiliate
         resulting from payments of interest on Debt, dividends, return of
         capital, repayments of loans or advances, or other transfers of assets,
         in each case to the Company or any Restricted Subsidiary of the
         Company, Restricted Affiliate or Restricted Subsidiary of a Restricted
         Affiliate from such Unrestricted Subsidiary or Unrestricted Affiliate
         (except to the extent that any such payment is included in the
         calculation of Consolidated Net Income) or from redesignations of
         Unrestricted Subsidiaries as Restricted Subsidiaries; provided that the
         amount included in this clause (c) shall not exceed the Company's Pro
         Rata Portion of the amount of Investments previously made by the
         Company and its Restricted Subsidiaries, Restricted Affiliates and
         Restricted Subsidiaries of Restricted Affiliates in such Unrestricted
         Subsidiary or Unrestricted Affiliate;

provided, further, that the Company, any Unrestricted Subsidiary of the Company,
Restricted Affiliate or Restricted Subsidiary of a Restricted Affiliate may make
any Restricted Payment with the aggregate net proceeds received by the Company
after the date of original issuance of the Securities, including the fair market
value of property other than cash (as determined in good faith by the Board of
Directors as evidenced by a resolution of the Board of Directors filed with the
Trustee), from contributions of capital or the issuance and sale (other than to
a Restricted Subsidiary of the Company, Restricted Affiliate or Restricted
Subsidiary of a Restricted Affiliate) of Capital Stock (other than Redeemable
Stock) of the Company, options, warrants or other rights to acquire Capital
Stock (other than Redeemable Stock) of the Company and Debt of the Company that
has been converted into or exchanged for Capital Stock (other than Redeemable
Stock and other than by or from a Restricted Subsidiary of the Company,
Restricted Affiliate or Restricted Subsidiary of a Restricted Affiliate) of the
Company after the date of original issuance of the Securities; provided that any
such net proceeds received by the Company from an employee stock ownership plan
financed by loans from the Company or a Subsidiary of the Company shall be
included only to the extent such loans have been repaid with cash on or prior to
the date of determination. Prior to the making of any Restricted Payment, the
Company shall deliver to the Trustee an Officer's Certificate setting forth the
computations by which the determinations required by clauses (2) and (3) above
were made and stating that no Event of Default, or event that with the passing
of time or the giving of notice, or both, would constitute an Event of Default,
has occurred and is continuing or will result from such Restricted Payment.

                  Notwithstanding the foregoing, so long as no Event of Default,
or event that with the passing of time or the giving of notice, or both, would
constitute an Event of Default, shall have occurred and is continuing or would
result therefrom, (i) the Company may pay any dividend on Capital Stock of any
class within 60 days after the declaration thereof if, on the date when the
dividend was declared, the Company could have paid such dividend in accordance
with the foregoing provisions; (ii) the Company may refinance any Debt otherwise
as permitted by clause (8) of the second paragraph under Section 10.08 or solely
in exchange for or out of the net proceeds of the substantially concurrent sale
(other than from or to a Restricted Subsidiary, Restricted Affiliate or
Restricted Subsidiary of a Restricted Affiliate or from or to an employee stock
ownership plan financed by loans from the Company or a Restricted Subsidiary of
the Company, Restricted Affiliate or Restricted Subsidiary of a Restricted
Affiliate) of shares of Capital Stock (other than Redeemable Stock) of the
Company, provided that the amount of net proceeds from such exchange or sale
shall be excluded from the calculation of the amount available for Restricted
Payments pursuant to the preceding paragraph; (iii) the Company may purchase,
redeem, acquire or retire any shares of Capital Stock of the Company solely in
exchange for or out of the net proceeds of the substantially concurrent sale
(other than from or to a Restricted Subsidiary, Restricted Affiliate or
Restricted Subsidiary of a Restricted Affiliate or from or to an employee stock
ownership plan financed by loans from the Company or a Restricted Subsidiary of
the Company, Restricted Affiliate or Restricted Subsidiary of a Restricted
Affiliate) of shares of Capital Stock (other than Redeemable Stock) of the
Company; (iv) the Company may make loans to employees in connection with such
employees' exercise of options to purchase Capital Stock or otherwise in the
ordinary course of business; (v) the Company may purchase, redeem, acquire or
retire shares of its Capital Stock for aggregate consideration not to exceed $50
million and (vi) the Company may purchase or redeem any Debt from Net Available
Proceeds to the extent permitted under Section 10.14. Any payment made pursuant
to clause (i), (iii), (iv) or (v) of this paragraph shall be a Restricted
Payment for purposes of calculating aggregate Restricted Payments pursuant to
the preceding paragraph.

SECTION 10.10.    Limitation on Dividend and Other Payment Restrictions
                  Affecting Subsidiaries.

                  The Company shall not, and shall not permit any Restricted
Subsidiary of the Company, Restricted Affiliate or Restricted Subsidiary of a
Restricted Affiliate to, directly or indirectly, create or otherwise cause or
suffer to exist or become effective any encumbrance or restriction on the
ability of any such Restricted Subsidiary of the Company, Restricted Affiliate
or Restricted Subsidiary of a Restricted Affiliate (i) to pay dividends (in cash
or otherwise) or make any other distributions in respect of its Capital Stock to
the Company or any other Restricted Subsidiary of the Company, Restricted
Affiliate or Restricted Subsidiary of a Restricted Affiliate or pay any Debt or
other obligation owed to the Company or any other such Restricted Subsidiary of
the Company, Restricted Affiliate or Restricted Subsidiary of a Restricted
Affiliate; (ii) to make loans or advances to the Company or any other Restricted
Subsidiary of the Company, Restricted Affiliate or Restricted Subsidiary of a
Restricted Affiliate; or (iii) to transfer any of its property or assets to the
Company or any other Restricted Subsidiary of the Company, Restricted Affiliate
or Restricted Subsidiary of a Restricted Affiliate.

                  Notwithstanding the foregoing, the Company may, and may permit
any Restricted Subsidiary of the Company, Restricted Affiliate or Restricted
Subsidiary of a Restricted Affiliate to, suffer to exist any such encumbrance or
restriction

         (a)      pursuant to any agreement in effect on the date of original
issuance of the Securities;

         (b)      pursuant to an agreement relating to any Debt Incurred by a
Person (other than a Restricted Subsidiary of the Company, Restricted Affiliate
or Restricted Subsidiary of a Restricted Affiliate existing on the date of
original issuance of the Securities or any Person carrying on any of the
businesses of any such Restricted Subsidiary of the Company, Restricted
Affiliate or Restricted Subsidiary of a Restricted Affiliate) prior to the date
on which such Person became such a Restricted Subsidiary of the Company,
Restricted Affiliate or Restricted Subsidiary of a Restricted Affiliate and
outstanding on such date and not Incurred in anticipation of becoming such a
Restricted Subsidiary of the Company, Restricted Affiliate or Restricted
Subsidiary of a Restricted Affiliate, which encumbrance or restriction is not
applicable to any Person, or the properties or assets of any Person, other than
the Person so acquired;

         (c)      pursuant to an agreement by which a Restricted Subsidiary,
Restricted Affiliate or Restricted Subsidiary of a Restricted Affiliate obtains
financing, provided that (x) such restriction is not materially more restrictive
than customary provisions in comparable financing agreements and (y) management
of the Company determines that at the time such agreement is entered into such
restriction will not materially impair the Company's ability to make payments on
the Securities, such determination to be confirmed not less frequently than once
a year by an Officer's Certificate delivered to the Trustee;

         (d)      pursuant to an agreement effecting a renewal, refunding or
extension of Debt Incurred pursuant to an agreement referred to in clause (a) or
(b) or (c) above, provided, however, that the provisions contained in such
renewal, refunding or extension agreement relating to such encumbrance or
restriction are no more restrictive in any material respect than the provisions
contained in the agreement the subject thereof, as determined in good faith by
management of the Company, such determination to be confirmed not less
frequently than once a year by an Officer's Certificate delivered to the
Trustee;

         (e)      in the case of clause (iii) above, restrictions contained in
any security agreement (including a capital lease) securing Debt of a Restricted
Subsidiary of the Company, Restricted Affiliate or Restricted Subsidiary of a
Restricted Affiliate otherwise permitted under the Indenture, but only to the
extent such restrictions restrict the transfer of the property subject to such
security agreement;

         (f)      in the case of clause (iii) above, customary nonassignment
provisions entered into in the ordinary course of business consistent with past
practices in leases to the extent such provisions restrict the transfer or
subletting of any such lease;

         (g)      any restriction with respect to a Restricted Subsidiary of the
Company, Restricted Affiliate or Restricted Subsidiary of a Restricted Affiliate
imposed pursuant to an agreement which has been entered into for the sale or
disposition of all or substantially all of the Capital Stock or assets of such
Restricted Subsidiary or Restricted Affiliate, provided that consummation of
such transaction would not result in an Event of Default or an event that, with
the passing of time or the giving of notice or both, would constitute an Event
of Default, that such restriction terminates if such transaction is closed or
abandoned and that the closing or abandonment of such transaction occurs within
one year of the date such agreement was entered into; or

         (h)      such encumbrance or restriction is the result of applicable
law or regulation.

SECTION 10.11.    [RESERVED]

SECTION 10.12.    Limitation on Liens Securing Company Subordinated Debt.

                  The Company shall not, and shall not permit any Restricted
Subsidiary of the Company, Restricted Affiliate or Restricted Subsidiary of a
Restricted Affiliate to, Incur or suffer to exist any Lien on or with respect to
any property or assets now owned or hereafter acquired to secure any Debt of the
Company that is expressly by its terms subordinate or junior in right of payment
to any other Debt of the Company without making, or causing such Restricted
Subsidiary or Restricted Affiliate to make, effective provision for securing the
Securities (x) equally and ratably with such Debt as to such property or assets
for so long as such Debt will be so secured or (y) in the event such Debt is
subordinate in right of payment to the Securities, prior to such Debt as to such
property or assets for so long as such Debt will be so secured.

SECTION 10.13.    Limitation on Guarantees of Company Subordinated Debt.

                  The Company shall not permit any Restricted Subsidiary of the
Company, Restricted Affiliate or Restricted Subsidiary of a Restricted
Affiliate, directly or indirectly, to assume, Guarantee or in any other manner
become liable with respect to any Debt of the Company that is expressly by its
terms subordinate or junior in right of payment to any other Debt of the
Company.

SECTION 10.14.    Limitation on Asset Dispositions.

         (a)      The Company may not, and may not permit any Restricted
Subsidiary of the Company, Restricted Affiliate or Restricted Subsidiary of a
Restricted Affiliate to, make any Asset Disposition in one or more related
transactions unless:

         (i)      the Company or such Restricted Subsidiary or Restricted
    Affiliate or Restricted Subsidiary of a Restricted Affiliate, as the case
    may be, receives consideration for such disposition at least equal to the
    fair market value for the assets sold or disposed of as determined by the
    Board of Directors in good faith and evidenced by a Board Resolution filed
    with the Trustee;

         (ii)     at least 75% of the consideration for such disposition
    consists of (a) cash or readily marketable cash equivalents or the
    assumption of Debt of the Company (other than Debt that is subordinated to
    the Securities) or of such Restricted Subsidiary of the Company or
    Restricted Affiliate or Restricted Subsidiary of a Restricted Affiliate
    relating to such assets and release from all liability on the Debt assumed
    or (b) Related Assets; and

         (iii)    the Company's Pro Rata Portion of the difference between all
    Net Available Proceeds, less any amounts invested within 360 days of such
    disposition in a Related Business or committed to such investment, are
    applied within 360 days of such disposition (1) first, to the permanent
    repayment or reduction of Senior Debt of the Company or Debt of a Restricted
    Subsidiary of the Company, Restricted Affiliate or Restricted Subsidiary of
    a Restricted Affiliate, provided that except in the case of repayment or
    reduction of Senior Debt of the Company, only the Company's Pro Rata Portion
    of such Debt shall be deemed to have been repaid or reduced out of such
    funds remaining, (2) second, to the extent of the Company's Pro Rata Portion
    of any such funds remaining, to make an Offer to Purchase outstanding
    Securities at 100% of their principal amount plus accrued interest to the
    date of purchase and, to the extent required by the terms thereof, any other
    Debt of the Company that is pari passu with the Securities at a price no
    greater than 100% of the principal amount thereof plus accrued interest to
    the date of purchase, and (3) third, to the extent of any such funds
    remaining, to any other use as determined by the Company which is not
    otherwise prohibited by the Indenture.

                  Notwithstanding the foregoing, the Company will not be
required to purchase Securities pursuant to the requirements described in clause
(iii)(2) of the preceding paragraph if the Company's Pro Rata Portion of the
funds available for such use in respect of an Asset Disposition, together with
the Company's Pro Rata Portion of the funds available for such use in respect of
all prior Asset Dispositions, but which were not so used pursuant to the
provisions described in this paragraph, are less than $10 million.

         (b)      The Company will mail the Offer to Purchase required pursuant
to Section 10.14(a) not more than 360 days after consummation of the disposition
referred to in Section 10.14(a). The aggregate principal amount of the
Securities to be offered to be purchased pursuant to the Offer to Purchase shall
equal the Net Available Proceeds available therefor pursuant to clause (iii)(2)
of Section 10.14(a) (rounded down to the next lowest integral multiple of
$1,000). Each Holder shall be entitled to tender all or any portion of the
Securities owned by such Holder pursuant to the Offer to Purchase, subject to
the requirement that any portion of a Security tendered must be tendered in an
integral multiple of $1,000 principal amount.

                  The Company shall not be entitled to any credit against its
obligations under this Section 10.14 for the principal amount of any Securities
acquired or redeemed by the Company otherwise than pursuant to the Offer to
Purchase pursuant to this Section 10.14.

         (c)      Not later than the date of the Offer with respect to an Offer
to Purchase pursuant to this Section 10.14, the Company shall deliver to the
Trustee an Officer's Certificate as to (i) the Purchase Amount, (ii) the
allocation of the Net Available Proceeds from the Asset Disposition pursuant to
which such Offer is being made, and (iii) the compliance of such allocation with
the provisions of Section 10.14(a).

                  The Company and the Trustee shall perform their respective
obligations specified in the Offer to Purchase and in this Section 10.14. On or
prior to the Purchase Date, the Company shall (i) accept for payment (on a pro
rata basis, if necessary) Securities or portions thereof tendered pursuant to
the Offer, (ii) deposit with the Paying Agent (or, if the Company is acting as
its own Paying Agent, segregate and hold in trust as provided in Section 10.03)
money sufficient to pay the purchase price of all Securities or portions thereof
so accepted and (iii) deliver or cause to be delivered to the Trustee all
Securities so accepted together with an Officer's Certificate stating the
Securities or portions thereof accepted for payment by the Company. The Paying
Agent (or the Company, if so acting) shall promptly mail or deliver to Holders
of Securities so accepted payment in an amount equal to the purchase price, and
the Trustee shall promptly authenticate and mail or deliver to such Holders a
new Security of like tenor equal in principal amount to any unpurchased portion
of the Security surrendered. Any Security not accepted for payment shall be
promptly mailed or delivered by the Company to the Holder thereof.

         (d)      Notwithstanding the foregoing, this Section 10.14 shall not
apply to any Asset Disposition which constitutes a transfer, conveyance, sale,
lease or other disposition of all or substantially all of the Company's
properties or assets within the meaning of Section 8.01 hereof.

SECTION 10.15.    Transactions with Affiliates and Related Persons.

                  The Company may not, and may not permit any Restricted
Subsidiary of the Company, Restricted Affiliate or Restricted Subsidiary of a
Restricted Affiliate to, enter into any transaction (or series of related
transactions) with an Affiliate or Related Person of the Company (other than the
Company or a Restricted Subsidiary of the Company which is an 80% or more owned
Subsidiary prior to such transaction), including any Investment, either directly
or indirectly, unless such transaction is on terms no less favorable to the
Company or such Restricted Subsidiary of the Company, Restricted Affiliate or
Restricted Subsidiary of a Restricted Affiliate than those that could be
obtained in a comparable arm's-length transaction with an entity that is not an
Affiliate or Related Person and is in the best interests of such Company or such
Restricted Subsidiary of the Company, Restricted Affiliate or Restricted
Subsidiary of a Restricted Affiliate. For any transaction that involves in
excess of $5 million, a majority of the disinterested members of the Board of
Directors shall determine that the transaction satisfies the above criteria and
shall evidence such a determination by a Board Resolution filed with the
Trustee.

                  The foregoing restriction shall not apply to (i) reasonable
and customary payments on behalf of directors, officers or employees of the
Company or any of its Restricted Subsidiaries, Restricted Affiliates or
Restricted Subsidiaries of Restricted Affiliates, or in reimbursement of
reasonable and customary payments or reasonable and customary expenditures made
or incurred by such Persons as directors, officers or employees, (ii) any
Restricted Payment permitted under Section 10.09 and any Permitted Investment;
provided, however, that any Investment (including any Permitted Investment) made
in reliance on this clause (ii) is in the best interests of the Company, and
(iii) any loan or advance by the Company or a Restricted Subsidiary of the
Company, Restricted Affiliate or Restricted Subsidiary of a Restricted Affiliate
to employees of any of them in the ordinary course of business.

SECTION 10.16.    Change of Control.

         (a)      Within 60 days of the occurrence of a Change of Control
Triggering Event, the Company will be required to make an Offer to Purchase all
Outstanding Securities at a purchase price equal to 101% of their principal
amount plus accrued interest to the date of purchase.

         (b)      The Company and the Trustee shall perform their respective
obligations specified in the Offer to Purchase. Prior to the Purchase Date, the
Company shall (i) accept for payment Securities or portions thereof tendered
pursuant to the Offer, (ii) deposit with the Paying Agent (or, if the Company is
acting as its own Paying Agent, segregate and hold in trust as provided in
Section 10.03) money sufficient to pay the purchase price of all Securities or
portions thereof so accepted and (iii) deliver or cause to be delivered to the
Trustee all Securities so accepted together with an Officer's Certificate
stating the Securities or portions thereof accepted for payment by the Company.
The Paying Agent shall promptly mail or deliver to Holders of Securities so
accepted payment in an amount equal to the purchase price, and the Trustee shall
promptly authenticate and mail or deliver to such Holders a new Security or
Securities equal in principal amount to any unpurchased portion of the Security
surrendered as requested by the Holder. Any Security not accepted for payment
shall be promptly mailed or delivered by the Company to the Holder thereof. The
Company shall publicly announce the results of the Offer on or as soon as
practicable after the Purchase Date.

         (c)      A "Change of Control Triggering Event" will be deemed to have
occurred if a Change of Control has occurred and a Rating Decline occurs.

         (d)      A "Change of Control" will be deemed to have occurred at such
time as either (a) any Person (other than a Permitted Holder) or any Persons
acting together that would constitute a "group" (a "Group") for purposes of
Section 13(d) of the Securities Exchange Act of 1934, or any successor provision
thereto (other than Permitted Holders), together with any Affiliates thereof,
shall beneficially own (within the meaning of Rule 13d-3 under the Securities
Exchange Act of 1934, or any successor provision thereto) at least 50% of the
aggregate voting power of all classes of Voting Stock of the Company; or (b) any
Person or Group (other than Permitted Holders), together with any Affiliates
thereof, shall succeed in having a sufficient number of its nominees elected to
the Board of Directors of the Company such that such nominees, when added to any
existing director remaining on the Board of Directors of the Company after such
election who was a nominee of or is an Affiliate of such Person or Group, will
constitute a majority of the Board of Directors of the Company.

         (e)      A "Rating Decline" will be deemed to have occurred if at any
time within the earlier of (i) 90 days after the date of public notice of a
Change of Control, or of the intention of the Company or of any Person to effect
a Change of Control and (ii) the occurrence of the Change in Control (which
period shall in either event be extended so long as the rating of the Securities
is under publicly announced consideration for possible downgrade by a Rating
Agency), the rating of the Securities is decreased by either Rating Agency by
one or more Gradations and the rating by both Rating Agencies on the Securities
following such downgrade is below Investment Grade.

SECTION 10.17.    Provision of Financial Information.

                  Whether or not the Company is required to be subject to
Section 13(a) or 15(d) of the Exchange Act, or any successor provision thereto,
the Company shall file with the Commission the annual reports and other
documents which the Company would have been required to file with the Commission
pursuant to such Section 13(a) or 15(d) or any successor provision thereto if
the Company were so required, such documents to be filed with the Commission on
or prior to the respective dates (the "Required Filing Dates") by which the
Company would have been required so to file such documents if the Company were
so required. The Company shall also in any event (a) within 15 days of each
Required Filing Date (i) transmit by mail to all Holders, as their names and
addresses appear in the Security Register, without cost to such Holders, and
(ii) file with the Trustee, copies of the annual reports and other documents
which the Company files with the Commission pursuant to such Section 13(a) or
15(d) or any successor provision thereto or would have been required to file
with the Commission pursuant to such Section 13(a) or 15(d) or any successor
provisions thereto if the Company were required to be subject to such Sections
and (b) if filing such documents by the Company with the Commission is not
permitted under the Exchange Act, promptly upon written request supply copies of
such documents to any prospective Holder.

SECTION 10.18.    Limitation on Lines of Business.

                  The Company shall, and shall cause each Restricted Subsidiary
of the Company, Restricted Affiliate or Restricted Subsidiary of a Restricted
Affiliate to, directly or indirectly engage primarily in a Related Business.

SECTION 10.19.    Payment of Additional Amounts.

                  The Company agrees that, if any deduction or withholding of
any present or future withholding taxes, levies, imposts or charges whatsoever
imposed by or for the account of Luxembourg or any political subdivision or
taxing authority thereof or therein shall be required, the Company will (subject
to compliance by the holders of the Securities with any relevant administrative
requirements) pay such additional amount in respect of principal (and premium,
if any) and interest (the "Additional Amounts") as may be necessary in order
that the net amounts paid to such holders pursuant to the Securities after such
deduction or withholding shall equal the respective amounts of principal (and
premium, if any) and interest specified in the Securities; provided, however,
that the foregoing shall not apply to any such tax, levy, impost or charge which
would not be payable but for the fact that the holder of a Security is a
domiciliary, national or resident of, or engaging in business or maintaining a
permanent establishment or being physically present in, Luxembourg or such
political subdivision or otherwise having some connection with Luxembourg other
than the holding or ownership of such Security or the collection of principal of
(and premium, if any) and interest on such Security or the enforcement of such
Security.

SECTION 10.20.    Guarantee.

                  The Company shall cause Millicom International Operations,
B.V., a corporation incorporated under the laws of the Netherlands and its
wholly-owned subsidiary, to execute and deliver a guarantee pursuant to which
Millicom International Operations, B.V. shall guarantee full payment of the
Securities and other amounts under the Indenture on the terms and conditions set
forth in this Indenture and the guarantee agreement attached hereto as Exhibit
E.

SECTION 10.21.    Waiver of Certain Covenants.

                  The Company may omit in any particular instance to comply with
any covenant or condition set forth in Sections 8.01 and 10.05 to 10.19,
inclusive, if before the time for such compliance the Holders of at least a
majority in principal amount of the Outstanding Securities shall, by Act of such
Holders, either waive such compliance in such instance or generally waive
compliance with such covenant or condition, but no such waiver shall extend to
or affect such covenant or condition except to the extent so expressly waived,
and, until such waiver shall become effective, the obligations of the Company
and the duties of the Trustee in respect of any such covenant or condition shall
remain in full force and effect; provided, however, with respect to an Offer to
Purchase as to which an Offer has been mailed, no such waiver may be made or
shall be effective against any Holder tendering Securities pursuant to such
Offer, and the Company may not omit to comply with the terms of such Offer as to
such Holder.

                                 ARTICLE ELEVEN

                            Redemption of Securities

SECTION 11.01.    Right of Redemption.

         (a)      The Securities may be redeemed, as a whole or in part, at the
election of the Company, at any time prior to Maturity, upon not less than 30
nor more than 60 days' notice by mail from the Company to each Holder of
Securities to be redeemed (with a copy to the Trustee) at such Holder's address
appearing in the Security Register, in amounts of $1,000 or an integral multiple
of $1,000 at the applicable Redemption Price, together with accrued interest
(including Special Interest) to, but excluding, the Redemption Date (subject to
the right of Holders of record on the relevant Regular Record Date to receive
interest (including Special Interest) due on an Interest Payment Date that is on
or prior to the Redemption Date).

         (b)      The Securities further may be redeemed, as a whole, at the
election of the Company if, as the result of any change in or any amendment to
the laws of Luxembourg, or of any political subdivision or taxing authority
thereof or therein, affecting taxation, or any change in an application or
interpretation of such laws either generally or in relation to the Securities,
which change or amendment to such laws becomes effective on or after May 8,
2003, or which change in application or interpretation is notified to the
Company on or after such date, it is determined by the Company that the Company
would be required to pay any Additional Amounts pursuant to Section 10.19 of
this Indenture or the terms of any Security thereof in respect of interest on
the next succeeding Interest Payment Date pursuant to the terms of the
Securities at a Redemption Price equal to 100% of the principal amount thereof
plus accrued interest to the date fixed for redemption. Prior to any redemption
of such a series of Securities pursuant to this Section 11.01(b), the Company
shall provide the Trustee with an Opinion of Counsel that the conditions
precedent to the right of the Company to redeem such Securities pursuant to this
Section have occurred. Such Opinion of Counsel shall be based on the laws and
application and interpretation thereof in effect on the date of such opinion or
to become effective on or before the next succeeding Interest Payment Date.

SECTION 11.02.    Applicability of Article.

                  Redemption of Securities at the election of the Company, as
permitted by any provision of this Indenture, shall be made in accordance with
such provision and this Article.

SECTION 11.03.    Election to Redeem; Notice to Trustee.

                  The election of the Company to redeem any Securities pursuant
to Section 11.01 shall be evidenced by a Board Resolution. In case of any
redemption at the election of the Company of less than all the Securities, the
Company shall, at least 60 days prior to the Redemption Date fixed by the
Company (unless a shorter notice shall be satisfactory to the Trustee), notify
the Trustee of such Redemption Date and of the principal amount of Securities to
be redeemed. In the case of any redemption at the election of the Company
pursuant to Section 11.01 prior to the expiration of any restriction on such
redemption provided in the terms of such Securities or elsewhere in this
Indenture, the Company shall furnish the Trustee with an Officer's Certificate
evidencing compliance with Section 11.01.

SECTION 11.04.    Selection by Trustee of Securities to Be Redeemed.

                  If less than all the Securities are to be redeemed, the
particular Securities to be redeemed shall be selected not more than 60 days
prior to the Redemption Date by the Trustee by lot from the Outstanding
Securities not previously called for redemption, by such method as the Trustee
shall deem fair and appropriate and which may provide for the selection for
redemption of portions (equal to $1,000 or any integral multiple thereof) of the
principal amount of Securities of a denomination larger than $1,000.

                  The Trustee shall promptly notify the Company and each
Security Registrar in writing of the Securities selected for redemption and, in
the case of any Securities selected for partial redemption, the principal amount
thereof to be redeemed.

                  For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to the redemption of Securities
shall relate, in the case of any Securities redeemed or to be redeemed only in
part, to the portion of the principal amount of such Securities which has been
or is to be redeemed.

SECTION 11.05.    Notice of Redemption.

                  Notice of redemption shall be given by the Company by
first-class mail, postage prepaid, mailed not less than 30 nor more than 60 days
prior to the Redemption Date, to each Holder of Securities to be redeemed, at
his address appearing in the Security Register.

                  All notices of redemption shall state:

                  (1)   the Redemption Date,

                  (2)   the Redemption Price,

                  (3)   whether the redemption is being made pursuant to Section
         11.01(a) or (b) or (c) and, if being made pursuant to Section 11.01(a)
         or (c), a brief statement setting forth the Company's right to effect
         such redemption and the Company's basis therefor,

                  (4)   if less than all the Outstanding Securities are to be
         redeemed, the identification (and, in the case of partial redemption of
         any Securities, the principal amounts) of the particular Securities to
         be redeemed,

                  (5)   that on the Redemption Date the Redemption Price will
         become due and payable upon each such Security to be redeemed and that
         interest thereon will cease to accrue on and after said date,

                  (6)   the place or places where such Securities are to be
         surrendered for payment of the Redemption Price,

                  (7)   that in the case that a Security is only redeemed in
         part, the Company shall execute and the Trustee shall authenticate and
         deliver to the Holder of such Security, without service charge, a new
         Security or Securities in an aggregate amount equal to the unredeemed
         portion of the Security,

                  (8)   the aggregate principal amount of Securities being
         redeemed, and

                  (9)   the CUSIP number or numbers of the Securities being
         redeemed.

                  Notice of redemption of Securities to be redeemed at the
election of the Company shall be given by the Company or, at the Company's
request, by the Trustee in the name and at the expense of the Company.

SECTION 11.06.    Deposit of Redemption Price and Amortization Payments.

                  Prior to any Redemption Date and any Amortization Payment
Date, as applicable, the Company shall deposit with the Trustee or with a Paying
Agent (or, if the Company is acting as its own Paying Agent, segregate and hold
in trust as provided in Section 10.03) an amount of money sufficient to pay the
Redemption Price (or Amortization Payment) of, and (except if the Redemption
Date or Amortization Payment Date shall be an Interest Payment Date) accrued
interest on, all the Securities which are to be redeemed on that date.

SECTION 11.07.    Securities Payable on Redemption Date.

                  Notice of redemption having been given as aforesaid, the
Securities so to be redeemed shall, on the Redemption Date, become due and
payable at the Redemption Price therein specified, and from and after such date
(unless the Company shall default in the payment of the Redemption Price and
accrued interest) such Securities shall cease to bear interest. Upon surrender
of any such Security for redemption in accordance with said notice, such
Security shall be paid by the Company at the Redemption Price, together with
accrued interest to the Redemption Date; provided, however, that installments of
interest whose Stated Maturity is on or prior to the Redemption Date shall be
payable to the Holders of such Securities, or one or more Predecessor
Securities, registered as such at the close of business on the relevant Record
Dates according to their terms and the provisions of Section 3.08.

                  If any Security called for redemption shall not be so paid
upon surrender thereof for redemption, the principal (and premium, if any)
shall, until paid, bear interest from the Redemption Date at the rate borne by
the Security.

                  The aforesaid provisions shall also be applicable to a
redemption made by way of Amortization Payment in accordance with Section 12.01.

SECTION 11.08.    Securities Redeemed in Part.

                  Any Security which is to be redeemed only in part shall be
surrendered at an office or agency of the Company designated for that purpose
pursuant to Section 10.02 (with, if the Company or the Trustee so requires, due
endorsement by, or a written instrument of transfer in form satisfactory to the
Company and the Trustee duly executed by, the Holder thereof or his attorney
duly authorized in writing), and the Company shall execute, and the Trustee
shall authenticate and deliver to the Holder of such Security without service
charge, a new Security or Securities, of any authorized denomination as
requested by such Holder, in aggregate principal amount equal to and in exchange
for the unredeemed portion of the principal of the Security so surrendered.

                                 ARTICLE TWELVE

                              Amortization Payments

SECTION 12.01.    Amortization Payments.

                  The Company will deposit, in accordance with Section 11.06,
prior to each Amortization Payment Date, commencing with June 1, 2004 and ending
December 1, 2005, an amount in cash equaling $17,500,000 for the principal
amount of Securities to be redeemed (each such $17,500,000 an "Amortization
Payment"). Each such Amortization Payment shall be applied to the redemption of
Securities on the successive applicable Amortization Payment Date as herein
provided. The Trustee shall, on or before the thirtieth day prior to such
Amortization Payment Date, select, in the manner provided in Section 11.4, the
Securities to be redeemed on the following Amortization Payment Date and cause
notice of the redemption thereof to be given in the name of and at the expense
of the Company in the manner provided in Section 11.5. Such notice having been
duly given, the redemption of such Securities shall be made upon the terms and
in the manner stated in Sections 11.7 and 11.8.

                                ARTICLE THIRTEEN

                       Defeasance and Covenant Defeasance

SECTION 13.01.    Company's Option to Effect Defeasance or Covenant Defeasance.

                  Subject to Section 13.04, the Company may at its option by
Board Resolution, at any time, elect to have either Section 13.02 or Section
13.03 applied to the Outstanding Securities upon compliance with conditions set
forth below in this Article Thirteen.

SECTION 13.02.    Company's Option to Effect Defeasance or Covenant Defeasance.

                  Upon the Company's exercise of the option provided in Section
13.01 applicable to this Section, the Company may be deemed to have been
discharged from its obligations (including the provisions of Article Twelve)
with respect to the Outstanding Securities on the date the conditions set forth
below are satisfied (hereinafter, "defeasance"). For this purpose, such
defeasance means that the Company shall be deemed to have paid and discharged
the entire indebtedness represented by the Outstanding Securities and to have
satisfied all its other obligations under the Securities and this Indenture
insofar as such Securities are concerned (and the Trustee, at the expense of the
Company, shall execute proper instruments acknowledging the same), except for
the following which shall survive until otherwise terminated or discharged
hereunder: (A) the rights of Holders of such Securities to receive, solely from
the trust fund described in Section 13.04 and as more fully set forth in such
Section, payments in respect of the principal of including (and Amortization
Payments premium, if any) and interest on such Securities when such payments are
due, (B) the Company's obligations with respect to such Securities under
Sections 3.04, 3.05, 3.06, 3.07, 6.07, 10.02 and 10.03, (C) the rights, powers,
trusts, duties and immunities of the Trustee hereunder and (D) this Article
Thirteen. Subject to compliance with this Article Thirteen, the Company may
exercise its option under this Section 13.02 notwithstanding the prior exercise
of its option under Section 13.03.

SECTION 13.03.    Covenant Defeasance.

                  Upon the Company's exercise of the option provided in Section
13.01 applicable to this Section, (i) the Company shall be released from its
obligations under Sections 10.05 through 10.19, inclusive, and Clauses (2), (3)
and (4) of Section 8.01, (ii) the occurrence of an event specified in Sections
5.01(3), 5.01(4) (with respect to Clauses (2), (3) or (4) of Section 8.01),
5.01(5) (with respect to any of Sections 10.05 through 10.19, inclusive),
5.01(6) and 5.01(7) shall not be deemed to be an Event of Default (hereinafter,
"covenant defeasance") and (iii) the provisions of Article Twelve hereof shall
cease to be effective on and after the date the conditions set forth below are
satisfied. For this purpose, such covenant defeasance means that the Company may
omit to comply with and shall have no liability in respect of any term,
condition or limitation set forth in any such Section, Clause or Article,
whether directly or indirectly by reason of any reference elsewhere herein to
any such Section, Clause or Article or by reason of any reference in any such
Section, Clause or Article to any other provision herein or in any other
document, but the remainder of this Indenture and such Securities shall be
unaffected thereby.

SECTION 13.04.    Conditions to Defeasance or Covenant Defeasance.

                  The following shall be the conditions to application of either
Section 13.02 or Section 13.03 to the then Outstanding Securities:

                  (1)   The Company shall irrevocably have deposited or caused
         to be deposited with the Trustee (or another trustee satisfying the
         requirements of Section 6.09 who shall agree to comply with the
         provisions of this Article Thirteen applicable to it) as trust funds in
         trust for the purpose of making the following payments, specifically
         pledged as security for, and dedicated solely to, the benefit of the
         Holders of such Securities, (A) money in an amount, or (B) U.S.
         Government Obligations which through the scheduled payment of principal
         and interest in respect thereof in accordance with their terms will
         provide, not later than one day before the due date of any payment,
         money in an amount, or (C) a combination thereof, sufficient, in the
         opinion of a nationally recognized firm of independent public
         accountants expressed in a written certification thereof delivered to
         the Trustee, to pay and discharge, and which shall be applied by the
         Trustee (or other qualifying trustee) to pay and discharge, the
         principal of (and premium, if any) and each installment of interest on
         the Securities on the Stated Maturity of such principal or installment
         of interest in accordance with the terms of this Indenture and of such
         Securities. For this purpose, "U.S. Government Obligations" means
         securities that are (x) direct obligations of the United States of
         America for the payment of which its full faith and credit is pledged
         or (y) obligations of a Person controlled or supervised by and acting
         as an agency or instrumentality of the United States of America the
         payment of which is unconditionally guaranteed as a full faith and
         credit obligation by the United States of America, which, in either
         case, are not callable or redeemable at the option of the issuer
         thereof, and shall also include a depository receipt issued by a bank
         (as defined in Section 3(a)(2) of the Securities Act of 1933, as
         amended) as custodian with respect to any such U.S. Government
         Obligation or a specific payment of principal of or interest on any
         such U.S. Government Obligation held by such custodian for the account
         of the holder of such depository receipt, provided that (except as
         required by law) such custodian is not authorized to make any
         deduction from the amount payable to the holder of such depository
         receipt from any amount received by the custodian in respect of the
         U.S. Government Obligation or the specific payment of principal of or
         interest on the U.S. Government Obligation evidenced by such
         depository receipt.

                  (2)   In the case of an election under Section 13.02, the
         Company shall have delivered to the Trustee an Opinion of Counsel
         stating that (x) the Company has received from, or there has been
         published by, the Internal Revenue Service a ruling, or (y) since the
         date of this Indenture there has been a change in the applicable
         Federal income tax law, in either case to the effect that, and based
         thereon such opinion shall confirm that, the Holders of the Outstanding
         Securities will not recognize gain or loss for Federal income tax
         purposes as a result of such deposit, defeasance and discharge and will
         be subject to Federal income tax on the same amount, in the same manner
         and at the same times as would have been the case if such deposit,
         defeasance and discharge had not occurred.

                  (3)   In the case of an election under Section 13.03, the
         Company shall have delivered to the Trustee an Opinion of Counsel to
         the effect that the Holders of the Outstanding Securities will not
         recognize gain or loss for Federal income tax purposes as a result of
         such deposit and covenant defeasance and will be subject to Federal
         income tax on the same amount, in the same manner and at the same times
         as would have been the case if such deposit and covenant defeasance had
         not occurred.

                  (4)   The Company shall have delivered to the Trustee an
         Officer's Certificate to the effect that the Securities, if then listed
         on any securities exchange, will not be delisted as a result of such
         deposit.

                  (5)   Such defeasance or covenant defeasance shall not cause
         the Trustee to have a conflicting interest as defined in Section 6.08
         and for purposes of the Trust Indenture Act with respect to any
         securities of the Company.

                  (6)   No Event of Default or event which with notice or lapse
         of time or both would become an Event of Default shall have occurred
         and be continuing on the date of such deposit or, insofar as
         subsections 5.01(8) and (9) are concerned with respect to the Company,
         at any time during the period ending on the 91st day after the date of
         such deposit (it being understood that this condition shall not be
         deemed satisfied until the expiration of such period).

                  (7)   Such defeasance or covenant defeasance shall not result
         in a breach or violation of, or constitute a default under, any other
         agreement or instrument to which the Company is a party or by which it
         is bound.

                  (8)   The Company shall have delivered to the Trustee an
         Officer's Certificate and an Opinion of Counsel, each stating that all
         conditions precedent provided for relating to either the defeasance
         under Section 13.02 or the covenant defeasance under Section 13.03 (as
         the case may be) have been complied with.

                  (9)   Such defeasance or covenant defeasance shall not result
         in the trust arising from such deposit constituting an investment
         company as defined in the Investment Company Act of 1940, as amended,
         or such trust shall be qualified under such act or exempt from
         regulation thereunder.

SECTION 13.05.    Deposited Money and U.S. Government Obligations to Be Held in
                  Trust; Other Miscellaneous Provisions.

                  Subject to the provisions of the last paragraph of Section
10.03, all money and U.S. Government Obligations (including the proceeds
thereof) deposited with the Trustee (or other qualifying trustee --
collectively, for purposes of this Section 13.05 only, the "Trustee") pursuant
to Section 13.04 in respect of the Securities shall be held in trust and applied
by the Trustee, in accordance with the provisions of such Securities and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Holders of such Securities, of all sums due and to become due
thereon in respect of principal (and premium, if any) and interest, but such
money need not be segregated from other funds except to the extent required by
law. Money so held in trust shall not be subject to the provisions of this
Article Thirteen.

                  The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the U.S. Government
Obligations deposited pursuant to Section 13.04 or the principal and interest
received in respect thereof other than any such tax, fee or other charge which
by law is for the account of the Holders of the Outstanding Securities.

                  Anything in this Article Thirteen to the contrary
notwithstanding, the Trustee shall deliver or pay to the Company from time to
time upon Company Request any money or U.S. Government Obligations held by it as
provided in Section 13.04 which, in the opinion of a nationally recognized firm
of independent public accountants expressed in a written certification thereof
delivered to the Trustee (at the Company's expense), are in excess of the amount
thereof which would then be required to be deposited to effect an equivalent
defeasance or covenant defeasance.

SECTION 13.06.    Reinstatement.

                  If the Trustee or the Paying Agent is unable to apply any
money in accordance with Section 13.02 or 13.03 by reason of any order or
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, then the Company's obligations under
this Indenture and the Securities shall be revived and reinstated as though no
deposit had occurred pursuant to this Article Thirteen until such time as the
Trustee or Paying Agent is permitted to apply all such money in accordance with
Section 13.02 or 13.03; provided, however, that if the Company makes any payment
of principal of (and premium, if any) or interest on any Security following the
reinstatement of its obligations, the Company shall be subrogated to the rights
of the Holders of such Securities to receive such payment from the money held by
the Trustee or the Paying Agent.

                          ____________________________

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



<PAGE>


                  IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed.

Dated:



                               MILLICOM INTERNATIONAL CELLULAR S.A.

                               By: /s
                                  ----------------------------------------------
                                   Name:
                                   Title:
Attest:

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

                               By:
                                  ----------------------------------------------
                                   Name:
                                   Title:
Attest:

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



<PAGE>


                  This is one of the Securities referred to in the
within-mentioned Indenture.

                                          THE BANK OF NEW YORK,
                                               as Trustee

                                          By:
                                             -----------------------------------
                                                     Authorized Signatory


<PAGE>


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


                                          MILLICOM INTERNATIONAL CELLULAR S.A.

                                          By:
                                             -----------------------------------
                                              Name:
                                              Title:
Attest:

- -----------------------------
By

                                          By:
                                             -----------------------------------
                                              Name:
                                              Title:
Attest:

- -----------------------------
By

                                          THE BANK OF NEW YORK
                                               As Trustee

                                          By:
                                             -----------------------------------
                                              Name:
                                              Title:
Attest:

- -----------------------------
By





<PAGE>


                                                        ANNEX A -- Form of
                                                        Regulation S Certificate


                            REGULATION S CERTIFICATE

      (For transfers pursuant toss. 3.06(b)(i) and (iii) of the Indenture)

The Bank of New York
101 Barclay Street, 21st Floor
New York, New York  10286


      Re: 11% Senior Notes due 2006 of Millicom International Cellular S.A.
          (the "Securities")

                  Reference is made to the Indenture, dated as
of___________________ (the "Indenture"), from Millicom International Cellular
S.A. (the "Company") to The Bank of New York, as Trustee. Terms used herein and
defined in the Indenture or in Regulation S or Rule 144 under the U.S.
Securities Act of 1933 (the "Securities Act") are used herein as so defined.

                  This certificate relates to U.S. $_____________ principal
amount of Securities, which are evidenced by the following certificate(s) (the
"Specified Securities"):

                  CUSIP No(s).
                                ------------------------------------------------

                  CERTIFICATE No(s).
                                     -------------------------------------------

The person in whose name this certificate is executed below (the "Undersigned")
hereby certifies that either (i) it is the sole beneficial owner of the
Specified Securities or (ii) it is acting on behalf of all the beneficial owners
of the Specified Securities and is duly authorized by them to do so. Such
beneficial owner or owners are referred to herein collectively as the "Owner".
If the Specified Securities are represented by a Global Security, they are held
through the Depository or an Agent Member in the name of the Undersigned, as or
on behalf of the Owner. If the Specified Securities are not represented by a
Global Security, they are registered in the name of the Undersigned, as or on
behalf of the Owner.

                  The Owner has requested that the Specified Securities be
transferred to a person (the "Transferee") who will take delivery in the form of
a Regulation S Security. In connection with such transfer, the Owner hereby
certifies that, unless such transfer is being effected pursuant to an effective
registration statement under the Securities Act, it is being effected in
accordance with Rule 904 or Rule 144 under the Securities Act and with all
applicable securities laws of the states of the United States and other
jurisdictions. Accordingly, the Owner hereby further certifies as follows:

         (1)      Rule 904 Transfers.  If the transfer is being effected in
accordance with Rule 904:

                  (A)   the Owner is not a distributor of the Securities, an
         affiliate of the Company or any such distributor or a person acting on
         behalf of any of the foregoing;

                  (B)   the offer of the Specified Securities was not made to a
         person in the United States or for the account or benefit of a U.S.
         Person;

                  (C)   either:

                        (i)     at the time the buy order was originated, the
                  Transferee was outside the United States or the Owner and any
                  person acting on its behalf reasonably believed that the
                  Transferee was outside the United States, or

                        (ii)    the transaction is being executed in, on or
                  through the facilities of the Eurobond market, as regulated by
                  the Association of International Bond Dealers, or another
                  designated offshore securities market and neither the Owner
                  nor any person acting on its behalf knows that the transaction
                  has been prearranged with a buyer in the United States;

                  (D)   no directed selling efforts have been made in the United
         States by or on behalf of the Owner or any affiliate thereof;

                  (E)   if the Owner is a dealer in securities or has received a
         selling concession, fee or other remuneration in respect of the
         Specified Securities, and the transfer is to occur during the
         Restricted Period, then the requirements of Rule 904(c)(1) have been
         satisfied; and

                  (F)   the transaction is not part of a plan or scheme to evade
         the registration requirements of the Securities Act.

         (2)      Rule 144 Transfers.  If the transfer is being effected
    pursuant to Rule 144:

                  (A)   the transfer is occurring after ____________________ and
         is being effected in accordance with the applicable amount, manner of
         sale and notice requirements of Rule 144; or

                  (B)   the transfer is occurring after _________________ and
         the Owner is not, and during the preceding three months has not been,
         an affiliate of the Company.


<PAGE>


                  This certificate and the statements contained herein are made
for your benefit and the benefit of the Company.

Dated:
                                ------------------------------------------------
                                (Print the name of the Undersigned, as such term
                                is defined in the second paragraph of this
                                certificate.)



                                By:
                                   ---------------------------------------------
                                     Name:
                                     Title:
                                (If the Undersigned is a corporation,
                                partnership or fiduciary, the title of the
                                person signing on behalf of the Undersigned
                                must be stated.)


<PAGE>


                                                   ANNEX B -- Form of Restricted
                                                   Securities Certificate



                        RESTRICTED SECURITIES CERTIFICATE

                   (For transfers pursuant toss. 3.06(b) (ii),
                      (iii), (iv) and (v) of the Indenture)

The Bank of New York
101 Barclay Street, 21st Floor
New York, New York  10286


      Re: 11% Senior Notes due 2006 of Millicom International Cellular S.A.
          (the "Securities")

                  Reference is made to the Indenture, dated as of May 8, 2003
(the "Indenture"), from Millicom International Cellular S.A. (the "Company") to
The Bank of New York, as Trustee. Terms used herein and defined in the Indenture
or in Regulation S or Rule 144 under the U.S. Securities Act of 1933 (the
"Securities Act") are used herein as so defined.

                  This certificate relates to U.S. $_______________ principal
amount of Securities, which are evidenced by the following certificate(s) (the
"Specified Securities"):

                  CUSIP No(s).
                                ------------------------------------------------

                  CERTIFICATE No(s).
                                      ------------------------------------------

The person in whose name this certificate is executed below (the "Undersigned")
hereby certifies that either (i) it is the sole beneficial owner of the
Specified Securities or (ii) it is acting on behalf of all the beneficial owners
of the Specified Securities and is duly authorized by them to do so. Such
beneficial owner or owners are referred to herein collectively as the "Owner".
If the Specified Securities are represented by a Global Security, they are held
through the Depository or an Agent Member in the name of the Undersigned, as or
on behalf of the Owner. If the Specified Securities are not represented by a
Global Security, they are registered in the name of the Undersigned, as or on
behalf of the Owner.

                  The Owner has requested that the Specified Securities be
transferred to a person (the "Transferee") who will take delivery in the form of
a Restricted Security. In connection with such transfer, the Owner hereby
certifies that, unless such transfer is being effected pursuant to an effective
registration statement under the Securities Act, it is being effected in
accordance with Rule 144A or Rule 144 under the Securities Act and all
applicable securities laws of the states of the United States and other
jurisdictions. Accordingly, the Owner hereby further certifies as:



                  (1)   Rule 144A Transfers.  If the transfer is being effected
         in accordance with Rule 144A:

                        (A)     the Specified Securities are being transferred
                  to a person that the Owner and any person acting on its behalf
                  reasonably believe is a "qualified institutional buyer" within
                  the meaning of Rule 144A, acquiring for its own account or for
                  the account of a qualified institutional buyer; and

                        (B)     the Owner and any person acting on its behalf
                  have taken reasonable steps to ensure that the Transferee is
                  aware that the Owner may be relying on Rule 144A in connection
                  with the transfer; and

                  (2)   Rule 144 Transfers.  If the transfer is being effected
         pursuant to Rule 144:

                        (A)     the transfer is occurring after June 3, 1998 and
                  is being effected in accordance with the applicable amount,
                  manner of sale and notice requirements of Rule 144; or

                        (B)     the transfer is occurring after June 3, 1999 and
                  the Owner is not, and during the preceding three months has
                  not been, an affiliate of the Company.

                  This certificate and the statements contained herein are made
for your benefit and the benefit of the Company.



Dated:
                              --------------------------------------------------
                              (Print the name of the Undersigned, as such term
                              is defined in the second paragraph of this
                              certificate.)



                              By:
                                 -----------------------------------------------
                                   Name:
                                   Title:
                              (If the Undersigned is a corporation, partnership
                              or fiduciary, the title of the person signing on
                              behalf of the Undersigned must be stated.)


<PAGE>


                                                 ANNEX C -- Form of Unrestricted
                                                 Securities Certificate



                       UNRESTRICTED SECURITIES CERTIFICATE

         (For removal of Securities Act Legends pursuant toss. 3.06(c))

The Bank of New York
101 Barclay Street, 21st Floor
New York, New York  10286


      Re: 11% Senior Notes due 2006 of Millicom International Cellular S.A.
          (the "Securities")

                  Reference is made to the Indenture, dated as of May 8, 2003
(the "Indenture"), from Millicom International Cellular S.A. (the "Company") to
The Bank of New York, as Trustee. Terms used herein and defined in the Indenture
or in Regulation S or Rule 144 under the U.S. Securities Act of 1933 (the
"Securities Act") are used herein as so defined.

                  This certificate relates to U.S. $_______________ principal
amount of Securities, which are evidenced by the following certificate(s) (the
"Specified Securities"):

                  CUSIP No(s).
                                ------------------------------------------------

                  CERTIFICATE No(s).
                                      ------------------------------------------

The person in whose name this certificate is executed below (the "Undersigned")
hereby certifies that either (i) it is the sole beneficial owner of the
Specified Securities or (ii) it is acting on behalf of all the beneficial owners
of the Specified Securities and is duly authorized by them to do so. Such
beneficial owner or owners are referred to herein collectively as the "Owner".
If the Specified Securities are represented by a Global Security, they are held
through the Depository or an Agent Member in the name of the Undersigned, as or
on behalf of the Owner. If the Specified Securities are not represented by a
Global Security, they are registered in the name of the Undersigned, as or on
behalf of the Owner.

                  The Owner has requested that the Specified Securities be
exchanged for Securities bearing no Securities Act Legend pursuant to Section
3.06(c) of the Indenture. In connection with such exchange, the Owner hereby
certifies that the exchange is occurring after __________ and the Owner is not,
and during the preceding three months has not been, an affiliate of the Company.
The Owner also acknowledges that any future transfers of the Specified
Securities must comply with all applicable securities laws of the states of the
United States and other jurisdictions.


<PAGE>


                  This certificate and the statements contained herein are made
for your benefit and the benefit of the Company.



Dated:
                                       -----------------------------------------
                                       (Print the name of the Undersigned, as
                                       such term is defined in the second
                                       paragraph of this certificate.)



                                       By:
                                          --------------------------------------
                                          Name:
                                          Title:
                                       (If the Undersigned is a corporation,
                                       partnership or fiduciary, the title of
                                       the person signing on behalf of the
                                       Undersigned must be stated.)


<PAGE>


                                                                         ANNEX D



                      MILLICOM INTERNATIONAL CELLULAR S.A.

                                                         -------------, --------



The Depository Trust Company
55 Water Street, 49th Floor
New York, New York  10041

The Bank of New York,
   As Trustee
101 Barclay Street, 21st Floor
New York, New York  10286


                          Re: 11% Senior Notes due 2006

Ladies and Gentlemen:

                  Reference is hereby made to the Indenture dated as of May 8,
2003 (the "Indenture"), between Millicom International Cellular S.A., as Issuer,
and The Bank of New York, as Trustee. Capitalized terms used and not defined
herein shall have the meanings given them in the Indenture.

                  This letter relates to U.S. $______________ principal amount
of Securities represented by the Regulation S Global Security, held by the
Trustee pursuant to Section 2.01 of the Indenture. We hereby certify that the
offering of the Securities closed on ____________ and therefore, the restricted
period (as defined in Regulation S) with respect to the offer and sale of the
Securities will terminate on _________, ____.

                                 MILLICOM INTERNATIONAL
                                    CELLULAR S.A.

                                 By:
                                    --------------------------------------------
                                     Name:
                                     Title:

cc:       Euroclear
          Clearstream



<PAGE>


                                                                         ANNEX E

                                   GUARANTEE

     GUARANTEE, dated as of May 7, 2003 made by Millicom International
Operations, B.V., a corporation incorporated under the laws of the Netherlands
(the "Guarantor") the undersigned wholly-owned subsidiary of Millicom
International Cellular, S.A. (the "Company") in favor of the Holders and the
Trustee (each as defined in the Indenture referred to below).

     Reference is made to the Indenture between the Company and the Trustee,
dated as of May 8, 2003, as amended and supplemented from time to time (the
"Indenture"), covering the Company's 11% Senior Notes due 2006 (collectively
the "Securities," each a "Security").

                              W I T N E S S E T H:

     WHEREAS the Company is restructuring its 13 1/2% Senior Subordinated
Discount Notes by way of exchanging them for certain new notes including the
Securities in an exchange offer and consent solicitation and in consideration
thereof, the Guarantor has agreed to enter into this Guarantee to guarantee the
obligations of the Company under the Indenture for the benefit of the Holders
and the Trustee in the manner set out in this Guarantee;

     WHEREAS, under the terms of Section 10.20 of the Indenture, the Company is
required to cause the Guarantor to enter into this Guarantee; and

     NOW THEREFORE, in consideration of the promises therein, the Guarantor
hereby agrees with and for the benefit of the Holders as follows:

                                  Article I.

                                  Definitions

     Section 1.1. Defined Terms. Capitalized terms used herein and not
otherwise defined shall have the meaning ascribed to them in the Indenture.

                                  Article II.

                Representations and Warranties of the Guarantor

     The Guarantor hereby represents and warrants to the Trustee and the
Holders as follows:

     Section 2.1. Due Existence; Compliance. The Guarantor is a corporation
incorporated under the laws of the Netherlands and is validly existing under
the laws of such jurisdiction and has all requisite power and authority under
such laws to own or lease and operate its properties and to carry on its
business as now conducted and as proposed to be conducted, and to execute,
deliver and perform its obligations under this Guarantee. The Guarantor is in
compliance in all material respects with all applicable law, rules, regulations
and orders.

<PAGE>


     Section 2.2. Corporate Authorities; No Conflicts. The execution, delivery
and performance by the Guarantor of this Guarantee is within its corporate
powers and has been duly authorized by all necessary corporate and stockholder
approvals or partnership or other approvals and (i) does not contravene its
organizational documents or any law, rule, regulation, judgment, order or
decree applicable to or binding on the Guarantor and (ii) does not contravene,
and will not result in the creation of any lien under, any provision of any
contract, indenture, mortgage or agreement to which the Guarantor is a party,
or by which it or any of its properties are bound, other than liens permitted
under the Indenture. Without prejudice to the generality of the foregoing, the
Guarantor represents and warrants that this Guarantee will not be voidable
under the Netherlands Commercial Code, including without limitation Section 2.7
of such code. For purposes of this Section 2.2, "lien" means, with respect to
any asset, an in rem security interest (zakelijk zekerheidsrecht) such as a
mortgage (hypotheek), pledge (pandrecht) or attachment (beslag).

     (a) Government Approvals and Authorizations. No authorization or approval
or other action by, and no notice to or filing with, any governmental authority
or regulatory body is required for the due execution, delivery and performance
by or enforcement against the Guarantor of this Guarantee (except such
governmental approvals or authorizations as have been duly obtained or made and
remain in full force and effect).

     (b) Legal, Valid and Binding. This Guarantee is the legal, valid and
binding obligation of the Guarantor, enforceable against the Guarantor in
accordance with its terms.

     (c) Ranking. The obligations of the Guarantor under this Guarantee rank
pari passu with other non-subordinated, senior, unsecured obligations of the
Guarantor (subject to any rights of set-off or counterclaim that may exist).

     (d) Immunities. Neither the Guarantor nor its property has any immunity
from jurisdiction of any court or from any legal process (whether through
service or notice, attachment prior to judgment, attachment in aid of
execution, execution or otherwise) under applicable law.

     (e) No Filing. To ensure the legality, validity, enforceability or
admissibility in evidence of this Guarantee in the Netherlands and the United
States or any other jurisdiction in which the Guarantor conducts business, it
is not necessary that this Guarantee be filed or recorded with any court or
other authority in such jurisdiction, or that any stamp or similar tax be paid
on or with respect to this Guarantee, or, if such actions are necessary, they
have been taken.

     (f) Solvency. The Guarantor is able to pay its debts as they fall due and
is not currently insolvent on a balance sheet basis and is not the subject of
any petitions/actions/resolutions pending or presently before a court which
seek to subject the Guarantor to: voluntary or involuntary liquidation;
dissolution; the sale of any collateral; receivership; bankruptcy (or
faillissement in The Netherlands); assignment for the benefit of creditors;
reorganization; administration (or surseance van betaling in The Netherlands);
any arrangement, composition or readjustment of debt of, or other similar
proceedings affecting, the Guarantor.


                                      -2-
<PAGE>


                                 Article III.

                                   Guarantee

     Section 3.1. Guarantee. The Guarantor hereby absolutely, irrevocably and
unconditionally agrees, subject only to the limitations expressly set forth in
this Guarantee, to pay, as primary obligor and not as a surety, in full basis
to the Holders of Securities from time to time, whether such rights under this
Guarantee are asserted by the Trustee or directly by any such Holder (without
duplication of amounts theretofore paid by the Company or the Guarantor
(including without duplication of amounts theretofore paid under this
Guarantee)), if, as and when due, regardless of any defense, right of setoff,
deduction, withholding or counterclaim that the Guarantor may have or assert
(other than the defense of payment having been made) and without abatement,
suspension, deferment or diminution on account of any event or condition
whatsoever:

     (a) any due and payable interest payments required to be paid on the
Securities in accordance with their terms (including without limitation any
Amortization Payments, Special Interest and Additional Amounts);

     (b) the Redemption Price required to be paid for each Security called for
redemption, plus an amount equal to accrued interest, if any, from the last
Interest Payment Date accrued on a daily basis to the Redemption Date, and all
other amounts outstanding thereon; and

     (c) upon Maturity of the Securities, or a dissolution, winding up or
liquidation or bankruptcy or similar proceeding of the Company, the aggregate
principal amount of the Securities, plus any accrued interest at the stated
rate from the last Interest Payment Date, through the date of payment, and all
other amounts outstanding thereon (collectively, the "Guarantee Payments").

     This Guarantee is a guarantee of payment and not of collection.

     All Guarantee Payments shall include interest accrued on such Guarantee
Payments (including Special Interest), at a rate per annum equal to the stated
interest rate of the Securities, since the date of the claim asserted under
this Guarantee relating to such Guarantee Payments through the date of payment
of or the date full payment is offered on such claim.

     The Guarantor's obligations to make any of the Guarantee Payments may be
satisfied by direct payment of the required amounts by the Guarantor to the
Holders or by causing the Company to pay such amounts to the Holders. In
addition, the Guarantor's obligations to make the payments described above will
exist regardless of any defense, right of set-off or counter claim that the
Company may have or assert (other than payment).

     No reference herein to the Indenture and no provision of this Guarantee or
of the Indenture shall alter or impair the Guarantee of the Guarantor, which is
absolute and unconditional, independent from the due and punctual payment of
the principal of and interest on the Securities.


                                      -3-
<PAGE>

     The obligations of the Guarantor under this Guarantee rank pari passu with
other senior unsecured obligations of the Guarantor.

     The Guarantor waives any right or remedy to require that any action be
brought first against the Company or any other Person or entity before
proceeding directly against the Guarantor. The Guarantor hereby further
expressly waives any right of protest, presentment, notice or demand
whatsoever, and any claims of waiver, release, surrender, alteration or
compromise and all defenses (other than payment), set-offs, counterclaims,
recoupments, reductions, limitations, impairments or terminations, whether
arising hereunder or otherwise. This Guarantee shall continue to be effective
or be reinstated if any payment to the Holders or the Trustee by the Company on
account of any Guaranteed Payment is returned to the Company or is rescinded
upon the dissolution, winding-up, liquidation or bankruptcy of the Company.

     Upon making any payment pursuant this Guarantee, the Guarantor shall be
subrogated to the rights of the payee against the Company with respect to such
payment; provided, however, that the Guarantor shall not claim or enforce any
payment by way of subrogation if and as long as any amounts under or in
connection with the Securities are outstanding.

     Section 3.2. No Waiver, etc. The obligations, covenants, agreements and
duties of the Guarantor under this Guarantee shall in no way be affected or
impaired by reason of the happening from time to time of any of the following:

     (i)  the release or waiver, by operation of law or otherwise, of the
          performance or observance by the Company of any express or implied
          agreement, covenant, term or condition relating to the Securities to
          be performed or observed by the Company under the Securities, the
          Indenture or otherwise;

     (ii) any failure, omission, delay or lack of diligence on the part of the
          Trustee or the Holders to enforce, assert or exercise any right,
          privilege, power or remedy conferred on the Trustee or the Holders
          pursuant to the terms of the Securities, or any action on the part of
          the Company granting indulgence or extension of any kind;

    (iii) the voluntary or involuntary liquidation, dissolution, sale of any
          collateral, receivership, insolvency, bankruptcy, assignment for the
          benefit of creditors, reorganization, arrangement, composition or
          readjustment of debt of, or other similar proceedings affecting, the
          Company or any of the assets of the Company;

     (iv) any invalidity, illegality or unenforceability of, or defect or
          deficiency in, the Securities;

     (v)  the settlement or compromise of any obligation guaranteed hereby or
          hereby incurred; or

     (vi) any other circumstance whatsoever that might otherwise constitute a
          legal or equitable discharge or defense of a guarantor, it being the
          intent that the obligations of each of the Guarantor hereunder shall
          be absolute and unconditional under any and all circumstances.


                                      -4-
<PAGE>

     There shall be no obligation of the Holders or the Trustee to give notice
to, or obtain consent of, the Guarantor with respect to the happening of any of
the foregoing.

     The Guarantor acknowledges that its obligations hereunder are independent
of the obligations of the Company with respect to the Securities, and that the
Guarantor shall be liable as principal and as debtor hereunder to make
Guarantee Payments pursuant to the terms of this Guarantee notwithstanding the
occurrence of any event referred to in paragraphs (i) through (vi) above.

     Section 3.3. Enforcement by Trustee. Should the Guarantor default in
respect of any of its obligations under this Guarantee, including any covenants
the Trustee will have the right to enforce the terms of the Guarantee for the
benefit of the Holders. The Holders of not less than a majority in total
principal amount of the outstanding Securities have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee regarding the Guarantor's obligations under the Guarantee or to
direct the exercise of any trust or power conferred upon the Trustee under this
Guarantee. If the Trustee fails to enforce the Guarantee, then any holder of
Securities may institute a legal proceeding directly against the Guarantor to
enforce the relevant trustee's rights under the guarantee, without first
instituting a legal proceeding against the Company, the Trustee or any other
person or entity.

     Section 3.4. Limitation on Liability. Any term or provision of this
Guarantee to the contrary notwithstanding, the maximum aggregate amount of the
Guarantee Payments guaranteed hereunder by the Guarantor shall not exceed the
maximum amount that can be hereby guarantied without rendering this Guarantee,
as it relates to such Guarantor, voidable under applicable law relating to
fraudulent conveyance or fraudulent transfer.

                                  Article IV.

                                 Miscellaneous

     Section 4.1. Successors and Assigns. This Agreement shall be continuing,
irrevocable and binding on the Guarantor and its successors and assigns and
shall inure to the benefit of the Holders and their successors and assigns and,
in the event of any transfer or assignment of rights by any Holder in
accordance with the terms of the Indenture, the rights and privileges conferred
upon that party in this Guarantee and in the Securities shall automatically
extend to and be vested in such transferee or assignee, all subject to the
terms and conditions of this Guarantee and the Indenture. The Guarantor may not
assign or transfer any of its rights and obligations under this Guarantee,
without the prior written consent of the Trustee. This Guarantee is an
irrevocable continuing guarantee of the Guarantee Payments which shall continue
in effect until all of the Guarantee Payments have been fully, finally and
indefeasibly paid.

     Section 4.2. Notices. All notices and other communications provided for
hereunder shall be given to in the manner and subject to the other notice
provisions set forth in the Indenture, provided however, that such notices
shall be delivered (i) if to the Trustee, the Holders or the Company, in the
manner provided in the Indenture and (ii) if to the Guarantor, at its address
set forth below:


                                      -5-
<PAGE>


                  Millicom International Operations B.V.
                  Att: The Managing Director
                  Locatellikade 1, Parnassustoren
                  1076 AZ Amsterdam

     Section 4.3. Parties. This Guarantee shall be binding upon and shall inure
to the benefit of the parties hereto and their respective successors and
assigns, including, without limitation, the Holders and the Trustee. Nothing
expressed or mentioned in this Guarantee is otherwise intended or shall be
construed to give any other Person any legal or equitable right, remedy or
claim under or in respect of this Guarantee or any provisions herein contained.

     Section 4.4. Waivers, Amendments and Remedies. The failure to insist in
any one or more instances upon strict performance of any of the provisions of
this Guarantee or to take advantage of any rights hereunder shall not be
construed as a waiver of any such provisions or the relinquishment of any such
rights, but the same shall continue and remain in full force and effect. Except
as otherwise expressly limited in this Guarantee, all remedies under this
Guarantee shall be cumulative and in addition to every other remedy provided
for herein or by law. No provisions of this Guarantee may be amended or waived
except by a written instrument executed by the Guarantor and the Trustee, on
behalf of the Holders.

     Section 4.5. Governing Law. The Guarantee shall be governed by and
construed in accordance with the laws of the State of New York, except for the
ranking provisions as set forth in Section 2.2 subparagraph (c), which shall be
governed by the laws of The Netherlands. Any claim or proceeding brought to
enforce the Guarantor's obligations herein shall be brought exclusively before
any federal or state court in the Borough of Manhattan, The City of New York.
The Guarantor will irrevocably and unconditionally (i) submit itself and its
property in any legal action or proceeding relating to the Guarantee to which
it is a party, or for recognition and enforcement of any judgment in respect
thereof, to the general jurisdiction of the Courts of the State of New York,
the courts of the United States of America for the Southern District of New
York, appellate courts from any thereof and courts of its own corporate
domicile, with respect to actions brought against it as defendant; (ii) consent
that any such action or proceeding may be brought in such courts and waive any
objection that it may now or hereafter have to the venue of any such action or
proceeding in any such court or that such action or proceeding was brought in
an inconvenient court and agrees not to plead or claim the same; and (iii)
appoint CT Corporation System, currently having an office at 111 Eighth Avenue,
New York, New York 10011, as its agent to receive on its behalf service of all
process in any such action or proceeding, such service being hereby
acknowledged by the Guarantor to be effective and binding in every respect.

     Section 4.6. Partial Invalidity. If any provision of this Guarantee or the
application thereof to any party or circumstance is held invalid or
unenforceable, the remainder of this Guarantee and the application of such
provision or provisions to the other parties and circumstances will not be
affected thereby, the provisions of this Guarantee being severable in any such
instance.


                                      -6-
<PAGE>


     Section 4.7. Entire Agreement. This Guarantee embodies the entire
agreement of the parties and supersedes all prior agreements and understandings
relating to the subject matter hereof.

     Section 4.8. Expenses, Etc. The Guarantor agrees to pay or to reimburse
the Holders and the Trustee for all reasonable out of pocket costs and expenses
(including reasonable attorneys' fees and expenses) that may be incurred by any
of them in any effort to enforce any of the obligations of Guarantor under this
Guarantee, whether or not any lawsuit is filed, including all such out of
pocket costs and expenses (and reasonable attorneys' fees and expenses)
incurred by such party in any bankruptcy, reorganization, workout or similar
proceeding of Guarantor.


                                      -7-
<PAGE>


     IN WITNESS WHEREOF, the Guarantor has executed this Guarantee as of the
date first above written.



MILLICOM INTERNATIONAL OPERATIONS B.V.

By:
    ----------------------------------
    Name:
    Title:






                                      -8-

<PAGE>


                                                                         ANNEX F


                         REGISTRATION RIGHTS AGREEMENT

     THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement"), attached as Annex F
to this Indenture (as defined below) is being entered into in connection
therewith and is being made part thereof, as set forth in Section 1.01 of each
of the Indentures covering the Company's 11% Senior Notes Due 2006 (the "11%
Notes" and such Indenture the "11% Indenture") and the Company's 2% Senior
Convertible PIK Notes Due 2006 (the "2% Notes" and together with the 11% Notes,
the "Notes" and such Indenture the "2% Indenture" and together with the 11%
Indenture the "Indentures," each an "Indenture"), respectively, in the
definition of "Registration Rights Agreement." Any Holder of Notes pursuant to
the Indentures, by virtue of holding such Notes, is deemed to have accepted and
agreed and being made subject to the terms and obligations and is entitled to
the rights under this Agreement as set forth herein.

                                R E C I T A L S

     1. This Agreement is made in accordance with the Company's private amended
and restated Offering Memorandum, dated April 16, 2003, (the "Offering
Memorandum") under which the Company offered to holders of its existing 13-1/2%
Senior Subordinated Discount Notes due 2005 (the "Old Notes") who are not U.S.
persons, or who are U.S. persons that are either "qualified institutional
buyers" or institutional "accredited investors" (as each of those terms are
defined under the Securities Act of 1933, as amended (the "Securities Act"))
and who can make the representations to exchange upon the terms and subject to
the conditions set forth in the Offering Memorandum, to exchange their Old
Notes for Notes without registration under the Securities Act, in reliance upon
the exemption from registration provided by Section 4(2) of the Securities Act
and the provisions of Rule 506 of Regulation D, promulgated under the
Securities Act (the "Exchange Offer and Consent Solicitation").

     2. In accordance with the Section "Notice to Investors and Transfer
Restrictions" in Offering Memorandum, each holder of Notes (each a "Holder" and
collectively the "Holders") is deemed to make the representations and further
acknowledgments and agreements set forth in such section.

     3. In order to induce the Holders to tender their Old Notes in the
Exchange Offer and Consent Solicitation, the Company has agreed with certain
Holders to provide to the Holders (and their permitted transferees, if any) the
registration rights set forth in this Agreement with respect to the resale of
the Notes, as well as with respect to the resale of the common stock of the
Company issuable upon conversion of the 2% Notes (the "Conversion Shares").

     4. Capitalized terms used but not defined herein shall have the meaning
provided in the indentures governing the Notes, each dated May [8], 2003,
between the Company and the Trustee, as the same may be amended from time to
time (the "Indentures").

     In consideration of the foregoing premises and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the Company and the Holders intending to be legally bound, agree as follows:


<PAGE>


                                   Article I.

                              Registration Rights

     Section 1.1. Filing of Form F-3 Resale Registration Statement. As soon as
practicable and, in no event later than December [4], 2003 (the "Effective
Date"), the Company shall file with the Securities and Exchange Commission (the
"SEC" or the "Commission") a registration statement on Form F-3 pursuant to
Rule 415 under the Securities Act, or, in the event that Form F-3 is
unavailable to the Company, a registration statement on such other SEC Form
that is available to the Company (together with any exhibits, amendments or
supplements thereto, and any documents incorporated by reference therein, the
"Registration Statement"), with respect to the resale of the Notes and the
Conversion Shares, and any securities of the Company issued as a dividend or
other distribution with respect to, or in exchange for or in replacement of,
the Notes and Conversion Shares, provided that at least 50% of holders of
Registrable Securities (as defined below) have submitted the information
required by Article II for inclusion in such Registration Statement. The
securities described in the preceding sentence are collectively referred to
herein as the "Registrable Securities"; provided, that the term "Registrable
Securities" shall not include securities transferred to a person other than a
permitted transferee under the Offering Memorandum and the Indentures.

     Section 1.2. Effectiveness of Registration Statement. The Company shall,
subject to Article VI hereof, use its commercially reasonable efforts to cause
the Registration Statement to become effective as soon as practicable and
within 90 days after the filing thereof, and shall use its commercially
reasonable efforts to keep the Registration Statement continuously effective
from the date such Registration Statement becomes effective until the earlier
of (i) the sale of all the securities registered thereunder, (ii) two years
after the Effective Date and (iii) the holding period mandated in Rule 144(k)
of the Securities Act of 1933 or any successor provision thereof "Effectiveness
Period").

     Section 1.3. Supplements; Amendments. Subject to Sections V and VI hereof,
the Company shall supplement or amend the Registration Statement, (i) as
required by Form F-3 (or such other form as is available to the Company at such
time), including, without limitation, the instructions applicable to Form F-3,
or by the Securities Act, the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), or the rules and regulations promulgated under the Securities
Act or the Exchange Act, respectively, (ii) upon receipt of the information set
forth in Article II below, as is necessary to permit at least 5% of holders of
the then-outstanding 11% Notes, 2% Notes or Conversion Shares, respectively, at
any time and from time to time, to be included in the prospectus contained in
such Registration Statement and to deliver such prospectus to purchasers of the
Notes or the Conversion Shares, as the case may be, and (iii) to include in the
Registration Statement any additional securities that become Registrable
Securities by operation of the definition thereof. The Company shall furnish to
the Holders of such Registrable Securities to which the Registration Statement
relates copies of any such supplement or amendment sufficiently in advance of
its use and/or filing with the Commission.


<PAGE>

                                  Article II.

                    Provision of Information by the Holders

     Section 2.1. Information To Be Provided By Holders. Each of the Holders
whose Registrable Securities are included in the Registration Statement shall
furnish to the Company at least five (5) business days prior to each of (i) the
initial filing of the Registration Statement and (ii) any supplement or
amendment to such Registration Statement in accordance with Section 1.3., a
completed questionnaire set forth on Annex A hereto (the "Questionnaire") and
such other information regarding such Holder as the Company may reasonably
request in writing and as shall be reasonably required or advisable in
connection with any registration, qualification or compliance referred to in
this Agreement (such information together with the Questionnaire the "Holder
Information"), and shall promptly notify the Company if such Holder Information
becomes incorrect or misleading, or requires amendment or updating; provided
that such Holder Information shall only be used in connection with the
completion of the Registration Statement. Subject to the foregoing, Holders
hereby also waive any notice of the initial filing of the Registration
Statement and agree that such Holders and their successors and assigns will
promptly notify the Company of any changes in such Holder Information.

     Section 2.2. Special Interest. Any Holder that does not complete and
deliver the Holder Information will not be named as a selling security holder
in the prospectus and therefore will not be permitted to sell the Notes or the
Conversion Shares pursuant to the Registration Statement and will not be
entitled to receive, and the Company shall not be obligated to pay, Special
Interest (as defined in the Indentures). Further, the Holders shall not be
entitled to receive, and the Company shall not be obligated to pay, Special
Interest if the Company is not required to file a Registration Statement
because the 50% threshold set forth in Section 1.1 is not met.

     Section 2.3. Transfer Restrictions. Each Holder further acknowledges the
restrictions set forth in the Offering Memorandum in the Section "Notice to
Investors and Transfer Restrictions" and that such Holder will not resell any
Registrable Securities pursuant to the Registration Statement in any manner
other than as provided therein or herein.

                                 Article III.

                            Registration Procedures

     Section 3.1. Registration. The Company will advise the Holders as to the
status of the preparation, filing and effectiveness of the Registration
Statement and, at the Company's expense, will do the following:

     (a) make available to each Holder upon their request a copy of the
Registration Statement (including all exhibits thereto) and any prospectus
forming a part thereof and any amendments and supplements thereto (including
all documents incorporated or deemed incorporated by reference therein prior to
the effectiveness of the Registration Statement and including each preliminary
prospectus) and any other prospectus filed under Rule 424 under the Securities
Act, which documents, other than documents incorporated or deemed incorporated
by


                                      -3-
<PAGE>


reference, will be subject to the review of the information contained therein
regarding the Holders and any plan for resale of the Registrable Securities by
the Holders for a period of at least seven (7) business days from the Holder's
receipt of such documents, and the Company shall not file the Registration
Statement or such prospectus or any amendment or supplement to the Registration
Statement or prospectus if any Holder shall reasonably object within a seven
(7) business day period after the receipt thereof unless the Company shall have
been advised by its counsel that the Registration Statement or such prospectus
or amendment or supplement thereto is required under the Securities Act or the
rules or regulations adopted thereunder in connection with the distribution of
Registrable Securities by the Holders or the Company. A Holder shall be deemed
to have reasonably objected to such filing only if the Registration Statement,
amendment, prospectus or supplement, as applicable, as proposed to be filed,
contains a material misstatement or omission with respect to such Holder or its
plan of resale;

     (b) make available to each Holder upon their request one copy of the
Registration Statement and of each amendment and supplement thereto (in each
case including all exhibits) and such number of copies of the prospectus
forming a part of the Registration Statement and any prospectus filed under
Rule 424 under the Securities Act, in conformity with the requirements of the
Securities Act;

     (c) use its commercially reasonable efforts (i) to register or qualify all
Registrable Securities covered by the Registration Statement under state
securities, or "blue sky," laws of such States of the United States of America
where required and where an exemption is not available and as the Holders of
Registrable Securities covered by the Registration Statement shall reasonably
request, (ii) to keep such registration or qualification in effect for the
Registration Period, and (iii) to take any other action which may be reasonably
necessary or advisable to enable the Holders to consummate the disposition of
the securities to be sold by the Holders in such jurisdictions, consistent with
the plan of distribution described in the prospectus included in the
Registration Statement, except that the Company shall not for any such purpose
be required to qualify generally to do business as a foreign corporation in any
jurisdiction where it is not so qualified, or to execute a general consent to
service of process in effecting such registration, qualification or compliance,
unless the Company is already subject to service in such jurisdiction and
except as may be required by the Securities Act or applicable rules or
regulations thereunder;

     (d) use its commercially reasonable efforts to cause all Registrable
Securities covered by the Registration Statement to be registered or qualified
with or approved by all other applicable governmental authorities as may be
necessary, in the opinion of counsel to the Company and counsel to the Holders
of Registrable Securities, to enable the Holders thereof to consummate the
disposition of such Registrable Securities;

     (e) subject to Article VI hereof, promptly notify the Trustee on behalf of
the Holders and each Holder selling Registrable Securities covered by the
Registration Statement (i) upon discovery that, or upon the occurrence of any
event as a result of which, the prospectus forming a part of the Registration
Statement, as then in effect, includes an untrue statement of a material fact
or omits to state any material fact required to be stated therein or necessary
to make the statements therein, in the light of the circumstances under which
they were made, not misleading, (ii) of the issuance by the Commission of any
stop order suspending the


                                      -4-
<PAGE>


effectiveness of the Registration Statement or the initiation of proceedings
for that purpose, (iii) of any request by the Commission for (A) amendments to
the Registration Statement or any document incorporated or deemed to be
incorporated by reference in the Registration Statement, or (B) supplements to
the prospectus forming a part of the Registration Statement, or (C) additional
information, or (iv) of the receipt by the Company of any notification with
respect to the suspension of the registration, qualification or exemption from
registration or qualification of any of the Registrable Securities for sale in
any jurisdiction or the initiation of any proceeding for such purpose, and at
the request of the Trustee as directed by such Holders or any such selling
Holder promptly prepare and file an amendment to the Registration Statement or
a supplement to the prospectus, as the Company may deem necessary so that, as
thereafter delivered to the purchasers of such securities, such prospectus
shall not include an untrue statement of a material fact or omit to state a
material fact relating to any holder of Registrable Securities required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and make available to
each Holder upon their request a reasonable number of copies of such supplement
to, or amendment of, such registration statement and prospectus, and, in the
event of a stop order, use its commercially reasonable efforts to obtain the
withdrawal of any order suspending the effectiveness of any the Registration
Statement, or the lifting of any suspension of the qualification (or exemption
from qualification) of any of the Registrable Securities for sale in any
jurisdiction;

     (f) if reasonably requested by any Holder or if required by law or SEC or
other applicable rule or regulation, promptly incorporate in the Registration
Statement such appropriate information as the Holder may reasonably request to
have included therein by filing a Form 6-K, or filing a supplement to the
prospectus, to reflect any change in the information regarding the Holder, and
make all required filings with the Commission in respect of any offer or sale
of Registrable Securities or any amendment or supplement to the Registration
Statement or related prospectus provided, however that the Company shall only
be obligated to include the information of Holders of Registrable Securities in
such prospectus who, from time to time, collectively hold collectively at least
5% of the then-outstanding 11% Notes, the 2% Notes and/or the Conversion
Shares, respectively and have provided the Holder Information to the Company
for inclusion in the prospectus;

     (g) use its commercially reasonable efforts to cause all Registrable
Securities included in the Registration Statement to be listed on The Nasdaq
National Market ("Nasdaq") and each securities exchange on which securities of
the same class are then listed, or, if not then listed on any securities
exchange or Nasdaq, to be eligible for trading in any over-the-counter market
or trading system in which securities of the same class are then traded;

     (h) the Trustee shall have no duty to monitor the Company's performance of
its obligations under this Agreement; and

     (i) Article VI of each of the Indentures is incorporated herein by
reference.


                                      -5-
<PAGE>


                                  Article IV.

                                Indemnification

     Section 4.1. Indemnification by the Company. The Company will indemnify
and hold harmless to the fullest extent permitted by law:

     (a) the Trustee;

     (b) each of the Holders, as applicable, and

     (c) each of the Holder's officers, directors, members and general and
limited partners,

with respect to the Registration Statement, against all expenses, claims,
losses, damages and liabilities (joint or several) (or actions, investigations
or proceedings in respect thereof) (collectively, a "Claim") arising out of or
based on any actual or alleged untrue statement of a material fact, or any
omission of a material fact required to be stated therein or necessary in order
to make the statements included therein not misleading, contained in the
Registration Statement, any prospectus or other offering document (including
any related registration statement, notification or the like) incident to the
registration, qualification or compliance, or any violation by the Company of
the Securities Act or the Exchange Act or any other laws or any rule or
regulation thereunder applicable to the Company and relating to action or
inaction required of the Company in connection with any such registration,
qualification or compliance, and will reimburse each of the Holders, each of
its officers, directors, members and partners, and each Person controlling each
of the Holders, for any legal and any other expenses reasonably incurred in
connection with investigating and defending any such Claim; provided, however,
that the Company will not be liable in any such case to the extent that any
such Claim (i) arises out of or is based on any untrue statement or omission
based upon the Holder Information or any other written information furnished to
the Company by the Holders or their representatives and stated to be
specifically for use therein, or (ii) is finally judicially determined to have
resulted primarily from the gross negligence or willful misconduct of any
person or entity set forth in subsections (a) through (c) above.

     Section 4.2. Indemnification by the Holders. Each of the Holders will, if
Registrable Securities held by it are included in the securities as to which
such Registration Statement is being effected, severally and not jointly,
indemnify the Company, each of its directors and officers, and each Person who
"controls" the Company within the meaning of SEC Rule 405 under the Securities
Act, Section 15 of the Securities Act or Section 20 of the Exchange Act, and
each other Holder, against all Claims arising out of or based on any actual or
alleged untrue statement of a material fact, or any omission or a material fact
required to be stated therein or necessary in order to make the statement
included or incorporated therein not misleading, contained in the Registration
Statement, prospectus, or other offering document made by or on behalf of such
Holder, and will reimburse the Company and each other Holder, its respective
directors, officers, partners, members or control Persons for any legal or any
other expenses reasonably incurred in connection with investigating and
defending any such Claim, in each case to the extent, but only to the extent,
that such untrue statement (or alleged untrue statement) or omission (or
alleged omission) is made in the Registration Statement, prospectus, offering


                                      -6-
<PAGE>


memorandum or other document in reliance upon and in conformity with written
information furnished to the Company by or on behalf of such Holder and stated
to be specifically for use therein; provided, however, that the several
obligations of each of the Holders hereunder shall be limited to an amount
equal to the net proceeds received by such Holder from the sale of the
Registrable Securities pursuant to the Registration Statement.

     Section 4.3. Procedures. Each party entitled to indemnification under this
Agreement (each, an "Indemnified Party") shall give written notice to the party
required to provide indemnification (the "Indemnifying Party") promptly after
such Indemnified Party has actual knowledge of any Claim as to which indemnity
may be sought, and shall permit the Indemnifying Party to assume the defense of
any such Claim; provided that counsel for the Indemnifying Party, who shall
conduct the defense of such Claim, shall be approved by the Indemnified Party
(whose approval shall not unreasonably be withheld), and the Indemnified Party
may participate in such defense at such party's expense (unless the Indemnified
Party shall have reasonably concluded that there may be a conflict of interest
between the Indemnifying Party and the Indemnified Party in such action, in
which case the fees and expenses of one such counsel for all Indemnified
Parties shall be at the expense of the Indemnifying Party), and provided
further that the failure of any Indemnified Party to give notice as provided
herein shall not relieve the Indemnifying Party of its obligations under this
Agreement unless the Indemnifying Party is materially prejudiced thereby. No
Indemnifying Party, in the investigation or defense of any such Claim shall,
except with the consent of each Indemnified Party (which consent shall not be
unreasonably withheld or delayed), consent to entry of any judgment or enter
into any settlement or compromise which does not include an unconditional
release of the Indemnifying Party from all liability in respect to such Claim.
Each Indemnified Party shall furnish such information regarding itself or the
Claim in question as an Indemnifying Party may reasonably request in writing
and as shall be reasonably required in connection with the investigation and
defense of such Claim.

     Section 4.4. Contribution. If the indemnification provided for in this
Agreement is held by a court of competent jurisdiction to be unavailable to an
Indemnified Party with respect to any Claim or expense, then the Indemnifying
Party, in lieu of indemnifying such Indemnified Party hereunder, shall
contribute to the amount paid or payable by such Indemnified Party as a result
of such loss, liability, claim, damage or expense in such proportion as is
appropriate to reflect the relative fault of the Indemnifying Party on the one
hand and of the Indemnified Party on the other in connection with the
statements or omissions which resulted in such Claim, as well as any other
relevant equitable considerations; provided, however, that the Company will not
be liable in any such case to the extent that any such Claim (i) arises out of
or is based on any untrue statement or omission based upon written information
furnished to the Company by the Holders or their Representatives and stated to
be specifically for use therein, or (ii) is finally judicially determined to
have resulted primarily from the gross negligence or willful misconduct of any
person or entity set forth in Section 4.1(a) through 4.1(c) above. The relative
fault of the Indemnifying Party and of the Indemnified Party shall be
determined by reference to, among other things, whether the untrue (or alleged
untrue) statement of a material fact or the omission (or alleged omission) to
state a material fact relates to information supplied by the Indemnifying Party
or by the Indemnified Party and the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such statement or
omission, and provided that each Holder shall not be required to contribute, in
the aggregate, more than the net proceeds


<PAGE>


received by such Holder from the sale of its Registrable Securities pursuant to
the Registration Statement and further provided that the obligations of the
Holders under this Section 4.4 shall be several and not joint.

     Section 4.5. Periodic Payments. The indemnification and contribution
required by this Article IV shall be made by periodic payments of the amount
thereof during the course of the investigation or defense, as and when bills
are received or expense, loss, damage or liability is incurred.

                                  Article V.

                                   Marketing

     The Company shall use its commercially reasonable efforts to undertake
such marketing efforts, in consultation with the holders of Registrable
Securities listed on Schedule V hereto1, as are appropriate for similar
securities of comparable issuers, provided, however, that the Company shall
only be required to undertake any such efforts at the request of at least 5% of
Holders of then-outstanding Registrable Securities who have provided to the
Company the Holder Information for inclusion in the prospectus and provided
further, however, that the Company shall only be obligated to undertake one
such effort pursuant to this Agreement.

                                  Article VI.

                                    Expenses

     Section 6.1. The Company shall pay all expenses, fees and costs incurred
in connection with the preparation, filing, distribution and effectiveness of
the Registration Statement and any supplements or amendments thereto, whether
or not the Registration Statement becomes effective, and whether all, none or
some of the Registrable Securities are sold pursuant to the Registration
Statement, including, without limitation, all registration and filing fees,
printing expenses, fees and disbursements of counsel for the Company, fees and
state securities, or "blue sky," fees, and the expense of any special audits
incident to or required by, or in connection with the filing and effectiveness
of the Registration Statement. The Holders shall, severally and not jointly,
pay all selling commissions, brokerage fees and stock transfer taxes applicable
to the Registrable Securities sold by such Holder.

                                 Article VII.

                             Holdback; Postponement

     Notwithstanding the other provisions of this Agreement, if (a) there is
material non-public information regarding the Company which the Company's Board
of Directors reasonably and in good faith determines not to be in the Company's
best interest to disclose and which the Company is not otherwise required to
disclose, or (b) there is a extraordinary business


- --------
1 The Initial Participants.


                                      -8-
<PAGE>

opportunity (including but not limited to the acquisition or disposition of
assets (other than in the ordinary course of business) or any merger,
consolidation, tender offer or other similar extraordinary transaction not in
the ordinary course of business) available to the Company which the Company's
Board of Directors reasonably and in good faith determines not to be in the
Company's best interest to disclose, then the Company may postpone or suspend
filing or effectiveness of a registration statement for a period not to exceed
30 days in any 90 day period, provided that the Company may not postpone or
suspend filing or effectiveness of a registration statement for more than 180
days in the aggregate during any 365-day period and there shall be an aggregate
of not more than two (2) suspensions during any 365-day period; provided,
however that no postponement or suspension shall be permitted for consecutive
90 day periods arising out of the same set of facts, circumstances or
transactions.

                                 Article VIII.

                            Rule 144 Reporting, Etc.

     Section 8.1. SEC Reporting Compliance.

     (a) During the Effectiveness Period and with a view to making available
the benefits of certain rules and regulations of the Commission which may at
any time permit the sale of the Registrable Securities to the public without
registration, the Company will:

     (i)  make and keep "current public information" regarding the Company
          available, as defined in Commission Rule 144(c) under the Securities
          Act, and cooperate with the Holders and take such further reasonable
          action as the Holders may reasonable request in writing (including,
          without limitation, making such reasonable representations as the
          Holders may reasonably request);

     (ii) use its commercially reasonable efforts to file with the Commission
          in a timely manner all SEC Reports and other filings and documents
          required of the Company under the Securities Act and the Exchange
          Act; and

    (iii) so long as a Holder owns any Registrable Securities, furnish to such
          Holder and the Trustee forthwith upon request a written statement by
          the Company as to its compliance with the reporting requirements
          under the Securities Act and the Exchange Act, including compliance
          with SEC Rule 144(c), a copy of the most recent annual or quarterly
          report of the Company, and such other reports and documents of the
          Company and other information in the possession of, or reasonably
          obtainable by, the Company as a Holder may reasonably request in
          availing itself of any rule or regulation of the Commission allowing
          a Holder to sell any such securities without registration.

     Notwithstanding the foregoing, nothing in this Section 7.1(a) shall be
deemed to require the Company to register any of its securities (other than the
Conversion Shares) under any section of the Exchange Act, unless otherwise
required.


                                      -9-
<PAGE>


     (b) The Company shall timely file the reports required to be filed by it
under the Exchange Act and shall comply with all other requirements set forth
in the instruction to Form F-3 in order to allow the Company to be eligible to
file registration statements on Form F-3.

                                  Article IX.

                                 Miscellaneous

     Section 9.1. Assignment. The registration rights set forth herein may be
assigned, in whole or in part, to any transferee of Registrable Securities
permitted in accordance with the Indentures, which transferee, upon
registration on the Company's or its transfer agent's books and records as a
holder of record of Registrable Securities, shall be considered thereafter to
be a Holder and shall be bound by all obligations and limitations of this
Agreement and the Indentures.

     Section 9.2. Section Headings. The titles and headings of the sections and
subsections of this Agreement are inserted for convenience only and shall not
be deemed to constitute a part thereof.

     Section 9.3. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York without giving
effect to the conflict of law rules thereof to the extent that the application
of the law of another jurisdiction would be required thereby. Any claim or
proceeding brought to enforce the Company's obligations herein shall be brought
exclusively before any federal or state court in the Borough of Manhattan, The
City of New York. The Company will irrevocably and unconditionally (i) submit
itself and its property in any legal action or proceeding relating to the
Guarantee to which it is a party, or for recognition and enforcement of any
judgment in respect thereof, to the general jurisdiction of the Courts of the
State of New York, the courts of the United States of America for the Southern
District of New York, appellate courts from any thereof and courts of its own
corporate domicile, with respect to actions brought against it as defendant;
(ii) consent that any such action or proceeding may be brought in such courts
and waive any objection that it may now or hereafter have to the venue of any
such action or proceeding in any such court or that such action or proceeding
was brought in an inconvenient court and agrees not to plead or claim the same;
and (iii) appoint CT Corporation System , currently having an office at 111
Eighth Avenue, New York, New York 10011, as its agent to receive on its behalf
service of all process in any such action or proceeding, such service being
hereby acknowledged by the Company to be effective and binding in every
respect.

     Section 9.4. Notices.

     (a) All communications under this Agreement shall be in writing and shall
be delivered by facsimile, by hand, by reliable overnight delivery service such
as UPS or FedEx or by registered or certified mail, postage prepaid, to the
address listed in the Indentures, or at such other address as it may have
furnished in writing to respective other party.

(b) Any notice so addressed shall be deemed to be given (i) if delivered by
hand, on the date of such delivery, (ii) if sent by reliable overnight delivery
service such as UPS or FedEx,


                                     -10-
<PAGE>


on the first business day following the date of delivery to such service for
overnight delivery, (iii) if delivered by facsimile, on the date of such
facsimile, or (iv) if mailed by registered or certified mail, on the third
business day after the date of such mailing. In the event that any notice is
sent by facsimile transmission to the Company, such transmission shall be
followed immediately by overnight delivery to the Company of such notice.

     Section 9.5. Successors and Assigns; No Third Party Beneficiaries. This
Agreement shall inure to the benefit of and be binding upon the successors and
permitted assigns of each of the parties. No other person is intended to or
shall have any rights or remedies hereunder, whether as a third part
beneficiary or otherwise.

     Section 9.6. Severability. In the event that any provision contained
herein is unenforceable, the remaining provisions shall continue in full force
and effect.

     Section 9.7. Delays or Omissions. It is agreed that no delay or omission
to exercise any right, power or remedy accruing to the Holders, upon any breach
or default of the Company under this Agreement, shall impair any such right,
power or remedy, nor shall it be construed to be a waiver of any provision
hereof, or of any similar breach or default thereafter occurring; nor shall any
waiver of any single breach or default be deemed a waiver of any other breach
or default theretofore or thereafter occurring. It is further agreed that any
waiver, permit, consent or approval of any kind or character by a Holder of any
breach or default under this Agreement, or any waiver by a Holder of any
provisions or conditions of this Agreement, must be in writing and shall be
effective only to the extent specifically set forth in the writing, and that
all remedies, either under this Agreement, or by law or otherwise afforded to a
Holder, shall be cumulative and not alternative.

     Section 9.8. Entire Agreement; Amendment. This Agreement is a part of and
read to be in conjunction with the applicable Indenture to which it is
attached. This Agreement and the Indentures and any other document contemplated
hereby or thereby constitute the entire understanding and agreement of the
parties with respect to the subject matter hereof and supersede all prior
understandings, written or otherwise, among such parties. This Agreement may be
amended only in a writing signed by the Company and the Holders of at least a
majority in principal amount of the then outstanding Registrable Securities.



















                                      -11-
<PAGE>


                                    ANNEX A

            Form of Selling Securityholder Notice and Questionnaire

     The undersigned beneficial holder of 11% Senior Amortizing Notes due 2006
(the "11% Notes") and 2% Senior Convertible PIK Notes due 2006 (the "2% Notes"
and together with the 11% Notes the "New Notes") of Millicom International
Cellular, S.A. ("MIC" or the "Company") or shares of common stock issued upon
conversion of the 2% Notes, (together with the New Notes, the "Registrable
Securities"), of the Company understands that the Company has filed or intends
to file with the Securities and Exchange Commission a registration statement on
Form F-3, or, in the event that Form F-3 is unavailable to the Company, a
registration statement on such other SEC Form that is available to the Company,
(the "Shelf Registration Statement") for the registration and resale under Rule
415 of the Securities Act of 1933, as amended (the "Securities Act"), of the
Registrable Securities in accordance with the terms of the Registration Rights
Agreement (the "Registration Rights Agreement") between the Company and the
holders named therein. A copy of the Registration Rights Agreement is available
from the Company upon request at the address set forth below. All capitalized
terms not otherwise defined herein shall have the meaning ascribed thereto in
the Registration Rights Agreement.

     Each beneficial owner of Registrable Securities is entitled to the
benefits of the Registration Rights Agreement. In order to sell or otherwise
dispose of any Registrable Securities pursuant to the Shelf Registration
Statement, a beneficial owner of Registrable Securities generally will be
required to be named as a selling securityholder in the related prospectus,
deliver a prospectus to purchasers of Registrable Securities and be bound by
those provisions of the Registration Rights Agreement applicable to such
beneficial owner (including certain indemnification provisions, as described
below). Beneficial owners are encouraged to complete and deliver this Notice
and Questionnaire prior to the effectiveness of the Shelf Registration
Statement so that such beneficial owners may be named as selling
securityholders in the related prospectus at the time of effectiveness. Upon
receipt of a completed Notice and Questionnaire from a beneficial owner
following the effectiveness of the Shelf Registration Statement, the Company
will, as promptly as practicable, file such amendments to the Shelf
Registration Statement or supplements to the related prospectus as are
necessary to permit such holder to deliver such prospectus to purchasers of
Registrable Securities. The Company has agreed to pay liquidated damages
pursuant to the Registration Rights Agreement under certain circumstances as
set forth therein.

     Certain legal consequences arise from being named as a selling
securityholder in the Shelf Registration Statement and the related prospectus.
Accordingly, holders and beneficial owners of Registrable Securities are
advised to consult their own securities law counsel regarding the consequences
of being named or not being named as a selling securityholder in the Shelf
Registration Statement and the related prospectus.

                                     Notice

     The undersigned beneficial owner (the "Selling Securityholder") of
Registrable Securities hereby gives notice to the Company of its intention to
sell or otherwise dispose of Registrable Securities beneficially owned by it
and listed below in Item 3 (unless otherwise specified under Item 3) pursuant
to the Shelf Registration Statement. The undersigned, by
<PAGE>


signing and returning this Notice and Questionnaire, understands that it will
be bound by the terms and conditions of this Notice and Questionnaire and the
Registration Rights Agreement.

     The undersigned hereby provides the following information to the Company
and represents and warrants that such information is accurate and complete:

                                 Questionnaire

                 1. Full legal Name of Selling Securityholder:

     ___________________________________________________________________________
Full Legal Name of Registered Holder (if not the same as (a) above) through
which Registrable Securities listed in (3) below are held:

     ___________________________________________________________________________
Full Legal Name of DTC Participant (if applicable and if not the same as (b)
above) through which Registrable Securities listed in (3) below are held:

      ____________________________________________________________________
               2. Address for Notices to Selling Securityholder:

      Telephone:________________________________________________________________

      Fax:______________________________________________________________________

     Contact Person:____________________________________________________________

               3. Beneficial Ownership of Registrable Securities:

Type and Principal Amount of Registrable Securities beneficially owned:

     ___________________________________________________________________________

CUSIP No(s). of such Registrable Securities beneficially owned:

     ___________________________________________________________________________
     4. Beneficial Ownership of other Company securities owned by the Selling
        Securityholder:

Except as set forth below in this Item (4),the undersigned is not the
beneficial or registered owner of any securities of the Company other than the
Registrable Securities listed above in Item (3).

Type and Amount of Other Securities beneficially owned by the Selling
Securityholder:

     ___________________________________________________________________________
CUSIP No(s). of such Other Securities beneficially owned:

     ___________________________________________________________________________
                       5. Relationship with the Company:


                                      -2-
<PAGE>


Except as set forth below, neither the undersigned nor any of its affiliates,
directors or principal equityholders (5% or more) has held any position or
office or has had any other material relationship with the Company (or its
predecessors or affiliates) during the past three years.

State any exceptions here:

________________________________________________________________________________

________________________________________________________________________________

                            6. Plan of Distribution:

Except as set forth below, the undersigned (including its donees or pledgees)
intends to distribute the Registrable Securities listed above in Item (3)
pursuant to the Shelf Registration Statement only in accordance with the
following principles (if at all): Such Registrable Securities may be sold from
time to time directly by the undersigned or alternatively, through
underwriters, broker-dealers or agents. If the Registrable Securities are sold
through underwriters or broker-dealers, the Selling Securityholder will be
responsible for underwriting discounts or commissions or agent's commissions.
Such Registrable Securities may be sold in one or more transactions at fixed
prices, at prevailing market prices at the time of sale, at varying prices
determined at the time of sale, or at negotiated prices. Such sales may be
effected in transactions (which may involve block transactions) (i) on any
national securities exchange or quotation service on which the Registrable
Securities may be listed or quoted at the time of sale, (ii) in the
over-the-counter market, (iii) in transactions otherwise than on such exchanges
or services or in the over-the-counter market, or (iv) through the writing of
options. In connection with sales of the Registrable Securities or otherwise,
the undersigned may enter into hedging transactions with broker-dealers, which
may in turn engage in short sales of the Registrable Securities, short and
deliver Registrable Securities to close out such short positions, or loan or
pledge Registrable Securities to broker-dealers that in turn may sell such
securities.

State any exceptions here:

________________________________________________________________________________

________________________________________________________________________________

Note:   In no event will such method(s) of distribution take the form of an
        underwritten offering of the Registrable Securities
        without the prior agreement of the Company.

     The undersigned acknowledges that it understands its obligation to comply
with the provisions of the Securities Exchange Act of 1934, as amended, and the
rules thereunder relating to stock manipulation, particularly Regulation M
thereunder (or any successor rules or regulations), in connection with any
offering of Registrable Securities pursuant to the Shelf Registration
Statement. The undersigned agrees that neither it nor any person acting on its
behalf will engage in any transaction in violation of such provisions.

     The Selling Securityholder hereby acknowledges its obligations under the
Registration Rights Agreement to indemnify and hold harmless certain persons as
set forth therein.

                                      -3-
<PAGE>


     Pursuant to the Registration Rights Agreement, the Company has agreed
under certain circumstances to indemnify the Selling Securityholders against
certain liabilities.

     In accordance with the undersigned's obligation under the Registration
Rights Agreement to provide such information as may be required by law for
inclusion in the Shelf Registration Statement, the undersigned agrees to
promptly notify the Company of any inaccuracies or changes in the information
provided herein that may occur subsequent to the date hereof at any time while
the Shelf Registration Statement remains effective. All notices hereunder and
pursuant to the Registration Rights Agreement shall be made in writing at the
address set forth below.

     By signing below, the undersigned consents to the disclosure of the
information contained herein in its answers to items (1) through (6) above and
the inclusion of such information in the Shelf Registration Statement and the
related prospectus. The undersigned understands that such information will be
relied upon by the Company in connection with the preparation or amendment of
the Shelf Registration Statement and the related prospectus.

     IN WITNESS WHEREOF, the undersigned, by authority duly given, has caused
this Notice and Questionnaire to be executed and delivered either in person or
by its duly authorized agent.


Dated:


                                              Beneficial Owner


                                              By:
                                                  ------------------------------
                                                  Name:
                                                  Title:


PLEASE RETURN THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE TO MIC.


                                      -4-

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4.2
<SEQUENCE>5
<FILENAME>jun2703_ex0402.txt
<TEXT>


                                                                    EXHIBIT 4.2

================================================================================


                      MILLICOM INTERNATIONAL CELLULAR S.A.

                                                         Issuer

                                      TO

                              THE BANK OF NEW YORK

                                                        Trustee

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

                                   Indenture

                            Dated as of May 8, 2003

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


                                  $63,714,000

                        2% SENIOR CONVERTIBLE PIK NOTES

                                    Due 2006

================================================================================


<PAGE>


                      MILLICOM INTERNATIONAL CELLULAR S.A.
                 Certain Sections of this Indenture relating to
                        Sections 310 through 318 of the
                          Trust Indenture Act of 1939:


 Trust Indenture
   Act Section                                                 Indenture Section
- ----------------                                               -----------------
ss.310 (a)(1)                                                  6.09
        (a)(2)                                                 6.09
        (a)(3)                                                 Not Applicable
        (a)(4)                                                 Not Applicable
        (a)(5)                                                 6.09
        (b)                                                    6.08
                                                               6.10
ss.311 (a)                                                     6.13
        (b)                                                    6.13
ss.312 (a)                                                     7.01
                                                               7.02(a)
        (b)                                                    7.02(b)
        (c)                                                    7.02(c)
ss.313 (a)                                                     7.03(a)
        (b)                                                    7.03(a)
        (c)                                                    7.03(a)
        (d)                                                    7.03(b)
ss.314 (a)                                                     7.04
        (a)(4)                                                 1.01
                                                               10.04
        (b)                                                    Not Applicable
        (c)(1)                                                 1.02
        (c)(2)                                                 1.02
        (c)(3)                                                 Not Applicable
        (d)                                                    Not Applicable
        (e)                                                    1.02
ss.315 (a)                                                     6.01
        (b)                                                    6.02
        (c)                                                    6.01
        (d)                                                    6.01
        (e)                                                    5.14
ss.316 (a)                                                     1.01
       (a)(1)(A)                                               5.12
       (a)(1)(B)                                               5.02, 5.13
       (a)(2)                                                  Not Applicable
       (b)                                                     5.08
       (c)                                                     1.04(c)


                                      -i-


ss. 317(a)(1)                                                  5.03
       (a)(2)                                                  5.04
       (b)                                                    10.03
ss.318 (a)                                                     1.07
















                                       ii
<PAGE>


                               TABLE OF CONTENTS


                                                                            Page
                                                                            ----
Parties                                                                       1
Recitals of the Company                                                       1
                                  ARTICLE ONE
                      DEFINITIONS AND OTHER PROVISIONS OF
                              GENERAL APPLICATION

   SECTION 1.01   Definitions .................................................1
                  Acquired Debt ...............................................2
                  Act .........................................................2
                  Additional Step-Up ..........................................2
                  Affiliate ...................................................2
                  Agent Member ................................................2
                  Applicable Procedures .......................................2
                  Asset Disposition ...........................................2
                  Authenticating Agent ........................................3
                  Board of Directors ..........................................3
                  Board Resolution ............................................3
                  Business Day ................................................3
                  Capital Lease Obligation ....................................3
                  Capital Stock ...............................................3
                  Cash Equivalents ............................................3
                  Cellular Operating Income ...................................4
                  Change of Control ...........................................4
                  Closing Price ...............................................4
                  Commission ..................................................5
                  Common Stock ................................................5
                  Company .....................................................5
                  Company Request or Company Order ............................5
                  Consolidated Corporate and License Acquisition Expense ......5
                  Consolidated Income Tax Expense .............................5
                  Consolidated Interest Expense ...............................5
                  Consolidated Net Income .....................................6
                  Corporate Trust Office ......................................6
                  corporation .................................................6
                  Credit Facility .............................................6
                  Debt ........................................................7
                  Debt Coverage Ratio .........................................7
                  Default Amount ..............................................7
                  Defaulted Interest ..........................................7
                  Depository ..................................................8
                  Event of Default ............................................8


                                    -iii-
<PAGE>


                  Exchange Act ................................................8
                  Expiration Date .............................................8
                  Global Security .............................................8
                  Government Securities .......................................8
                  Gradation ...................................................8
                  Guarantee ...................................................8
                  Holder ......................................................9
                  Incur .......................................................9
                  Indenture ...................................................9
                  Interest Payment Date .......................................9
                  Interest Rate, Currency or Commodity Price Agreement ........9
                  Investment ..................................................9
                  Investment Grade ............................................9
                  Lien ........................................................9
                  Maturity ...................................................10
                  Minority Owned Affiliate ...................................10
                  Moody's ....................................................10
                  Net Available Proceeds .....................................10
                  Offer to Purchase ..........................................10
                  Officer's Certificate ......................................12
                  Opinion of Counsel .........................................12
                  Other Securities                  Error! Bookmark not defined.
                  Outstanding ................................................13
                  Paying Agent ...............................................13
                  Permitted Holder ...........................................13
                  Permitted Interest Rate, Currency or Commodity
                    Price Agreement ..........................................13
                  Permitted Investments ......................................14
                  Person .....................................................15
                  Predecessor Security .......................................15
                  Preferred Dividends ........................................15
                  Preferred Stock ............................................15
                  Pro Rata Portion ...........................................15
                  Purchase Date ..............................................15
                  Rating Agencies ............................................16
                  Rating Category ............................................16
                  Receivables ................................................16
                  Receivables Sale ...........................................16
                  Redeemable Stock ...........................................16
                  Redemption Date ............................................16
                  Redemption Price ...........................................16
                  Registration Rights Agreement ..............................16
                  Regular Record Date ........................................16
                  Regulation S ...............................................16
                  Regulation S Global Securities .............................16
                  Regulation S Legend ........................................17
                  Regulation S Securities ....................................17


                                               -iv-
<PAGE>


                  Related Assets .............................................17
                  Related Business ...........................................17
                  Related Person .............................................17
                  Resale Registration Statement ..............................17
                  Responsible Officer ........................................17
                  Restricted Affiliate .......................................17
                  Restricted Global Security .................................17
                  Restricted Group ...........................................17
                  Restricted Securities ......................................18
                  Restricted Securities Certificate ..........................18
                  Restricted Securities Legend ...............................18
                  Restricted Period ..........................................18
                  Restricted Subsidiary ......................................18
                  S&P ........................................................18
                  Securities Act .............................................18
                  Security Register and Security Registrar ...................18
                  Senior Debt ................................................18
                  Significant Restricted Group Member ........................19
                  Special Interest ...........................................19
                  Special Record Date ........................................19
                  Stated Maturity ............................................19
                  Step-Down Date .............................................19
                  Step-Up ....................................................19
                  Strategic Investor .........................................19
                  Subsidiary .................................................19
                  Successor Security .........................................19
                  Trustee ....................................................19
                  Trust Indenture Act ........................................20
                  Unrestricted Affiliate .....................................20
                  Unrestricted Subsidiary ....................................20
                  Vice President .............................................20
                  Voting Stock ...............................................20
                  Weighted Average Life to Maturity ..........................20
                  Wholly Owned Restricted Subsidiary .........................21
                  13 1/2% Notes ..............................................21
SECTION 1.02 Compliance Certificates and Opinions. ...........................21
SECTION 1.03 Form of Documents Delivered to Trustee. .........................21
SECTION 1.04 Acts of Holders; Record Dates. ..................................22
SECTION 1.05 Notices, Etc., to Trustee and Company ...........................23
SECTION 1.06 Notice to Holders; Waiver. ......................................23
SECTION 1.07 Conflict with Trust Indenture Act ...............................24
SECTION 1.08 Effect of Headings and Table of Contents ........................24
SECTION 1.09 Successors and Assigns ..........................................24
SECTION 1.10 Separability Clause. ............................................24
SECTION 1.11 Benefits of Indenture ...........................................24
SECTION 1.12 Governing Law. ..................................................24


                                      -v-
<PAGE>


SECTION 1.13 Submission to Jurisdiction. .....................................24
SECTION 1.14 Legal Holidays ..................................................25

                                  ARTICLE TWO
                                 SECURITY FORMS

SECTION 2.01 Forms Generally; Initial Forms of Securities ....................25
SECTION 2.02 Form of Face of Security. .......................................26
SECTION 2.03 Form of Reverse of Security .....................................29
SECTION 2.04 Form of Trustee's Certificate of Authentication .................33
SECTION 2.05 Form of Conversion Notice On Reverse of Security. ...............33

                                 ARTICLE THREE
                                 THE SECURITIES

SECTION 3.01 Title and Terms .................................................34
SECTION 3.02 Denominations. ..................................................36
SECTION 3.03 Execution, Authentication, Delivery and Dating ..................36
SECTION 3.04 Temporary Securities ............................................36
SECTION 3.05 Global Securities ...............................................37
SECTION 3.06 Registration, Registration of Transfer Generally; Certain
    Transfers and Exchanges. .................................................38
SECTION 3.07 Mutilated, Destroyed, Lost and Stolen Securities ................43
SECTION 3.08 Payment of Interest; Interest Rights Preserved ..................44
SECTION 3.09 Persons Deemed Owners. ..........................................45
SECTION 3.10 Cancellation. ...................................................46
SECTION 3.11 Computation of Interest. ........................................46
SECTION 3.12 CUSIP Numbers ...................................................46

                                  ARTICLE FOUR
                           SATISFACTION AND DISCHARGE

SECTION 4.01 Satisfaction and Discharge of Indenture .........................46
SECTION 4.02 Application of Trust Money ......................................47

                                  ARTICLE FIVE
                                    REMEDIES

SECTION 5.01 Events of Default. ..............................................48
SECTION 5.02 Acceleration of Maturity; Rescission and Annulment ..............50
SECTION 5.03 Collection of Indebtedness and Suits for Enforcement by Trustee .51
SECTION 5.04 Trustee May File Proofs of Claim. ...............................51
SECTION 5.05 Trustee May Enforce Claims Without Possession of Securities .....52
SECTION 5.06 Application of Money Collected ..................................52

                                     - vi -
<PAGE>


   SECTION 5.07 Limitation on Suits ..........................................52
   SECTION 5.08 Unconditional Right of Holders to Receive Principal, Premium
         and Interest ........................................................53
   SECTION 5.09 Restoration of Rights and Remedies ...........................53
   SECTION 5.10 Rights and Remedies Cumulative ...............................53
   SECTION 5.11 Delay or Omission Not Waiver .................................54
   SECTION 5.12 Control by Holders ...........................................54
   SECTION 5.13 Waiver of Past Defaults. .....................................54
   SECTION 5.14 Undertaking for Costs ........................................55
   SECTION 5.15 Waiver of Stay or Extension Laws. ............................55

                                  ARTICLE SIX
                                  THE TRUSTEE

   SECTION 6.01 Certain Duties and Responsibilities ..........................55
   SECTION 6.02 Notice of Defaults ...........................................56
   SECTION 6.03 Certain Rights of Trustee ....................................56
   SECTION 6.04 Not Responsible for Recitals or Issuance of Securities. ......58
   SECTION 6.05 May Hold Securities. .........................................58
   SECTION 6.06 Money Held in Trust ..........................................58
   SECTION 6.07 Compensation and Reimbursement. ..............................58
   SECTION 6.08 Disqualification; Conflicting Interests ......................59
   SECTION 6.09 Corporate Trustee Required; Eligibility ......................59
   SECTION 6.10 Resignation and Removal; Appointment of Successor ............60
   SECTION 6.11 Acceptance of Appointment by Successor .......................61
   SECTION 6.12 Merger, Conversion, Consolidation or Succession to Business ..61
   SECTION 6.13 Preferential Collection of Claims Against Company ............61
   SECTION 6.14 Appointment of Authenticating Agent ..........................61

                                 ARTICLE SEVEN
                         HOLDERS' LISTS AND REPORTS BY
                              TRUSTEE AND COMPANY

   SECTION 7.01 Company to Furnish Trustee Names and Addresses of Holders. ...63
   SECTION 7.02 Preservation of Information; Communications to Holders .......63
   SECTION 7.03 Reports by Trustee. ..........................................64
   SECTION 7.04 Reports by Company ...........................................64
   SECTION 7.05 Officer's Certificate with Respect to Change in
                Interest Rates................................................64

                                 ARTICLE EIGHT
                       CONSOLIDATION, MERGER, CONVEYANCE,
                               TRANSFER OR LEASE

   SECTION 8.01 Company May Consolidate, Etc., Only on Certain Terms. ........64

                                     -vii-
<PAGE>


   SECTION 8.02 Successor Substituted ....................................... 66

                                  ARTICLE NINE
                            SUPPLEMENTAL INDENTURES

   SECTION 9.01 Supplemental Indentures Without Consent of Holders. ..........66
   SECTION 9.02 Supplemental Indentures with Consent of Holders. .............67
   SECTION 9.03 Execution of Supplemental Indentures. ........................68
   SECTION 9.04 Effect of Supplemental Indentures ............................68
   SECTION 9.05 Conformity with Trust Indenture Act. .........................68
   SECTION 9.06 Reference in Securities to Supplemental Indentures ...........68

                                  ARTICLE TEN
                                   COVENANTS

   SECTION 10.01 Payment of Principal, Premium and Interest. .................69
   SECTION 10.02 Maintenance of Office or Agency .............................69
   SECTION 10.03 Money for Security Payments to Be Held in Trust .............69
   SECTION 10.04 Statement by Officers as to Default; Compliance
                   Certificates...............................................70
   SECTION 10.05 Existence ...................................................71
   SECTION 10.06 Maintenance of Properties. ..................................71
   SECTION 10.07 Payment of Taxes and Other Claims ...........................71
   SECTION 10.08 Limitation on Debt ..........................................72
   SECTION 10.09 Limitation on Restricted Payments ...........................74
   SECTION 10.10 Limitation on Dividend and Other Payment Restrictions
      Affecting Subsidiaries .................................................76
   SECTION 10.11 [RESERVED] ..................................................78
   SECTION 10.12 Limitation on Liens Securing Company Subordinated Debt ......78
   SECTION 10.13 Limitation on Guarantees of Company Subordinated Debt .......78
   SECTION 10.14 Limitation on Asset Dispositions ............................78
   SECTION 10.15 Transactions with Affiliates and Related Persons ............80
   SECTION 10.16 Change of Control ...........................................81
   SECTION 10.17 Provision of Financial Information ..........................82
   SECTION 10.18 Limitation on Lines of Business. ............................82
   SECTION 10.19 Payment of Additional Amounts. ..............................82
   SECTION 10.20 Guarantee. ..................................................82
   SECTION 10.21 Waiver of Certain Covenants .................................83

                                 ARTICLE ELEVEN
                            REDEMPTION OF SECURITIES

   SECTION 11.01 Right of Redemption .........................................83
   SECTION 11.02 Applicability of Article ....................................84
   SECTION 11.03 Election to Redeem; Notice to Trustee. ......................84


                                     -viii-

<PAGE>


SECTION 11.04 Selection by Trustee of Securities to Be Redeemed. .............84
SECTION 11.05 Notice of Redemption ...........................................85
SECTION 11.06 Deposit of Redemption Price ....................................86
SECTION 11.07 Securities Payable on Redemption Date ..........................86
SECTION 11.08 Securities Redeemed in Part. ...................................86

                                 ARTICLE TWELVE
                            CONVERSION OF SECURITIES

SECTION 12.01 Right to Convert ...............................................87
SECTION 12.02 Exercise of Conversion Privilege; Issuance of Shares of Common
                Stock on Conversion; No Adjustment for Interest or Dividends..87
SECTION 12.03 Cash Payments in Lieu of Fractional Shares. ....................89
SECTION 12.04 Conversion Price ...............................................89
SECTION 12.05 Adjustment of Conversion Price .................................89
SECTION 12.06 Effect of Reclassification, Consolidation, Merger or Sale ......96
SECTION 12.07 Taxes on Shares Issued. ........................................98
SECTION 12.08 Reservation of Shares; Shares to Be Fully Paid; Listing of
    Common Stock .............................................................98
SECTION 12.09 Responsibility of Trustee. .....................................99
SECTION 12.10 Notice to Holders Prior to Certain Actions .....................99

                                ARTICLE THIRTEEN
                            DEFEASANCE AND COVENANT
                                   DEFEASANCE

SECTION 13.01 Company's Option to Effect Defeasance or Covenant
                Defeasance. .................................................100
SECTION 13.02 Covenant Defeasance ...........................................101
SECTION 13.03 Conditions to Defeasance or Covenant Defeasance. ..............101
SECTION 13.04 Deposited Money and U.S. Government Obligations to Be Held
    in Trust; Other Miscellaneous Provisions ................................103
SECTION 13.05 Reinstatement .................................................103

                                      -ix-


<PAGE>


     INDENTURE, dated as of May 8, 2003, between Millicom International
Cellular S.A., a corporation duly organized and existing under the laws of the
Grand Duchy of Luxembourg (herein called the "Company"), having its principal
office at 75 Route de Longwy, Box 23, L-8080 Bertrange, Luxembourg, and The
Bank of New York, a New York banking corporation, as Trustee (herein called the
"Trustee").

                            RECITALS OF THE COMPANY

     The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its 2% Senior
Convertible PIK Notes due 2006 (herein called the "Securities"), to be issued
in one series as herein set forth.

     All things necessary to make the Securities, when executed by the Company
and authenticated and delivered hereunder and duly issued by the Company, the
valid obligations of the Company, and to make this Indenture a valid agreement
of the Company in accordance with their and its terms, have been done.

     NOW, THEREFORE, THIS INDENTURE WITNESSETH:

     For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Securities, as follows: ARTICLE ONE

     Definitions and Other Provisions of General Application SECTION 1.01
Definitions.

     For all purposes of this Indenture, except as otherwise expressly provided
or unless the context otherwise requires:

          (1) the terms defined in this Article have the meanings assigned to
     them in this Article and include the plural as well as the singular;

          (2) all other terms used herein which are defined in the Trust
     Indenture Act, either directly or by reference therein, have the meanings
     assigned to them therein;

          (3) all accounting terms not otherwise defined herein have the
     meanings assigned to them in accordance with generally accepted
     International Financial Reporting Standards and, except as otherwise
     herein expressly provided, the term International Financial Reporting
     Standards, with respect to any computation required or permitted hereunder
     shall mean such accounting principles as are generally accepted at the
     date of this Indenture; and


<PAGE>


          (4) the words "herein", "hereof" and "hereunder" and other words of
     similar import refer to this Indenture as a whole and not to any
     particular Article, Section or other subdivision.

     "Acquired Debt" means Debt of any Person at the time it becomes a
Restricted Subsidiary of the Company, a Restricted Affiliate or a Restricted
Subsidiary of a Restricted Affiliate; provided that the Debt Coverage Ratio of
the Company and its Restricted Group, after giving pro forma effect to the
transaction or transactions by which such Person becomes a Restricted
Subsidiary of the Company, Restricted Affiliate or Restricted Subsidiary of a
Restricted Affiliate, would be not more than such ratio of the Company and its
Restricted Group before giving effect to such transactions.

     "Act", when used with respect to any Holder, has the meaning specified in
Section 1.04.

     "Additional Step-Up" has the meaning set forth in the form of the Security
contained in Section 2.02.

     "Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.

     "Agent Member" means any member of, or participant in, the Depository.
"Applicable Procedures" means, with respect to any transfer or transaction
involving a Global Security or beneficial interest therein, the rules and
procedures of the Depository for such Security, Euroclear and Clearstream, in
each case to the extent applicable to such transaction and as in effect from
time to time.

     "Asset Disposition" means any transfer, conveyance, sale, lease or other
disposition by the Company, any Restricted Subsidiary of the Company, any
Restricted Affiliate or any Restricted Subsidiary of a Restricted Affiliate
(including a consolidation or merger or other sale of any such Restricted
Subsidiary of the Company, Restricted Affiliate or Restricted Subsidiary of a
Restricted Affiliate with, into or to another Person in a transaction in which
such Restricted Subsidiary of the Company, Restricted Affiliate or Restricted
Subsidiary of a Restricted Affiliate ceases to be a Restricted Subsidiary of
the Company, Restricted Affiliate or Restricted Subsidiary of a Restricted
Affiliate, but excluding a disposition by a Restricted Subsidiary of the
Company, Restricted Affiliate or Restricted Subsidiary of a Restricted
Affiliate to the Company or a Restricted Subsidiary which is an 80% or more
owned Subsidiary of the Company, by the Company to a Restricted Subsidiary of
the Company which is an 80% or more owned Subsidiary of the Company, by any
Restricted Subsidiary of a Restricted Affiliate to such Restricted Affiliate or
an 80% or more owned Restricted Subsidiary of such Restricted Affiliate or by a
Restricted Affiliate to a Restricted Subsidiary of such Restricted Affiliate
which is an 80% or more owned Subsidiary of such Restricted Affiliate) of (i)
shares of Capital Stock (other

                                     - 2 -
<PAGE>


than directors' qualifying shares) or other ownership interests of a Restricted
Subsidiary of the Company, Restricted Affiliate or Restricted Subsidiary of a
Restricted Affiliate, (ii) substantially all of the assets of the Company, any
Restricted Subsidiary of the Company, any Restricted Affiliate or any
Restricted Subsidiary of a Restricted Affiliate representing a division or line
of business or (iii) other assets or rights of the Company, any Restricted
Subsidiary of the Company, any Restricted Affiliate or any Restricted
Subsidiary of a Restricted Affiliate outside of the ordinary course of business
(other than Receivables Sales), provided in each case that the aggregate
consideration for such transfer, conveyance, sale, lease or other disposition
is equal to $10 million or more; provided further that the term "Asset
Disposition" shall not include (x) any transaction subject to, and permitted
under Section 10.09 or (y) any Permitted Investment.

     "Authenticating Agent" means any Person authorized by the Trustee pursuant
to Section 6.14 to act on behalf of the Trustee to authenticate Securities.

     "Board of Directors" means either the board of directors of the Company or
any duly authorized committee of that board.

     "Board Resolution" means a copy of a resolution certified by the
President, Chief Executive Officer, any Director or the Secretary of the Board
of Directors of the Company to have been duly adopted by the Board of Directors
or a committee thereof and to be in full force and effect on the date of such
certification, and delivered to the Trustee.

     "Business Day" means each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in the Borough of Manhattan,
the City of New York, in London, England or in Luxembourg are authorized or
obligated by law or executive order to close.

     "Capital Lease Obligation" of any Person means the obligation to pay rent
or other payment amounts under a lease of real or personal property of such
Person which is required to be classified and accounted for as a capital lease
on the face of a balance sheet of such Person in accordance with International
Financial Reporting Standards. The stated maturity of such obligation shall be
the date of the last payment of rent or any other amount due under such lease
prior to the first date upon which such lease may be terminated by the lessee
without payment of a penalty. The principal amount of such obligation shall be
the capitalized amount thereof that would appear on the face of a balance sheet
of such Person in accordance with International Financial Reporting Standards.

     "Capital Stock" of any Person means any and all shares, interests,
participation or other equivalents (however designated) of corporate stock or
other equity participation, including partnership interests, whether general or
limited, of such Person.

     "Cash Equivalents" means, with respect to any Person, (i) Government
Securities, (ii) certificates of deposit and eurodollar time deposits and money
market deposits, bankers' acceptances and overnight bank deposits, in each case
issued by or with a bank or trust company which is organized under the laws of
the United States of America, any state thereof or any foreign country
recognized by the United States, and which bank or trust company has capital,
surplus and undivided profits aggregating in excess of $100 million (or the
foreign currency

                                     - 3 -
<PAGE>


equivalent thereof) and has outstanding debt which is rated "A" (or such
similar equivalent rating) or higher by at least one nationally recognized
statistical rating organization (as defined in Rule 436 under the Securities
Act) or any money-market fund sponsored by a registered broker dealer or mutual
fund distributor, (iii) repurchase obligations with a term of not more than
seven days for underlying securities of the types described in clauses (i) and
(ii) entered into with any financial institution meeting the qualifications
specified in clause (ii) above, (iv) commercial paper having the highest rating
obtainable from Moody's or S&P and in each case maturing within six months
after the date of acquisition, (v) with respect to any Person organized under
the laws of, or having its principal business operations in, a jurisdiction
outside Luxembourg or the United States, those investments that are comparable
to clauses (i), (ii), (iii) and (iv) in the country in which such Person is
organized or conducting business; and (vi) up to $2 million in aggregate of
other Investments held by Restricted Subsidiaries of the Company, Restricted
Affiliates or Restricted Subsidiaries of Restricted Affiliates.

     "Cellular Operating Income" for any period means the Consolidated Net
Income of the Company and its Restricted Group for such period increased by the
sum of (i) Consolidated Interest Expense of the Company and its Restricted
Group for such period, plus (ii) Consolidated Income Tax Expense of the Company
and its Restricted Group for such period, plus (iii) the consolidated
depreciation and amortization expense included in the income statement of the
Company and its Restricted Group for such period, plus (iv) Consolidated
Corporate and License Acquisition Expense of the Company and its Restricted
Group for such period; provided, however, that for purposes of any
determination pursuant to the provisions of Section 10.09(3)(a)(x), there shall
be excluded therefrom the Cellular Operating Income (if positive) of any
Restricted Subsidiary of the Company, Restricted Affiliate or Restricted
Subsidiary of such Restricted Affiliate (calculated separately for such Person
in the same manner as provided above for the Company and its Restricted Group)
that is subject to a restriction to the extent it would have prevented the
payment of dividends or the making of distributions to the Company or another
Restricted Subsidiary of the Company, Restricted Affiliate or Restricted
Subsidiary of a Restricted Affiliate to the extent of such restriction;
provided further that, in the event any of the Company, Restricted Affiliates
or Restricted Subsidiaries of Restricted Affiliates have made Asset
Dispositions or acquisitions of assets not in the ordinary course of business
(including acquisitions of other Persons by merger, consolidation or purchase
of Capital Stock) during or after such period, Cellular Operating Income shall
be calculated on a pro forma basis as if the Asset Dispositions or acquisitions
had taken place on the first day of such period.

     "Change of Control" has the meaning set forth in Section 10.16.

     "Closing Price" with respect to any securities (including the Securities)
on any day means the closing price on such day or, if no such sale takes place
on such day, the average of the reported high and low prices on such day, in
each case on The Nasdaq National Market or, if such security is not listed or
admitted to trading on such national market or exchange, on the principal
national securities exchange or quotation system on which such security is
quoted or listed or admitted to trading, or, if not quoted or listed or
admitted to trading on any national securities exchange or quotation system,
the average of the high and low prices of such security on the over-the-counter
market on the day in question as reported by the National Quotation Bureau
Incorporated, or a similar generally accepted reporting service, or, if not so
available, in such manner as furnished by any internationally reputable
investment bank selected from time to

                                     - 4 -


<PAGE>


time by the Board of Directors for that purpose, or a price determined in good
faith by the Board of Directors, whose determination shall be conclusive and
described in a resolution of the Board of Directors.

     "Commission" means the Securities and Exchange Commission, as from time to
time constituted, created under the Securities Exchange Act of 1934, or, if at
any time after the execution of this instrument such Commission is not existing
and performing the duties now assigned to it under the Trust Indenture Act,
then the body performing such duties at such time.

     "Common Stock" of any Person means Capital Stock of such Person that does
not rank prior, as to the payment of dividends or as to the distribution of
assets upon any voluntary or involuntary liquidation, dissolution or winding up
of such Person, to shares of Capital Stock of any other class of such Person.

     "Common Stock of the Company" means the Company's common stock, par value
$6.0.

     "Company" means the Person named as the "Company" in the first paragraph
of this instrument until a successor Person shall have become such pursuant to
the applicable provisions of this Indenture, and thereafter "Company" shall
mean such successor Person.

     "Company Request" or "Company Order" means a written request or order
signed in the name of the Company by its President; Chairman of the Board, any
Vice Chairman of the Board, any Director, its President, its Chief Executive
Officer, its Chief Operating Officer, any Senior Vice President or the
Secretary of the Board of the Company, and delivered to the Trustee.

     "Consolidated Corporate and License Acquisition Expense" means, with
respect to the Company, (i) costs of head office personnel salaries, rent, and
other head office expenses and (ii) costs (other than capitalized costs)
incurred in seeking new licenses.

     "Consolidated Income Tax Expense" for any period means the consolidated
provision for income taxes of the Company and its Restricted Group for such
period calculated on a consolidated basis in accordance with International
Financial Reporting Standards.

     "Consolidated Interest Expense" means for any period the consolidated
interest expense included in a consolidated income statement (without deduction
of interest income) of the Company and its Restricted Group for such period
calculated on a consolidated basis in accordance with International Financial
Reporting Standards, including without limitation or duplication (or, to the
extent not so included, with the addition of), (i) the amortization of Debt
discounts; (ii) any payments or fees with respect to letters of credit,
bankers' acceptances or similar facilities; (iii) fees with respect to interest
rate swap or similar agreements or foreign currency hedge, exchange or similar
agreements; (iv) Preferred Stock dividends (other than with respect to
Redeemable Stock) declared and paid or payable; (v) accrued Redeemable Stock
dividends, whether or not declared or paid; (vi) interest on Debt guaranteed by
the Company and any member of its Restricted Group; and (vii) the portion of
any rental obligation allocable to interest expense.

                                     - 5 -
<PAGE>


     "Consolidated Net Income" for any period means the consolidated net income
(or loss) of the Company and its Restricted Group for such period determined on
a consolidated basis in accordance with International Financial Reporting
Standards; provided that there shall be excluded therefrom (without
duplication) (a) the net income (or loss) of any Person acquired by the Company
or a member of its Restricted Group in a pooling-of-interests transaction for
any period prior to the date of such transaction, (b) the net income (or loss)
of any Person that is not a member of the Restricted Group of the Company
except to the extent of the amount of dividends or other distributions actually
paid to the Company or a member of its Restricted Group by such Person during
such period, (c) gains or losses on Asset Dispositions by the Company or any
member of its Restricted Group, (d) all extraordinary gains and extraordinary
losses, (e) the cumulative effect of changes in accounting principles, (f)
non-cash gains or losses resulting from fluctuations in currency exchange rates
and (g) the tax effect of any of the items described in clauses (a) through (f)
above.

     "Conversion Agent" means The Bank of New York.

     "Conversion Date" has the meaning set forth in Section 12.2.

     "Conversion Price" has the meaning set forth in Section 12.4 and is
subject to adjustment as provided in Section 12.05.

     "Corporate Trust Office" means the principal office of the Trustee at
which at any particular time its corporate trust business shall be principally
administered, which office as of the date of the execution of this Indenture is
located at The Bank of New York, One Canada Square, London E14 5AL, England,
Attention: Corporate Trust Administration, or such other address as the Trustee
may designate from time to time by notice to the Holders and the Company.

     "corporation" means a corporation, association, company, limited liability
company, joint-stock company or business trust.

     "Current Market Price" has the meaning set forth in Section 12.5(g).

     "Credit Facility" means the equity swap facility dated as of December 7,
2001, between The Toronto-Dominion Bank, London Branch and Millicom
Telecommunications S.A. including the ISDA Master Agreement, dated as of
December 7, 2001, the Schedule to the ISDA Master Agreement, dated as of
December 7, 2001, the Confirmation of an Equity Swap Transaction, dated
December 7, 2001, the Amendment Confirmation of an Equity Swap Transaction,
dated December 12, 2001, the Side Letter to Amendment Confirmation, dated
December 18, 2001, the Notice of the Initial Exchange Amount for the Amendment
Confirmation of an Equity Swap Transaction, dated December 12, 2001, the Notice
of the Initial Exchange Amount for the Amendment Confirmation of an Equity Swap
Transaction, dated December 17, 2001, the ISDA Credit Support Deed, dated
December 7, 2001, and the Side Letter regarding hedging and disposal of shares,
dated December 7, 2001, all of which are between The Toronto-Dominion Bank,
London Branch and Millicom Telecommunications S.A. and the Custody Agreement
between The Toronto-Dominion Bank, London Branch, Millicom Telecommunications
S.A. and Nordea Bank Sweden AB, dated December 7, 2001.

                                     - 6 -

<PAGE>

     "Debt" means (without duplication), with respect to any Person, whether
recourse is to all or a portion of the assets of such Person and whether or not
contingent, (i) every obligation of such Person for money borrowed, (ii) every
obligation of such Person evidenced by bonds, debentures, notes or other
similar instruments, including obligations incurred in connection with the
acquisition of property, assets or businesses, (iii) every reimbursement
obligation of such Person with respect to letters of credit, bankers'
acceptances or similar facilities issued for the account of such Person, (iv)
every obligation of such Person issued or assumed as the deferred purchase
price of property or services (including securities repurchase agreements but
excluding trade accounts payable or accrued liabilities arising in the ordinary
course of business which are not overdue or which are being contested in good
faith), (v) every Capital Lease Obligation of such Person, (vi) all Receivables
Sales of such Person, together with any obligation of such Person to pay any
discount, interest, fees, indemnities, penalties, recourse, expenses or other
amounts in connection therewith, (vii) all Redeemable Stock issued by such
Person, (viii) every obligation under Interest Rate, Currency or Commodity
Price Agreements of such Person and (ix) every obligation of the type referred
to in clauses (i) through (viii) of another Person and all dividends of another
Person the payment of which, in either case, such Person has Guaranteed or is
responsible or liable, directly or indirectly, as obligor, Guarantor or
otherwise. The "amount" or "principal amount" of Debt at any time of
determination as used herein represented by (a) any Debt issued at a price that
is less than the principal amount at maturity thereof, shall be the amount of
the liability in respect thereof determined in accordance with International
Financial Reporting Standards, (b) any Receivables Sale, shall be the amount of
the unrecovered capital or principal investment of the purchaser (other than
the Company or a Wholly Owned Restricted Subsidiary of the Company) thereof,
excluding amounts representative of yield or interest earned on such
investment, and (c) any Redeemable Stock, shall be the maximum fixed redemption
or repurchase price in respect thereof.

     "Debt Coverage Ratio", when used in connection with any Incurrence (or
deemed Incurrence) of Debt, means the ratio of (i) the consolidated principal
amount of Debt of the Company and its Restricted Group outstanding as of the
most recent available quarterly or annual balance sheet, after giving pro forma
effect to (a) the Incurrence of such Debt and any other Debt Incurred since
such balance sheet date, (b) the receipt and application of the proceeds
thereof and (c) (without duplication) the repayment, redemption or repurchase
of any other Debt since such balance sheet date, to (ii) four times Cellular
Operating Income for the full fiscal quarter next preceding the Incurrence of
such Debt for which consolidated financial statements are available, determined
on a pro forma basis as if any such Debt had been Incurred and the proceeds
thereof had been applied, or such other Debt had been repaid, redeemed or
repurchased, as applicable, at the beginning of such fiscal quarter. In the
case of any such Incurrence of Debt by a Restricted Subsidiary of the Company,
Restricted Affiliate or Restricted Subsidiary of a Restricted Affiliate, the
amount of Debt Incurred or repaid, redeemed or repurchased, as applicable, for
purposes of the foregoing computation, will be deemed to be the greater of (i)
the Company's Pro Rata Portion of such Debt and (ii) the amount of any
Guarantee of such Debt by the Company.

     "Default Amount" means in respect to any particular Security as of any
particular date, the principal amount of such Security.

     "Defaulted Interest" has the meaning set forth in Section 3.08.

                                     - 7 -


<PAGE>


     "Depository" means, with respect to the Securities issuable or issued in
whole or in part in the form of one or more Global Securities, The Depository
Trust Company ("DTC") for so long as it shall be a clearing agency registered
under the Exchange Act, or such successor as the Company shall designate from
time to time in an Officer's Certificate delivered to the Trustee.

     "Equity Security" has the meaning set forth in Section 12.05(d). "Event of
Default" has the meaning set forth in Section 5.01.

     "Exchange Act" means the Securities Exchange Act of 1934, as amended (or
any successor act) and the rules and regulations thereunder.

     "Expiration Date" has the meaning set forth in the definition of "Offer to
Purchase" in this Section 1.01.

     "Expiration Time" has the meaning set forth in Section 12.05(f).

     "Global Security" means a Security that evidences all or part of the
Securities and bears the legend set forth in the third paragraph of Section
2.02 and includes, as the context may require, any or all of the Regulation S
Global Security and the Restricted Global Security.

     "Government Securities" means direct obligations of, or obligations
guaranteed by, the United States of America for the payment of which
obligations or guarantee the full faith and credit of the United States is
pledged and which have a remaining weighted average life to maturity of not
more than one year from the date of Investment therein.

     "Gradation" means a gradation within a Rating Category or a change to
another Rating Category, which shall include: (i) "+" and "-" in the case of
S&P's current Rating Categories (e.g., a decline from BB+ to BB would
constitute a decrease of one gradation), (ii) 1, 2 and 3 in the case of Moody's
current Rating Categories (e.g., a decline from Ba1 to Ba2 would constitute a
decrease of one gradation), or (iii) the equivalent in respect of successor
Rating Categories of S&P or Moody's or Rating Categories used by Rating
Agencies other than S&P and Moody's.

     "Guarantee" by any Person means any obligation, contingent or otherwise,
of such Person guaranteeing, or having the economic effect of guaranteeing, any
Debt of any other Person (the "primary obligor") in any manner, whether
directly or indirectly, and including, without limitation, any obligation of
such Person, (i) to purchase or pay (or advance or supply funds for the
purchase or payment of) such Debt or to purchase (or to advance or supply funds
for the purchase of) any security for the payment of such Debt, (ii) to
purchase property, securities or services for the purpose of assuring the
holder of such Debt of the payment of such Debt, or (iii) to maintain working
capital, equity capital or other financial statement condition or liquidity of
the primary obligor so as to enable the primary obligor to pay such Debt (and
"Guaranteed", "Guaranteeing" and "Guarantor" shall have meanings correlative to
the foregoing); provided, however, that the Guarantee by any Person shall not
include endorsements by such Person for collection or deposit, in either case,
in the ordinary course of business.

                                     - 8 -

<PAGE>


     "Holder" means a Person in whose name a Security is registered in the
Security Register.

     "Incur" means, with respect to any Debt or other obligation of any Person,
to create, issue, incur (by conversion, exchange or otherwise), assume,
Guarantee or otherwise become liable in respect of such Debt or other
obligation, including by acquisition of Subsidiaries (the Debt of any other
Person becoming a Subsidiary of such Person being deemed for this purpose to
have been incurred at the time such other Person becomes a Subsidiary), or the
recording, as required pursuant to generally accepted accounting principles or
otherwise, of any such Debt or other obligation on the balance sheet of such
Person (and "Incurrence", "Incurred", "Incurrable" and "Incurring" shall have
meanings correlative to the foregoing); provided, however, that a change in
generally accepted accounting principles that results in an obligation of such
Person that exists at such time becoming Debt shall not be deemed an Incurrence
of such Debt.

     "Indenture" means this instrument as originally executed or as it may from
time to time be supplemented or amended by one or more indentures supplemental
hereto entered into pursuant to the applicable provisions hereof, including,
for all purposes of this instrument and any such supplemental indenture, the
provisions of the Trust Indenture Act that are deemed to be a part of and
govern this instrument and any such supplemental indenture, respectively.

     "Interest Payment Date" means the Stated Maturity of an installment of
interest on the Securities.

     "Interest Rate, Currency or Commodity Price Agreement" of any Person means
any forward contract, futures contract, swap, option or other financial
agreement or arrangement (including, without limitation, caps, floors, collars
and similar agreements) relating to, or the value of which is dependent upon,
interest rates, currency exchange rates or commodity prices or indices
(excluding contracts for the purchase or sale of goods in the ordinary course
of business).

     "Investment" by any Person means any direct or indirect loan, advance or
other extension of credit or capital contribution (by means of transfers of
cash or other property to others or payments for property or services for the
account or use of others, or otherwise) to, or purchase or acquisition of
Capital Stock, bonds, notes, debentures or other securities or evidence of Debt
issued by, any other Person, including any payment on a Guarantee of any
obligation of such other Person, but shall not include trade accounts
receivable in the ordinary course of business on credit terms made generally
available to the customers of such Person.

     "Investment Grade" means (i) BBB- or above in the case of S&P (or its
equivalent under any successor Rating Categories of S&P), (ii) Baa3 or above,
in the case of Moody's (or its equivalent under any successor Rating Categories
of Moody's), and (iii) the equivalent in respect of the Rating Categories of
any Rating Agencies substituted for S&P or Moody's.

     "Lien" means, with respect to any property or assets, any mortgage,
pledge, security interest, lien, charge, encumbrance, priority or other
security agreement or preferential arrangement of any kind or nature whatsoever
on or with respect to such property or assets

                                     - 9 -

<PAGE>


(including, without limitation, any conditional sale or other title retention
agreement having substantially the same economic effect as any of the
foregoing).

     "Maturity", when used with respect to any Security, means the date on
which the principal of such Security becomes due and payable as therein or
herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption or otherwise.

     "Minority Owned Affiliate" of any specified Person means any other Person
in which an Investment has been made by the specified Person other than a
direct or indirect Subsidiary of the specified Person.

     "Moody's" means Moody's Investor Service, Inc. and its successors.

     "Net Available Proceeds" from any Asset Disposition means cash or readily
marketable cash equivalents received (including by way of sale or discounting
of a note, installment receivable or other receivable, but excluding any other
consideration received in the form of assumption by the acquiror of Debt or
other obligations relating to such properties or assets) therefrom by the
Company or any Restricted Subsidiary of the Company, Restricted Affiliate or
Restricted Subsidiary of a Restricted Affiliate, net of (i) all legal, title
and recording tax expenses, commissions and other fees and expenses Incurred
and all federal, state, provincial, foreign and local taxes required to be
accrued as a liability as a consequence of such Asset Disposition, (ii) all
payments made by the Company or any Restricted Subsidiary of the Company,
Restricted Affiliate or Restricted Subsidiary of a Restricted Affiliate, on any
Debt which is secured by such assets in accordance with the terms of any Lien
upon or with respect to such assets or which must by the terms of such Debt or
Lien, or in order to obtain a necessary consent to such Asset Disposition or by
applicable law, be repaid out of the proceeds from such Asset Disposition,
(iii) all distributions and other payments made to other equity holders in
Restricted Subsidiaries of the Company, Restricted Affiliates or Restricted
Subsidiaries of Restricted Affiliates, or joint ventures as a result of such
Asset Disposition and (iv) appropriate amounts to be provided by the Company or
any Restricted Subsidiary of the Company, Restricted Affiliate or Restricted
Subsidiary of a Restricted Affiliate, as the case may be, as a reserve in
accordance with International Financial Reporting Standards, against any
liabilities associated with such assets and retained by the Company or any
Restricted Subsidiary of the Company, Restricted Affiliate or Restricted
Subsidiary of a Restricted Affiliate, as the case may be, after such Asset
Disposition, including, without limitation, liabilities under any
indemnification obligations and severance and other employee termination costs
associated with such Asset Disposition, in each case as determined by the Board
of Directors, in its reasonable good faith judgment evidenced by a resolution
of the Board of Directors filed with the Trustee; provided, however, that any
reduction in such reserve within twelve months following the consummation of
such Asset Disposition will be treated for all purposes of the Indenture and
the Securities as a new Asset Disposition at the time of such reduction with
Net Available Proceeds equal to the amount of such reduction.

     "non-election share" has the meaning set forth in Section 12.6.

     "Offer to Purchase" means a written offer (the "Offer") sent by the
Company by first class mail, postage prepaid, to each Holder at his address
appearing in the Security Register

                                     - 10 -

<PAGE>


on the date of the Offer offering to purchase up to the principal amount of
Securities specified in such Offer at the purchase price specified in such
Offer (as determined pursuant to the Indenture). Unless otherwise required by
applicable law, the Offer shall specify an expiration date (the "Expiration
Date") of the Offer to Purchase which shall be, subject to any contrary
requirements of applicable law, not less than 30 days or more than 60 days
after the date of such Offer and a settlement date (the "Purchase Date") for
purchase of Securities within five Business Days after the Expiration Date. The
Company shall notify the Trustee at least 15 Business Days (or such shorter
period as is acceptable to the Trustee) prior to the mailing of the Offer of
the Company's obligation to make an Offer to Purchase, and the Offer shall be
mailed by the Company or, at the Company's request, by the Trustee in the name
and at the expense of the Company. The Offer shall contain information
concerning the business of the Company which the Company in good faith believes
will enable such Holders to make an informed decision with respect to the Offer
to Purchase (which at a minimum will include (i) the most recent annual and
quarterly financial statements and "Management's Discussion and Analysis of
Financial Condition and Results of Operations" contained in the documents
required to be filed with the Trustee pursuant to this Indenture (which
requirements may be satisfied by delivery of such documents together with the
Offer), (ii) a description of material developments in the Company's business
subsequent to the date of the latest of such financial statements referred to
in clause (i) (including a description of the events requiring the Company to
make the Offer to Purchase), (iii) if applicable, appropriate pro forma
financial information concerning the Offer to Purchase and the events requiring
the Company to make the Offer to Purchase and (iv) any other information
required by applicable law to be included therein. The Offer shall contain all
instructions and materials necessary to enable such Holders to tender
Securities pursuant to the Offer to Purchase. The Offer shall also state: (a)
the Section of this Indenture pursuant to which the Offer to Purchase is being
made;

          (b) the Expiration Date and the Purchase Date;

          (c) the aggregate principal amount of the Outstanding Securities
     offered to be purchased by the Company pursuant to the Offer to Purchase
     (including, if less than 100%, the manner by which such has been
     determined pursuant to the Section hereof requiring the Offer to Purchase)
     (the "Purchase Amount");

          (d) the purchase price to be paid by the Company for each $1,000
     aggregate principal amount of Securities accepted for payment (as
     specified pursuant to the Indenture) (the "Purchase Price");

          (e) that the Holder may tender all or any portion of the Securities
     registered in the name of such Holder and that any portion of a Security
     tendered must be tendered in an integral multiple of $1,000 principal
     amount;

          (f) the place or places where Securities are to be surrendered for
     tender pursuant to the Offer to Purchase;

                                     - 11 -
<PAGE>


          (g) that interest on any Security not tendered or tendered but not
     purchased by the Company pursuant to the Offer to Purchase will continue
     to accrue;

          (h) that on the Purchase Date the Purchase Price will become due and
     payable upon each Security being accepted for payment pursuant to the
     Offer to Purchase and that interest thereon shall cease to accrue on and
     after the Purchase Date;

          (i) that each Holder electing to tender a Security pursuant to the
     Offer to Purchase will be required to surrender such Security at the place
     or places specified in the Offer prior to the close of business on the
     Expiration Date (such Security being, if the Company or the Trustee so
     requires, duly endorsed by, or accompanied by a written instrument of
     transfer in form satisfactory to the Company and the Trustee duly executed
     by, the Holder thereof or his attorney duly authorized in writing);

          (j) that Holders will be entitled to withdraw all or any portion of
     Securities tendered if the Company (or their Paying Agent) receives, not
     later than the close of business on the Expiration Date, a telegram,
     telex, facsimile transmission or letter setting forth the name of the
     Holder, the principal amount of the Security the Holder tendered, the
     certificate number of the Security the Holder tendered and a statement
     that such Holder is withdrawing all or a portion of his tender;

          (k) that (a) if Securities in an aggregate principal amount less than
     or equal to the Purchase Amount are duly tendered and not withdrawn
     pursuant to the Offer to Purchase, the Company shall purchase all such
     Securities and (b) if Securities in an aggregate principal amount in
     excess of the Purchase Amount are tendered and not withdrawn pursuant to
     the Offer to Purchase, the Company shall purchase Securities having an
     aggregate principal amount equal to the Purchase Amount on a pro rata
     basis (with such adjustments as may be deemed appropriate so that only
     Securities in denominations of $1,000 or integral multiples thereof shall
     be purchased); and

          (l) that in the case of any Holder whose Security is purchased only
     in part, the Company shall execute, and the Trustee shall authenticate and
     deliver to the Holder of such Security without service charge, a new
     Security or Securities, of any authorized denomination as requested by
     such Holder, in an aggregate principal amount equal to and in exchange for
     the unpurchased portion of the Security so tendered.

Any Offer to Purchase shall be governed by and effected in accordance with the
Offer for such Offer to Purchase.

     "Officer's Certificate" means a certificate signed by the President;
Chairman of the Board, any Vice Chairman of the Board, any Director, the Chief
Executive Officer, the Chief Operating Officer, any Senior Vice President, or
the Secretary of the Board of the Company and delivered to the Trustee. An
officer signing an Officer's Certificate given pursuant to Section 10.04 shall
be the principal executive, financial or accounting officer of the Company.

     "Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company and who shall be acceptable to the Trustee.


                                     - 12 -
<PAGE>


     "Outstanding", when used with respect to Securities, means, as of the date
of determination, all Securities theretofore authenticated and delivered under
this Indenture, except:

          (i) Securities theretofore cancelled by the Trustee or delivered to
     the Trustee for cancellation (including any Securities converted under
     Article Twelve);

          (ii) Securities for whose payment or redemption money in the
     necessary amount has been theretofore deposited with the Trustee or any
     Paying Agent (other than the Company) in trust or set aside and segregated
     in trust by the Company (if the Company shall act as its own Paying Agent)
     for the Holders of such Securities; provided that, if such Securities are
     to be redeemed, notice of such redemption has been duly given pursuant to
     this Indenture or provision therefor satisfactory to the Trustee has been
     made; and

          (iii) Securities which have been paid pursuant to Section 3.07 or in
     exchange for or in lieu of which other Securities have been authenticated
     and delivered pursuant to this Indenture, other than any such Securities
     in respect of which there shall have been presented to the Trustee proof
     satisfactory to it that such Securities are held by a bona fide purchaser
     in whose hands such Securities are valid obligations of the Company;

provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Securities owned
by the Company or any other obligor upon the Securities or any Affiliate of the
Company or of such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be protected
in relying upon any such request, demand, authorization, direction, notice,
consent or waiver, only Securities which the Trustee knows to be so owned shall
be so disregarded. Securities so owned which have been pledged in good faith
may be regarded as Outstanding if the pledgee establishes to the satisfaction
of the Trustee the pledgee's right so to act with respect to such Securities
and that the pledgee is not the Company or any other obligor upon the
Securities or any Affiliate of the Company or of such other obligor.

     "Paying Agent" means any Person authorized by the Company to pay the
principal of (and premium, if any) or interest on any Securities on behalf of
the Company.

     "Permitted Holder" means Industriforvaltnings AB Kinnevik, Kinnevik B.V.
and each of their Affiliates and the estate, spouse, ancestors, and lineal
descendants of Jan H. Stenbeck, the legal representatives of any of the
foregoing and the trustee of any bona fide trust of which the foregoing are the
sole beneficiaries or the grantors, or any Person of which the foregoing
"beneficially owns" (within the meaning of Rule 13d-3 and 13d-5 under the
Exchange Act or any successor provision thereto) voting securities representing
at least 66 2/3% of the total voting power of all classes of Capital Stock of
such Person (exclusive of any matters as to which class voting rights exist).

     "Permitted Interest Rate, Currency or Commodity Price Agreement" of any
Person means any Interest Rate, Currency or Commodity Price Agreement entered
into with one

                                     - 13 -
<PAGE>


or more financial institutions in the ordinary course of business that is
designed to protect such Person against fluctuations in interest rates or
currency exchange rates with respect to Debt Incurred and which shall have a
notional amount no greater than the payments due with respect to the Debt being
hedged thereby, or in the case of currency or commodity protection agreements,
against currency exchange rate or commodity price fluctuations in the ordinary
course of business relating to then existing financial obligations or then
existing or sold production and not for purposes of speculation.

     "Permitted Investments" means:

          (1) Investments in Cash Equivalents;

          (2) Investments by the Company or any Restricted Subsidiary of the
     Company in a Restricted Subsidiary of the Company that is primarily
     engaged in a Related Business, or Investments by any Restricted Affiliate
     or any Restricted Subsidiary of such Restricted Affiliate in a Restricted
     Subsidiary of such Restricted Affiliate that is primarily engaged in a
     Related Business;

          (3) Investments by the Company or any Restricted Subsidiary of the
     Company in a Person, if as a result of such Investment (i) such Person
     becomes a Restricted Subsidiary of the Company that is primarily engaged
     in a Related Business or (ii) such Person is merged, consolidated or
     amalgamated into, or transfers or conveys all or substantially all of its
     assets to, or is liquidated into, the Company or a Restricted Subsidiary
     of the Company that is primarily engaged in a Related Business;

          (4) Investments by a Restricted Affiliate or any Restricted
     Subsidiary of such Restricted Affiliate in a Person, if as a result of
     such Investment (i) such Person becomes a Restricted Subsidiary of such
     Restricted Affiliate that is primarily engaged in a Related Business or
     (ii) such Person is merged, consolidated or amalgamated into, or transfers
     or conveys all or substantially all of its assets to, or is liquidated
     into such Restricted Affiliate or a Restricted Subsidiary of such
     Restricted Affiliate that is primarily engaged in a Related Business;

          (5) Investments by the Company or any of its Restricted Subsidiaries
     in any Minority Owned Affiliate that has been properly designated as a
     Restricted Affiliate and that is primarily engaged in a Related Business,
     provided that as of fiscal year end, not less than 60% of the Company's
     Pro Rata Portion of the aggregate cumulative direct and indirect
     investment in all members of the Company's Restricted Group since the date
     of the Indenture shall be in the form of debt of such members of the
     Company's Restricted Group, provided further that any such Investment
     shall cease to be a Permitted Investment pursuant to this clause (5) if
     and for so long as such Restricted Affiliate ceases to observe any of the
     provisions of the covenants that are applicable to such Restricted
     Affiliate;

          (6) Investments acquired as consideration as permitted under Section
     10.14; and

          (7) Other Investments in Persons primarily engaged in Related
     Businesses, in an aggregate cumulative amount not to exceed $50 million.

                                              - 14 -
<PAGE>


     For purposes of the foregoing clause (7), only the Company's Pro Rata
Portion of any Investment will be counted in determining the amount of
Investments permitted to be made under such clause. In the event of any change
in the Company's Pro Rata Portion of any such Investment, such calculation
shall be recomputed as of the date of such change.

     "Person" means any individual, corporation, partnership, limited liability
company, joint venture, trust, unincorporated organization or government or any
agency or political subdivision thereof or any other entity.

     "Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security; and, for the purposes of this definition, any Security
authenticated and delivered under Section 3.07 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Security shall be deemed to evidence the
same debt as the mutilated, destroyed, lost or stolen Security.

     "Preferred Dividends" for any Person means for any period the quotient
determined by dividing the amount of dividends and distributions paid or
accrued (whether or not declared) on Preferred Stock of such Person during such
period calculated in accordance with International Financial Reporting
Standards, by one (1) minus the actual combined Federal, state, local and
foreign income tax rate of the Company on a consolidated basis (expressed as a
decimal).

     "Preferred Stock" of any Person means Capital Stock of such Person of any
class or classes (however designated) that ranks prior, as to the payment of
dividends or as to the distribution of assets upon any voluntary or involuntary
liquidation, dissolution or winding up of such Person, to shares of Capital
Stock of any other class of such Person.

     "Pro Rata Portion" means, when applied to the Company for purposes of
determining the amount of Net Available Proceeds from an Asset Disposition
required to be applied pursuant to Section 10.14 or for purposes of determining
the amount of an Investment that will be deemed to be outstanding or the amount
of Debt that will be deemed to be Incurred under a particular covenant or
definition, that portion of such Net Available Proceeds or Investment or Debt
as corresponds to the Company's direct or indirect percentage ownership
interest in the profits of the Person who engaged in the Asset Disposition or
the Person in whom the Investment was made or the Person which Incurred the
Debt, as applicable (which would be 100% in the case of any Investments made or
Debt Incurred by the Company directly). The Pro Rata Portion of the Net
Available Proceeds from an Asset Disposition shall be determined in good faith
by the Company's Board of Directors in connection with such Asset Disposition.
The Pro Rata Portion of an Investment or amount of Debt as of any date shall be
determined in good faith either by the Company's Board of Directors or in
accordance with procedures established as to such Investment or Debt by the
Company's Board of Directors.

     "Purchase Date" has the meaning set forth in the definition of "Offer to
Purchase".

     "Purchased Shares" has the meaning set forth in Section 12.05 (f).

                                     - 15 -
<PAGE>


     "Rating Agencies" means (i) S&P and Moody's or (ii) if S&P or Moody's or
both of them are not making ratings of the Securities publicly available, a
nationally recognized U.S. rating agency or agencies, as the case may be,
selected by the Company, which will be substituted for S&P or Moody's or both,
as the case may be.

     "Rating Category" means (i) with respect to S&P, any of the following
categories (any of which may include a "+" or "-"): AAA, AA, A, BBB, BB, B,
CCC, CC, C, R, SD and D (or equivalent successor categories); (ii) with respect
to Moody's, any of the following categories (any of which may include a "1",
"2" or "3"): Aaa, Aa, A, Baa, Ba, B, Caa, Ca and C (or equivalent successor
categories), and (iii) the equivalent of any such categories of S&P or Moody's
used by another Rating Agency, if applicable.

     "Receivables" means receivables, chattel paper, instruments, documents or
intangibles evidencing or consisting of the right to payment of money for goods
sold or services rendered.

     "Receivables Sale" of any Person means any sale of Receivables of such
Person (pursuant to a purchase facility or otherwise), other than in connection
with a disposition of the business operations of such Person relating thereto
or a disposition of defaulted Receivables for purpose of collection and not as
a financing arrangement.

     "Redeemable Stock" of any Person means any Capital Stock of such Person
that by its terms (or by the terms of any security into which it is convertible
or for which it is exchangeable) or otherwise (including upon the occurrence of
an event) matures or is required to be redeemed (pursuant to any sinking fund
obligation or otherwise) or is convertible into or exchangeable for Debt or is
redeemable at the option of the holder thereof, in whole or in part, at any
time prior to the final Stated Maturity of the Securities.

     "Redemption Date", when used with respect to any Security to be redeemed,
means the date fixed for such redemption by or pursuant to this Indenture.

     "Redemption Price", when used with respect to any Security to be redeemed,
means the price at which it is to be redeemed pursuant to this Indenture.

     "Registration Rights Agreement ", means the Registration Rights Agreement
attached as Annex F to this Indenture, which is being made a part hereof. Any
Holder of Securities pursuant to this Indenture, by virtue of holding such
Securities, is deemed to have accepted and agreed and being made subject to the
terms and obligations and is entitled to the rights under the Registration
Rights Agreement as set forth therein.

     "Regular Record Date" for the interest payable on any Interest Payment
Date means the May 15 or November 15 (whether or not a Business Day), as the
case may be, next preceding such Interest Payment Date.

     "Regulation S" means Regulation S under the Securities Act (or any
successor provision), as it may be amended from time to time.

     "Regulation S Global Securities" has the meaning specified in Section
2.01.

                                     - 16 -

<PAGE>


     "Regulation S Legend" means a legend substantially in the form of the
legend required in the form of Security set forth in Section 2.02 to be placed
upon a Regulation S Global Security.

     "Regulation S Securities" means all Securities required pursuant to
Section 3.06(c) to bear a Regulation S Legend. Such term includes the
Regulation S Global Security.

     "Related Assets" means all assets, rights (contractual or otherwise) and
properties, whether tangible or intangible, used or intended for use in
connection with a Related Business.

     "Related Business" means any business in which the Company, its
Subsidiaries or Minority Owned Affiliates are engaged, directly or indirectly,
that consist primarily of, or are related to, operating, acquiring, developing
and constructing any telecommunications services and related businesses.

     "Related Person" of any Person means any other Person directly or
indirectly owning (a) 5% or more of the outstanding Common Stock of such Person
(or, in the case of a Person that is not a corporation, 5% or more of the
equity interest in such Person) or (b) 5% or more of the combined voting power
of the Voting Stock of such Person.

     "Resale Registration Statement" means a shelf registration statement under
the Securities Act filed by the Company, if required by, and meeting the
requirements of, the Registration Rights Agreement in respect of the Company's
securities covered thereby.

     "Responsible Officer" means any Vice President, Assistant Vice President,
Secretary, Assistant Secretary, Treasurer or Assistant Treasurer of the Trustee
assigned by the Trustee to administer this Indenture, or any other officer
customarily performing functions similar to those performed by any of the above
designated officers and also, with respect to a particular matter any other
officer to whom such matter is referred.

     "Restricted Affiliate" means any direct or indirect Minority Owned
Affiliate of the Company or a Restricted Subsidiary of the Company that has
been designated in a Board Resolution as a Restricted Affiliate based on a
determination by the Board of Directors that (i) the Company has, directly or
indirectly, the requisite control over such Minority Owned Affiliate to prevent
it from incurring any Debt, or taking any other action at any time, in
contravention of any of the provisions of the Indenture that are applicable to
Restricted Affiliates or (ii) the Minority Owned Affiliate is a joint venture
with at least one or more Strategic Investors. The Company will be required to
deliver an Officer's Certificate to the Trustee, including a copy of the Board
Resolution, upon designating any Minority Owned Affiliate as a Restricted
Affiliate.

     "Restricted Global Security" has the meaning specified in Section 2.01.

     "Restricted Group", when used in respect of the Company, means the
Company, the Restricted Subsidiaries and Restricted Affiliates of the Company,
and the Restricted Subsidiaries of such Restricted Affiliates, taken together
on a consolidated basis.

                                     - 17 -


     "Restricted Securities" means all Securities required pursuant to Section
3.06(c) to bear a Restricted Securities Legend. Such term includes the
Regulation S Global Security and the Restricted Global Security.

     "Restricted Securities Certificate" means a certificate substantially in
the form set forth in Annex B.

     "Restricted Securities Legend" means a legend substantially in the form of
the legend required in the form of Security set forth in Section 2.02 to be
placed upon a Restricted Security.

     "Restricted Period" means the period of 41 consecutive days beginning on
and including the day on which Securities are first offered to persons other
than distributors (as defined in Regulation S) in reliance on Regulation S.

     "Restricted Subsidiary" means any Subsidiary other than an Unrestricted
Subsidiary.

     "S&P" means Standard & Poor's Ratings Group, a division of McGraw Hill,
Inc., a New York corporation and its successors.

     "Securities Act" means the Securities Act of 1933 (or any successor
statute), as it may be amended from time to time.

     "Security Register" and "Security Registrar" have the respective meanings
specified in Section 3.06.

     "Senior Debt" means the principal of (and premium, if any) and interest
(including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to the Company whether or not such
claim for post-petition interest is allowed in such proceeding) on, or other
amount of, (i) Debt for money borrowed of the Company, and any other
obligations of the Company, contingent or otherwise, created pursuant to the
Credit Facility, (ii) Debt for money borrowed of the Company, whether incurred
on or prior to the date of the Indenture or thereafter incurred, other than the
Securities, (iii) Debt evidenced by bonds, debentures, notes or other similar
instruments, including Debt Incurred in connection with the acquisition of
property, assets or businesses, (iv) matured and unmatured reimbursement or
other obligations of the Company with respect to letters of credit, bankers'
acceptances or similar facilities issued for the account of the Company, (v)
obligations of the Company under interest rate swaps, caps, collars and similar
arrangements, (vi) Capital Lease Obligations of the Company, (vii) Guarantees
by the Company of Debt for money borrowed and (viii) amendments, renewals,
extensions, modifications, refinancings and refundings of any such Debt;
provided, however, the following shall not constitute Senior Debt: (A) any Debt
owed to a Person when such Person is a Subsidiary of the Company, (B) any Debt
which by the terms of the instrument creating or evidencing the same is pari
passu or subordinated in right of payment to the Securities (including the
13-1/2% Notes, if any), (C) any Debt Incurred in violation of the Indenture or
(D) any Debt which is subordinated in right of payment in any respect to any
other Debt of the Company.

                                     - 18 -

<PAGE>


     "Significant Restricted Group Member" means any Restricted Subsidiary of
the Company, Restricted Affiliate or Restricted Subsidiary of a Restricted
Affiliate which, for each of the two most recently completed fiscal years for
which financial statements are available, accounted for 17-1/2% or more of
Cellular Operating Income of the Company and its Restricted Group for such
period (determined on a consolidated basis in accordance with International
Financial Reporting Standards).

     "Special Interest" has the meaning specified in the form of the Securities
set forth in Section 2.02.

     "Special Record Date" for the payment of any Defaulted Interest means a
date fixed by the Trustee pursuant to Section 3.08.

     "Stated Maturity", when used with respect to any Security or any
installment of interest thereon, means the date specified in such Security as
the fixed date on which the principal of such Security or such installment of
interest is due and payable.

     "Step-Down Date" has the meaning set forth in the form of the Security
contained in Section 2.02.

     "Step-Up" has the meaning set forth in the form of the Security contained
in Section 2.02.

     "Strategic Investor" means a corporation, partnership or other entity
engaged in one or more telecommunications businesses that has, or is a
Subsidiary of a Person that has, an equity market capitalization in excess of
$2.0 billion or book equity in excess of $1.0 billion.

     "Subsidiary" of any Person means (i) a corporation more than 50% of the
combined voting power of the outstanding Voting Stock of which is owned,
directly or indirectly, by such Person or by one or more other Subsidiaries of
such Person or by such Person and one or more Subsidiaries thereof or (ii) any
other Person (other than a corporation) in which such Person, or one or more
other Subsidiaries of such Person or such Person and one or more other
Subsidiaries thereof, directly or indirectly, has at least a majority ownership
and power to direct the policies, management and affairs thereof.

     "Successor Security" of any particular Security means every Security
issued after, and evidencing all or a portion of the same debt as that
evidenced by, such particular Security; and, for the purposes of this
definition, any Security authenticated and delivered under Section 3.07 in
exchange for or in lieu of a mutilated, destroyed, lost or stolen Security
shall be deemed to evidence the same debt as the mutilated, destroyed, lost or
stolen Security.

     "Trading Day" means any day on which securities are being traded on stock
exchanges in New York, London and Luxembourg.

     "Trustee" means the Person named as the "Trustee" in the first paragraph
of this instrument until a successor Trustee shall have become such pursuant to
the applicable provisions of this Indenture, and thereafter "Trustee" shall
mean such successor Trustee.

                                     - 19 -

<PAGE>


     "Trust Indenture Act" means the Trust Indenture Act of 1939 as in force at
the date as of which this instrument was executed or, if this Indenture is
qualified under such Act after the issuance of the Securities, as in effect at
the date of such qualification; provided, however, that in the event the Trust
Indenture Act of 1939 is amended after such date, "Trust Indenture Act" means,
to the extent required by any such amendment, the Trust Indenture Act of 1939
as so amended.

     "Unrestricted Affiliate" means any Minority Owned Affiliate of the Company
which is not a Restricted Affiliate.

     "Unrestricted Subsidiary" means (1) any Subsidiary of the Company (other
than Millicom International Operations, B.V.) or a Restricted Affiliate
designated as such by the Board of Directors as set forth below where no
default with respect to any Debt of such Subsidiary or any Subsidiary of such
Subsidiary (including any right which the holders thereof may have to take
enforcement action against such Subsidiary) would permit (upon notice, lapse of
time or both) any holder of any other Debt of the Company and its Subsidiaries
(other than another Unrestricted Subsidiary) or any Restricted Affiliate or any
Restricted Subsidiary of a Restricted Affiliate to declare a default on such
other Debt or cause the payment thereof to be accelerated or payable prior to
its final scheduled maturity and (2) any Subsidiary of an Unrestricted
Subsidiary. The Board of Directors may designate any Subsidiary of the Company
or a Restricted Affiliate to be an Unrestricted Subsidiary unless such
Subsidiary owns any Capital Stock of, or owns or holds any Lien on any property
of, any other Subsidiary of the Company or such Restricted Affiliate which is
not a Subsidiary of the Subsidiary to be so designated or otherwise an
Unrestricted Subsidiary, provided that either (x) the Subsidiary to be so
designated has total assets of $100,000 or less or (y) immediately after giving
effect to such designation, the Company could Incur at least $1.00 of
additional Debt pursuant to the first paragraph under Section 10.08 and
provided further, that the Company could make a Restricted Payment in an amount
equal to the Company's Pro Rata Portion of the greater of the fair market value
and book value of such Subsidiary pursuant to Section 10.09 and such amount is
thereafter treated as a Restricted Payment for the purpose of calculating the
aggregate amount available for Restricted Payments thereunder. For the
avoidance of doubt, Millicom International Operations, B.V., may not be
designated an Unrestricted Subsidiary for as long as the Securities remain
Outstanding.

     "Vice President", when used with respect to the Company or the Trustee,
means any vice president, whether or not designated by a number or a word or
words added before or after the title "vice president".

     "Voting Stock" of any Person means Capital Stock of such Person which
ordinarily has voting power for the election of directors (or persons
performing similar functions) of such Person, whether at all times or only so
long as no senior class of securities has such voting power by reason of any
contingency.

     "Weighted Average Life to Maturity" means, when applied to any Debt or
Preferred Stock at any date, the number of years obtained by dividing (a) the
then outstanding principal amount of such Debt or liquidation preference of
such Preferred Stock, as the case may be, into (b) the total of the product
obtained by multiplying (x) the amount of each then

                                     - 20 -



remaining installment, sinking fund, serial maturity or other required payments
of principal or upon mandatory redemption, including payment at final maturity,
in respect thereof, by (y) the number of years (calculated to the nearest
one-twelfth) that will elapse between such date and the making of such payment.

     "Wholly Owned Restricted Subsidiary" of any Person means a Restricted
Subsidiary of such Person all of the outstanding Capital Stock or other
ownership interests of which (other than directors' qualifying shares) shall at
the time be owned by such Person or by one or more Wholly Owned Restricted
Subsidiaries of such Person or by such Person and one or more Wholly Owned
Restricted Subsidiaries of such Person.

     "13 1/2% Notes" means the Company's 13 1/2% Senior Subordinated Discount
Notes Due 2005, as the same may be Outstanding from time to time.

     SECTION 1.02 Compliance Certificates and Opinions.

     Upon any application or request by the Company to the Trustee to take any
action under any provision of this Indenture, the Company shall furnish to the
Trustee such certificates and opinions as may be required under the Trust
Indenture Act. Each such certificate or opinion shall be given in the form of
an Officer's Certificate, if to be given by an officer of the Company, or an
Opinion of Counsel, if to be given by counsel, and shall comply with the
requirements of the Trust Indenture Act and any other requirement set forth in
this Indenture.

     Every certificate or opinion with respect to compliance with a condition
or covenant provided for in this Indenture shall include

          (1) a statement that each individual signing such certificate or
     opinion has read such covenant or condition and the definitions herein
     relating thereto;

          (2) a brief statement as to the nature and scope of the examination
     or investigation upon which the statements or opinions contained in such
     certificate or opinion are based;

          (3) a statement that, in the opinion of each such individual, he has
     made such examination or investigation as is necessary to enable him to
     express an informed opinion as to whether or not such covenant or
     condition has been complied with; and

          (4) a statement as to whether, in the opinion of each such
     individual, such condition or covenant has been complied with.

     SECTION 1.03 Form of Documents Delivered to Trustee.

     In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters

                                     - 21 -
<PAGE>


and one or more other such Persons as to other matters, and any such Person may
certify or give an opinion as to such matters in one or several documents.

     Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or opinion of counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.

     Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.

     SECTION 1.04 Acts of Holders; Record Dates.

     (a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Indenture to be given or taken by Holders may
be embodied in and evidenced by one or more instruments of substantially
similar tenor signed by such Holders in person or by agent duly appointed in
writing; and, except as herein otherwise expressly provided, such action shall
become effective when such instrument or instruments are received by the
Trustee and, where it is hereby expressly required, by the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for any purpose of this
Indenture and (subject to Section 6.01) conclusive in favor of the Trustee, and
the Company if made in the manner provided in this Section.

     (b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where
such execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which the Trustee deems sufficient.

     (c) The Company may, by or pursuant to a Board Resolution, in the
circumstances permitted by the Trust Indenture Act, fix any day as the record
date for the purpose of determining the Holders entitled to give or take any
request, demand, authorization, direction, notice, consent, waiver or other
action, or to vote on any action, authorized or permitted to be given or taken
by Holders. If not set by the Company prior to the first solicitation of a
Holder made by any Person in respect of any such action, or, in the case of any

                                     - 22 -
<PAGE>


such vote, prior to such vote, the record date for any such action or vote
shall be the 30th day (or, if later, the date of the most recent list of
Holders required to be provided pursuant to Section 7.01) prior to such first
solicitation or vote, as the case may be. With regard to any record date, only
the Holders on such date (or their duly designated proxies) shall be entitled
to give or take, or vote on, the relevant action.

          (d) The ownership of Securities shall be proved by the Security
     Register.

          (e) Any request, demand, authorization, direction, notice, consent,
     waiver or other Act of the Holder of any Security shall bind every future
     Holder of the same Security and the Holder of every Security issued upon
     the registration of transfer thereof or in exchange therefor or in lieu
     thereof in respect of anything done, omitted or suffered to be done by the
     Trustee or the Company in reliance thereon, whether or not notation of
     such action is made upon such Security.

     SECTION 1.05 Notices, Etc., to Trustee and Company.

     Any request, demand, authorization, direction, notice, consent, waiver or
Act of Holders or other document provided or permitted by this Indenture to be
made upon, given or furnished to, or filed with,

          (1) the Trustee by any Holder or by the Company shall be sufficient
     for every purpose hereunder if made, given, furnished or filed in writing
     in the manner specified in this Indenture to or with the Trustee at its
     Corporate Trust Office; or

          (2) the Company by the Trustee or by any Holder shall be sufficient
     for every purpose hereunder (unless otherwise herein expressly provided)
     if in writing and mailed, first-class postage prepaid, to the Company
     addressed to it at the address of its principal office specified in the
     first paragraph of this instrument or at any other address previously
     furnished in writing to the Trustee by the Company.

     SECTION 1.06 Notice to Holders; Waiver.

     Where this Indenture provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to each Holder affected
by such event, at his address as it appears in the Security Register, not later
than the latest date (if any), and not earlier than the earliest date (if any),
prescribed for the giving of such notice. In any case where notice to Holders
is given by mail, neither the failure to mail such notice, nor any defect in
any notice so mailed, to any particular Holder shall affect the sufficiency of
such notice with respect to other Holders. Where this Indenture provides for
notice in any manner, such notice may be waived in writing by the Person
entitled to receive such notice, either before or after the event, and such
waiver shall be the equivalent of such notice. Waivers of notice by Holders
shall be filed with the Trustee, but such filing shall not be a condition
precedent to the validity of any action taken in reliance upon such waiver.

                                     - 23 -

<PAGE>


     In case by reason of the suspension of regular mail service or by reason
of any other cause it shall be impracticable to give such notice by mail, then
such notification as shall be made with the approval of the Trustee shall
constitute a sufficient notification for every purpose hereunder.

     SECTION 1.07 Conflict with Trust Indenture Act.

     If any provision hereof limits, qualifies or conflicts with a provision of
the Trust Indenture Act that is required under such Act to be a part of and
govern this Indenture, the latter provision shall control. If any provision of
this Indenture modifies or excludes any provision of the Trust Indenture Act
that may be so modified or excluded, the latter provision shall be deemed to
apply to this Indenture as so modified or to be excluded, as the case may be.
Until such time as this Indenture shall be qualified under the Trust Indenture
Act, this Indenture, the Company and the Trustee shall be deemed for all
purposes hereof to be subject to and governed by the Trust Indenture Act to the
same extent as would be the case if this Indenture were so qualified on the
date hereof.

     SECTION 1.08 Effect of Headings and Table of Contents. The Article and
Section headings herein and the Table of Contents are for convenience only and
shall not affect the construction hereof.

     SECTION 1.09 Successors and Assigns.

     All covenants and agreements in this Indenture by the Company shall bind
its respective successors and assigns, whether so expressed or not.

     SECTION 1.10 Separability Clause.

     In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.

     SECTION 1.11 Benefits of Indenture.

     Nothing in this Indenture or in the Securities, express or implied, shall
give to any Person, other than the parties hereto and their successors
hereunder, and the Holders of Securities, any benefit or any legal or equitable
right, remedy or claim under this Indenture.

     SECTION 1.12 Governing Law. This Indenture and the Securities shall be
governed by and construed in accordance with the laws of the State of New York.

     SECTION 1.13 Submission to Jurisdiction.

     The Company irrevocably (i) agrees that any legal suit, action or
proceeding against the Company brought by any Holder or the Trustee arising out
of or based upon this

                                     - 24 -

<PAGE>


Indenture may be instituted in any State or Federal court in the Borough of
Manhattan, The City of New York, (ii) waives, to the fullest extent it may
effectively do so, any objection which it may now or hereafter have to the
laying of venue of any such proceeding and (iii) submits to the exclusive
jurisdiction of such courts in any such suit, action or proceeding. The Company
has appointed CT Corporation, 111 Eighth Avenue, New York, New York 10011, as
its authorized agent (the "Authorized Agent") upon whom process may be served
in any such action arising out of or based on this Indenture which may be
instituted in any State or Federal court in the Borough of Manhattan, The City
of New York, expressly consents to the jurisdiction of any such court in
respect of any such action, and waives any other requirements of or objections
to personal jurisdiction with respect thereto. Such appointment shall be
irrevocable. The Company represents and warrants that the Authorized Agent has
agreed to act as such agent for service of process and agrees to take any and
all action, including the filing of any and all documents and instruments, that
may be necessary to continue such appointment in full force and effect as
aforesaid. Service of process upon the Authorized Agent and written notice of
such service to the Company shall be deemed, in every respect, effective
service of process upon the Company.

     SECTION 1.14 Legal Holidays.

     In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Security shall not be a Business Day, then (notwithstanding any
other provision of this Indenture or of the Securities) payment of interest or
principal (and premium, if any) need not be made on such date, but may be made
on the next succeeding Business Day with the same force and effect as if made
on the Interest Payment Date or Redemption Date, or at the Stated Maturity,
provided that no interest shall accrue for the period from and after such
Interest Payment Date, Redemption Date or Stated Maturity, as the case may be.

                                  ARTICLE TWO

                                 Security Forms

     SECTION 2.01 Forms Generally; Initial Forms of Securities. The Securities
and the Trustee's certificates of authentication shall be in substantially the
forms set forth in this Article or in such other form as shall be established
pursuant to a Board Resolution or in one or more supplemental indentures, in
each case, with such appropriate insertions, omissions, substitutions and other
variations as are required or permitted by this Indenture, and may have such
letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange or as may, consistently herewith, be determined by the
officers executing such Securities, as evidenced by their execution of the
Securities. If the form of Securities of any series is established by action
taken pursuant to a Board Resolution, a copy of an appropriate record of such
action shall be certified by the President, the Chief Executive Officer, any
Director or the Secretary of the Board of Directors of the Company and
delivered to the Trustee at or prior to the delivery of the Company Order
contemplated by Section 3.03 for the authentication and delivery of such
Securities.

                                     - 25 -

<PAGE>


     The definitive Securities shall be printed, lithographed or engraved or
produced by any combination of these methods on steel engraved borders or may
be produced in any other manner permitted by the rules of any securities
exchange on which the Securities may be listed, all as determined by the
officers executing such Notes, as evidenced by their execution whether in
original or in facsimile form, of such Securities.

     Upon their original issuance, initial Regulation S Securities shall be
issued in the form of one or more Global Securities registered in the name of
DTC, as Depository, or its nominee and deposited with the Trustee, as custodian
for DTC, for credit by DTC to the respective accounts of beneficial owners of
the Securities represented thereby (or such other accounts as they may direct),
provided that upon such deposit all such Securities shall be credited to or
through accounts maintained at DTC by or on behalf of Euroclear or Clearstream.
Such Global Securities, together with their Successor Securities which are
Global Securities other than the Restricted Global Security, are collectively
herein called the "Regulation S Global Securities".

     Upon their original issuance, Securities (other than Regulation S
Securities) shall be issued in the form of one or more Global Securities
registered in the name of DTC, as Depository, or its nominee and deposited with
the Trustee, as custodian for DTC, for credit by DTC to the respective accounts
of beneficial owners of the Securities represented thereby (or such other
accounts as they may direct). Such Global Securities, together with their
Successor Securities which are Global Securities are collectively herein called
the "Restricted Global Security".

     SECTION 2.02 Form of Face of Security.

     THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF
1933 (THE "SECURITIES ACT") AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED EXCEPT (1) IN AN OFFSHORE TRANSACTION COMPLYING WITH RULE 903 OR
RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (2) TO AN INSTITUTIONAL
ACCREDITED INVESTOR IN A TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT, (3) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE) OR (4) PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE
IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED
STATES AND OTHER JURISDICTIONS.

     [If the Security is a Regulation S Security, then insert -- THIS SECURITY
HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT AND MAY NOT BE OFFERED, SOLD,
OR DELIVERED IN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, ANY
U.S. PERSON, UNLESS THIS SECURITY IS REGISTERED UNDER THE SECURITIES ACT OR AN
EXEMPTION FROM THE REGISTRATION REQUIREMENTS THEREOF IS AVAILABLE.]

                                     - 26 -

<PAGE>


     [If the Security is a Global Security, then insert -- THIS SECURITY IS A
GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND
IS REGISTERED IN THE NAME OF A DEPOSITORY OR A NOMINEE THEREOF. THIS SECURITY
MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A SECURITY REGISTERED, AND NO
TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF
ANY PERSON OTHER THAN SUCH DEPOSITORY OR A NOMINEE THEREOF, EXCEPT IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.]

     [If the Security is a Global Security and The Depository Trust Company is
to be the Depository therefor, then insert -- UNLESS THIS CERTIFICATE IS
PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A
NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF
TRANSFER, 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 INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.] CUSIP NO.

                      MILLICOM INTERNATIONAL CELLULAR S.A.

                    2% Senior Convertible PIK Notes due 2006

No. ___________                                                 $_______________

     Millicom International Cellular S.A., a corporation duly organized and
existing under the laws of the Grand-Duchy of Luxembourg (herein called the
"Company", which term includes any successor Person under the Indenture
hereinafter referred to), for value received, hereby promises to pay, on June
1, 2006, to _________________, or registered assigns, the principal sum of
______________ either (i) in cash, (ii) in an amount of shares of the Company's
Common Stock calculated by dividing such principal sum by the lesser of (x)
$10.75 (subject to adjustments as provided in the Indenture) and (y) the
average closing prices of the Company's common stock over the 60-day period
immediately preceding June 1, 2006 or (iii) any combination of (i) and (ii),
and to pay interest thereon, accruing in the first instance from December 1,
2002 to June 1, 2003 (the first interest payment date) and continuing to accrue
thereafter and payable semi-annually on June 1 and December 1 in each year, at
the rate of 2% per annum, until the principal hereof is paid or made available
for payment. Such interest may be paid, at the Company's option, either in cash
or in additional Securities, provided, however, that if (i) the Company has not
filed a shelf registration statement on Form F-3 under the Securities Act of
1933, as amended (or, in the event that Form F-3 is unavailable to the Company,
a registration statement on such other SEC Form that is available to the
Company), (the "Resale Registration Statement") covering the resale of this
Security by the holder thereof

     - 27 -

<PAGE>


(subject to the conditions and qualifications set forth in the Registration
Rights Agreement) and the Resale Registration Statement has not become or been
declared effective by December 4, 2003, or (ii) the Resale Registration
Statement is filed and declared effective but shall thereafter cease to be
effective (except as specifically permitted pursuant to the agreement referred
to below) without being succeeded immediately by an additional registration
statement filed and declared effective, in each case (i) and (ii), upon the
terms and conditions set forth in the Registration Rights Agreement (each such
event referred to in Clauses (i) and (ii), a "Registration Default"), provided,
however, that no such Registration Default shall have occurred (x) with respect
to any Holder who has not provided the Company with information for inclusion
in the Resale Registration Statement or (y) if the Company is not required to
file a Resale Registration Statement because less than 50% of the Holders have
provided such information, in each case (x) and (y) as is required by the
Registration Rights Agreement, then additional interest will accrue (the
"Step-Up") at a rate of 0.25% per annum, determined daily, on the principal
amount of the Securities, for the first 90-day period immediately following the
occurrence of the Registration Default until such time (the "Step-Down Date")
as no Registration Default is in effect and, provided, further, that for each
additional 90-day period that the Registration Default continues, the per annum
rate of such Special Interest (as defined below) shall increase (each such
increase, an "Additional Step-Up") by an additional 0.25% per annum up to a
maximum aggregate amount of 1.00% per annum rate of Special Interest (i.e., for
the combined Step-Up and any Additional Step-Up) until the Step-Down Date
(after which the interest rate will be restored to its initial rate). The
Company shall provide the Trustee with written notice of the date of any
Registration Default and the Step-Down Date, and, in connection with each
Step-Up, an Officer's Certificate specifying the principal Outstanding as of
the date of such Step-Up. Interest accruing as a result of the Step-Up or the
Additional Step-Up is referred to herein as "Special Interest." Special
Interest, if any, shall be paid in cash semi-annually in arrears on June 1 and
December 1 in each year; and the amount of accrued Special Interest shall be
determined on the basis of the number of days actually elapsed.

     The interest so payable, and punctually paid or duly provided for, on any
Interest Payment Date will, as provided in such Indenture, be paid to the
Person in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on the Regular Record Date for such
interest, which shall be the May 15 or November 15 (whether or not a Business
Day), as the case may be, next preceding such Interest Payment Date. Any such
interest not so punctually paid or duly provided for will forthwith cease to be
payable to the Holder on such Regular Record Date and may either be paid to the
Person in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on a Special Record Date for the payment of
such Defaulted Interest to be fixed by the Trustee, notice whereof shall be
given to Holders of Securities not less than 10 days prior to such Special
Record Date, or be paid at any time in any other lawful manner not inconsistent
with the requirements of any securities exchange on which the Securities may be
listed, and upon such notice as may be required by such exchange, all as more
fully provided in said Indenture.

     Payment of the principal of (and premium, if any) and interest on this
Security will be made at the office or agency of the Company maintained for
that purpose in the Borough of Manhattan, The City of New York, in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts; provided,

                                     - 28 -

<PAGE>


however, that at the option of the Company payment of interest may be made by
check mailed to the address of the Person entitled thereto as such address
shall appear in the Security Register.

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

     Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.

     IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.

Dated:

                                           MILLICOM INTERNATIONAL CELLULAR S.A.

                                           By
                                              ----------------------------------
                                              Name:
                                              Title:

Attest:

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

                                           By
                                              ----------------------------------
                                              Name:
                                              Title:


Attest:

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


     SECTION 2.03 Form of Reverse of Security.

     This Security is one of a duly authorized issue of Securities of the
Company designated as its 2% Senior Convertible PIK Notes due 2006 (herein
called the "Securities"), issued and to be issued under an Indenture, dated as
of May 8, 2003 (herein called the "Indenture"), between the Company and The
Bank of New York, as Trustee (herein called the "Trustee", which term includes
any successor trustee under the Indenture), to which Indenture and all
indentures supplemental thereto reference is hereby made for a statement of the

                                     - 29 -

<PAGE>


respective rights, limitations of rights, duties and immunities thereunder of
the Company the Trustee, and the Holders of the Securities and of the terms
upon which the Securities are, and are to be, authenticated and delivered.

     (a) The Securities are subject to redemption upon not less than 30 nor
more than 60 days' notice by mail, to each Holder of Securities to be redeemed
at such Holder's address appearing in the Security Register, at the option of
the Company (i) in cash, in amounts of $1,000 or an integral multiple of $1,000
at any time prior to maturity, as a whole or in part, at the election of the
Company, at a Redemption Price of 102.25% if such redemption occurs prior to
June 1, 2004 and on June 1, 2004 and thereafter at a Redemption Price equal to
100% of the principal amount, together in the case of any such redemption with
accrued interest to the Redemption Date (but interest installments whose Stated
Maturity is on or prior to such Redemption Date will be payable to the Holders
of such Securities, or one or more Predecessor Securities, of record at the
close of business on the relevant Record Dates referred to on the face hereof,
all as provided in the Indenture), (ii) in such number of shares of the
Company's common stock calculated by dividing the principal amount of
Securities being repaid by the lesser of (x) $10.75 (subject to adjustments as
provided in the Indenture) and (y) the average of the closing prices of the
Company's common stock over the 60-day period immediately preceding the
Redemption Date, or (iii) any combination of (i) and (ii). Any references to
"Redemption Price," any rights thereto and the satisfaction and payment thereof
in this Security shall refer to both the payment in cash and in shares of the
Company's common stock.

     The Securities have the benefit of any guarantee issued specifically for
the benefit of the Securities in accordance with the terms of the Indenture
(including the guarantee issued by Millicom International Operations, B.V.,
dated May 7, 2003).

     The Securities do not have the benefit of any sinking fund obligations.
The Indenture provides that, subject to certain conditions, if (i) a Change of
Control occurs or (ii) certain Net Available Proceeds are available to the
Company as a result of any Asset Disposition, the Company shall be required to
make an Offer to Purchase for all or a specified portion of the Securities.

     In the event of redemption or purchase pursuant to an Offer to Purchase of
this Security in part only, a new Security or Securities of like tenor for the
unredeemed or unpurchased portion hereof will be issued in the name of the
Holder hereof upon the cancellation hereof.

     If an Event of Default shall occur and be continuing, the principal of all
the Securities may be declared due and payable in the manner and with the
effect provided in the Indenture.

     The Indenture contains provisions for defeasance at any time of (i) the
entire indebtedness of this Security, or (ii) certain restrictive covenants and
Events of Default with respect to this Security, in each case upon compliance
with certain conditions set forth therein.

                                     - 30 -

<PAGE>


     Unless the context otherwise requires, the Securities (as defined in the
Indenture) shall constitute one series for all purposes under the Indenture,
including without limitation, amendments, waivers, redemptions and Offers to
Purchase.

     Subject to and upon compliance with the provisions of the Indenture, the
Holder of a Security shall have the right, at his or her option, at any time on
or before the close of business on the last Trading Day prior to the applicable
date of Maturity (except that with respect to any Security or portion thereof
which is called for redemption prior to such date, such right will terminate,
except as provided in the Indenture, at the close of business on the last
Trading day preceding the date fixed for redemption (unless the Company
defaults in payment of the Redemption Price in which case the conversion right
will terminate at the close of business on the date such default is cured)) to
convert the principal amount of any Security held by such Holder, or any
portion of such principal amount which is $1,000 or integral multiples thereof,
into that number of fully paid and non-assessable shares of the Company's
Common Stock (as such shares shall then be constituted) obtained by dividing
the principal amount of the Security or portion thereof to be converted by the
Conversion Price in effect at such time, by surrender of the Security so to be
converted in whole or in part in the manner provided in the Indenture.

     To convert a Security a Holder must (1) complete and manually sign the
conversion notice on the back of this Security (or complete and manually sign a
facsimile of such notice) and deliver such notice to the Conversion Agent and
(2) if required under the terms of the Conversion Notice, pay all transfer or
similar taxes.

     The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities under the Indenture at
any time by the Company and the Trustee with the consent of the Holders of a
majority in aggregate principal amount of the Securities at the time
Outstanding. The Indenture also contains provisions permitting the Holders of
specified percentages in aggregate principal amount of the Securities at the
time Outstanding, on behalf of the Holders of all the Securities, to waive
compliance by the Company with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Security shall be conclusive and binding upon such
Holder and upon all future Holders of this Security and of any Security issued
upon the registration of transfer hereof or in exchange herefor or in lieu
hereof, whether or not notation of such consent or waiver is made upon this
Security.

     No reference herein to the Indenture and no provision of this Security or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of (and premium, if any) and
interest (including Special Interest) on this Security at the times, place and
rate, and in the coin or currency, herein prescribed.

     As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Security is registrable in the Security
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company in the Borough of Manhattan, the City of New
York duly endorsed by, or accompanied by a written instrument of transfer in
form satisfactory to the Company and the Security Registrar duly executed by,
the Holder hereof

                                     - 31 -

<PAGE>


or his attorney duly authorized in writing, and thereupon one or more new
Securities, of authorized denominations and for the same aggregate principal
amount, will be issued to the designated transferee or transferees.

     The Securities are issuable only in registered form without coupons in
denominations of $1,000 and any integral multiple thereof. As provided in the
Indenture and subject to certain limitations therein set forth, Securities are
exchangeable for a like aggregate principal amount of Securities of a different
authorized denomination, as requested by the Holder surrendering the same.

     No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.

     Prior to due presentment of this Security for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name this Security is registered as the owner hereof for
all purposes, whether or not this Security be overdue, and neither the Company,
the Trustee nor any such agent shall be affected by notice to the contrary.

     Interest on this Security shall be computed on the basis of a 360-day year
of twelve 30-day months; provided, however, that Special Interest shall be
computed on the basis of a 365- or 366-day year, as the case may be, and the
number of days actually elapsed.

     All terms used in this Security which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.

     The Indenture and this Security shall be governed by and construed in
accordance with the laws of the State of New York.

                                     - 32 -

<PAGE>


                       OPTION OF HOLDER TO ELECT PURCHASE

     If you want to elect to have this Security purchased in its entirety by
the Company pursuant to Section 10.14 or 10.16 of the Indenture, check the box:

                                     [  ]

     If you want to elect to have only a part of this Security purchased by the
Company pursuant to Section 10.14 or 10.16 of the Indenture, state the amount:
$_______________

Dated:______________________   Your Signature:__________________________________
                                              (Sign exactly as name appears on
                                               the other side of this Security)

Signature Guarantee:
                     -----------------------------------------------------------
                     Notice: Signature(s) must be guaranteed by an "eligible
                     guarantor institution" meeting the requirements of the
                     Trustee, which requirements will include membership or
                     participation in STAMP or such other "signature guarantee
                     program" as may be determined by the Trustee in addition
                     to, or in substitution for STAMP, all in accordance with
                     the Securities Exchange Act of 1934, as amended.

     SECTION 2.04 Form of Trustee's Certificate of Authentication.

Dated:

     This is one of the Securities referred to in the within-mentioned
     Indenture.


                                                          The Bank of New York,
                                                                     as Trustee

                                                 By:
                                                     --------------------------
                                                     Authorized Signatory

     SECTION 2.05 Form of Conversion Notice On Reverse of Security.

     To: Millicom International Cellular, S.A.

     The undersigned beneficial owner of the Security hereby irrevocably
exercises the option to convert this Security, or portion hereof (at least
$1,000 or integral multiples thereof) below designated, into shares of Common
Stock of Millicom International Cellular, S.A. in accordance with the terms of
the Indenture referred to in this Security, and directs that the shares
issuable and deliverable upon the conversion, together with any check in
payment for fractional shares and Securities representing any unconverted
principal amount hereof, be issued and delivered to the beneficial owner hereof
unless a different name has been indicated below. If shares or any portion of
this Security not converted are to be issued in the name of a person other

                                     - 33 -

<PAGE>


than the undersigned, the undersigned will pay all transfer taxes payable with
respect thereto. Any amount required to be paid by the undersigned on account
of interest and taxes accompanies this Security.

Dated:

Fill in for registration of shares if to be delivered, _________________________
and Securities  if to be issued, other than to and in  _________________________
the name of the beneficial owner (Please Print):       _________________________
                                                        (Signature(s))

________________________________________            Principal amount to be
(Name)                                              converted if less than all:

________________________________________            $___________________________
(Street Address)

________________________________________            ____________________________
(City, State and Zip Code)                          (Social Security or other
                                                    Taxpayer ID Numbe

Signature Guarantee:____________________________________________________________
                    Notice: Signature(s) must be guaranteed by an "eligible
                    guarantor institution" meeting the requirements of the
                    Trustee, which requirements will include membership or
                    participation in STAMP or such other "signature guarantee
                    program" as may be determined by the Trustee in addition
                    to, or in substitution for STAMP, all in accordance with
                    the Securities Exchange Act of 1934, as amended.


                                 ARTICLE THREE

                                 The Securities

     SECTION 3.01 Title and Terms.

     The aggregate principal amount of Securities which may be authenticated
and delivered under this Indenture is unlimited.

     The Securities shall be known and designated as the "2% Senior Convertible
PIK Notes due 2006" of the Company. Their Stated Maturity shall be June 1,
2006, and they shall bear interest at the rate of 2% per annum, accruing in the
first instance from December 1, 2002 to

                                    - 34 -

<PAGE>


June 1, 2003 (the first Interest Payment Date) and continuing to accrue
thereafter and payable semi-annually on June 1 and December 1, until the
principal thereof is paid or made available for payment (which interest may be
paid, at the Company's option, either in cash or in additional Securities). At
their Stated Maturity, the Outstanding principal amount of Securities (plus
accrued and outstanding interest thereon, including any Special Interest) may
be paid either (i) in cash, (ii) in an amount of shares of the Company's Common
Stock calculated by dividing such Outstanding principal amount by the lesser of
(x) the Conversion Price and (y) the average of the closing prices of the
Company's common stock over the 60-day period immediately preceding the
Maturity date or (iii) any combination of (i) and (ii). With respect to
Securities, if there has been a Registration Default, then additional interest
will accrue (the "Step-Up") at a rate of 0.25% per annum, determined daily, on
the principal amount of the Securities, for the first 90-day period immediately
following the occurrence of the Registration Default until such time (the
"Step-Down Date") as no Registration Default is in effect and, provided,
further, that for each additional 90-day period that the Registration Default
continues, the per annum rate of such Special Interest shall increase (each
such increase, an "Additional Step-Up") by an additional 0.25% per annum up to
a maximum aggregate amount of 1.00% per annum rate of Special Interest (i.e.,
for the combined Step-Up and any Additional Step-Up) until the Step-Down Date
(after which the interest rate will be restored to its initial rate). Accrued
Special Interest, if any, shall be paid in cash in arrears semi-annually on
June 1 and December 1 in each year, the amount of accrued Special Interest
shall be determined on the basis of the number of days actually elapsed and
computed as provided in Section 3.11.

     The principal of (and premium, if any) and interest on the Securities
shall be payable at the office or agency of the Company maintained for that
purpose in the Borough of Manhattan, The City of New York, either in additional
Securities or in such coin or currency of the United States of America as at
the time of payment is legal tender for payment of public and private debts;
provided, however, that at the option of the Company payment of interest may be
made by check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register.

     The Securities shall be redeemable as provided in Article Eleven. The
Securities shall be subject to repurchase by the Company pursuant to an Offer
to Purchase as provided in Sections 10.14 and 10.16.

     The Securities shall not have the benefit of any sinking fund obligations.
The Securities shall be convertible into Common Stock of the Company as
provided in Article Twelve.

     The Securities shall be subject to defeasance at the option of the Company
as provided in Article Thirteen.

     The Securities shall have the benefit of any guarantees issued
specifically for the benefit of these Securities in accordance with Section
10.20 (including the guarantee issued by Millicom International Operations,
B.V., dated May 8, 2003 attached to this Indenture as Exhibit E).

                                     - 35 -

<PAGE>


     Unless the context otherwise requires, the Securities issued hereunder
shall constitute one series for all purposes under the Indenture, including
with respect to any amendment, waiver, acceleration or other Act of Holders,
redemption or Offer to Purchase.

                          SECTION 3.02 Denominations.

     The Securities shall be issuable only in registered form without coupons
and only in denominations of $1,000 and any integral multiple thereof.

          SECTION 3.03 Execution, Authentication, Delivery and Dating.

     The Securities shall be executed on behalf of the Company by any two
Directors of the Company. The signature of any of these officers on the
Securities may be manual or facsimile.

     Securities bearing the manual or facsimile signatures of individuals who
were at any time the proper officers of the Company shall bind the Company
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities.

     At any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Securities executed by the Company to the
Trustee for authentication, together with a Company Order for the
authentication and delivery of such Securities; and the Trustee in accordance
with such Company Order shall authenticate and deliver such Securities as in
this Indenture provided and not otherwise.

     In authenticating the Securities pursuant to this Section, and accepting
the additional responsibilities under this Indenture in relation to such
Securities, the Trustee shall be entitled to receive, and (subject to Section
6.01) shall be fully protected in relying upon, an Opinion of Counsel stating,
that such Securities have been duly and validly issued in accordance with the
terms of the Indenture, and are entitled to all the rights and benefits set
forth herein.

     Each Security shall be dated the date of its authentication.

     No Security shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose unless there appears on such Security a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature, and such certificate upon any
Security shall be conclusive evidence, and the only evidence, that such
Security has been duly authenticated and delivered hereunder.

     SECTION 3.04 Temporary Securities.

     Pending the preparation of definitive Securities, the Company may execute,
and upon Company Order the Trustee shall authenticate and deliver, temporary
Securities which are printed, lithographed, typewritten, mimeographed or
otherwise produced, in any authorized denomination, substantially of the tenor
of the definitive Securities in lieu of which they are issued and with such
appropriate insertions, omissions, substitutions and other variations as the

                                     - 36 -

<PAGE>


officers executing such Securities may determine, as evidenced by their
execution of such Securities.

     If temporary Securities are issued, the Company will cause definitive
Securities to be prepared without unreasonable delay. After the preparation of
definitive Securities, the temporary Securities shall be exchangeable for
definitive Securities upon surrender of the temporary Securities at any office
or agency of the Company designated pursuant to Section 10.02, without charge
to the Holder. Upon surrender for cancellation of any one or more temporary
Securities the Company shall execute and the Trustee shall authenticate and
deliver in exchange therefor a like principal amount of definitive Securities
of authorized denominations. Until so exchanged the temporary Securities shall
in all respects be entitled to the same benefits under this Indenture as
definitive Securities.

     SECTION 3.05 Global Securities.

     (a) Each Global Security authenticated under this Indenture shall be
registered in the name of the Depository designated by the Company for such
Global Security or a nominee thereof and delivered to such Depository or a
nominee thereof or custodian therefor, and each such Global Security shall
constitute a single Security for all purposes of this Indenture.

     (b) Notwithstanding any other provision in this Indenture, no Global
Security may be exchanged in whole or in part for Securities registered, and no
transfer of a Global Security in whole or in part may be registered, in the
name of any Person other than the Depository for such Global Security or a
nominee thereof unless (i) such Depository (A) has notified the Company that it
is unwilling or unable to continue as Depository for such Global Security or
(B) has ceased to be a clearing agency registered as such under the Exchange
Act, (ii) there shall have occurred and be continuing an Event of Default with
respect to such Global Security, (iii) the Company executes and delivers to the
Trustee a Company Order stating that all Global Securities shall be exchanged
in whole for Securities that are not Global Securities (in which case such
exchange shall be effected by the Trustee) or (iv) pursuant to the following
sentence. Subject to any other applicable provisions hereof, all or any portion
of a Global Security may be exchanged for a Security that has a like aggregate
principal amount and is not a Global Security, upon 20 days' prior request made
by the Depository or its authorized representative to the Trustee.

     (c) If any Global Security is to be exchanged for other Securities or
cancelled in whole, it shall be surrendered by or on behalf of the Depository
or its nominee to the Trustee, as Security Registrar, for exchange or
cancellation as provided in this Article Three. If any Global Security is to be
exchanged for other Securities or cancelled in part, or if another Security is
to be exchanged in whole or in part for a beneficial interest in any Global
Security, then either (i) such Global Security shall be so surrendered for
exchange or cancellation as provided in this Article Three or (ii) the
principal amount thereof shall be reduced or increased by an amount equal to
the portion thereof to be so exchanged or cancelled, or equal to the principal
amount of such other Security to be so exchanged for a beneficial interest
therein, as the case may be, by means of an appropriate adjustment made on the
records of the Trustee, as Security Registrar, whereupon the Trustee, in
accordance with the Applicable Procedures, shall instruct the Depository or its
authorized representative to make a corresponding adjustment to its records.

                                     - 37 -

<PAGE>


Upon any such surrender or adjustment of a Global Security, the Trustee shall,
subject to Section 3.05(b) and as otherwise provided in this Article Three,
authenticate and deliver any Securities issuable in exchange for such Global
Security (or any portion thereof) to or upon the order of, and registered in
such names as may be directed by, the Depository or its authorized
representative. Upon the request of the Trustee in connection with the
occurrence of any of the events specified in the preceding paragraph, the
Company shall promptly make available to the Trustee a reasonable supply of
Securities that are not in the form of Global Securities. The Trustee shall be
entitled to rely upon any order, direction or request of the Depository or its
authorized representative which is given or made pursuant to this Article Three
if such order, direction or request is given or made in accordance with the
Applicable Procedures.

     (d) Every Security authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Security or any portion
thereof, whether pursuant to this Article Three, Section 9.06, 10.14 or 10.16
or otherwise, shall be authenticated and delivered in the form of, and shall
be, a Global Security, unless such Security is registered in the name of a
Person other than the Depository for such Global Security or a nominee thereof.

     (e) The Depository or its nominee, as registered owner of a Global
Security, shall be the Holder of such Global Security for all purposes under
the Indenture and the Securities, and owners of beneficial interests in a
Global Security shall hold such interests pursuant to the Applicable
Procedures. Accordingly, any such owner's beneficial interest in a Global
Security will be shown only on, and the transfer of such interest shall be
effected only through, records maintained by the Depository or its nominee or
its Agent Members.

     SECTION 3.06 Registration, Registration of Transfer Generally; Certain
Transfers and Exchanges.

     (a) Registration, Registration of Transfer and Exchange Generally. The
Company shall cause to be kept at the Corporate Trust Office of the Trustee a
register (the register maintained in such office and in any other office or
agency designated pursuant to Section 10.02 being herein sometimes collectively
referred to as the "Security Register") in which, subject to such reasonable
regulations as it may prescribe, the Company shall provide for the registration
and transfer of Securities. The Trustee is hereby appointed "Security
Registrar" for the purpose of registering Securities and transfers of
Securities as herein provided.

     Upon surrender for registration of transfer or exchange of any Security at
an office or agency of the Company designated pursuant to Section 10.02 for
such purpose, the Company shall execute, and the Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Securities of any authorized denominations and of a like aggregate
principal amount and bearing such restrictive legends as may be required by
this Indenture.

     Subject to Section 3.06(b), at the option of the Holder, Securities may be
exchanged for other Securities of any authorized denominations and of a like
aggregate principal amount, upon surrender of the Securities to be exchanged at
such office or agency. Whenever any Securities are so surrendered for exchange,
the Company shall execute, and the Trustee shall

                                     - 38 -

<PAGE>


authenticate and deliver, the Securities which the Holder making the exchange
is entitled to receive.

     All Securities issued upon any registration of transfer of or exchange for
Securities shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the Securities
surrendered upon such registration of transfer or exchange.

     Every Security presented or surrendered for registration of transfer or
for exchange shall (if so required by the Company or the Trustee) be duly
endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Security Registrar duly executed, by the
Holder thereof or his attorney duly authorized in writing.

     No service charge shall be made for any registration of transfer or
exchange of Securities, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
with any registration of transfer or exchange of Securities, other than
exchanges pursuant to Section 3.04, 9.06 or 11.08 or in accordance with any
Offer to Purchase pursuant to Section 10.14 or 10.16 not involving any
transfer.

     The Company shall not be required (i) to issue or register the transfer of
any Security during a period beginning at the opening of business 15 days
before the day of the mailing of a notice of redemption of Securities selected
for redemption under Section 11.04 and ending at the close of business on the
day of such mailing, or (ii) to register the transfer of any Security so
selected for redemption in whole or in part, except the unredeemed portion of
any Security being redeemed in part.

     (b) Certain Transfers and Exchanges. Notwithstanding any other provision
of this Indenture or the Securities, transfers or exchanges of Securities and
beneficial interests in a Global Security of the kinds specified in this
Section 3.06(b) shall be made only in accordance with this Section 3.06(b).

     (i)   Restricted Global Security to Regulation S Global Security. If the
          owner of a beneficial interest in the Restricted Global Security
          wishes at any time to transfer such interest to a Person who wishes
          to take delivery thereof in the form of a beneficial interest in the
          Regulation S Global Security, such transfer may be effected only in
          accordance with the provisions of this Clause (b)(i) and Clause
          (b)(vii) below and subject to the Applicable Procedures. Upon receipt
          by the Trustee, as Security Registrar, of (A) an order given by the
          Depository or its authorized representative directing that a
          beneficial interest in the Regulation S Global Security in a
          specified principal amount be credited to a specified Agent Member's
          account and that a beneficial interest in the Restricted Global
          Security in an equal principal amount be debited from another
          specified Agent Member's account and (B) a Regulation S

                                     - 39 -

<PAGE>


          Certificate, satisfactory to the Trustee and duly executed by the
          owner of such beneficial interest in the Restricted Global Security
          or his attorney in fact duly authorized in writing, then the Trustee,
          as Security Registrar but subject to Clause (b)(vii) below, shall
          reduce the principal amount of the Restricted Global Security and
          increase the principal amount of the Regulation S Global Security by
          such specified principal amount as provided in Section 3.05(c).

    (ii)  Regulation S Global Security to Restricted Global Security. If the
          owner of a beneficial interest in the Regulation S Global Security
          wishes at any time to transfer such interest to a Person who wishes
          to take delivery thereof in the form of a beneficial interest in the
          Restricted Global Security, such transfer may be effected only in
          accordance with this Clause (b)(ii) and subject to the Applicable
          Procedures. Upon receipt by the Trustee, as Security Registrar, of
          (A) an order given by the Depository or its authorized representative
          directing that a beneficial interest in the Restricted Global
          Security in a specified principal amount be credited to a specified
          Agent Member's account and that a beneficial interest in the
          Regulation S Global Security in an equal principal amount be debited
          from another specified Agent Member's account and (B) if such
          transfer is to occur during the Restricted Period, a Restricted
          Securities Certificate, satisfactory to the Trustee and duly executed
          by the owner of such beneficial interest in the Regulation S Global
          Security or his attorney in fact duly authorized in writing, then the
          Trustee, as Security Registrar, shall reduce the principal amount of
          the Regulation S Global Security and increase the principal amount of
          the Restricted Global Security by such specified principal amount as
          provided in Section 3.05(c). If transfers under this Section
          3.06(b)(ii) occur after the Restricted Period, no Restricted
          Securities Certificates will be required.

   (iii)  Restricted Non-Global Security to Restricted Global Security or
          Regulation S Global Security. If the Holder of a Restricted Security
          (other than a Global Security) wishes at any time to transfer all or
          any portion of such Security to a Person who wishes to take delivery
          thereof in the form of a beneficial interest in the Restricted Global
          Security or the Regulation S Global Security, such transfer may be
          effected only in accordance with the provisions of this Clause
          (b)(iii) and Clause (b)(vii) below and subject to the Applicable
          Procedures. Upon receipt by the Trustee, as Security Registrar, of
          (A) such Security as provided in Section 3.06(a) and instructions
          satisfactory to the Trustee directing that a beneficial interest in
          the Restricted Global Security or Regulation S Global Security in a
          specified principal amount not greater than the principal amount of
          such Security be credited to a specified Agent Member's account and
          (B) a Restricted Securities Certificate, if the


                                     - 40 -

<PAGE>


          specified account is to be credited with a beneficial interest in the
          Restricted Global Security, or a Regulation S Certificate, if the
          specified account is to be credited with a beneficial interest in the
          Regulation S Global Security, in either case satisfactory to the
          Trustee and duly executed by such Holder or his attorney duly
          authorized in writing, then the Trustee, as Security Registrar but
          subject to Clause (b)(vii) below, shall cancel such Security (and
          issue a new Security in respect of any untransferred portion thereof)
          as provided in Section 3.06(a) and increase the principal amount of
          the Restricted Global Security or the Regulation S Global Security,
          as the case may be, by the specified principal amount as provided in
          Section 3.05(c).

    (iv) Regulation S Non-Global Security to Restricted Global Security or
          Regulation S Global Security. If the Holder of a Regulation S
          Security (other than a Global Security) wishes at any time to
          transfer all or any portion of such Security to a Person who wishes
          to take delivery thereof in the form of a beneficial interest in the
          Restricted Global Security or the Regulation S Global Security, such
          transfer may be effected only in accordance with this Clause (b)(iv)
          and Clause (b)(vii) below and subject to the Applicable Procedures.
          Upon receipt by the Trustee, as Security Registrar, of (A) such
          Security as provided in Section 3.06(a) and instructions satisfactory
          to the Trustee directing that a beneficial interest in the Restricted
          Global Security or Regulation S Global Security in a specified
          principal amount not greater than the principal amount of such
          Security be credited to a specified Agent Member's account and (B) if
          the transfer is to occur during the Restricted Period and the
          specified account is to be credited with a beneficial interest in the
          Restricted Global Security, a Restricted Securities Certificate
          satisfactory to the Trustee and duly executed by such Holder or his
          attorney duly authorized in writing, then the Trustee, as Security
          Registrar but subject to Clause (b)(vii) below, shall cancel such
          Security (and issue a new Security in respect of any untransferred
          portion thereof) as provided in Section 3.06(a) and increase the
          principal amount of the Restricted Global Security or the Regulation
          S Global Security, as the case may be, by the specified principal
          amount as provided in Section 3.05(c).

     (v)  Non-Global Security to Non-Global Security. A Security that is not a
          Global Security may be transferred, in whole or in part, to a Person
          who takes delivery in the form of another Security that is not a
          Global Security as provided in Section 3.06(a), provided that, if the
          Security to be transferred in whole or in part is a Restricted
          Security and the transfer is to occur during the Restricted Period,
          then the Trustee shall have received (A) a Restricted Securities
          Certificate, satisfactory to the Trustee and duly executed by the


                                     - 41 -

<PAGE>


          transferor Holder or his attorney duly authorized in writing, in
          which case the transferee Holder shall take delivery in the form of a
          Restricted Security, or (B) a Regulation S Certificate, satisfactory
          to the Trustee and duly executed by the transferor Holder or his
          attorney duly authorized in writing, in which case the transferee
          Holder shall take delivery in the form of a Regulation S Security
          (subject in each case to Section 3.06(c)).

    (vi)  Exchanges between Global Security and Non-Global Security. A
          beneficial interest in a Global Security may be exchanged for a
          Security that is not a Global Security as provided in Section 3.05,
          provided that, if such interest is a beneficial interest in the
          Restricted Global Security, then such interest shall be exchanged for
          a Restricted Security (subject in each case to Section 3.06(c)). A
          Security that is not a Global Security may be exchanged for a
          beneficial interest in a Global Security only if such exchange occurs
          in connection with a transfer effected in accordance with Clause
          (b)(iii) or (iv) above.

   (vii)   Regulation S Global Security to be Held Through Euroclear or
          Clearstream during Restricted Period. The Company shall use its best
          efforts to cause the Depository to ensure that, until the expiration
          of the Restricted Period, beneficial interests in the Regulation S
          Global Security may be held only in or through accounts maintained at
          the Depository by Euroclear or Clearstream (or by Agent Members
          acting for the account thereof), and no person shall be entitled to
          effect any transfer or exchange that would result in any such
          interest being held otherwise than in or through such an account;
          provided that this Clause (b)(vii) shall not prohibit any transfer or
          exchange of such an interest in accordance with Clause (b)(ii) or
          (vi) above.

     The Company shall notify the Trustee promptly of the expiration of the
Restricted Period. Such notification shall be in the form of Annex D hereto.

     (c) Securities Act Legends. Securities shall bear a Restricted Securities
Legend and Regulation S Securities shall bear a Regulation S Legend, subject to
the following:

     (i)  subject to the following Clauses of this Section 3.06(c), a Security
          or any portion thereof which is exchanged, upon transfer or
          otherwise, for a Global Security or any portion thereof shall bear
          the Securities Act Legend borne by such Global Security while
          represented thereby;

    (ii)  subject to the following Clauses of this Section 3.06(c), a new
          Security which is not a Global Security and is issued in exchange for
          another Security (including a Global Security) or any portion


                                     - 42 -

<PAGE>


          thereof, upon transfer or otherwise, shall bear the Securities Act
          Legend borne by such other Security, provided that, if such new
          Security is required pursuant to Section 3.06(b)(v) or (vi) to be
          issued in the form of a Restricted Security, it shall bear a
          Restricted Securities Legend and, if such new Security is so required
          to be issued in the form of a Regulation S Security, it shall bear a
          Regulation S Legend;

    (iii) after a date that is two years from issuance, a new Security which
          does not bear a Securities Act Legend may be issued in exchange for
          or in lieu of a Security or any portion thereof which bears such a
          legend if the Trustee has received an Unrestricted Securities
          Certificate, satisfactory to the Trustee and duly executed by the
          Holder of such legended Security or his attorney duly authorized in
          writing, and after such date and receipt of such certificate, the
          Trustee shall authenticate and deliver such a new Security in
          exchange for or in lieu of such other Security as provided in this
          Article Three;

    (iv)  a new Security which does not bear a Securities Act Legend (other
          than a Global Security) may be issued in exchange for or in lieu of a
          Security or any portion thereof which bears such a legend if, in the
          Company's judgment, placing such a legend upon such new Security is
          not necessary to ensure compliance with the registration requirements
          of the Securities Act, and the Trustee, at the direction of the
          Company, shall authenticate and deliver such a new Security as
          provided in this Article Three; and

     (v)  notwithstanding the foregoing provisions of this Section 3.06(c), a
          Successor Security of a Security that does not bear a particular form
          of Securities Act Legend shall not bear such form of legend unless
          the Company has reasonable cause to believe that such Successor
          Security is a "restricted security" within the meaning of Rule 144,
          in which case the Trustee, at the direction of the Company, shall
          authenticate and deliver a new Security bearing a Restricted
          Securities Legend in exchange for such Successor Security as provided
          in this Article Three.


     SECTION 3.07 Mutilated, Destroyed, Lost and Stolen Securities.

     If any mutilated Security is surrendered to the Trustee, the Company shall
execute and the Trustee shall authenticate and deliver in exchange therefor a
new Security of like tenor and principal amount and bearing a number not
contemporaneously outstanding.

     If there shall be delivered to the Company and the Trustee (i) evidence to
their satisfaction of the destruction, loss or theft of any Security and (ii)
such security or indemnity as may be required by them to save each of them and
any agent of either of them harmless, then, in

                                     - 43 -

<PAGE>


the absence of notice to the Company or the Trustee that such Security has been
acquired by a bona fide purchaser, the Company shall execute and the Trustee
shall authenticate and deliver, in lieu of any such destroyed, lost or stolen
Security, a new Security of like tenor and principal amount and bearing a
number not contemporaneously outstanding.

     In case any Security, which has matured or is about to mature, or has been
called for redemption pursuant to Article Eleven, or is about to be converted
into shares of the Company's Common Stock pursuant to Article Twelve, shall
become mutilated or be destroyed, lost or stolen, the Company may, instead of
issuing a substitute Security, pay or authorize the payment of or convert or
authorize the conversion of the same (without surrender thereof except in the
case of a mutilated Security), as the case may be, if the applicant for such
payment or conversion shall furnish to the Company, to the Trustee and, if
applicable, to the authenticating agent such security or indemnity as may be
required by them to save each of them harmless for any loss, liability, cost or
expense caused by or connected with such substitution, and, in case of
destruction, loss or theft, evidence satisfactory to the Company, the Trustee
and, if applicable, any paying agent or conversion agent of the destruction,
loss or theft of such Security and of the ownership thereof.

     Upon the issuance of any new Security under this Section, 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 Trustee) connected therewith.

     Every new Security issued pursuant to this Section in lieu of any
destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities duly issued hereunder.

     The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities.

     SECTION 3.08 Payment of Interest; Interest Rights Preserved.

     Interest on any Security which is payable, and is punctually paid or duly
provided for, on any Interest Payment Date shall be paid to the Person in whose
name that Security (or one or more Predecessor Securities) is registered at the
close of business on the Regular Record Date for such interest.

     Any interest on any Security which is payable, but is not punctually paid
or duly provided for, on any Interest Payment Date (herein called "Defaulted
Interest") shall forthwith cease to be payable to the Holder on the relevant
Regular Record Date by virtue of having been such Holder, and such Defaulted
Interest may be paid by the Company, at its election in each case, as provided
in Clause (1) or (2) below:

          (1) The Company may elect to make payment of any Defaulted Interest
     to the Persons in whose names the Securities (or their respective


                                    - 44 -

<PAGE>


     Predecessor Securities) are registered at the close of business on a
     Special Record Date for the payment of such Defaulted Interest, which
     shall be fixed in the following manner. The Company shall notify the
     Trustee in writing of the amount of Defaulted Interest proposed to be paid
     on each Security and the date of the proposed payment, and at the same
     time the Company shall deposit with the Trustee an amount of money equal
     to the aggregate amount proposed to be paid in respect of such Defaulted
     Interest or shall make arrangements satisfactory to the Trustee for such
     deposit prior to the date of the proposed payment, such money when
     deposited to be held in trust for the benefit of the Persons entitled to
     such Defaulted Interest as in this Clause provided. Thereupon the Trustee
     shall fix a Special Record Date for the payment of such Defaulted Interest
     which shall be not more than 15 days and not less than 10 days prior to
     the date of the proposed payment and not less than 10 days after the
     receipt by the Trustee of the notice of the proposed payment. The Trustee
     shall promptly notify the Company of such Special Record Date and, in the
     name and at the expense of the Company, shall cause notice of the proposed
     payment of such Defaulted Interest and the Special Record Date therefor to
     be mailed, first-class postage prepaid, to each Holder at his address as
     it appears in the Security Register, not less than 10 days prior to such
     Special Record Date. Notice of the proposed payment of such Defaulted
     Interest and the Special Record Date therefor having been so mailed, such
     Defaulted Interest shall be paid to the Persons in whose names the
     Securities (or their respective Predecessor Securities) are registered at
     the close of business on such Special Record Date and shall no longer be
     payable pursuant to the following Clause (2).

          (2) The Company may make payment of any Defaulted Interest in any
     other lawful manner not inconsistent with the requirements of any
     securities exchange on which the Securities may be listed, and upon such
     notice as may be required by such exchange, if, after notice given by the
     Company to the Trustee of the proposed payment pursuant to this Clause,
     such manner of payment shall be deemed practicable by the Trustee.

     Subject to the foregoing provisions of this Section, each Security
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Security shall carry the rights to interest accrued
and unpaid, and to accrue, which were carried by such other Security.

     SECTION 3.09 Persons Deemed Owners.

     Prior to due presentment of a Security for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name such Security is registered as the owner of such Security
for the purpose of receiving payment of principal of (and premium, if any) and
(subject to Section 3.08) interest on such Security and for all other purposes
whatsoever, whether or not such Security be overdue, and neither the Company,
the Trustee nor any agent of the Company or the Trustee shall be affected by
notice to the contrary.

                                     - 45 -

<PAGE>


     SECTION 3.10 Cancellation.

     All Securities surrendered for payment, conversion, redemption,
registration of transfer, exchange or pursuant to any Offer to Purchase
pursuant to Section 10.14 or 10.16 shall, if surrendered to any Person other
than the Trustee, be delivered to the Trustee and shall be promptly cancelled
by it. The Company may at any time deliver to the Trustee for cancellation any
Securities previously authenticated and delivered hereunder which the Company
may have acquired in any manner whatsoever, and all Securities so delivered
shall be promptly cancelled by the Trustee. No Securities shall be
authenticated in lieu of or in exchange for any Securities cancelled as
provided in this Section, except as expressly permitted by this Indenture. All
cancelled Securities held by the Trustee shall be disposed of as directed by a
Company Order; provided, however, that the Trustee may, but shall not be
required to destroy cancelled Securities.

     SECTION 3.11 Computation of Interest.

     Interest on the Securities shall be computed on the basis of a 360-day
year of twelve 30-day months; provided, however, that Special Interest on
Securities shall be computed on the basis of a 365- or 366-day year, as the
case may be, and the number of days actually elapsed.

     SECTION 3.12 CUSIP Numbers.

     The Company shall in issuing the Securities use CUSIP numbers, and the
Trustee shall use the applicable CUSIP number in notices of redemption or
exchange as a convenience to the Holders; provided, that any such notice may
state that no representation is made as to the accuracy or correctness of the
CUSIP number or numbers printed in the notice or on the certificates
representing the Securities and that reliance may be placed only on the other
identification numbers printed on the certificates representing the Securities.

                                  ARTICLE FOUR

                           Satisfaction and Discharge

     SECTION 4.01 Satisfaction and Discharge of Indenture.

     This Indenture shall cease to be of further effect (except as to any
surviving rights of registration of transfer or exchange of Securities herein
expressly provided for), and the Trustee, on demand of and at the expense of
the Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when

          (1) either

               (A) all Securities theretofore authenticated and delivered
          (other than (i) Securities which have been destroyed, lost or stolen
          and which have been replaced or paid as provided in Section 3.07 and
          (ii) Securities for whose payment money has theretofore been
          deposited in trust or segregated and held in trust by the Company and
          thereafter repaid to the

                                     - 46 -

<PAGE>


          Company or discharged from such trust, as provided in Section 10.03)
          have been delivered to the Trustee for cancellation; or

               (B) all such Securities not theretofore delivered to the Trustee
          for cancellation

          (i) have become due and payable, or

         (ii) will become due and payable at their Stated Maturity within one
     year, or

          (iii) are to be called for redemption within one year under
     arrangements satisfactory to the Trustee for the giving of notice of
     redemption by the Trustee in the name, and at the expense, of the Company,

               and the Company in the case of (i), (ii) or (iii) above, has
               deposited or caused to be deposited with the Trustee as trust
               funds in trust for the purpose an amount sufficient to pay and
               discharge the entire indebtedness on such Securities not
               theretofore delivered to the Trustee for cancellation, for
               principal (and premium, if any) and interest to the date of such
               deposit (in the case of Securities which have become due and
               payable) or to the Stated Maturity or Redemption Date, as the
               case may be;

               (2) the Company has paid or cause to be paid all other sums
          payable hereunder by the Company; and

               (3) the Company has delivered to the Trustee an Officer's
          Certificate and an Opinion of Counsel, each stating that all
          conditions precedent herein provided for relating to the satisfaction
          and discharge of this Indenture have been complied with.

Notwithstanding the satisfaction and discharge of this Indenture pursuant to
this Article Four, the obligations of the Company to the Trustee under Section
6.07, the obligations of the Trustee to any Authenticating Agent under Section
6.14 and, if money shall have been deposited with the Trustee pursuant to
subclause (B) of Clause (1) of this Section, the obligations of the Trustee
under Section 4.02 and the last paragraph of Section 10.03 shall survive.

     SECTION 4.02 Application of Trust Money.

     Subject to the provisions of the last paragraph of Section 10.03, all
money deposited with the Trustee pursuant to Section 4.01 shall be held in
trust and applied by it, in accordance with the provisions of the Securities
and this Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal (and premium, if
any) and interest for whose payment such money has been deposited with the
Trustee.

                                     - 47 -

<PAGE>


                                  ARTICLE FIVE

                                    Remedies

     SECTION 5.01 Events of Default.

     "Event of Default", wherever used herein, means any one of the following
events (whatever the reason for such Event of Default and whether it shall be
voluntary or involuntary or be effected by operation of law or pursuant to any
judgment, decree or order of any court or any order, rule or regulation of any
administrative or governmental body):

          (1) default in the payment of the principal of (or premium, if any,
     on) any Security at its Maturity; or

          (2) default in the payment of any interest upon any Security
     (including Additional Amounts and Special Interest if any) when it becomes
     due and payable, and continuance of such default for a period of 30 days;
     or

          (3) default in the payment of principal and interest upon any
     Security required to be purchased pursuant to an Offer to Purchase
     pursuant to Section 10.14 or 10.16; or

          (4) default in the performance, or breach, of Section 8.01; or

          (5) default in the performance, or breach, of any covenant or
     warranty of the Company in this Indenture (other than a covenant or
     warranty a default in whose performance or whose breach is elsewhere in
     this Section specifically dealt with), and continuance of such default or
     breach for a period of 60 days after there has been given, by registered
     or certified mail, to the Company by the Trustee or to the Company and the
     Trustee by the Holders of at least 25% in aggregate principal amount of
     the Outstanding Securities a written notice specifying such default or
     breach and requiring it to be remedied and stating that such notice is a
     "Notice of Default" hereunder; or

          (6) a default or defaults under any bond(s), debenture(s), note(s) or
     other evidence(s) of Debt by the Company or any Significant Restricted
     Group Member or under any mortgage(s), indenture(s) or instrument(s) under
     which there may be issued or by which there may be secured or evidenced
     any Debt of such type by the Company or any Significant Restricted Group
     Member with a principal amount then outstanding, individually or in the
     aggregate, in excess of $10 million, whether such Debt now exists or shall
     hereafter be created, which default or defaults shall constitute a failure
     to pay such Debt when due at the final maturity thereof, or shall have
     resulted in such Debt becoming or being declared due and payable prior to
     the date on which it would otherwise have become due and payable; or

          (7) a final judgment or final judgments (not subject to appeal) for
     the payment of money are entered against the Company or any Significant
     Restricted

                                    - 48 -

<PAGE>


     Group Member in an aggregate amount in excess of $10 million by a court or
     courts of competent jurisdiction, which judgments remain undischarged or
     unstayed for a period (during which execution shall not be effectively
     stayed) of 45 days after the right to appeal all such judgments has
     expired; or

          (8) the entry by a court having jurisdiction in the premises of (A) a
     decree or order for relief in respect of the Company or any Significant
     Restricted Group Member in an involuntary case or proceeding under any
     applicable Federal, State or foreign bankruptcy, insolvency,
     reorganization or other similar law or (B) a decree or order adjudging the
     Company or any Significant Restricted Group Member a bankrupt or
     insolvent, or approving as properly filed a petition seeking
     reorganization, arrangement, adjustment or composition of or in respect of
     the Company or any Significant Restricted Group Member under any
     applicable Federal, State or foreign law, or appointing a custodian,
     receiver, liquidator, assignee, trustee, sequestrator or other similar
     official of the Company or any Significant Restricted Group Member or of
     any substantial part of its property, or ordering the winding up or
     liquidation of its affairs, and the continuance of any such decree or
     order for relief or any such other decree or order unstayed and in effect
     for a period of 60 consecutive days;

          (9) the commencement by the Company or any Significant Restricted
     Group Member of a voluntary case or proceeding under any applicable
     Federal, State or foreign bankruptcy, insolvency, reorganization or other
     similar law or of any other case or proceeding to be adjudicated a
     bankrupt or insolvent, or the consent by it to the entry of a decree or
     order for relief in respect of the Company or any Significant Restricted
     Group Member in an involuntary case or proceeding under any applicable
     Federal, State or foreign bankruptcy, insolvency, reorganization or other
     similar law or to the commencement of any bankruptcy or insolvency case or
     proceeding against it, or the filing by it of a petition or answer or
     consent seeking reorganization or relief under any applicable Federal,
     State or foreign law, or the consent by it to the filing of such petition
     or to the appointment of or taking possession by a custodian, receiver,
     liquidator, assignee, trustee, sequestrator or other similar official of
     the Company or any Significant Restricted Group Member or of any
     substantial part of its property, or the making by it of an assignment for
     the benefit of creditors, or the admission by it in writing of its
     inability to pay its debts generally as they become due, or the taking of
     corporate action by the Company or any Significant Restricted Group Member
     in furtherance of any such action; or

          (10) the failure to deliver fully authorized and validly issued
     shares of the Company's Common Stock upon conversion of the Securities in
     accordance with Article Twelve, if such failure remains unremedied for a
     period of 30 days after the Notice of Conversion.

                                     - 49 -

<PAGE>


     SECTION 5.02 Acceleration of Maturity; Rescission and Annulment. If an
Event of Default (other than an Event of Default specified in Section 5.01(8)
or (9) with respect to the Company) occurs and is continuing, then and in every
such case the Trustee or the Holders of not less than 25% in aggregate
principal amount of the Outstanding Securities may declare the Default Amount
of all the Securities to be due and payable immediately, by a notice in writing
to the Company (and to the Trustee if given by Holders), and upon any such
declaration the Default Amount and any accrued interest, together with all
other amounts due under this Indenture, shall become immediately due and
payable. If an Event of Default specified in Section 5.01(8) or (9) occurs with
respect to the Company, then the Default Amount of, and any accrued interest
on, the Securities then Outstanding, together with all other amounts due under
this Indenture, shall ipso facto become immediately due and payable without any
declaration or other action on the part of the Trustee or any Holder.

     At any time after such a declaration of acceleration has been made and
before a judgment or decree for payment of the money due has been obtained by
the Trustee as hereinafter in this Article provided, the Holders of a majority
in principal amount of the Outstanding Securities, by written notice to the
Company and the Trustee, may rescind and annul such declaration and its
consequences if

          (1) the Company has paid or deposited with the Trustee a sum or an
     amount of Securities or shares of the Company's Common Stock, as
     applicable, sufficient to pay

               (A) all overdue interest on all Securities,

               (B) the principal of (and premium, if any, on) any Securities
          which have become due otherwise than by such declaration of
          acceleration (including any Securities required to have been
          purchased on the Purchase Date pursuant to an Offer to Purchase made
          by the Company) and interest thereon at the rate borne by the
          Securities,

               (C) to the extent that payment of such interest is lawful,
          interest upon overdue interest at the rate borne by the Securities,
          and

               (D) all sums paid or advanced by the Trustee hereunder and the
          reasonable compensation, expenses, disbursements and advances of the
          Trustee, its agents and counsel;

        and

          (2) all Events of Default, other than the non-payment of the
     principal of Securities which have become due solely by such declaration
     of acceleration, have been cured or waived as provided in Section 5.13.

No such rescission shall affect any subsequent default or impair any right
consequent thereon.

                                     - 50 -

<PAGE>




     SECTION 5.03 Collection of Indebtedness and Suits for Enforcement by
Trustee.

     The Company covenants that if

          (1) default is made in the payment of any interest on any Security
     when such interest becomes due and payable and such default continues for
     a period of 30 days, or

          (2) default is made in the payment of the principal of (or premium,
     if any, on) any Security at the Maturity thereof, or, with respect to any
     Security required to have been purchased pursuant to an Offer to Purchase
     made by the Company at the Purchase Date thereof,

the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities, the whole amount then due and payable on such
Securities for principal (and premium, if any) and interest, and, to the extent
that payment of such interest shall be legally enforceable, interest on any
overdue principal (and premium, if any) and on any overdue interest, at the
rate borne by the Securities, and, in addition thereto, such further amount as
shall be sufficient to cover the costs and expenses of collection, including
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel.

     If the Company fails to pay such amounts forthwith upon such demand, the
Trustee, in its own name and as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, may
prosecute such proceeding to judgment or final decree, and may enforce the same
against the Company or any other obligor upon the Securities and collect the
moneys adjudged or decreed to be payable in the manner provided by law out of
the property of the Company or any other obligor upon the Securities, wherever
situated.

     If an Event of Default occurs and is continuing, the Trustee may in its
discretion proceed to protect and enforce its rights and the rights of the
Holders by such appropriate judicial proceedings as the Trustee shall deem most
effectual to protect and enforce any such rights, whether for the specific
enforcement of any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other proper remedy.

     SECTION 5.04 Trustee May File Proofs of Claim.

     In case of any judicial proceeding relative to the Company, Millicom
International Operations B. V. as guarantor of the Securities (or any other
obligor upon the Securities), its property or its creditors, the Trustee shall
be entitled and empowered, by intervention in such proceeding or otherwise, to
take any and all actions authorized under the Trust Indenture Act in order to
have claims of the Holders and the Trustee allowed in any such proceeding. In
particular, the Trustee shall be authorized to collect and receive any moneys
or other property payable or deliverable on any such claims and to distribute
the same; and any custodian, receiver, assignee, trustee, liquidator,
sequestrator or other similar official in any such judicial proceeding is
hereby authorized by each Holder to make such payments to the Trustee and, in
the event that the Trustee shall consent to the making of such payments
directly to the Holders, to

                                    - 51 -

<PAGE>


pay to the Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any
other amounts due the Trustee under Section 6.07.

     No provision of this Indenture shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.

     SECTION 5.05 Trustee May Enforce Claims Without Possession of Securities.

     All rights of action and claims under this Indenture or the Securities may
be prosecuted and enforced by the Trustee without the possession of any of the
Securities or the production thereof in any proceeding relating thereto, and
any such proceeding instituted by the Trustee shall be brought in its own name
as trustee of an express trust, and any recovery of judgment shall, after
provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Securities in respect of which such
judgment has been recovered.

     SECTION 5.06 Application of Money Collected.

     Any money collected by the Trustee pursuant to this Article shall be
applied in the following order, at the date or dates fixed by the Trustee and,
in case of the distribution of such money on account of principal (or premium,
if any) or interest, upon presentation of the Securities and the notation
thereon of the payment if only partially paid and upon surrender thereof if
fully paid: FIRST: To the payment of all amounts due the Trustee under Section
6.07; and SECOND: To the payment of the amounts then due and unpaid for
principal of (and premium, if any) and interest on the Securities in respect of
which or for the benefit of which such money has been collected, ratably,
without preference or priority of any kind, according to the amounts due and
payable on such Securities for principal (and premium, if any) and interest,
respectively.

     SECTION 5.07 Limitation on Suits.

     No Holder of any Security shall have any right to institute any
proceeding, judicial or otherwise, with respect to this Indenture, or for the
appointment of a receiver or trustee, or for any other remedy hereunder, unless
(1) such Holder has previously given written notice to the Trustee of a
continuing Event of Default;

                                     - 52 -

<PAGE>


          (2) the Holders of not less than 25% in principal amount of the
     Outstanding Securities shall have made written request to the Trustee to
     institute proceedings in respect of such Event of Default in its own name
     as Trustee hereunder;

          (3) such Holder or Holders have offered to the Trustee reasonable
     indemnity against the costs, expenses and liabilities to be incurred in
     compliance with such request;

          (4) the Trustee for 60 days after its receipt of such notice, request
     and offer of indemnity has failed to institute any such proceeding; and

          (5) no direction inconsistent with such written request has been
     given to the Trustee during such 60-day period by the Holders of a
     majority in principal amount of the Outstanding Securities;

it being understood and intended that no one or more Holders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this Indenture to affect, disturb or prejudice the rights of any other Holders,
or to obtain or to seek to obtain priority or preference over any other Holders
or to enforce any right under this Indenture, except in the manner herein
provided and for the equal and ratable benefit of all the Holders.

     SECTION 5.08 Unconditional Right of Holders to Receive Principal, Premium
and Interest.

     Notwithstanding Section 5.07 or any other provision in this Indenture, the
Holder of any Security shall have the right, which is absolute and
unconditional, to receive payment of the principal of (and premium, if any) and
(subject to Section 3.08) interest on such Security on the respective Stated
Maturities expressed in such Security (or, in the case of redemption, on the
Redemption Date or, in the case of an Offer to Purchase made by the Company, on
the Purchase Date) and to institute suit for the enforcement of any such
payment or to institute suit for the enforcement of the right to convert the
Security and such rights shall not be impaired without the consent of such
Holder.

     SECTION 5.09 Restoration of Rights and Remedies.

     If the Trustee or any Holder has instituted any proceeding to enforce any
right or remedy under this Indenture and such proceeding has been discontinued
or abandoned for any reason, or has been determined adversely to the Trustee or
to such Holder, then and in every such case, subject to any determination in
such proceeding, the Company, the Trustee and the Holders shall be restored
severally and respectively to their former positions hereunder and thereafter
all rights and remedies of the Trustee and the Holders shall continue as though
no such proceeding had been instituted.

     SECTION 5.10 Rights and Remedies Cumulative.

     Except as otherwise provided with respect to the replacement or payment of
mutilated, destroyed, lost or stolen Securities in the last paragraph of
Section 3.07, no right or

                                     - 53 -

<PAGE>


remedy herein conferred upon or reserved to the Trustee or to the Holders is
intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at
law or in equity or otherwise. The assertion or employment of any right or
remedy hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.

     SECTION 5.11 Delay or Omission Not Waiver.

     No delay or omission of the Trustee or of any Holder of any Security to
exercise any right or remedy accruing upon any Event of Default shall impair
any such right or remedy or constitute a waiver of any such Event of Default or
an acquiescence therein. Every right and remedy given by this Article or by law
to the Trustee or to the Holders may be exercised from time to time, and as
often as may be deemed expedient, by the Trustee or by the Holders, as the case
may be.

     SECTION 5.12 Control by Holders.

     The Holders of a majority in principal amount of the Outstanding
Securities shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on the Trustee, provided that (1) such direction
shall not be in conflict with any rule of law or with this Indenture, and (2)
the Trustee may take any other action deemed proper by the Trustee which is not
inconsistent with such direction.

     SECTION 5.13 Waiver of Past Defaults.

     The Holders of not less than a majority in principal amount of the
Outstanding Securities may on behalf of the Holders of all the Securities waive
any past default hereunder and its consequences, except a default (1) in the
payment of the principal of (or premium, if any) or interest on any Security
(including any Security which is required to have been purchased pursuant to an
Offer to Purchase made by the Company), or (2) in respect of a covenant or
provision hereof which under Article Nine cannot be modified or amended without
the consent of the Holder of each Outstanding Security affected.

     Upon any such waiver, such default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
default or impair any right consequent thereon.

                                     - 54 -

<PAGE>


     SECTION 5.14 Undertaking for Costs.

     In any suit for the enforcement of any right or remedy under this
Indenture, or in any suit against the Trustee for any action taken, suffered or
omitted by it as Trustee, a court may require any party litigant in such suit
to file an undertaking to pay the costs of such suit, and may assess costs
against any such party litigant, in the manner and to the extent provided in
the Trust Indenture Act; provided, that neither this Section nor the Trust
Indenture Act shall be deemed to authorize any court to require such an
undertaking or to make such an assessment in any suit instituted by the
Company.

     SECTION 5.15 Waiver of Stay or Extension Laws.

     The Company covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, or plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay or extension law wherever
enacted, now or at any time hereafter in force, which may affect the covenants
or the performance of this Indenture; and the Company (to the extent that it
may lawfully do so) hereby expressly waives all benefit or advantage of any
such law and covenants that it will not hinder, delay or impede the execution
of any power herein granted to the Trustee, but will suffer and permit the
execution of every such power as though no such law had been enacted.

                                  ARTICLE SIX

                                  The Trustee

     SECTION 6.01 Certain Duties and Responsibilities.

          (a) Except during the continuance of an Event of Default,

               (1) the Trustee undertakes to perform such duties and only such
          duties as are specifically set forth in this Indenture, and no
          implied covenants or obligations shall be read into this Indenture
          against the Trustee; and

               (2) in the absence of bad faith on its part, the Trustee may
          conclusively rely, as to the truth of the statements and the
          correctness of the opinions expressed therein, upon certificates or
          opinions furnished to the Trustee and conforming to the requirements
          of this Indenture; but in the case of any such certificates or
          opinions which by any provision hereof are specifically required to
          be furnished to the Trustee, the Trustee shall be under a duty to
          examine the same to determine whether or not they conform to the
          requirements of this Indenture (but need not confirm or investigate
          the accuracy of mathematical calculations or other facts stated
          therein).

          (b) In case an Event of Default has occurred and is continuing, the
     Trustee shall exercise such of the rights and powers vested in it by this
     Indenture, and use the same degree of care and skill in their exercise, as
     a prudent man would exercise or use under the circumstances in the conduct
     of his own affairs.

                                     - 55 -

<PAGE>


          (c) No provision of this Indenture shall be construed to relieve the
     Trustee from liability for its own negligent action, its own negligent
     failure to act, or its own willful misconduct, except that

               (1) this Subsection shall not be construed to limit the effect
          of Subsection (a) of this Section;

               (2) the Trustee shall not be liable for any error of judgment
          made in good faith by a Responsible Officer, unless it shall be
          proved that the Trustee was negligent in ascertaining the pertinent
          facts; and

               (3) the Trustee shall not be liable with respect to any action
          taken or omitted to be taken by it in good faith in accordance with
          the direction of the Holders of a majority in principal amount of the
          Outstanding Securities, relating to the time, method and place of
          conducting any proceeding for any remedy available to the Trustee, or
          exercising any trust or power conferred upon the Trustee under this
          Indenture; and

               (4) The Trustee shall not be responsible for the computation of
          the Conversion Price or any adjustment to the Conversion Price of the
          Securities or for any determination as to whether an adjustment is
          required and shall not be deemed to have knowledge of any adjustment
          until it shall have received the actual written notice from the
          Company contemplated by Section 12.05(j).

     Notwithstanding the foregoing, no provision of this Indenture shall
require the Trustee to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties hereunder, or in
the exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity
against such risk or liability is not reasonably assured to it. Whether or not
therein expressly so provided, every provision of this Indenture relating to
the conduct or affecting the liability of or affording protection to the
Trustee shall be subject to the provisions of this Section.

     SECTION 6.02 Notice of Defaults.

     The Trustee shall give the Holders notice of any default hereunder
actually known by the Trustee as and to the extent provided by the Trust
Indenture Act; provided, however, that in the case of any default of the
character specified in Section 5.01(5), no such notice to Holders shall be
given until at least 60 days after the occurrence thereof. For the purpose of
this Section, the term "default" means any event which is, or after notice or
lapse of time or both would become, an Event of Default.

     SECTION 6.03 Certain Rights of Trustee. Subject to the provisions of
Section 6.01:

     (a) the Trustee may rely and shall be protected in acting or refraining
from acting upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or

                                     - 56 -

<PAGE>


document believed by it to be genuine and to have been signed or presented by
the proper party or parties;

     (b) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any resolution
of the Board of Directors may be sufficiently evidenced by a Board Resolution;

     (c) whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other evidence
be herein specifically prescribed) may, in the absence of bad faith on its
part, rely conclusively upon an Officer's Certificate;

     (d) the Trustee may consult with counsel of its selection and the written
advice of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by it hereunder in good faith and in reliance thereon;

     (e) the Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Indenture at the request or direction of any of
the Holders pursuant to this Indenture, unless such Holders shall have offered
to the Trustee reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred by it in compliance with such request or
direction;

     (f) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document, but the
Trustee, in its discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit, and, if the Trustee shall determine to
make such further inquiry or investigation, it shall be entitled to examine the
books, records and premises of the Company personally or by agent or attorney;

     (g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder.

     (h) the rights, privileges, protections, immunities and benefits given to
the Trustee, including, without limitation, its right to be indemnified, are
extended to, and shall be enforceable by, the Trustee in each of its capacities
hereunder, and each agent, custodian and other Person employed to act
hereunder;

     (i) the Trustee may request that the Company deliver an Officers'
Certificate setting forth the names of individuals and/or titles of officers
authorized at such time to take specified actions pursuant to this Indenture,
which Officers' Certificate may be signed by any person authorized to sign an
Officers' Certificate, including any person specified as so authorized in any
such certificate previously delivered and not superseded;

                                     - 57 -

<PAGE>


     (j) in no event shall the Trustee be responsible or liable for special,
indirect or consequential loss or damage of any kind whatsoever (including, but
not limited to, loss of profit) irrespective of whether the Trustee has been
advised of the likelihood of such loss or damage and regardless of the form of
action;

     (k) in no event shall the Trustee be responsible or liable for any failure
or delay in the performance of its obligations under this Indenture arising out
of or caused by, directly or indirectly, forces beyond its control, including
without limitation strikes, work stoppages, accidents, acts of war or
terrorism, civil or military disturbances, nuclear or natural catastrophes or
acts of God, and interruptions, loss or malfunctions of utilities,
communications or computer (software and hardware) services; it being
understood that the Trustee shall use reasonable efforts which are consistent
with accepted practices in the banking industry to resume performance as soon
as practicable under the circumstances; and

     (l) the Trustee shall not be deemed to have notice of any Default or Event
of Default unless a Responsible Officer of the Trustee has actual knowledge
thereof or unless written notice of any event which is in fact such a default
is received by the Trustee at the Corporate Trust Office of the Trustee, and
such notice references the Securities and this Indenture.

     SECTION 6.04 Not Responsible for Recitals or Issuance of Securities. The
recitals contained herein and in the Securities, except the Trustee's
certificates of authentication, shall be taken as the statements of the
Company, and the Trustee assumes no responsibility for their correctness. The
Trustee makes no representations as to the validity or sufficiency of this
Indenture or of the Securities. The Trustee shall not be accountable for the
use or application by the Company of Securities or the proceeds thereof.

     SECTION 6.05 May Hold Securities.

     The Trustee, any Authenticating Agent, any Paying Agent, any Security
Registrar or any other agent of the Company in its individual or any other
capacity, may become the owner or pledgee of Securities and, subject to
Sections 6.08 and 6.13, may otherwise deal with the Company with the same
rights it would have if it were not Trustee, Authenticating Agent, Paying
Agent, Security Registrar or such other agent.

     SECTION 6.06 Money Held in Trust.

     Money held by the Trustee in trust hereunder need not be segregated from
other funds except to the extent required by law. The Trustee shall be under no
liability for interest on any money received by it hereunder except as
otherwise agreed with the Company.

     SECTION 6.07 Compensation and Reimbursement. The Company agrees

          (1) to pay to the Trustee from time to time such compensation as the
     Company and the Trustee shall from time to time agree for all services
     rendered

                                     - 58 -

<PAGE>


     by it hereunder (which compensation shall not be limited by any provision
     of law in regard to the compensation of a trustee of an express trust);

          (2) except as otherwise expressly provided herein, to reimburse the
     Trustee upon its request for all reasonable expenses, disbursements and
     advances incurred or made by the Trustee in accordance with any provision
     of this Indenture (including the reasonable compensation and the expenses
     and disbursements of its agents and counsel), except any such expense,
     disbursement or advance as may be attributable to its negligence or bad
     faith; and

          (3) to indemnify the Trustee and its officers and agents for, and to
     hold them harmless against, any loss, liability, damage, claims or expense
     incurred without negligence or bad faith on its part, arising out of or in
     connection with the acceptance or administration of this trust, including
     the costs and expenses of defending itself against any claim or liability
     in connection with the exercise or performance of any of its powers or
     duties hereunder.

     When the Trustee incurs expenses or renders services in connection with an
Event of Default specified in Section 5.01(8) or Section 5.01(9), the expenses
(including the reasonable charges and expenses of its counsel) and the
compensation for the services are intended to constitute expenses of
administration under any applicable Federal or state bankruptcy, insolvency or
other similar law.

     The provisions of this Section shall survive the termination of this
Indenture and the resignation or removal of the Trustee.

     SECTION 6.08 Disqualification; Conflicting Interests.

     If the Trustee has or shall acquire a conflicting interest within the
meaning of the Trust Indenture Act, the Trustee shall either eliminate such
interest or resign, to the extent and in the manner provided by, and subject to
the provisions of, the Trust Indenture Act and this Indenture.

     SECTION 6.09 Corporate Trustee Required; Eligibility.

     There shall at all times be a Trustee hereunder which shall be a Person
that is eligible pursuant to the Trust Indenture Act to act as such and has a
combined capital and surplus of at least $50,000,000 and its Corporate Trust
Office in The City of New York, New York. If such Person publishes reports of
condition at least annually, pursuant to law or to the requirements of said
supervising or examining authority, then for the purposes of this Section, the
combined capital and surplus of such Person shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. If at any time the Trustee shall cease to be eligible in accordance
with the provisions of this Section, it shall resign immediately in the manner
and with the effect hereinafter specified in this Article.

                                     - 59 -

<PAGE>


     SECTION 6.10 Resignation and Removal; Appointment of Successor. (a) No
resignation or removal of the Trustee and no appointment of a successor Trustee
pursuant to this Article shall become effective until the acceptance of
appointment by the successor Trustee under Section 6.11.

     (b) The Trustee may resign at any time by giving written notice thereof to
the Company. If an instrument of acceptance by a successor Trustee shall not
have been delivered to the Trustee within 30 days after the giving of such
notice of resignation, the resigning Trustee may petition any court of
competent jurisdiction for the appointment of a successor Trustee.

     (c) The Trustee may be removed at any time by Act of the Holders of a
majority in principal amount of the Outstanding Securities, delivered to the
Trustee and to the Company.

     (d) If at any time:

               (1) the Trustee shall fail to comply with Section 6.08 after
          written request therefor by the Company or by any Holder who has been
          a bona fide Holder of a Security for at least six months, or

               (2) the Trustee shall cease to be eligible under Section 6.09
          and shall fail to resign after written request therefor by the
          Company or by any such Holder, or

               (3) the Trustee shall become incapable of acting or shall be
          adjudged a bankrupt or insolvent or a receiver of the Trustee or of
          its property shall be appointed or any public officer shall take
          charge or control of the Trustee or of its property or affairs for
          the purpose of rehabilitation, conservation or liquidation,

then, in any such case, (i) the Company by a Board Resolution may remove the
Trustee, or (ii) subject to Section 5.14, any Holder who has been a bona fide
Holder of a Security for at least six months may, on behalf of himself and all
others similarly situated, petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor Trustee.

     (e) If the Trustee shall resign, be removed or become incapable of acting,
or if a vacancy shall occur in the office of Trustee for any cause, the
Company, by a Board Resolution, shall promptly appoint a successor Trustee. If,
within one year after such resignation, removal or incapability, or the
occurrence of such vacancy, a successor Trustee shall be appointed by Act of
the Holders of a majority in principal amount of the Outstanding Securities
delivered to the Company and the retiring Trustee, the successor Trustee so
appointed shall, forthwith upon its acceptance of such appointment, become the
successor Trustee and supersede the successor Trustee appointed by the Company.
If no successor Trustee shall have been so appointed by the Company or the
Holders and accepted appointment in the manner hereinafter provided, any Holder
who has been a bona fide Holder of a Security for at least six months may, on
behalf of himself and all others similarly situated, petition any court of
competent jurisdiction for the appointment of a successor Trustee.

                                     - 60 -

<PAGE>


     (f) The Company shall give notice of each resignation and each removal of
the Trustee and each appointment of a successor Trustee to all Holders in the
manner provided in Section 1.06. Each notice shall include the name of the
successor Trustee and the address of its Corporate Trust Office.

     SECTION 6.11 Acceptance of Appointment by Successor.

     Every successor Trustee appointed hereunder shall execute, acknowledge and
deliver to the Company and to the retiring Trustee an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring Trustee
shall become effective and such successor Trustee, without any further act,
deed or conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Trustee; but, on request of the Company or the successor
Trustee, such retiring Trustee shall, upon payment of its charges, execute and
deliver an instrument transferring to such successor Trustee all the rights,
powers and trusts of the retiring Trustee and shall duly assign, transfer and
deliver to such successor Trustee all property and money held by such retiring
Trustee hereunder. Upon request of any such successor Trustee, the Company
shall execute any and all instruments for more fully and certainly vesting in
and confirming to such successor Trustee all such rights, powers and trusts.

     No successor Trustee shall accept its appointment unless at the time of
such acceptance such successor Trustee shall be qualified and eligible under
this Article.

     SECTION 6.12 Merger, Conversion, Consolidation or Succession to Business.

     Any corporation into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Securities shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such Securities.

     SECTION 6.13 Preferential Collection of Claims Against Company. If and
when the Trustee shall be or become a creditor of the Company (or any other
obligor upon the Securities), the Trustee shall be subject to the provisions of
the Trust Indenture Act regarding the collection of claims against the Company
(or any such other obligor).

     SECTION 6.14 Appointment of Authenticating Agent.

     The Trustee may appoint an Authenticating Agent or Agents which shall be
authorized to act on behalf of the Trustee to authenticate Securities issued
upon original issue and upon exchange, registration of transfer or partial
redemption or pursuant to Section 3.06, and

                                     - 61 -

<PAGE>


Securities so authenticated shall be entitled to the benefits of this Indenture
and shall be valid and obligatory for all purposes as if authenticated by the
Trustee hereunder. Wherever reference is made in this Indenture to the
authentication and delivery of Securities by the Trustee or the Trustee's
certificate of authentication, such reference shall be deemed to include
authentication and delivery on behalf of the Trustee by an Authenticating Agent
and a certificate of authentication executed on behalf of the Trustee by an
Authenticating Agent. Each Authenticating Agent shall be acceptable to the
Company and shall at all times be a corporation organized and doing business
under the laws of the United States of America, any State thereof or the
District of Columbia, authorized under such laws to act as Authenticating
Agent, having a combined capital and surplus of not less than $50,000,000 and
subject to supervision or examination by Federal or State authority. If such
Authenticating Agent publishes reports of condition at least annually, pursuant
to law or to the requirements of said supervising or examining authority, then
for the purposes of this Section, the combined capital and surplus of such
Authenticating Agent shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time
an Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, such Authenticating Agent shall resign immediately
in the manner and with the effect specified in this Section.

     Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such corporation shall be otherwise eligible
under this Section, without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agent.

     An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to the Company. The Trustee may at any time
terminate the agency of an Authenticating Agent by giving written notice
thereof to such Authenticating Agent and to the Company. Upon receiving such a
notice of resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall mail written notice of
such appointment by first-class mail, postage prepaid, to all Holders as their
names and addresses appear in the Security Register. Any successor
Authenticating Agent upon acceptance of its appointment hereunder shall become
vested with all the rights, powers and duties of its predecessor hereunder,
with like effect as if originally named as an Authenticating Agent. No
successor Authenticating Agent shall be appointed unless eligible under the
provisions of this Section.

     The Trustee agrees to pay to each Authenticating Agent from time to time
reasonable compensation for its services under this Section, and the Trustee
shall be entitled to be reimbursed for such payments, subject to the provisions
of Section 6.07.

     If an appointment is made pursuant to this Section, the Securities may
have endorsed thereon, in addition to the Trustee's certificate of
authentication, an alternative certificate of authentication in the following
form:

                                     - 62 -

<PAGE>


Dated:

     This is one of the Securities described in the within-mentioned Indenture.


                                                THE BANK OF NEW YORK As Trustee

                                                By
                                                   ----------------------------,
                                                   As Authenticating Agent


                                                By
                                                   ----------------------------,
                                                   As Authenticating Agent


                                 ARTICLE SEVEN

               Holders' Lists and Reports by Trustee and Company

     SECTION 7.01 Company to Furnish Trustee Names and Addresses of

     The Company will furnish or cause to be furnished to the Trustee Holders.

          (a) semi-annually, not more than 15 days after each Regular Record
     Date, a list, in such form as the Trustee may reasonably require, of the
     names and addresses of the Holders as of such Regular Record Date, and

          (b) at such other times as the Trustee may request in writing, within
     30 days after the receipt by the Company of any such request, a list of
     similar form and content as of a date not more than 15 days prior to the
     time such list is furnished;

excluding from any such list names and addresses received by the Trustee in its
capacity as Security Registrar.

     SECTION 7.02 Preservation of Information; Communications to Holders.

     (a) The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 7.01 and the names and
addresses of Holders received by the Trustee in its capacity as Security
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 7.01 upon receipt of a new list so furnished.

     (b) The rights of Holders to communicate with other Holders with respect
to their rights under this Indenture or under the Securities, and the
corresponding rights and duties of the Trustee, shall be as provided by the
Trust Indenture Act.

     (c) Every Holder of Securities, by receiving and holding the same, agrees
with the Company and the Trustee that neither the Company nor the Trustee nor
any agent of

                                     - 63 -

<PAGE>


either of them shall be held accountable by reason of any disclosure of
information as to names and addresses of Holders made pursuant to the Trust
Indenture Act.

     SECTION 7.03 Reports by Trustee.

     (a) The Trustee shall transmit to Holders such reports concerning the
Trustee and its actions under this Indenture as may be required pursuant to the
Trust Indenture Act at the times and in the manner provided pursuant thereto.
If required by Section 3.13(a) of the Trust Indenture Act, the Trustee shall,
within 60 days after each May 15 following the date of this Indenture deliver
to Holders a brief report, dated as of such May 15, which complies with the
provisions of such Section 3.13(a).

     (b) A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Trustee with each stock exchange upon which the
Securities are listed, with the Commission and with the Company. The Company
will notify the Trustee when the Securities are listed on any stock exchange.

     SECTION 7.04 Reports by Company.

     The Company shall file with the Trustee and the Commission, and transmit
to Holders, such information, documents and other reports, and such summaries
thereof, as may be required pursuant to the Trust Indenture Act at the times
and in the manner provided pursuant to such Act; provided that any such
information, documents or reports required to be filed with the Commission
pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 shall be
filed with the Trustee within 15 days after the same is so required to be filed
with the Commission. Delivery of such reports, information and documents to the
Trustee is for informational purposes only and the Trustee's receipt of such
shall not constitute constructive notice of any information contained therein,
including the Company's compliance with any of its covenants hereunder (as to
which the Trustee is entitled to rely exclusively on Officer's Certificates).

     SECTION 7.05 Officer's Certificate with Respect to Change in Interest
Rates.

     Within five days after any Step-Up or Additional Step-Up or Step-Down
Date, the Company shall deliver an Officer's Certificate to the Trustee stating
the interest rate thereupon in effect for the Outstanding Securities (if any
are Outstanding) and the date on which such rate became effective.

                                 ARTICLE EIGHT

              Consolidation, Merger, Conveyance, Transfer or Lease

     SECTION 8.01 Company May Consolidate, Etc., Only on Certain Terms.

     The Company shall not consolidate with or merge into any other Person or
convey, transfer or lease its properties and assets substantially as an
entirety to any Person, and the Company shall not permit any Person to
consolidate with or merge into the Company or

                                     - 64 -

<PAGE>


convey, transfer or lease its properties and assets substantially as an
entirety to the Company unless:

          (1) in a transaction in which the Company does not survive or in
     which the Company sells, leases or otherwise disposes of all or
     substantially all of its assets, the successor entity to the Company (A)
     shall expressly assume, by a supplemental indenture executed and delivered
     to the Trustee in form satisfactory to the Trustee, all of the Company's
     obligations under the Indenture and (B) is organized under the laws of (x)
     Luxembourg or (y) the United States of America or any State thereof or the
     District of Columbia or (z) any other country if such successor entity
     undertakes, in such supplemental indenture, to pay such additional amounts
     in respect of principal (and premium, if any) and interest as may be
     necessary in order that the net amounts paid pursuant to the Securities
     after deduction or withholding of any present or future withholding taxes,
     levies, imports or charges whatsoever imposed by or for the account of
     such country or any political subdivision or taxing authority thereof or
     therein shall equal the respective amounts of principal (and premium, if
     any) and interest specified in the Securities;

          (2) immediately after giving effect to such transaction and treating
     any Debt which becomes an obligation of the Company or a Restricted
     Subsidiary of the Company, Restricted Affiliate or Restricted Subsidiary
     of a Restricted Affiliate as a result of such transaction as having been
     Incurred by the Company or such Restricted Subsidiary of the Company,
     Restricted Affiliate or Restricted Subsidiary of a Restricted Affiliate at
     the time of such transaction, no Event of Default, and no event that with
     the passing of time or the giving of notice or both would constitute an
     Event of Default, shall have occurred and be continuing; and

          (3) immediately after giving effect to such transaction, and treating
     any Debt which becomes an obligation of the Company or a Restricted
     Subsidiary of the Company, Restricted Affiliate or Restricted Subsidiary
     of a Restricted Affiliate as a result of such transaction as having been
     Incurred by the Company or such Restricted Subsidiary of the Company,
     Restricted Affiliate or Restricted Subsidiary of a Restricted Affiliate at
     the time of the transaction, the Company (including any successor entity
     to the Company) could Incur at least $1.00 of additional Debt pursuant to
     the provisions of the first paragraph of Section 10.08; provided, however,
     that this Clause (3) will not apply if, in the good faith determination of
     the Board of Directors of the Company, whose determination shall be
     evidenced by a Board Resolution, the principal purpose of such transaction
     is to change the jurisdiction of incorporation of the Company;

          (4) if, as a result of any such consolidation or merger or such
     conveyance, transfer or lease, properties or assets of the Company would
     become subject to a mortgage, pledge, lien, security interest or other
     encumbrance which would not be permitted by Section 10.12, the Company or
     such successor Person, as the case may be, shall take such steps as shall
     be necessary effectively to secure

                                     - 65 -

<PAGE>


     the Securities equally and ratably with (or prior to) all indebtedness
     secured thereby; and

          (5) the Company has delivered to the Trustee an Officer's Certificate
     and an Opinion of Counsel, each stating that such consolidation, merger,
     conveyance, transfer or lease and, if a supplemental indenture is required
     in connection with such transaction, such supplemental indenture comply
     with this Article and that all conditions precedent herein provided for
     relating to such transaction have been complied with.

     SECTION 8.02 Successor Substituted.

     Upon any consolidation of the Company with, or merger of the Company into,
any other Person or any conveyance, transfer or lease of the properties and
assets of the Company substantially as an entirety in accordance with Section
8.01, the successor Person formed by such consolidation or into which the
Company is merged or to which such conveyance, transfer or lease is made shall
succeed to, and be substituted for, and may exercise every right and power of,
the Company under this Indenture with the same effect as if such successor
Person had been named as the Company herein, and thereafter, except in the case
of a lease, the predecessor Person shall be relieved of all obligations and
covenants under this Indenture and the Securities.

                                  ARTICLE NINE

                            Supplemental Indentures

     SECTION 9.01 Supplemental Indentures Without Consent of Holders.

     Without the consent of any Holders, the Company when authorized by a Board
Resolution, and the Trustee, at any time and from time to time, may enter into
one or more indentures supplemental hereto, in form satisfactory to the
Trustee, for any of the following purposes:

          (1) to evidence the succession of another Person to the Company and
     the assumption by any such successor of the covenants of the Company
     herein and in the Securities; or

          (2) to add to the covenants of the Company for the benefit of the
     Holders, or to surrender any right or power herein conferred upon the
     Company; or

          (3) to secure the Securities pursuant to the requirements of Section
     10.12 or otherwise; or

          (4) to modify, eliminate or add to the provisions of this Indenture
     to such extent as shall be necessary to comply with any requirement of the
     Commission in order to effect qualification of this Indenture under the
     Trust

                                     - 66 -

<PAGE>


     Indenture Act in connection with the Resale Registration Statement or
     thereafter to maintain the qualification of this Indenture under the Trust
     Indenture Act; or

          (5) to cure any ambiguity, to correct or supplement any provision
     herein which may be inconsistent with any other provision herein, or to
     make any other provisions with respect to matters or questions arising
     under this Indenture which shall not be inconsistent with the provisions
     of this Indenture, provided that such action pursuant to this Clause (5)
     shall not adversely affect the interests of the Holders in any material
     respect; or

          (6) to modify, eliminate or add to Article Three and other provisions
     of this Indenture regarding registration, transfer and exchange of
     securities to such extent as may be necessary to issue additional
     Securities in order to comply with applicable law; or

          (7) to modify, eliminate or add to the provisions of this Indenture
     to permit or facilitate the issuance of Securities or Global Securities
     and matters related thereto, provided that such action pursuant to this
     Clause (7) shall not adversely affect the interests of the Holders in any
     material respect; or (8) reduce the Conversion Price in accordance with
     Article Twelve.

     SECTION 9.02 Supplemental Indentures with Consent of Holders.

     With the consent of the Holders of not less than majority in aggregate
principal amount of the Outstanding Securities, by Act of said Holders
delivered to the Company and the Trustee, the Company when authorized by a
Board Resolution and the Trustee may enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture or of
modifying in any manner the rights of the Holders under this Indenture
(including, without limitation, any modification to the provisions of this
Indenture with respect to any Offer to Purchase, provided such modifications
are effected prior to the mailing to any Holder of an Offer Document with
respect to such Offer to Purchase); provided, however, that no such
supplemental indenture shall, without the consent of the Holder of each
Outstanding Security affected thereby,

          (1) change the Stated Maturity of the principal of, or any
     installment of interest on, any Security, or reduce the principal amount
     thereof or the rate of interest thereon or any premium payable upon the
     redemption thereof, or change the place of payment where, or the coin or
     currency in which, any Security or any premium or interest thereon is
     payable, or impair the right to institute suit for the enforcement of any
     such payment on or after the Stated Maturity thereof (or, in the case of
     redemption, on or after the Redemption Date or, in the case of an Offer to
     Purchase which has been made, on or after the applicable Purchase Date),
     or

          (2) reduce the percentage in principal amount of the Outstanding
     Securities, the consent of whose Holders is required for any such
     supplemental indenture, or the consent of whose Holders is required for
     any waiver (of

                                     - 67 -

<PAGE>


     compliance with certain provisions of this Indenture or certain defaults
     hereunder and their consequences) provided for in this Indenture, or

          (3) modify any of the provisions of this Section, Section 5.13 or
     Section 10.19, except to increase any such percentage or to provide that
     certain other provisions of this Indenture cannot be modified or waived
     without the consent of the Holder of each Outstanding Security affected
     thereby, or

          (4) following the mailing to a Holder of an Offer Document with
     respect to an Offer to Purchase and until the Expiration Date of such
     Offer to Purchase, modify the provisions of this Indenture with respect to
     such Offer to Purchase in a manner adverse to such Holder.

     It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental indenture, but it
shall be sufficient if such Act shall approve the substance thereof.

     SECTION 9.03 Execution of Supplemental Indentures.

     In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications thereby
of the trusts created by this Indenture, the Trustee shall be entitled to
receive, and (subject to Section 6.01) shall be fully protected in relying
upon, an Opinion of Counsel stating that the execution of such supplemental
indenture is authorized or permitted by this Indenture. The Trustee may, but
shall not be obligated to, enter into any such supplemental indenture which
affects the Trustee's own rights, duties or immunities under this Indenture or
otherwise.

     SECTION 9.04 Effect of Supplemental Indentures.

     Upon the execution of any supplemental indenture under this Article, this
Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every
Holder of Securities theretofore or thereafter authenticated and delivered
hereunder shall be bound thereby.

     SECTION 9.05 Conformity with Trust Indenture Act.

     Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act.

     SECTION 9.06 Reference in Securities to Supplemental Indentures.

     Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article may, and shall if required by
the Trustee, bear a notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. If the Company shall so determine,
new Securities so modified as to conform, in the opinion of the Trustee and the
Company to any such supplemental indenture may be prepared and executed by the
Company and authenticated and delivered by the Trustee in exchange for
Outstanding Securities.

                                     - 68 -

<PAGE>


                                  ARTICLE TEN

                                   Covenants

     SECTION 10.01 Payment of Principal, Premium and Interest.

     The Company will duly and punctually pay the principal of (and premium, if
any) and interest (including Special Interest, if any) on the Securities in
accordance with the terms of the Securities and this Indenture.

     SECTION 10.02 Maintenance of Office or Agency.

     The Company will maintain in the Borough of Manhattan, the City of New
York an office or agency where Securities may be presented or surrendered for
payment, where Securities may be surrendered for registration of transfer or
exchange, where Securities may be surrendered for conversion and where notices
and demands to or upon the Company in respect of the Securities and this
Indenture may be served. The Company will give prompt written notice to the
Trustee of the location, and any change in the location, of such office or
agency. If at any time the Company shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or served at
the Corporate Trust Office of the Trustee, and the Company hereby appoints the
Trustee as its agent to receive all such presentations, surrenders, notices and
demands.

     The Company may also from time to time designate one or more other offices
or agencies (in or outside the Borough of Manhattan, City of New York) where
the Securities may be presented or surrendered for any or all such purposes and
may from time to time rescind such designations; provided, however, that no
such designation or rescission shall in any manner relieve the Company of its
obligation to maintain an office or agency in the Borough of Manhattan, City of
New York for such purposes. The Company will give prompt written notice to the
Trustee of any such designation or rescission and of any change in the location
of any such other office or agency.

     SECTION 10.03 Money for Security Payments to Be Held in Trust. If the
Company shall at any time act as its own Paying Agent, it will, on or before
each due date of the principal of (and premium, if any) or interest on any of
the Securities, segregate and hold in trust for the benefit of the Persons
entitled thereto a sum (or an amount of Securities or shares of the Company's
Common Stock, as applicable) sufficient to pay the principal (and premium, if
any) or interest so becoming due until such sums shall be paid to such Persons
or otherwise disposed of as herein provided and will promptly notify the
Trustee of its action or failure so to act.

     Whenever the Company shall have one or more Paying Agents, it will, prior
to each due date of the principal of (and premium, if any) or interest on any
Securities, deposit with a Paying Agent a sum (or an amount of Securities or
shares of the Company's Common Stock, as applicable) sufficient to pay such
amount, such sum (or an amount of Securities or shares of the Company's Common
Stock, as applicable) to be held as provided by the Trust Indenture Act,

                                     - 69 -

<PAGE>


and (unless such Paying Agent is the Trustee) the Company will promptly notify
the Trustee of its action or failure so to act.

     The Company will cause each Paying Agent other than the Trustee to execute
and deliver to the Trustee an instrument in which such Paying Agent shall agree
with the Trustee, subject to the provisions of this Section, that such Paying
Agent will (i) comply with the provisions of the Trust Indenture Act applicable
to it as a Paying Agent and (ii) during the continuance of any default by the
Company (or any other obligor upon the Securities) in the making of any payment
in respect of the Securities, upon the written request of the Trustee,
forthwith pay to the Trustee all sums held in trust by such Paying Agent as
such.

     The Company may at any time, for the purpose of obtaining the satisfaction
and discharge of this Indenture or for any other purpose, pay, or by Company
Order direct any Paying Agent to pay, to the Trustee all sums (or Securities or
shares of the Company's Common Stock, as applicable) held in trust by the
Company or such Paying Agent, such sums (or Securities or shares of the
Company's Common Stock, as applicable) to be held by the Trustee upon the same
trusts as those upon which such sums were held by the Company or such Paying
Agent; and, upon such payment by any Paying Agent to the Trustee, such Paying
Agent shall be released from all further liability with respect to such money
(or Securities or shares of the Company's Common Stock, as applicable).

     Any money (or Securities or shares of the Company's Common Stock, as
applicable) deposited with the Trustee or any Paying Agent, or then held by the
Company in trust for the payment of the principal of (and premium, if any) or
interest on any Security and remaining unclaimed for two years after such
principal (and premium, if any) or interest has become due and payable shall be
paid to the Company on Company Request, or (if then held by the Company) shall
be discharged from such trust; and the Holder of such Security shall
thereafter, as an unsecured general creditor, look only to the Company for
payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money (or Securities or shares of the Company's Common
Stock, as applicable), and all liability of the Company as trustee thereof,
shall thereupon cease; provided, however, that the Trustee or such Paying
Agent, before being required to make any such repayment, may at the expense of
the Company cause to be published once, in a newspaper published in the English
language, customarily published on each Business Day and of general circulation
in the Borough of Manhattan, The City of New York, notice that such money (or
Securities or shares of the Company's Common Stock, as applicable) remain
unclaimed and that, after a date specified therein, which shall not be less
than 30 days from the date of such publication, any unclaimed balance of such
money (or Securities or shares of the Company's Common Stock, as applicable)
then remaining will be repaid to the Company.

     SECTION 10.04 Statement by Officers as to Default; Compliance
Certificates.

     (a) The Company will deliver to the Trustee, within 90 days after the end
of each fiscal year of the Company ending after the date of this Indenture an
Officer's Certificate, stating whether or not to the best knowledge of the
signers thereof the Company is in default in the performance and observance of
any of the terms, provisions and conditions of this Indenture

                                     - 70 -

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(without regard to any period of grace or requirement of notice provided
hereunder) and, if the Company shall be in default, specifying all such
defaults and the nature and status thereof of which they may have knowledge.

     (b) The Company shall deliver to the Trustee, as soon as possible and in
any event within 30 days after the Company becomes aware of the occurrence of
an Event of Default or an event which, with notice or the lapse of time or
both, would constitute an Event of Default, an Officer's Certificate setting
forth the details of such Event of Default or default, and the action which the
Company proposes to take with respect thereto.

     SECTION 10.05 Existence.

     Subject to Article Eight, the Company will do or cause to be done all
things necessary to preserve and keep in full force and effect its existence,
rights (charter and statutory) and franchises; provided, however, that the
Company shall not be required to preserve any such right or franchise if the
Board of Directors shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Company and that the loss
thereof is not disadvantageous in any material respect to the Holders.

     SECTION 10.06 Maintenance of Properties.

     The Company will cause all properties used or useful in the conduct of its
business or the business of any Subsidiary to be maintained and kept in good
condition, repair and working order and supplied with all necessary equipment
and will cause to be made all necessary repairs, renewals, replacements,
betterments and improvements thereof, all as in the judgment of the Company may
be necessary so that the business carried on in connection therewith may be
properly and advantageously conducted at all times; provided, however, that
nothing in this Section shall prevent the Company from discontinuing the
operation or maintenance of any of such properties if such discontinuance is,
in the judgment of the Company, desirable in the conduct of its business or the
business of any Restricted Subsidiary and not disadvantageous in any material
respect to the Holders.

     The Company shall, and shall cause the Restricted Subsidiaries of the
Company to, keep at all times all of their properties which are of an insurable
nature insured against loss or damage with insurers believed by the Company to
be responsible to the extent that property of similar character is usually so
insured by corporations similarly situated and owning like properties in
accordance with good business practice.

     SECTION 10.07 Payment of Taxes and Other Claims.

     The Company will pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, (1) all taxes, assessments and
governmental charges levied or imposed upon the Company or any Restricted
Subsidiary or upon the income, profits or property of the Company or any
Restricted Subsidiary, and (2) all lawful claims for labor, materials and
supplies which, if unpaid, might by law become a lien upon the property of the
Company or any Restricted Subsidiary; provided, however, that the Company shall
not be required to pay or discharge or cause to be paid or discharged any such
tax, assessment, charge or claim whose amount, applicability or validity is
being contested in good faith by appropriate proceedings.

                                    - 71 -

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     SECTION 10.08 Limitation on Debt.

     The Company may not, and may not permit any Restricted Subsidiary of the
Company, Restricted Affiliate or Restricted Subsidiary of a Restricted
Affiliate to Incur any Debt, unless the Debt Coverage Ratio for the most
recently completed fiscal quarter for which financial statements are available
would be less than 7.0 to 1.

     Notwithstanding the foregoing limitation, the following Debt may be
Incurred:

          (1) Debt Incurred under the Credit Facility in an aggregate principal
     amount at any one time not to exceed $200 million, and any renewal,
     extension, refinancing, refunding, substitution or replacement thereof in
     an amount which, together with any amount remaining outstanding or
     committed under the Credit Facility or any successor agreement, does not
     exceed the amount outstanding or committed under the Credit Facility or
     such successor agreement immediately prior to such renewal, extension,
     refinancing, refunding, substitution or replacement;

          (2) the original issuance by the Company of the Debt evidenced by the
     Securities;

          (3) Debt (other than Debt described in another clause of Section
     10.08) outstanding, committed or mandated on the date of the Indenture,
     including but not limited to the 13 1/2% Notes;

          (4) Debt owed by the Company to any Wholly Owned Restricted
     Subsidiary of the Company or Debt owed by a Restricted Subsidiary of the
     Company, Restricted Affiliate or Restricted Subsidiary of a Restricted
     Affiliate to the Company, a Restricted Subsidiary of the Company or a
     Restricted Affiliate or, in the case of Debt of a Restricted Subsidiary of
     a Restricted Affiliate, to another Restricted Subsidiary of such
     Restricted Affiliate; provided, however, that upon either (A) the transfer
     or other disposition by the Company or such Restricted Subsidiary,
     Restricted Affiliate or Restricted Subsidiary of a Restricted Affiliate of
     any Debt so permitted to a Person other than the Company or another
     Restricted Subsidiary of the Company or Restricted Affiliate or Restricted
     Subsidiary of a Restricted Affiliate or (B) such Restricted Subsidiary,
     Restricted Affiliate or Restricted Subsidiary of a Restricted Affiliate
     ceasing to be a Restricted Subsidiary of the Company, Restricted Affiliate
     or Restricted Subsidiary of a Restricted Affiliate, the provisions of this
     clause (4) shall no longer be applicable to such Debt and such Debt shall
     be deemed to have been Incurred at the time of such transfer or other
     disposition;

          (5) Guarantees by the Company of Debt of a Subsidiary or Minority
     Owned Affiliate of the Company; provided that the Company then holds cash
     or Cash Equivalents not subject to any pledge, security interest or other
     encumbrance in an aggregate amount equal to not less than 100% of the
     amount of all such Guarantees then outstanding; provided further, that if
     any such

                                     - 72 -

<PAGE>


     Guarantee relates to Debt incurred in reliance on one or more of clauses
     (1) through (4) above or clauses (6) through (10) below, the amount of
     such cash or Cash Equivalents held by the Company may be reduced by an
     amount equal to the amount of such Guaranteed Debt Incurred in reliance on
     such clause or clauses and provided further, that if at any time the
     aggregate amount of such Guarantees Incurred in reliance on this clause
     (5) exceeds the aggregate amount of such cash or Cash Equivalents so held
     by the Company (plus the amount of any reduction pursuant to the foregoing
     provision), the provisions of this clause (5) shall no longer be
     applicable to such Guarantees to the extent of such excess and an amount
     of such Guarantees equal to the amount of such excess shall be deemed to
     have been Incurred at the time such deficiency arose (this third proviso
     shall be applied successively whenever the amount of such cash and Cash
     Equivalents decreases);

          (6) Acquired Debt;

          (7) Debt consisting of Permitted Interest Rate, Currency or Commodity
     Price Agreements;

          (8) Debt of the Company, a Restricted Subsidiary of the Company, a
     Restricted Affiliate or a Restricted Subsidiary of a Restricted Affiliate
     which is exchanged for or the proceeds of which are used to refinance or
     refund, or any extension or renewal of, outstanding Debt of the same
     entity (each of the foregoing, a "refinancing") in an aggregate principal
     amount not to exceed the principal amount of the Debt so refinanced plus
     the amount of any premium required to be paid in connection with such
     refinancing pursuant to the terms of the Debt so refinanced or the amount
     of any premium reasonably determined by the issuer thereof as necessary to
     accomplish such refinancing by means of a tender offer or privately
     negotiated repurchase, plus the expenses of the issuer thereof incurred in
     connection with such refinancing; provided, however, that (A) Debt the
     proceeds of which are used to refinance the Securities or Debt which is
     pari passu with or subordinate in right of payment to the Securities shall
     only be permitted if (x) in the case of any refinancing of the Securities
     or Debt which is pari passu to the Securities, the refinancing Debt is
     Incurred by the Company and made pari passu to the Securities or
     subordinated to the Securities, and (y) in the case of any refinancing of
     Debt which is subordinated to the Securities, the refinancing Debt is
     Incurred by the Company and is so subordinated at least to the same
     extent; (B) the refinancing Debt by its terms, or by the terms of any
     agreement or instrument pursuant to which such Debt is issued, (x) has a
     Weighted Average Life to Maturity longer than the Weighted Average Life to
     Maturity of the Debt being refinanced and (y) does not permit redemption
     or other retirement (including pursuant to an offer to purchase) of such
     Debt at the option of the holder thereof prior to the earlier of the final
     stated maturity or time of comparable redemption or retirement with
     respect to the Debt being refinanced, other than a redemption or other
     retirement at the option of the holder of such Debt (including pursuant to
     an offer to purchase) which is conditioned upon provisions substantially
     similar to those described in Sections 10.14 and 10.16;

                                     - 73 -

<PAGE>


          (9) Debt in an aggregate amount not exceeding $200 million Incurred
     for the purpose of funding, and the net proceeds of which are applied to
     fund, capital expenditures of the Company or any of its Subsidiaries or
     Minority Owned Affiliates; and

          (10) Debt not otherwise permitted to be Incurred pursuant to clauses
     (1) through (9) above, which, together with any other outstanding Debt
     Incurred pursuant to this clause (10), has an aggregate principal amount
     not in excess of $75 million at any time outstanding.

     For purposes of the foregoing clauses (1) through (10), in case of any
Incurrence of Debt by a Restricted Subsidiary of the Company, Restricted
Affiliate or Restricted Subsidiary of a Restricted Affiliate, the amount of
Debt Incurred by such entity will be deemed to be the Company's Pro Rata
Portion of such Debt.

     SECTION 10.09 Limitation on Restricted Payments.

     The Company may not, and may not permit any Restricted Subsidiary of the
Company, Restricted Affiliate or Restricted Subsidiary of a Restricted
Affiliate to, directly or indirectly, (i) declare or pay any dividend or make
any distribution in respect of the Capital Stock of the Company or to the
holders thereof, excluding any dividends or distributions by the Company
payable solely in shares of its Capital Stock (other than Redeemable Stock) or
in options, warrants or other rights to acquire its Capital Stock (other than
Redeemable Stock), (ii) purchase, redeem, or otherwise acquire or retire for
value (a) any Capital Stock of the Company or any Related Person of the Company
or (b) any options, warrants or other rights to acquire shares of Capital Stock
of the Company or any Related Person of the Company or any securities
convertible or exchangeable into shares of Capital Stock of the Company or any
Related Person of the Company, (iii) redeem, repurchase, defease or otherwise
acquire or retire for value prior to any scheduled maturity, repayment or
sinking fund payment Debt of the Company which is subordinate in right of
payment to the Securities, or (iv) make any Investment, other than Permitted
Investments (each of clauses (i) through (iv) being a "Restricted Payment") if:

          (1) an Event of Default, or an event that with the passing of time or
     the giving of notice, or both, would constitute an Event of Default, shall
     have occurred and is continuing or would result from such Restricted
     Payment, or

          (2) after giving pro forma effect to such Restricted Payment as if
     such Restricted Payment had been made at the beginning of the applicable
     fiscal-quarter period, the Company could not Incur at least $1.00 of
     additional Debt pursuant to the provisions of the first paragraph of
     Section 10.08, or

          (3) upon giving effect to such Restricted Payment, the aggregate of
     all Restricted Payments from the date of the Indenture (including for this
     purpose, in respect of any Investment, only the Company's Pro Rata Portion
     of such Investment), excluding those made pursuant to the further proviso
     below or pursuant to clause (ii) or (vi) of the next paragraph, exceeds
     the sum of: (a) the difference of (x) 100% of cumulative Cellular
     Operating Income from March 31,

                                     - 74 -

<PAGE>


     1996, through the last day of the last full fiscal quarter ending
     immediately preceding the date of such Restricted Payment for which
     quarterly or annual financial statements are available minus (y) the
     product of 1.5 times cumulative Consolidated Interest Expense from March
     31, 1996, through the last day of the last full fiscal quarter immediately
     preceding such Restricted Payment for which quarterly or annual fiscal
     statements of the Company are available; plus (b) $10 million; plus (c)
     100% of the Company's Pro Rata Portion of the net reduction in Investments
     in any Unrestricted Subsidiary or Unrestricted Affiliate resulting from
     payments of interest on Debt, dividends, return of capital, repayments of
     loans or advances, or other transfers of assets, in each case to the
     Company or any Restricted Subsidiary of the Company, Restricted Affiliate
     or Restricted Subsidiary of a Restricted Affiliate from such Unrestricted
     Subsidiary or Unrestricted Affiliate (except to the extent that any such
     payment is included in the calculation of Consolidated Net Income) or from
     redesignations of Unrestricted Subsidiaries as Restricted Subsidiaries;
     provided that the amount included in this clause (c) shall not exceed the
     Company's Pro Rata Portion of the amount of Investments previously made by
     the Company and its Restricted Subsidiaries, Restricted Affiliates and
     Restricted Subsidiaries of Restricted Affiliates in such Unrestricted
     Subsidiary or Unrestricted Affiliate;

provided, further, that the Company, any Unrestricted Subsidiary of the
Company, Restricted Affiliate or Restricted Subsidiary of a Restricted
Affiliate may make any Restricted Payment with the aggregate net proceeds
received by the Company after the date of original issuance of the Securities,
including the fair market value of property other than cash (as determined in
good faith by the Board of Directors as evidenced by a resolution of the Board
of Directors filed with the Trustee), from contributions of capital or the
issuance and sale (other than to a Restricted Subsidiary of the Company,
Restricted Affiliate or Restricted Subsidiary of a Restricted Affiliate) of
Capital Stock (other than Redeemable Stock) of the Company, options, warrants
or other rights to acquire Capital Stock (other than Redeemable Stock) of the
Company and Debt of the Company that has been converted into or exchanged for
Capital Stock (other than Redeemable Stock and other than by or from a
Restricted Subsidiary of the Company, Restricted Affiliate or Restricted
Subsidiary of a Restricted Affiliate) of the Company after the date of original
issuance of the Securities; provided that any such net proceeds received by the
Company from an employee stock ownership plan financed by loans from the
Company or a Subsidiary of the Company shall be included only to the extent
such loans have been repaid with cash on or prior to the date of determination.
Prior to the making of any Restricted Payment, the Company shall deliver to the
Trustee an Officer's Certificate setting forth the computations by which the
determinations required by clauses (2) and (3) above were made and stating that
no Event of Default, or event that with the passing of time or the giving of
notice, or both, would constitute an Event of Default, has occurred and is
continuing or will result from such Restricted Payment.

     Notwithstanding the foregoing, so long as no Event of Default, or event
that with the passing of time or the giving of notice, or both, would
constitute an Event of Default, shall have occurred and is continuing or would
result therefrom, (i) the Company may pay any dividend on Capital Stock of any
class within 60 days after the declaration thereof if, on the date when the
dividend was declared, the Company could have paid such dividend in accordance
with the foregoing provisions; (ii) the Company may refinance any Debt
otherwise as permitted by


                                     - 75 -

<PAGE>


clause (8) of the second paragraph under Section 10.08 or solely in exchange
for or out of the net proceeds of the substantially concurrent sale (other than
from or to a Restricted Subsidiary, Restricted Affiliate or Restricted
Subsidiary of a Restricted Affiliate or from or to an employee stock ownership
plan financed by loans from the Company or a Restricted Subsidiary of the
Company, Restricted Affiliate or Restricted Subsidiary of a Restricted
Affiliate) of shares of Capital Stock (other than Redeemable Stock) of the
Company, provided that the amount of net proceeds from such exchange or sale
shall be excluded from the calculation of the amount available for Restricted
Payments pursuant to the preceding paragraph; (iii) the Company may purchase,
redeem, acquire or retire any shares of Capital Stock of the Company solely in
exchange for or out of the net proceeds of the substantially concurrent sale
(other than from or to a Restricted Subsidiary, Restricted Affiliate or
Restricted Subsidiary of a Restricted Affiliate or from or to an employee stock
ownership plan financed by loans from the Company or a Restricted Subsidiary of
the Company, Restricted Affiliate or Restricted Subsidiary of a Restricted
Affiliate) of shares of Capital Stock (other than Redeemable Stock) of the
Company; (iv) the Company may make loans to employees in connection with such
employees' exercise of options to purchase Capital Stock or otherwise in the
ordinary course of business; (v) the Company may purchase, redeem, acquire or
retire shares of its Capital Stock for aggregate consideration not to exceed
$50 million and (vi) the Company may purchase or redeem any Debt from Net
Available Proceeds to the extent permitted under Section 10.14. Any payment
made pursuant to clause (i), (iii), (iv) or (v) of this paragraph shall be a
Restricted Payment for purposes of calculating aggregate Restricted Payments
pursuant to the preceding paragraph. SECTION

     10.10 Limitation on Dividend and Other Payment Restrictions Affecting
Subsidiaries.

     The Company shall not, and shall not permit any Restricted Subsidiary of
the Company, Restricted Affiliate or Restricted Subsidiary of a Restricted
Affiliate to, directly or indirectly, create or otherwise cause or suffer to
exist or become effective any encumbrance or restriction on the ability of any
such Restricted Subsidiary of the Company, Restricted Affiliate or Restricted
Subsidiary of a Restricted Affiliate (i) to pay dividends (in cash or
otherwise) or make any other distributions in respect of its Capital Stock to
the Company or any other Restricted Subsidiary of the Company, Restricted
Affiliate or Restricted Subsidiary of a Restricted Affiliate or pay any Debt or
other obligation owed to the Company or any other such Restricted Subsidiary of
the Company, Restricted Affiliate or Restricted Subsidiary of a Restricted
Affiliate; (ii) to make loans or advances to the Company or any other
Restricted Subsidiary of the Company, Restricted Affiliate or Restricted
Subsidiary of a Restricted Affiliate; or (iii) to transfer any of its property
or assets to the Company or any other Restricted Subsidiary of the Company,
Restricted Affiliate or Restricted Subsidiary of a Restricted Affiliate.

     Notwithstanding the foregoing, the Company may, and may permit any
Restricted Subsidiary of the Company, Restricted Affiliate or Restricted
Subsidiary of a Restricted Affiliate to, suffer to exist any such encumbrance
or restriction

     (a) pursuant to any agreement in effect on the date of original issuance
of the Securities;

                                     - 76 -

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          (b) pursuant to an agreement relating to any Debt Incurred by a
     Person (other than a Restricted Subsidiary of the Company, Restricted
     Affiliate or Restricted Subsidiary of a Restricted Affiliate existing on
     the date of original issuance of the Securities or any Person carrying on
     any of the businesses of any such Restricted Subsidiary of the Company,
     Restricted Affiliate or Restricted Subsidiary of a Restricted Affiliate)
     prior to the date on which such Person became such a Restricted Subsidiary
     of the Company, Restricted Affiliate or Restricted Subsidiary of a
     Restricted Affiliate and outstanding on such date and not Incurred in
     anticipation of becoming such a Restricted Subsidiary of the Company,
     Restricted Affiliate or Restricted Subsidiary of a Restricted Affiliate,
     which encumbrance or restriction is not applicable to any Person, or the
     properties or assets of any Person, other than the Person so acquired;

          (c) pursuant to an agreement by which a Restricted Subsidiary,
     Restricted Affiliate or Restricted Subsidiary of a Restricted Affiliate
     obtains financing, provided that (x) such restriction is not materially
     more restrictive than customary provisions in comparable financing
     agreements and (y) management of the Company determines that at the time
     such agreement is entered into such restriction will not materially impair
     the Company's ability to make payments on the Securities, such
     determination to be confirmed not less frequently than once a year by an
     Officer's Certificate delivered to the Trustee;

          (d) pursuant to an agreement effecting a renewal, refunding or
     extension of Debt Incurred pursuant to an agreement referred to in clause
     (a) or (b) or (c) above, provided, however, that the provisions contained
     in such renewal, refunding or extension agreement relating to such
     encumbrance or restriction are no more restrictive in any material respect
     than the provisions contained in the agreement the subject thereof, as
     determined in good faith by management of the Company, such determination
     to be confirmed not less frequently than once a year by an Officer's
     Certificate delivered to the Trustee;

          (e) in the case of clause (iii) above, restrictions contained in any
     security agreement (including a capital lease) securing Debt of a
     Restricted Subsidiary of the Company, Restricted Affiliate or Restricted
     Subsidiary of a Restricted Affiliate otherwise permitted under the
     Indenture, but only to the extent such restrictions restrict the transfer
     of the property subject to such security agreement;

          (f) in the case of clause (iii) above, customary nonassignment
     provisions entered into in the ordinary course of business consistent with
     past practices in leases to the extent such provisions restrict the
     transfer or subletting of any such lease;

          (g) any restriction with respect to a Restricted Subsidiary of the
     Company, Restricted Affiliate or Restricted Subsidiary of a Restricted
     Affiliate imposed pursuant to an agreement which has been entered into for
     the sale or disposition of all or substantially all of the Capital Stock
     or assets of such Restricted Subsidiary or Restricted Affiliate, provided
     that consummation of such transaction would not result in an Event of
     Default or an event that, with the passing of time or the giving of notice
     or both, would constitute an Event of Default, that such restriction
     terminates if such transaction is closed or abandoned and that the closing
     or abandonment of such transaction occurs within one year of the date such
     agreement was entered into; or

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     (h) such encumbrance or restriction is the result of applicable law or
regulation.

     SECTION 10.11 [RESERVED]

     SECTION 10.12 Limitation on Liens Securing Company Subordinated Debt.

     The Company shall not, and shall not permit any Restricted Subsidiary of
the Company, Restricted Affiliate or Restricted Subsidiary of a Restricted
Affiliate to, Incur or suffer to exist any Lien on or with respect to any
property or assets now owned or hereafter acquired to secure any Debt of the
Company that is expressly by its terms subordinate or junior in right of
payment to any other Debt of the Company without making, or causing such
Restricted Subsidiary or Restricted Affiliate to make, effective provision for
securing the Securities (x) equally and ratably with such Debt as to such
property or assets for so long as such Debt will be so secured or (y) in the
event such Debt is subordinate in right of payment to the Securities, prior to
such Debt as to such property or assets for so long as such Debt will be so
secured.

     SECTION 10.13 Limitation on Guarantees of Company Subordinated Debt. The
Company shall not permit any Restricted Subsidiary of the Company, Restricted
Affiliate or Restricted Subsidiary of a Restricted Affiliate, directly or
indirectly, to assume, Guarantee or in any other manner become liable with
respect to any Debt of the Company that is expressly by its terms subordinate
or junior in right of payment to any other Debt of the Company.

     SECTION 10.14 Limitation on Asset Dispositions.

     (a) The Company may not, and may not permit any Restricted Subsidiary of
the Company, Restricted Affiliate or Restricted Subsidiary of a Restricted
Affiliate to, make any Asset Disposition in one or more related transactions
unless:

     (i)  the Company or such Restricted Subsidiary or Restricted Affiliate or
          Restricted Subsidiary of a Restricted Affiliate, as the case may be,
          receives consideration for such disposition at least equal to the
          fair market value for the assets sold or disposed of as determined by
          the Board of Directors in good faith and evidenced by a Board
          Resolution filed with the Trustee;

     (ii) at least 75% of the consideration for such disposition consists of
          (a) cash or readily marketable cash equivalents or the assumption of
          Debt of the Company (other than Debt that is subordinated to the
          Securities) or of such Restricted Subsidiary of the Company or
          Restricted Affiliate or Restricted Subsidiary of a Restricted
          Affiliate relating to such assets and release from all liability on
          the Debt assumed or (b) Related Assets; and


                                     - 78 -

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    (iii) the Company's Pro Rata Portion of the difference between all Net
          Available Proceeds, less any amounts invested within 360 days of such
          disposition in a Related Business or committed to such investment,
          are applied within 360 days of such disposition (1) first, to the
          permanent repayment or reduction of Senior Debt of the Company or
          Debt of a Restricted Subsidiary of the Company, Restricted Affiliate
          or Restricted Subsidiary of a Restricted Affiliate, provided that
          except in the case of repayment or reduction of Senior Debt of the
          Company, only the Company's Pro Rata Portion of such Debt shall be
          deemed to have been repaid or reduced out of such funds remaining,
          (2) second, to the extent of the Company's Pro Rata Portion of any
          such funds remaining, to make an Offer to Purchase outstanding
          Securities at 100% of their principal amount plus accrued interest to
          the date of purchase and, to the extent required by the terms
          thereof, any other Debt of the Company that is pari passu with the
          Securities at a price no greater than 100% of the principal amount
          thereof plus accrued interest to the date of purchase, and (3) third,
          to the extent of any such funds remaining, to any other use as
          determined by the Company which is not otherwise prohibited by the
          Indenture.

     Notwithstanding the foregoing, the Company will not be required to
purchase Securities pursuant to the requirements described in clause (iii)(2)
of the preceding paragraph if the Company's Pro Rata Portion of the funds
available for such use in respect of an Asset Disposition, together with the
Company's Pro Rata Portion of the funds available for such use in respect of
all prior Asset Dispositions, but which were not so used pursuant to the
provisions described in this paragraph, are less than $10 million.

     (b) The Company will mail the Offer to Purchase required pursuant to
Section 10.14(a) not more than 360 days after consummation of the disposition
referred to in Section 10.14(a). The aggregate principal amount of the
Securities to be offered to be purchased pursuant to the Offer to Purchase
shall equal the Net Available Proceeds available therefor pursuant to clause
(iii)(2) of Section 10.14(a) (rounded down to the next lowest integral multiple
of $1,000). Each Holder shall be entitled to tender all or any portion of the
Securities owned by such Holder pursuant to the Offer to Purchase, subject to
the requirement that any portion of a Security tendered must be tendered in an
integral multiple of $1,000 principal amount.

     The Company shall not be entitled to any credit against its obligations
under this Section 10.14 for the principal amount of any Securities acquired or
redeemed by the Company otherwise than pursuant to the Offer to Purchase
pursuant to this Section 10.14.

     (c) Not later than the date of the Offer with respect to an Offer to
Purchase pursuant to this Section 10.14, the Company shall deliver to the
Trustee an Officer's Certificate as to (i) the Purchase Amount, (ii) the
allocation of the Net Available Proceeds from the Asset Disposition pursuant to
which such Offer is being made, and (iii) the compliance of such allocation
with the provisions of Section 10.14(a).

                                     - 79 -

<PAGE>


     The Company and the Trustee shall perform their respective obligations
specified in the Offer to Purchase and in this Section 10.14. On or prior to
the Purchase Date, the Company shall (i) accept for payment (on a pro rata
basis, if necessary) Securities or portions thereof tendered pursuant to the
Offer, (ii) deposit with the Paying Agent (or, if the Company is acting as its
own Paying Agent, segregate and hold in trust as provided in Section 10.03)
money sufficient to pay the purchase price of all Securities or portions
thereof so accepted and (iii) deliver or cause to be delivered to the Trustee
all Securities so accepted together with an Officer's Certificate stating the
Securities or portions thereof accepted for payment by the Company. The Paying
Agent (or the Company, if so acting) shall promptly mail or deliver to Holders
of Securities so accepted payment in an amount equal to the purchase price, and
the Trustee shall promptly authenticate and mail or deliver to such Holders a
new Security of like tenor equal in principal amount to any unpurchased portion
of the Security surrendered. Any Security not accepted for payment shall be
promptly mailed or delivered by the Company to the Holder thereof.

     (d) Notwithstanding the foregoing, this Section 10.14 shall not apply to
any Asset Disposition which constitutes a transfer, conveyance, sale, lease or
other disposition of all or substantially all of the Company's properties or
assets within the meaning of Section 8.01 hereof.

     SECTION 10.15 Transactions with Affiliates and Related Persons. The
Company may not, and may not permit any Restricted Subsidiary of the Company,
Restricted Affiliate or Restricted Subsidiary of a Restricted Affiliate to,
enter into any transaction (or series of related transactions) with an
Affiliate or Related Person of the Company (other than the Company or a
Restricted Subsidiary of the Company which is an 80% or more owned Subsidiary
prior to such transaction), including any Investment, either directly or
indirectly, unless such transaction is on terms no less favorable to the
Company or such Restricted Subsidiary of the Company, Restricted Affiliate or
Restricted Subsidiary of a Restricted Affiliate than those that could be
obtained in a comparable arm's-length transaction with an entity that is not an
Affiliate or Related Person and is in the best interests of such Company or
such Restricted Subsidiary of the Company, Restricted Affiliate or Restricted
Subsidiary of a Restricted Affiliate. For any transaction that involves in
excess of $5 million, a majority of the disinterested members of the Board of
Directors shall determine that the transaction satisfies the above criteria and
shall evidence such a determination by a Board Resolution filed with the
Trustee.

     The foregoing restriction shall not apply to (i) reasonable and customary
payments on behalf of directors, officers or employees of the Company or any of
its Restricted Subsidiaries, Restricted Affiliates or Restricted Subsidiaries
of Restricted Affiliates, or in reimbursement of reasonable and customary
payments or reasonable and customary expenditures made or incurred by such
Persons as directors, officers or employees, (ii) any Restricted Payment
permitted under Section 10.09 and any Permitted Investment; provided, however,
that any Investment (including any Permitted Investment) made in reliance on
this clause (ii) is in the best interests of the Company, and (iii) any loan or
advance by the Company or a Restricted Subsidiary of the Company, Restricted
Affiliate or Restricted Subsidiary of a Restricted Affiliate to employees of
any of them in the ordinary course of business.

                                     - 80 -

<PAGE>


     SECTION 10.16 Change of Control.

     (a) Within 60 days of the occurrence of a Change of Control Triggering
Event, the Company will be required to make an Offer to Purchase all
Outstanding Securities at a purchase price equal to 101% of their principal
amount plus accrued interest to the date of purchase.

     (b) The Company and the Trustee shall perform their respective obligations
specified in the Offer to Purchase. Prior to the Purchase Date, the Company
shall (i) accept for payment Securities or portions thereof tendered pursuant
to the Offer, (ii) deposit with the Paying Agent (or, if the Company is acting
as its own Paying Agent, segregate and hold in trust as provided in Section
10.03) money sufficient to pay the purchase price of all Securities or portions
thereof so accepted and (iii) deliver or cause to be delivered to the Trustee
all Securities so accepted together with an Officer's Certificate stating the
Securities or portions thereof accepted for payment by the Company. The Paying
Agent shall promptly mail or deliver to Holders of Securities so accepted
payment in an amount equal to the purchase price, and the Trustee shall
promptly authenticate and mail or deliver to such Holders a new Security or
Securities equal in principal amount to any unpurchased portion of the Security
surrendered as requested by the Holder. Any Security not accepted for payment
shall be promptly mailed or delivered by the Company to the Holder thereof. The
Company shall publicly announce the results of the Offer on or as soon as
practicable after the Purchase Date.

     (c) A "Change of Control Triggering Event" will be deemed to have occurred
if a Change of Control has occurred and a Rating Decline occurs.

     (d) A "Change of Control" will be deemed to have occurred at such time as
either (a) any Person (other than a Permitted Holder) or any Persons acting
together that would constitute a "group" (a "Group") for purposes of Section
13(d) of the Securities Exchange Act of 1934, or any successor provision
thereto (other than Permitted Holders), together with any Affiliates thereof,
shall beneficially own (within the meaning of Rule 13d-3 under the Securities
Exchange Act of 1934, or any successor provision thereto) at least 50% of the
aggregate voting power of all classes of Voting Stock of the Company; or (b)
any Person or Group (other than Permitted Holders), together with any
Affiliates thereof, shall succeed in having a sufficient number of its nominees
elected to the Board of Directors of the Company such that such nominees, when
added to any existing director remaining on the Board of Directors of the
Company after such election who was a nominee of or is an Affiliate of such
Person or Group, will constitute a majority of the Board of Directors of the
Company.

     (e) A "Rating Decline" will be deemed to have occurred if at any time
within the earlier of (i) 90 days after the date of public notice of a Change
of Control, or of the intention of the Company or of any Person to effect a
Change of Control and (ii) the occurrence of the Change in Control (which
period shall in either event be extended so long as the rating of the
Securities is under publicly announced consideration for possible downgrade by
a Rating Agency), the rating of the Securities is decreased by either Rating
Agency by one or more Gradations and the rating by both Rating Agencies on the
Securities following such downgrade is below Investment Grade.

                                     - 81 -

<PAGE>


     SECTION 10.17 Provision of Financial Information.

     Whether or not the Company is required to be subject to Section 13(a) or
15(d) of the Exchange Act, or any successor provision thereto, the Company
shall file with the Commission the annual reports and other documents which the
Company would have been required to file with the Commission pursuant to such
Section 13(a) or 15(d) or any successor provision thereto if the Company were
so required, such documents to be filed with the Commission on or prior to the
respective dates (the "Required Filing Dates") by which the Company would have
been required so to file such documents if the Company were so required. The
Company shall also in any event (a) within 15 days of each Required Filing Date
(i) transmit by mail to all Holders, as their names and addresses appear in the
Security Register, without cost to such Holders, and (ii) file with the
Trustee, copies of the annual reports and other documents which the Company
files with the Commission pursuant to such Section 13(a) or 15(d) or any
successor provision thereto or would have been required to file with the
Commission pursuant to such Section 13(a) or 15(d) or any successor provisions
thereto if the Company were required to be subject to such Sections and (b) if
filing such documents by the Company with the Commission is not permitted under
the Exchange Act, promptly upon written request supply copies of such documents
to any prospective Holder.

     SECTION 10.18 Limitation on Lines of Business.

     The Company shall, and shall cause each Restricted Subsidiary of the
Company, Restricted Affiliate or Restricted Subsidiary of a Restricted
Affiliate to, directly or indirectly engage primarily in a Related Business.

     SECTION 10.19 Payment of Additional Amounts.

     The Company agrees that, if any deduction or withholding of any present or
future withholding taxes, levies, imposts or charges whatsoever imposed by or
for the account of Luxembourg or any political subdivision or taxing authority
thereof or therein shall be required, the Company will (subject to compliance
by the holders of the Securities with any relevant administrative requirements)
pay such additional amount in respect of principal (and premium, if any) and
interest (the "Additional Amounts") as may be necessary in order that the net
amounts paid to such holders pursuant to the Securities after such deduction or
withholding shall equal the respective amounts of principal (and premium, if
any) and interest specified in the Securities; provided, however, that the
foregoing shall not apply to any such tax, levy, impost or charge which would
not be payable but for the fact that the holder of a Security is a domiciliary,
national or resident of, or engaging in business or maintaining a permanent
establishment or being physically present in, Luxembourg or such political
subdivision or otherwise having some connection with Luxembourg other than the
holding or ownership of such Security or the collection of principal of (and
premium, if any) and interest on such Security or the enforcement of such
Security.

     SECTION 10.20 Guarantee.

     The Company shall cause Millicom International Operations, B.V., a
corporation incorporated under the laws of the Netherlands and, its
wholly-owned subsidiary to execute and

                                     - 82 -

<PAGE>


deliver a guarantee pursuant to which Millicom International Operations, B.V.
shall guarantee full payment of the Securities and other amounts under the
Indenture on the terms and conditions set forth in this Indenture and the
guarantee agreement attached hereto as Exhibit E.

     SECTION 10.21 Waiver of Certain Covenants.

     The Company may omit in any particular instance to comply with any
covenant or condition set forth in Sections 8.01 and 10.05 to 10.19, inclusive,
if before the time for such compliance the Holders of at least a majority in
principal amount of the Outstanding Securities shall, by Act of such Holders,
either waive such compliance in such instance or generally waive compliance
with such covenant or condition, but no such waiver shall extend to or affect
such covenant or condition except to the extent so expressly waived, and, until
such waiver shall become effective, the obligations of the Company and the
duties of the Trustee in respect of any such covenant or condition shall remain
in full force and effect; provided, however, with respect to an Offer to
Purchase as to which an Offer has been mailed, no such waiver may be made or
shall be effective against any Holder tendering Securities pursuant to such
Offer, and the Company may not omit to comply with the terms of such Offer as
to such Holder.

                                 ARTICLE ELEVEN

                            Redemption of Securities

     SECTION 11.01 Right of Redemption.

     (a) The Securities may be redeemed, as a whole or in part, at the election
of the Company, at any time prior to Maturity, upon not less than 30 nor more
than 60 days' notice by mail from the Company to each Holder of Securities to
be redeemed (with a copy to the Trustee) at such Holder's address appearing in
the Security Register, at the option of the Company either (i) in cash, in
amounts of $1,000 or an integral multiple of $1,000, at the Redemption Price,
together with accrued interest (including Special Interest) to, but excluding,
the Redemption Date (subject to the right of Holders of record on the relevant
Regular Record Date to receive interest (including Special Interest) due on an
Interest Payment Date that is on or prior to the Redemption Date), (ii) in such
number of shares of the Company's common stock calculated (by the Company) by
dividing the principal amount of Securities being repaid by the lesser of (x)
the Conversion Price and (y) the average of the closing prices of the Company's
Common Stock over the 60-day period immediately preceding the Redemption Date,
or (iii) any combination of (i) and (ii). For purposes of this Indenture, any
references to "Redemption Price," any rights thereto and the satisfaction and
payment thereof shall include both the payment in cash and in shares of the
Company's Common Stock provided for in this Section 11.01(a).

     (b) On and after the Redemption Date, unless the Company shall default in
the payment of the Redemption Price, interest will cease to accrue on the
principal amount of the Securities or portions thereof called for redemption
and for which funds have been set apart for payment, and such Securities, or
portions thereof, shall cease after the close of business on the Business Day
immediately preceding the Redemption Date to be convertible into shares of the
Company's Stock and, except as provided in this Section 11.01, to be entitled
to any benefit or security under this Indenture, and the Holders thereof shall
have no right in respect of such

                                     - 83 -

<PAGE>


Securities, or portions thereof, except the right to receive the Redemption
Price thereof and accrued and unpaid interest up to, but not including, the
Redemption Date. In the case of Securities or portions thereof redeemed on a
Redemption Date which is also an Interest Payment Date, the interest payment
due on such date shall be paid to the person in whose name the Security is
registered at the close of business on the relevant Regular Record Date.

     (c) The Securities further may be redeemed, as a whole, at the election of
the Company if, as the result of any change in or any amendment to the laws of
Luxembourg, or of any political subdivision or taxing authority thereof or
therein, affecting taxation, or any change in an application or interpretation
of such laws either generally or in relation to the Securities, which change or
amendment to such laws becomes effective on or after May 8, 2003, or which
change in application or interpretation is notified to the Company on or after
such date, it is determined by the Company that the Company would be required
to pay any Additional Amounts pursuant to Section 10.19 of this Indenture or
the terms of any Security thereof in respect of interest on the next succeeding
Interest Payment Date pursuant to the terms of the Securities at a Redemption
Price equal to 100% of the principal amount thereof plus accrued interest to
the date fixed for redemption. Prior to any redemption of such a series of
Securities pursuant to this Section 11.01(c), the Company shall provide the
Trustee with an Opinion of Counsel that the conditions precedent to the right
of the Company to redeem such Securities pursuant to this Section have
occurred. Such Opinion of Counsel shall be based on the laws and application
and interpretation thereof in effect on the date of such opinion or to become
effective on or before the next succeeding Interest Payment Date.

     SECTION 11.02 Applicability of Article.

     Redemption of Securities at the election of the Company, as permitted by
any provision of this Indenture, shall be made in accordance with such
provision and this Article.

     SECTION 11.03 Election to Redeem; Notice to Trustee.

     The election of the Company to redeem any Securities pursuant to Section
11.01 shall be evidenced by a Board Resolution. In case of any redemption at
the election of the Company of less than all the Securities, the Company shall,
at least 60 days prior to the Redemption Date fixed by the Company (unless a
shorter notice shall be satisfactory to the Trustee), notify the Trustee of
such Redemption Date and of the principal amount of Securities to be redeemed
and whether or not such redemption will be in cash or in shares of the
Company's Common Stock (including the amount of such shares). In the case of
any redemption at the election of the Company pursuant to Section 11.01 prior
to the expiration of any restriction on such redemption provided in the terms
of such Securities or elsewhere in this Indenture, the Company shall furnish
the Trustee with an Officer's Certificate evidencing compliance with Section
11.01 and the calculation of the number of shares of the Company's Common Stock
issued in such redemption, if applicable.

     SECTION 11.04 Selection by Trustee of Securities to Be Redeemed. If less
than all the Securities are to be redeemed, the particular Securities to be
redeemed shall be selected not more than 60 days prior to the Redemption Date
by the Trustee


                                     - 84 -

<PAGE>


by lot from the Outstanding Securities not previously called for redemption,
using such method as the Trustee shall deem fair and appropriate and which may
provide for the selection for redemption of portions (equal to $1,000 or any
integral multiple thereof) of the principal amount of Securities of a
denomination larger than $1,000.

     The Trustee shall promptly notify the Company and each Security Registrar
in writing of the Securities selected for redemption and, in the case of any
Securities selected for partial redemption, the principal amount thereof to be
redeemed.

     For all purposes of this Indenture, unless the context otherwise requires,
all provisions relating to the redemption of Securities shall relate, in the
case of any Securities redeemed or to be redeemed only in part, to the portion
of the principal amount of such Securities which has been or is to be redeemed.

     SECTION 11.05 Notice of Redemption.

     Notice of redemption shall be given by the Company by first-class mail,
postage prepaid, mailed not less than 30 nor more than 60 days prior to the
Redemption Date, to each Holder of Securities to be redeemed, at his address
appearing in the Security Register.

     All notices of redemption shall state:

          (1) the Redemption Date,

          (2) the Redemption Price,

          (3) whether the redemption is being made in cash pursuant to Section
     11.01(a)(i) or in shares of the Company's Common Stock pursuant to Section
     11.01(a)(ii) and, if being made pursuant to Section 11.01(a)(ii), a brief
     statement setting forth the Company's calculation of the number of shares
     issued thereunder

          (4) if less than all the Outstanding Securities are to be redeemed,
     the identification (and, in the case of partial redemption of any
     Securities, the principal amounts) of the particular Securities to be
     redeemed,

          (5) that Securities called for redemption may be converted at any
     time prior to the close of business on the day before the last Trading Day
     immediately preceding the Redemption Date and if not converted prior to
     the close of business on such date, the right of conversion will be lost;

          (6) that on the Redemption Date the Redemption Price will become due
     and payable upon each such Security to be redeemed and that interest
     thereon will cease to accrue on and after said date,

          (7) the place or places where such Securities are to be surrendered
     for payment of the Redemption Price,

                                     - 85 -

<PAGE>


          (8) that in the case that a Security is only redeemed in part, the
     Company shall execute and the Trustee shall authenticate and deliver to
     the Holder of such Security, without service charge, a new Security or
     Securities in an aggregate amount equal to the unredeemed portion of the
     Security,

          (9) the aggregate principal amount of Securities being redeemed, and
     (10) the CUSIP number or numbers of the Securities being redeemed.

     Notice of redemption of Securities to be redeemed at the election of the
Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company.

     SECTION 11.06 Deposit of Redemption Price.

     Prior to any Redemption Date, the Company shall deposit with the Trustee
or with a Paying Agent (or, if the Company is acting as its own Paying Agent,
segregate and hold in trust as provided in Section 10.03) either (i) an amount
of money sufficient to pay the Redemption Price of, and (except if the
Redemption Date shall be an Interest Payment Date) accrued interest on, all the
Securities which are to be redeemed on that date or (ii) the amount of shares
of the Company's Common Stock issued for the redemption of all the Securities
which are to be redeemed on that date, calculated pursuant to Section
11.01(a)(ii).

     SECTION 11.07 Securities Payable on Redemption Date.

     Notice of redemption having been given as aforesaid, the Securities so to
be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified, and from and after such date (unless the
Company shall default in the payment of the Redemption Price and accrued
interest) such Securities shall cease to bear interest. Upon surrender of any
such Security for redemption in accordance with said notice, such Security
shall be paid by the Company at the Redemption Price, together with accrued
interest to the Redemption Date; provided, however, that installments of
interest whose Stated Maturity is on or prior to the Redemption Date shall be
payable to the Holders of such Securities, or one or more Predecessor
Securities, registered as such at the close of business on the relevant Record
Dates according to their terms and the provisions of Section 3.08.

     If any Security called for redemption shall not be so paid upon surrender
thereof for redemption, the principal (and premium, if any) shall, until paid,
bear interest from the Redemption Date at the rate borne by the Security.

     SECTION 11.08 Securities Redeemed in Part.

     Any Security which is to be redeemed only in part shall be surrendered at
an office or agency of the Company designated for that purpose pursuant to
Section 10.02 (with, if the Company or the Trustee so requires, due endorsement
by, or a written instrument of transfer in form satisfactory to the Company and
the Trustee duly executed by, the Holder thereof or his attorney duly
authorized in writing), and the Company shall execute, and the Trustee shall
authenticate and deliver to the Holder of such Security without service charge,
a new Security or

                                     - 86 -

<PAGE>


Securities, of any authorized denomination as requested by such Holder, in
aggregate principal amount equal to and in exchange for the unredeemed portion
of the principal of the Security so surrendered.

                                 ARTICLE TWELVE

                            Conversion of Securities

     SECTION 12.01 Right to Convert.

     Subject to and upon compliance with the provisions of this Indenture, each
Holder of Securities shall have the right, at his or her option, at any time on
or before the close of business on the last Trading Day prior to the applicable
date of Maturity (except that with respect to any Security or portion thereof
which is called for redemption prior to such date, such right will terminate,
except as provided in Section 12.02(e), at the close of business on the last
Trading Day preceding the date fixed for redemption (unless the Company
defaults in payment of the Redemption Price in which case the conversion right
will terminate at the close of business on the date such default is cured) to
convert the principal amount of any Security held by such Holder, or any
portion of such principal amount which is $1,000 or integral multiples thereof,
into that number of fully paid and non-assessable shares of the Company's
Common Stock (as such shares shall then be constituted) obtained by dividing
the principal amount of the Security or portion thereof to be converted by the
Conversion Price in effect at such time and by surrender of the Security so to
be converted in whole or in part in the manner provided in Section 12.02. A
Holder of Securities is not entitled to any rights of a Holder of shares of the
Company's Common Stock until such Holder of Securities has converted his or her
Securities to shares of the Company's Common Stock, and only to the extent such
Securities are deemed to have been converted to shares of the Company's Common
Stock under this Article Twelve. The Company covenants to effect such
conversion by procuring the issuance of shares of the Company's Common Stock
and payment of cash in lieu of fractional shares in exchange for and in
consideration of the delivery of such Securities in the manner set forth in
Section 12.02. The shares shall be duly authorized, validly issued fully paid
and nonassessable shares of the Company's Common Stock.

     SECTION 12.02 Exercise of Conversion Privilege; Issuance of Shares of
Common Stock on Conversion; No Adjustment for Interest or Dividends.

     (a) To exercise, in whole or in part, the conversion privilege with
respect to any Security, the holder of such Security shall surrender such
Security, duly endorsed, at an office or agency maintained by the Company
pursuant to Section 10.02, accompanied by the funds, if any, required by the
final paragraph of this Section 12.02 and a duly signed and completed written
notice of conversion in the form provided on the Securities (or such other
notice which is acceptable to the Company) to the office or agency that the
holder of Securities elects to convert such Security or such portion thereof
specified in said notice. Such notice shall also state the name or names (with
address or addresses) in which the certificate or certificates for shares of
Common Stock which are issuable on such conversion shall be issued, and shall
be accompanied by transfer taxes, if required pursuant to Section 12.07. Each
such Security surrendered for conversion shall, unless the shares issuable on
conversion are to be issued in the

                                     - 87 -

<PAGE>


same name as the registration of such Security, be duly endorsed by, or be
accompanied by instruments of transfer in form satisfactory to the Company duly
executed by, the holder of Securities or his or her duly authorized attorney.
The holder of such Securities will not be required to pay any tax or duty which
may be payable in respect of the issue or delivery of shares of the Company's
Common Stock on conversion, but will be required to pay any tax or duty which
may be payable in respect of any transfer involved in the issue or delivery of
shares of the Company's Common Stock in a name other than the same name as the
registration of such Security. The date on which the holder of Securities
satisfies each of the requirements provided in this paragraph shall be referred
to as the "Conversion Date."

     (b) As promptly as practicable after satisfaction of the requirements for
conversion set forth above, the Company shall issue and shall deliver or cause
to be delivered to such holder at the office or agency maintained by the
Company for such purpose pursuant to Section 10.02, (1) a certificate or
certificates for the number of full shares of the Company's Common Stock
issuable upon the conversion of such Security and (2) a check or cash in an
amount calculated pursuant to Section 12.03 in respect of any fractional
interest in respect of a share of the Company's Common Stock arising upon such
conversion no later than the tenth Business Day after the Conversion Date.

     (c) Certificates representing shares of the Company's Common Stock will
not be issued or delivered unless all taxes and duties, if any, payable by the
Holder have been paid. In case any Security of a denomination of integral
multiples greater than $1,000 is surrendered for partial conversion, the
Company shall execute, and the Trustee shall authenticate and deliver or cause
to be delivered to the Holder of the Security so surrendered, without charge to
him or her, a new Security or Securities in authorized denominations in an
aggregate principal amount equal to the unconverted portion of the surrendered
Security.

     (d) Each conversion shall be deemed to have been effected as to any such
Security (or portion thereof) on the applicable Conversion Date, and the person
in whose name any certificate or certificates for shares of the Company's
Common Stock are issuable upon such conversion shall be deemed to have become
on the applicable Conversion Date the holder of record of the shares
represented thereby; provided, however, that any such surrender on any date
when the Company's stock transfer books are closed shall constitute the person
in whose name the certificates are to be issued as the record holder thereof
for all purposes on the next succeeding day on which such stock transfer books
are open, but such conversion shall be at the Conversion Price in effect on the
date upon which such Security is surrendered.

     (e) Any Security or portion thereof surrendered for conversion during the
period from the close of business on a Regular Record Date for any interest
payment through the close of business on the last Trading Day immediately
preceding such Interest Payment Date shall (unless such Security or portion
thereof being converted has been called for redemption pursuant to a notice of
redemption mailed by the Company to the holders in accordance with the
provisions of Section 11.05) be accompanied by payment, in funds acceptable to
the Company, of an amount equal to the interest otherwise payable on such
Interest Payment Date on the principal amount being converted; provided,
however, that no such payment need be made if there exists at the time of
conversion a default in the payment of interest on the Securities. An amount
equal to such payment shall be paid by the Company on such Interest Payment
Date to

                                     - 88 -

<PAGE>


the holder of such Security at the close of business on such Regular Record
Date; provided, however, that if the Company defaults in the payment of
interest or on such Interest Payment Date, such amount shall be paid to the
person who made such required payment. Except as provided above in this Section
12.02, no adjustment shall be made for interest accrued on any Security
converted or for dividends on any shares of the Company's Common Stock issued
upon the conversion of such Security as provided in this Article Twelve.

     SECTION 12.03 Cash Payments in Lieu of Fractional Shares.

     No fractional shares of the Company's Common Stock or scrip representing
fractional shares shall be issued upon conversion of Securities. If more than
one Security shall be surrendered for conversion at one time by the same
Holder, the number of full shares which shall be issuable upon conversion shall
be computed on the basis of the aggregate principal amount of the Securities
(or specified portions thereof to the extent permitted hereby) so surrendered
for conversion. If any fractional share of the Company's Common Stock otherwise
would be issuable upon the conversion of any Security or Securities, the
Company shall make an adjustment therefor in cash based upon the Current Market
Price of the Company's Common Stock on the last Trading Day prior to the
Conversion Date.

     SECTION 12.04 Conversion Price.

     The conversion price shall be $10.75 per share of the Company's Common
Stock, subject to adjustment as provided in Section 12.05.

     SECTION 12.05 Adjustment of Conversion Price.

     The Conversion Price shall be adjusted from time to time by the Company as
follows:

     (a) If the Company shall hereafter pay a dividend or make a distribution
to all holders of the outstanding shares of Common Stock in shares of the
Company's Common Stock (including, for the avoidance of doubt, a dividend or
distribution that permits the recipient to elect between cash and Common
Shares), the Conversion Price in effect at the opening of business on the date
following the date fixed for the determination of shareholders entitled to
receive such dividend or other distribution shall be reduced by multiplying
such Conversion Price by a fraction of which the numerator shall be the number
of shares of the Company's Common Stock outstanding at the close of business on
the Record Date (as defined in Section 12.05(g)) fixed for such determination
and the denominator shall be the sum of such number of shares of the Company's
Common Stock and the total number of shares of the Company's Common Stock
constituting such dividend or other distribution, such reduction to become
effective immediately after the opening of business on the day following the
Record Date. If any dividend or distribution of the type described in this
Section 12.05(a) is declared but not so paid or made, the Conversion Price
shall again be adjusted to the Conversion Price which would then be in effect
if such dividend or distribution had not been declared.

     (b) If the outstanding shares of the Company's Common Stock shall be
subdivided or split into a greater number of shares of the Company's Common
Stock or the Company issues any shares of Capital Stock in connection with a
reclassification or

                                    - 89 -

<PAGE>


consolidation of its Common Stock, the Conversion Price in effect at the
opening of business on the day following the day upon which such subdivision or
split becomes effective or issuance occurs shall be proportionately reduced,
and, conversely, if the outstanding shares of the Company's Common Stock shall
be combined or consolidated into a smaller number of shares of the Company's
Common Stock, the Conversion Price in effect at the opening of business on the
day following the day upon which such combination becomes effective shall be
proportionately increased, such reduction or increase, as the case may be, to
become effective immediately after the opening of business on the day following
the day upon which such subdivision or combination becomes effective or
issuance occurs.

     (c) If the Company shall issue rights or warrants (which term shall
include any rights to purchase or subscribe for Common Stock or other
securities which are convertible into shares of Capital Stock of the Company to
all or substantially all holders of its outstanding shares of the Company's
Common Stock entitling such holders to subscribe for or purchase shares of the
Company's Common Stock at a price per share less than the Current Market Price
of the Company's Common Stock on the Record Date fixed for the determination of
shareholders entitled to receive such rights or warrants, the Conversion Price
shall be adjusted so that the same shall equal the price determined by
multiplying the Conversion Price in effect at the opening of business on the
date after such Record Date by a fraction of which the numerator shall be the
number of shares of the Company's Common Stock outstanding at the close of
business on the Record Date plus the number of shares of the Company's Common
Stock which the aggregate offering price of the total number of shares of the
Company's Common Stock so offered would purchase at such Current Market Price,
and of which the denominator shall be the number of shares of the Company's
Common Stock outstanding on the close of business on the Record Date plus the
total number of additional shares of the Company's Common Stock so offered for
subscription or purchase. Such adjustment shall become effective immediately
after the opening of business on the day following the Record Date fixed for
determination of shareholders entitled to receive such rights or warrants. To
the extent that shares of the Company's Common Stock are not delivered pursuant
to such rights or warrants, upon the expiration or termination of such rights
or warrants, the Conversion Price shall be readjusted to be the Conversion
Price which would then be in effect had the adjustments made upon the issuance
of such rights or warrants been made on the basis of delivery of only the
number of shares of the Company's Common Stock actually delivered. If such
rights or warrants are not so issued, the Conversion Price shall again be
adjusted to be the Conversion Price which would then be in effect if such date
fixed for the determination of shareholders entitled to receive such rights or
warrants had not been fixed. In determining whether any rights or warrants
entitle the holders to subscribe for or purchase shares of the Company's Common
Stock at less than such Current Market Price, and in determining the aggregate
offering price of such shares of the Company's Common Stock, there shall be
taken into account any consideration received for such rights or warrants, with
the value of such consideration, if other than cash, to be determined by the
Board of Directors.

     (d) If the Company shall, by dividend or otherwise, issue or distribute to
all holders of its Common Stock shares of any class of Capital Stock of the
Company (other than any dividends or distributions to which Section 12.05(a)
applies) or evidences of its indebtedness, cash or other assets (including
securities, but excluding (i) any rights or warrants of a type referred to in
Section 12.05(c) and (ii) dividends and distributions paid exclusively in

                                    - 90 -

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cash) (the foregoing hereinafter in this Section 12.05(d) called the "Equity
Securities"), then, in each such case, the Conversion Price shall be reduced so
that the same shall be equal to the price determined by multiplying the
Conversion Price in effect immediately prior to the close of business on the
Record Date with respect to such distribution by a fraction of which the
numerator shall be the Current Market Price (determined as provided in section
12.05(g)) of the Company's Common Stock on such date less the fair market value
(as determined by the Board of Directors, whose determination shall be
conclusive and described in a resolution of the Board of Directors) on such
date of the portion of the Equity Securities so distributed applicable to one
share of the Company's Common Stock and the denominator shall be equal to the
sum of the Current Market Price of the Company's Common Stock, such reduction
to become effective immediately prior to the opening of business on the day
following the Record Date; provided, however, that in the event the fair market
value (as so determined) of the portion of the Equity Securities so distributed
applicable to one share of Common Stock is equal to or greater than the Current
Market Price of the Company's Common Stock on the Record Date, in lieu of the
foregoing adjustment, adequate provision shall be made so that each holder of
Securities shall have the right to receive upon conversion of a Security (or
any portion thereof) the amount of Equity Securities such holder would have
received had such holder converted such Security (or portion thereof)
immediately prior to such Record Date. If such dividend or distribution is not
so paid or made, the Conversion Price shall again be adjusted to be the
Conversion Price which would then be in effect if such dividend or distribution
had not been declared. If the Board of Directors determines the fair market
value of any distribution for purposes of this Section 12.05(d) by reference to
the actual or when issued trading market for any securities comprising all or
part of such distribution, it must in doing so consider the prices in such
market over the same period used in computing the Current Market Price of the
Company's Common Stock pursuant to Section 12.5(g) to the extent possible.

     Rights or warrants distributed by the Company to all holders of its Common
Stock entitling the holders thereof to subscribe for or purchase shares of the
Company's Capital Stock (either initially or under certain circumstances),
which rights or warrants, until the occurrence of a specified event or events
("Trigger Event"): (i) are deemed to be transferred with such shares of the
Company's Common Stock; (ii) are not exercisable; and (iii) are also issued in
respect of future issuances of shares of the Company's Common Stock, shall be
deemed not to have been distributed for purposes of this Section 12.05(d) (and
no adjustment to the Conversion Price under this Section 12.05(d) shall be
required) until the occurrence of the earliest Trigger Event, whereupon such
rights and warrants shall be deemed to have been distributed and an appropriate
adjustment to the Conversion Price under this Section 12.05(d) shall be made.
If any such rights or warrants, including any such existing rights or warrants
distributed prior to the date of this Indenture, are subject to subsequent
events, upon the occurrence of each of which such rights or warrants shall
become exercisable to purchase different securities, evidences of indebtedness
or other assets, then the occurrence of each such event shall be deemed to be
such date of issuance and record date with respect to new rights or warrants
(and a termination or expiration of the existing rights or warrants without
exercise by the holder thereof). In addition, in the event of any distribution
(or deemed distribution) of rights or warrants, or any Trigger Event with
respect thereto, that was counted for purposes of calculating a distribution
amount for which an adjustment to the Conversion Price under this Section 12.05
was made, (1) in the case of any such rights or warrants which shall all have
been redeemed or repurchased without exercise by any holders thereof, the
Conversion Price shall be readjusted upon such final

                                    - 91 -

<PAGE>


redemption or repurchase to give effect to such distribution or Trigger Event,
as the case may be, as though it were a cash distribution, equal to the per
share redemption or repurchase price received by a holder or holders of the
Company's Common Stock with respect to such rights or warrants (assuming such
holder had retained such rights or warrants), made to all holders of the
Company's Common Stock as of the date of such redemption or repurchase, and (2)
in the case of such rights or warrants which shall have expired or been
terminated without exercise by any holders thereof, the Conversion Price shall
be readjusted as if such rights and warrants had not been issued.

     For purposes of Sections 12.05(a) and (c) and this Section 12.05(d), any
dividend or distribution to which this Section 12.05(d) is applicable that also
includes shares of the Company's Common Stock, or rights or warrants to
subscribe for or purchase shares of Common Stock to which Section 12.05(c)
applies, shall be deemed instead to be (1) a dividend or distribution of the
evidences of indebtedness, assets, shares of capital stock, rights or warrants
other than such shares of the Company's Common Stock or rights or warrants to
which Section 12.05(c) applies (and any Conversion Price reduction required by
this Section 12.05(d) with respect to such dividend or distribution shall then
be made) immediately followed by (2) a dividend or distribution of such shares
of the Company's Common Stock or such rights or warrants (and any further
Conversion Price reduction required by Section 12.05(a) and (c) with respect to
such dividend or distribution shall then be made, except that (A) the Record
Date of such dividend or distribution shall be substituted as "the date fixed
for the determination of shareholders entitled to receive such dividend or
other distribution", "Record Date fixed for such determination" and "Record
Date" within the meaning of Section 12.05(a) and as "the date fixed for the
determination of shareholders entitled to receive such rights or warrants",
"the Record Date fixed for the determination of the shareholders entitled to
receive such rights or warrants" and "such Record Date" within the meaning of
Section 12.05(c) and (B) any shares of the Company's Common Stock included in
such dividend or distribution shall not be deemed "outstanding at the close of
business on the date fixed for such determination" within the meaning of
Section 12.05(a)).

     (e) If the Company shall, by dividend or otherwise, distribute cash to all
holders of its Common Stock (excluding any cash that is distributed upon a
merger or consolidation to which Section 12.06 applies or as part of a
distribution referred to in Section 12.05(d)) in an aggregate amount that,
combined together with (1) the aggregate amount of any other such all-cash
distributions to all holders of its Common Stock within the 12 months preceding
the date of payment of such distribution, and in respect of which no adjustment
pursuant to this Section 12.05(e) has been made, and (2) the aggregate of any
cash plus the fair market value (as determined by the Board of Directors, whose
determination shall be conclusive and described in a resolution of the Board of
Directors) of consideration payable in respect of any tender offer by the
Company or any of its subsidiaries for all or any portion of the Common Stock
concluded within the 12 months preceding the date of payment of such
distribution, and in respect of which no adjustment pursuant to Section
12.05(f) has been made, exceeds 10% of the product of (x) the Current Market
Price (determined as provided in Section 12.05(g)) of the Common Stock on the
Record Date with respect to such distribution times (y) the number of shares of
Common Stock outstanding on such date, then, and in each such case, immediately
after the close of business on such date, the Conversion Price shall be reduced
so that it shall equal the price determined by multiplying the Conversion Price
in effect immediately prior to the

                                    - 92 -

<PAGE>


close of business on such Record Date by a fraction (i) the numerator of which
shall be equal to the Current Market Price (determined as provided in Section
12.05(g)) of the Common Stock on the Record Date less an amount equal to the
quotient of (x) the excess of such combined amount over such 10% allocable to
the shares of Common Stock (as determined by the Board of Directors, whose
determination shall be conclusive and set forth in a resolution of the Board of
Directors) and (y) the number of shares of Common Stock outstanding on the
Record Date and (ii) the denominator of which shall be equal to the Current
Market Price of the Common Stock on such Record Date; provided, however, that
if the portion of the cash so distributed applicable to one share of Common
Stock is equal to or greater than the Current Market Price of the Common Stock
on the Record Date, in lieu of the foregoing adjustment, adequate provision
shall be made so that each holder of Securities shall have the right to receive
upon conversion of a Security (or any portion thereof) the amount of cash such
holder would have received had such holder converted such Security (or portion
thereof) immediately prior to such Record Date. If such dividend or
distribution is not so paid or made, the Conversion Price shall again be
adjusted to be the Conversion Price which would then be in effect if such
dividend or distribution had not been declared.

     (f) If a tender offer made by the Company or any of its subsidiaries for
all or any portion of the Company's Common Stock expires and such tender offer
(as amended upon the expiration thereof) requires the payment to shareholders
(based on the acceptance (up to any maximum specified in the terms of the
tender offer) of Purchased Shares) of an aggregate consideration having a fair
market value (as determined by the Board of Directors, whose determination
shall be conclusive and described in a resolution of the Board of Directors)
that, combined together with (1) the aggregate of the cash plus the fair market
value (as determined by the Board of Directors, whose determination shall be
conclusive and described in a resolution of the Board of Directors), as of the
expiration of such tender offer, of consideration payable in respect of any
other tender offers, by the Company or any of its subsidiaries for all or any
portion of the Company's Common Stock, expiring within the 12 months preceding
the expiration of such tender offer and in respect of which no adjustment
pursuant to this Section 12.05(f) has been made and (2) the aggregate amount of
any such all-cash distributions to all holders of the Company's Common Stock
within 12 months preceding the expiration of such tender offer and in respect
of which no adjustment pursuant to Section 12.05(e) has been made, exceeds 10%
of the product of (x) the Current Market Price (determined as provided in
Section 12.05(g)) of the Company's Common Stock as of the last time (the
"Expiration Time") tenders could have been made pursuant to such tender offer
(as it may be amended) times (y) the number of shares of the Company's Common
Stock outstanding (including any tendered shares) on the Expiration Time, then,
and in each such case, immediately prior to the opening of business on the day
after the date of the Expiration Time, the Conversion Price shall be adjusted
so that the same shall equal the price determined by multiplying the Conversion
Price in effect immediately prior to close of business on the date of the
Expiration Time by a fraction of which the numerator shall be the number of
shares of Common Stock outstanding (including any tendered shares) as of the
Expiration Time multiplied by the Current Market Price of the Common Stock on
the Trading Day next succeeding the Expiration Time and the denominator shall
be the sum of (x) the fair market value (determined as aforesaid) of the
aggregate consideration payable to holders of Common Stock based on the
acceptance (up to any maximum specified in the terms of the tender offer) of
all shares of Common Stock validly tendered and not withdrawn as of the
Expiration Time (the shares deemed so accepted, up to any such maximum, being
referred to as the

                                    - 93 -

<PAGE>


"Purchased Shares") and (y) the product of the number of shares of Common Stock
outstanding (less any Purchased Shares) on the Expiration Time and the Current
Market Price of the Common Stock on the Trading Day next succeeding the
Expiration Time, such reduction (if any) to become effective immediately prior
to the opening of business on the day following the Expiration Time. If the
Company is obligated to purchase shares pursuant to any such tender offer, but
the Company is permanently prevented by applicable law from effecting any such
purchases or all such purchases are rescinded, the Conversion Price shall again
be adjusted to be the Conversion Price which would then be in effect if such
tender offer had not been made. If the application of this Section 12.05(f) to
any tender offer would result in an increase in the Conversion Price, no
adjustment shall be made for such tender offer under this Section 12.05(f).

     (g) For purposes of this Section 12.05, the following terms shall have the
meaning indicated:

     (i)  "Current Market Price" means the average of the daily closing price
          per share of Common Stock for the 10 consecutive Trading Days
          immediately prior to the date in question; provided, however, that
          (1) if the "ex" date (as hereinafter defined) for any event (other
          than the issuance or distribution requiring such computation) that
          requires an adjustment to the Conversion Price pursuant to Section
          12.05(a), (b), (c), (d), (e) or (f) occurs during such 10 consecutive
          Trading Days, the closing price for each Trading Day prior to the
          "ex" date for such other event shall be adjusted by multiplying such
          closing price by the same fraction by which the Conversion Price is
          so required to be adjusted as a result of such other event, (2) if
          the "ex" date for any event (other than the issuance or distribution
          requiring such computation) that requires an adjustment to the
          Conversion Price pursuant to Section 12.05(a), (b), (c), (d), (e) or
          (f) occurs on or after the "ex" date for the issuance or distribution
          requiring such computation and prior to the day in question, the
          closing price for each Trading Day on and after the "ex" date for
          such other event shall be adjusted by multiplying such closing price
          by the reciprocal of the fraction by which the Conversion Price is so
          required to be adjusted as a result of such other event, and (3) if
          the "ex" date for the issuance or distribution requiring such
          computation is prior to the day in question, after taking into
          account any adjustment required pursuant to clause (1) or (2) of this
          proviso, the closing price for each Trading Day on or after such "ex"
          date shall be adjusted by adding thereto the amount of any cash and
          the fair market value (as determined by the Board of Directors in a
          manner consistent with any determination of such value for purposes
          of Sections 12.05(d) or (f), whose determination shall be conclusive
          and described in a resolution of the Board of Directors) of the
          evidences of indebtedness, shares of capital stock or assets being
          distributed applicable to one share of the Company's Common Stock as
          of the close of business on the day before such "ex" date. For
          purposes of any computation under Section 12.05(f),


                                     - 94 -

<PAGE>


          the Current Market Price on any date shall be deemed to be the
          average of the daily closing prices per share of the Company's Common
          Stock for such day and the next two succeeding Trading Days;
          provided, however, that if the "ex" date for any event (other than
          the tender offer requiring such computation) that requires an
          adjustment to the Conversion Price pursuant to Section 12.05(a), (b),
          (c), (d), (e) or (f) occurs on or after the Expiration Time for the
          tender or exchange offer requiring such computation and prior to the
          day in question, the closing price for each Trading Day on and after
          the "ex" date for such other event shall be adjusted by multiplying
          such applicable Closing Price by the reciprocal of the fraction by
          which the Conversion Price is so required to be adjusted as a result
          of such other event. For purposes of this paragraph, the term "ex"
          date, (1) when used with respect to any issuance or distribution,
          means the first date on which the shares of the Company's Common
          Stock, trade regular way on the relevant exchange or in the relevant
          market from which the closing price was obtained without the right to
          receive such issuance or distribution, (2) when used with respect to
          any subdivision or combination of shares of the Company's Common
          Stock means the first date on which the shares of the Company's
          Common Stock trade regular way on such exchange or in such market
          after the time at which such subdivision or combination becomes
          effective, and (3) when used with respect to any tender or exchange
          offer means the first date on which the shares of the Company's
          Common Stock trade regular way on such exchange or in such market
          after the Expiration Time of such offer. Notwithstanding the
          foregoing, whenever successive adjustments to the Conversion Price
          are called for pursuant to this Section 12.05, such adjustments shall
          be made to the applicable Current Market Price as may be necessary or
          appropriate to effectuate the intent of this Section 12.05 and to
          avoid unjust or inequitable results as determined in good faith by
          the Board of Directors.

          (ii) "fair market value" shall mean the amount which a willing buyer
               would pay a willing seller in an arm's length transaction.

     (h) The Company (with notice to the Trustee) may make such reductions in
the Conversion Price, in addition to those required by Sections 12.05(a), (b),
(c), (d), (e) and (f), as the Board of Directors considers to be advisable to
avoid or diminish any income tax to holders of the Company's Common Stock or
rights to purchase shares of Common Stock resulting from any dividend or
distribution of stock (or rights to acquire stock) or from any event treated as
such for income tax purposes.

     The Company from time to time may, to the extent permitted by law, reduce
the Conversion Price by any amount for any period of at least 20 days, if the
Board of Directors has made a determination that such reduction would be in the
Company's best interests, which

                                     - 95 -

<PAGE>


determination shall be conclusive and described in a resolution of the Board of
Directors. The reduction in Conversion Price shall be irrevocable during this
period. Whenever the Conversion Price is reduced pursuant to the preceding
sentence, the Company shall mail to the holders of Securities at his or her
last address appearing on the Security Register a notice of the reduction at
least 15 days prior to the date the reduced Conversion Price takes effect, and
such notice shall state the reduced Conversion Price and the period during
which it will be in effect.

     (i) No adjustment in the Conversion Price shall be required unless such
adjustment would require an increase or decrease of at least 1% of the
Conversion Price then in effect; provided, however, that any adjustments which
by reason of this Section 12.05(i) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment. All calculations
under this Article Twelve shall be made by the Company and shall be made to the
nearest cent or to the nearest one hundredth of a share, as the case may be.

     No adjustment need be made for a change in the par value or no par value
of the Company's Common Stock.

     (j) Whenever the Conversion Price is adjusted as herein provided, the
Company shall promptly file with the Trustee and any Conversion Agent other
than the Trustee an Officers' Certificate setting forth the Conversion Price
after such adjustment and setting forth a brief statement of the facts
requiring such adjustment. Promptly after delivery of such certificate, the
Company shall prepare a notice of such adjustment of the Conversion Price
setting forth the adjusted Conversion Price and the date on which each
adjustment becomes effective and shall mail (first class postage prepaid) such
notice of such adjustment of the Conversion Price to each Holder of Securities
at his or her last address appearing on the Register of holders maintained for
that purpose within 20 days of the effective date of such adjustment. Failure
to deliver such notice shall not affect the legality or validity of any such
adjustment.

     (k) In any case in which this Section 12.05 provides that an adjustment
shall become effective immediately after a Record Date for an event, the
Company may defer until the occurrence of such event issuing to the holder of
any Security converted after such Record Date and before the occurrence of such
event the additional shares of Common Stock issuable upon such conversion by
reason of the adjustment required by such event over and above the shares of
Common Stock issuable upon such conversion before giving effect to such
adjustment.

     (l) For purposes of this Section 12.05, the number of shares of Common
Stock at any time outstanding shall not include shares held in the treasury of
the Company but shall include shares issuable in respect of scrip certificates
issued in lieu of fractions of shares of the Company's Common Stock. The
Company shall not pay any dividend or make any distribution on shares of Common
Stock held in the treasury of the Company.

     SECTION 12.06 Effect of Reclassification, Consolidation, Merger or Sale.

     If any of the following events occur:

     (i)  any reclassification or change of the outstanding shares of the
          Company's Common Stock (other than a change in par value, or

                                     - 96 -

<PAGE>


          from par value to no par value, or from no par value to par value, or
          as a result of a subdivision or combination);

     (ii) any consolidation, merger or combination of the Company with another
          corporation as a result of which holders of Common Stock shall be
          entitled to receive stock, securities or other property or assets
          (including cash) with respect to or in exchange for such shares of
          the Company's Common Stock; or

    (iii) any sale or conveyance of the properties and assets of the Company
          as an entirety or substantially as an entirety to any other
          corporation as a result of which holders of the Company's Common
          Stock shall be entitled to receive stock, securities or other
          property or assets (including cash) with respect to or in exchange
          for such Common Stock,


then the Company or the successor or purchasing corporation, as the case may
be, shall execute with the Trustee a supplemental indenture (which shall comply
with the TIA as in force at the date of execution of such supplemental
indenture if such supplemental indenture is then required to so comply)
providing that the Securities shall be convertible into the kind and amount of
shares of stock and other securities or property or assets (including cash)
receivable upon such reclassification, change, consolidation, merger,
combination, sale or conveyance by a holder of a number of shares of the
Company's Common Stock issuable upon conversion of the Securities (assuming,
for such purposes, a sufficient number of authorized shares of the Company's
Common Stock available to convert all such Securities) immediately prior to
such reclassification, change, consolidation, merger, combination, sale or
conveyance, assuming such holder of shares of the Company's Common Stock did
not exercise his or her rights of election, if any, as to the kind or amount of
securities, cash or other property receivable upon such consolidation, merger,
sale or conveyance (provided that, if the kind or amount of securities, cash or
other property receivable upon such consolidation, merger, sale or conveyance
is not the same for each share of the Company's Common Stock in respect of
which such rights of election have not been exercised ("non-electing share"),
then, for the purposes of this Section 12.06, the kind and amount of
securities, cash or other property receivable upon such consolidation, merger,
sale or conveyance for each non-electing share shall be deemed to be the kind
and amount so receivable per share by a plurality of the non-electing shares).
Such supplemental indenture shall provide for adjustments which shall be as
nearly equivalent as may be practicable to the adjustments provided for in this
Article Twelve. If, in the case of any such reclassification, change,
consolidation, merger, combination, sale or conveyance, the stock or other
securities and assets receivable thereupon by a holder of the Company's Common
Stock includes shares of stock or other securities and assets of a corporation
other than the successor or purchasing corporation, as the case may be, in such
reclassification, change, consolidation, merger, combination, sale or
conveyance, then such supplemental indenture shall also be executed by such
other corporation and shall contain such additional provisions to protect the
interests of the holders of the Securities as the Board of Directors shall
reasonably consider necessary by reason of the foregoing.

                                     - 97 -

<PAGE>


     The Company shall cause notice of the execution of such supplemental
indenture to be mailed (first class postage prepaid) to each holder of
Securities at his or her address appearing on the Security Register within 20
days after execution thereof. Failure to deliver such notice shall not affect
the legality or validity of such supplemental indenture.

     The above provisions of this Section 12.06 shall similarly apply to
successive reclassifications, changes, consolidations, mergers, combinations,
sales and conveyances.

     If this Section 12.06 applies to any event or occurrence, Section 12.05
shall not apply.

     SECTION 12.07 Taxes on Shares Issued.

     The issue of stock certificates on conversions of Securities shall be made
without charge to the converting holder for any tax in respect of the issue
thereof. The Company shall not, however, be required to pay any tax which may
be payable in respect of any transfer involved in the issue and delivery of
stock in any name other than that of the holder of any Security converted, and
the Company shall not be required to issue or deliver any such stock
certificate unless and until the person or persons requesting the issue thereof
shall have paid to the Company the amount of such tax or shall have established
to the satisfaction of the Company that such tax has been paid.

     SECTION 12.08 Reservation of Shares; Shares to Be Fully Paid; Listing of
Common Stock.

     The Company shall provide, free from preemptive rights, out of its
authorized but unissued shares or shares held in treasury, sufficient shares to
provide for the conversion of the Securities from time to time as such
Securities are presented for conversion.

     Before taking any action which would cause an adjustment reducing the
Conversion Price below the then par value, if any, of the shares of the
Company's Common Stock issuable upon conversion of the Securities, the Company
shall take all corporate action which may, in the opinion of its counsel, be
necessary in order that the Company may validly and legally issue such shares
of the Company's Common Stock at such adjusted Conversion Price.

     The Company covenants that all shares of the Company's Common Stock issued
upon conversion of Securities will be fully paid and non-assessable by the
Company and free from all taxes, liens and charges with respect to the issue
thereof.

     The Company further covenants that as long as the Common Stock is listed
on The Nasdaq National Market and the Luxembourg Stock Exchange, or their
respective successors, the Company shall cause all shares of the Company's
Common Stock issuable upon conversion of the Securities to be eligible for such
listing in accordance with, and at the times required under, the requirements
of such market, and if at any time the Company's Common Stock becomes quoted on
the New York Stock Exchange or listed on any other national securities
exchange, the Company shall cause all shares of its Common Stock issuable upon
conversion of the Securities to be so quoted or listed and kept so quoted or
listed.

                                     - 98 -

<PAGE>


     SECTION 12.09 Responsibility of Trustee.

     The Trustee shall not at any time have any duty or responsibility to any
holders of Securities to determine the Conversion Price or determine whether
any facts exist which may require any adjustment of the Conversion Price, or
with respect to the nature or extent or calculation of any such adjustment when
made, or with respect to the method employed, or herein or in any supplemental
indenture provided to be employed, in making the same. The Trustee shall not be
accountable with respect to the validity or value (or the kind or amount) of
any shares of Common Stock, or of any securities or property, which may at any
time be issued or delivered upon the conversion of any Security; and the
Trustee makes no representations with respect thereto. Subject to the
provisions of Section 6.01, the Trustee shall not be responsible for any
failure of the Company to issue, transfer or deliver any shares of the
Company's Common Stock or stock certificates or other securities or property or
cash upon the surrender of any Security for the purpose of conversion or to
comply with any of the duties, responsibilities or covenants of the Company
contained in this Article Twelve. Without limiting the generality of the
foregoing, the Trustee shall not have any responsibility to determine the
correctness of any provisions contained in any supplemental indenture entered
into pursuant to Section 12.06 relating either to the kind or amount of shares
of stock or securities or property (including cash) receivable by holders of
Securities upon the conversion of their Securities after any event referred to
in such Section 12.06 or to any adjustment to be made with respect thereto,
but, subject to the provisions of Section 6.01, may accept as conclusive
evidence of the correctness of any such provisions, and shall be protected in
relying upon, the Officers' Certificate and Opinion of Counsel (which the
Company shall be obligated to file with the Trustee prior to the execution of
any such supplemental indenture) with respect thereto.

     SECTION 12.10 Notice to Holders Prior to Certain Actions.

     If:

     (a) the Company declares a dividend (or any other distribution) on its
Common Stock (other than in cash out of retained earnings or other than a
dividend that results in an adjustment in the Conversion Price pursuant to
Section 12.05 as to which the Company has made an election in accordance with
Section 12.05(m)); or

     (b) the Company authorizes the granting to all or substantially all of the
holders of its Common Stock of rights or warrants to subscribe for or purchase
any share of Common Stock or any other rights or warrants (other than rights or
warrants referred to in the second paragraph of Section 12.05(d)); or

     (c) there is any reclassification of the Company's Common Stock (other
than a subdivision or combination of outstanding shares of the Company's Common
Stock, or a change in par value, or from par value to no par value, or from no
par value to par value), or any consolidation or merger to which the Company is
a party and for which approval of any shareholders of the Company is required,
or the sale or transfer of all or substantially all of the assets of the
Company; or

                                     - 99 -

<PAGE>


     (d) there is any voluntary or involuntary dissolution, liquidation or
winding-up of the Company;

then the Company shall cause to be filed with the Trustee and to be mailed to
each holder of Securities at his or her address appearing on the Register
maintained for that purpose as promptly as possible but in any event at least
15 days prior to the applicable date hereinafter specified, a notice stating
(x) the date on which a record is to be taken for the purpose of such dividend,
distribution or rights or warrants, or, if a record is not to be taken, the
date as of which the holders of the Company's Common Stock of record to be
entitled to such dividend, distribution or rights are to be determined, or (y)
the date on which such reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding-up is expected to become effective or
occur, and the date as of which it is expected that holders of the Company's
Common Stock of record shall be entitled to exchange their shares of the
Company's Common Stock for securities or other property deliverable upon such
reclassification, consolidation, merger, sale, transfer, dissolution,
liquidation or winding-up. Failure to give such notice, or any defect therein,
shall not affect the legality or validity of such dividend, distribution,
reclassification, consolidation, merger, sale, transfer, dissolution,
liquidation or winding-up.

                                ARTICLE THIRTEEN

                       Defeasance and Covenant Defeasance

     SECTION 13.01 Company's Option to Effect Defeasance or Covenant
Defeasance.

     The Company may at its option by Board Resolution, at any time, elect to
have either Section 13.02 or Section 13.03 applied to the Outstanding
Securities upon compliance with conditions set forth below in this Article
Thirteen.

     Upon the Company's exercise of the option provided in Section 13.01
applicable to this Section, the Company may be deemed to have been discharged
from its obligations with respect to the Outstanding Securities on the date the
conditions set forth below are satisfied (hereinafter, "defeasance"). For this
purpose, such defeasance means that the Company shall be deemed to have paid
and discharged the entire indebtedness represented by the Outstanding
Securities and to have satisfied all its other obligations under the Securities
and this Indenture insofar as such Securities are concerned (and the Trustee,
at the expense of the Company, shall execute proper instruments acknowledging
the same), except for the following which shall survive until otherwise
terminated or discharged hereunder: (A) the rights of Holders of such
Securities to receive, solely from the trust fund described in Section 13.04
and as more fully set forth in such Section, payments in respect of the
principal of (and premium, if any) and interest on such Securities when such
payments are due, (B) the Company's obligations with respect to such Securities
under Sections 3.04, 3.05, 3.06, 3.07, 6.07, 10.02 and 10.03, (C) the rights,
powers, trusts, duties and immunities of the Trustee hereunder and (D) this
Article Thirteen. Subject to compliance with this Article Thirteen, the Company
may exercise its option under this Section 13.02 notwithstanding the prior
exercise of its option under Section 13.03.

                                    - 100 -

<PAGE>


     SECTION 13.02 Covenant Defeasance.

     Upon the Company's exercise of the option provided in Section 13.01
applicable to this Section, (i) the Company shall be released from its
obligations under Sections 10.05 through 10.19, inclusive, and Clauses (2), (3)
and (4) of Section 8.01 and (ii) the occurrence of an event specified in
Sections 5.01(3), 5.01(4) (with respect to Clauses (2), (3) or (4) of Section
8.01), 5.01(5) (with respect to any of Sections 10.05 through 10.19,
inclusive), 5.01(6) and 5.01(7) shall not be deemed to be an Event of Default
(hereinafter, "covenant defeasance"). For this purpose, such covenant
defeasance means that the Company may omit to comply with and shall have no
liability in respect of any term, condition or limitation set forth in any such
Section, Clause or Article, whether directly or indirectly by reason of any
reference elsewhere herein to any such Section, Clause or Article or by reason
of any reference in any such Section, Clause or Article to any other provision
herein or in any other document, but the remainder of this Indenture and such
Securities shall be unaffected thereby.

     SECTION 13.03 Conditions to Defeasance or Covenant Defeasance.

     The following shall be the conditions to application of either Section
13.02 or Section 13.03 to the then Outstanding Securities:

          (1) The Company shall irrevocably have deposited or caused to be
     deposited with the Trustee (or another trustee satisfying the requirements
     of Section 6.09 who shall agree to comply with the provisions of this
     Article Thirteen applicable to it) as trust funds in trust for the purpose
     of making the following payments, specifically pledged as security for,
     and dedicated solely to, the benefit of the Holders of such Securities,
     (A) money in an amount, or (B) U.S. Government Obligations which through
     the scheduled payment of principal and interest in respect thereof in
     accordance with their terms will provide, not later than one day before
     the due date of any payment, money in an amount, or (C) a combination
     thereof, sufficient, in the opinion of a nationally recognized firm of
     independent public accountants expressed in a written certification
     thereof delivered to the Trustee, to pay and discharge, and which shall be
     applied by the Trustee (or other qualifying trustee) to pay and discharge,
     the principal of (and premium, if any) and each installment of interest on
     the Securities on the Stated Maturity of such principal or installment of
     interest in accordance with the terms of this Indenture and of such
     Securities. For this purpose, "U.S. Government Obligations" means
     securities that are (x) direct obligations of the United States of America
     for the payment of which its full faith and credit is pledged or (y)
     obligations of a Person controlled or supervised by and acting as an
     agency or instrumentality of the United States of America the payment of
     which is unconditionally guaranteed as a full faith and credit obligation
     by the United States of America, which, in either case, are not callable
     or redeemable at the option of the issuer thereof, and shall also include
     a depository receipt issued by a bank (as defined in Section 3(a)(2) of
     the Securities Act of 1933, as amended) as custodian with respect to any
     such U.S. Government Obligation or a specific payment of principal of or
     interest on any such U.S. Government Obligation held by such custodian for
     the account of the holder of such depository receipt,

                                    - 101 -

<PAGE>


     provided that (except as required by law) such custodian is not authorized
     to make any deduction from the amount payable to the holder of such
     depository receipt from any amount received by the custodian in respect of
     the U.S. Government Obligation or the specific payment of principal of or
     interest on the U.S. Government Obligation evidenced by such depository
     receipt.

          (2) In the case of an election under Section 13.02, the Company shall
     have delivered to the Trustee an Opinion of Counsel stating that (x) the
     Company has received from, or there has been published by, the Internal
     Revenue Service a ruling, or (y) since the date of this Indenture there
     has been a change in the applicable Federal income tax law, in either case
     to the effect that, and based thereon such opinion shall confirm that, the
     Holders of the Outstanding Securities will not recognize gain or loss for
     Federal income tax purposes as a result of such deposit, defeasance and
     discharge and will be subject to Federal income tax on the same amount, in
     the same manner and at the same times as would have been the case if such
     deposit, defeasance and discharge had not occurred.

          (3) In the case of an election under Section 13.03, the Company shall
     have delivered to the Trustee an Opinion of Counsel to the effect that the
     Holders of the Outstanding Securities will not recognize gain or loss for
     Federal income tax purposes as a result of such deposit and covenant
     defeasance and will be subject to Federal income tax on the same amount,
     in the same manner and at the same times as would have been the case if
     such deposit and covenant defeasance had not occurred.

          (4) The Company shall have delivered to the Trustee an Officer's
     Certificate to the effect that the Securities, if then listed on any
     securities exchange, will not be delisted as a result of such deposit.

          (5) Such defeasance or covenant defeasance shall not cause the
     Trustee to have a conflicting interest as defined in Section 6.08 and for
     purposes of the Trust Indenture Act with respect to any securities of the
     Company.

          (6) No Event of Default or event which with notice or lapse of time
     or both would become an Event of Default shall have occurred and be
     continuing on the date of such deposit or, insofar as subsections 5.01(8)
     and (9) are concerned with respect to the Company, at any time during the
     period ending on the 91st day after the date of such deposit (it being
     understood that this condition shall not be deemed satisfied until the
     expiration of such period).

          (7) Such defeasance or covenant defeasance shall not result in a
     breach or violation of, or constitute a default under, any other agreement
     or instrument to which the Company is a party or by which it is bound.

          (8) The Company shall have delivered to the Trustee an Officer's
     Certificate and an Opinion of Counsel, each stating that all conditions
     precedent

                                    - 102 -

<PAGE>


     provided for relating to either the defeasance under Section 13.02 or the
     covenant defeasance under Section 13.03 (as the case may be) have been
     complied with.

          (9) Such defeasance or covenant defeasance shall not result in the
     trust arising from such deposit constituting an investment company as
     defined in the Investment Company Act of 1940, as amended, or such trust
     shall be qualified under such act or exempt from regulation thereunder.

     SECTION 13.04 Deposited Money and U.S. Government Obligations to Be Held
in Trust; Other Miscellaneous Provisions.

     Subject to the provisions of the last paragraph of Section 10.03, all
money and U.S. Government Obligations (including the proceeds thereof)
deposited with the Trustee (or other qualifying trustee--collectively, for
purposes of this Section 13.05 only, the "Trustee") pursuant to Section 13.04
in respect of the Securities shall be held in trust and applied by the Trustee,
in accordance with the provisions of such Securities and this Indenture, to the
payment, either directly or through any Paying Agent (including the Company
acting as its own Paying Agent) as the Trustee may determine, to the Holders of
such Securities, of all sums due and to become due thereon in respect of
principal (and premium, if any) and interest, but such money need not be
segregated from other funds except to the extent required by law. Money so held
in trust shall not be subject to the provisions of this Article Thirteen.

     The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the U.S. Government Obligations
deposited pursuant to Section 13.04 or the principal and interest received in
respect thereof other than any such tax, fee or other charge which by law is
for the account of the Holders of the Outstanding Securities.

     Anything in this Article Thirteen to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon Company
Request any money or U.S. Government Obligations held by it as provided in
Section 13.04 which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee at the Company's expense, are in excess of the amount
thereof which would then be required to be deposited to effect an equivalent
defeasance or covenant defeasance.

     SECTION 13.05 Reinstatement.

     If the Trustee or the Paying Agent is unable to apply any money in
accordance with Section 13.02 or 13.03 by reason of any order or judgment of
any court or governmental authority enjoining, restraining or otherwise
prohibiting such application, then the Company's obligations under this
Indenture and the Securities shall be revived and reinstated as though no
deposit had occurred pursuant to this Article Thirteen until such time as the
Trustee or Paying Agent is permitted to apply all such money in accordance with
Section 13.02 or 13.03; provided, however, that if the Company makes any
payment of principal of (and premium, if any) or interest on any Security
following the reinstatement of its obligations, the Company shall be subrogated
to the rights of the Holders of such Securities to receive such payment from
the money held by the Trustee or the Paying Agent.

                                    - 103 -

<PAGE>


                              ____________________

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


















                                    - 104 -





     IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed. Dated:


                                            MILLICOM INTERNATIONAL CELLULAR S.A.


                                            By:
                                                --------------------------------
                                                Name:
                                                Title:

Attest:


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


                                            By:
                                                --------------------------------
                                                Name:
                                                Title:

Attest:


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

<PAGE>


     This is one of the Securities referred to in the within-mentioned
Indenture.


                                            THE BANK OF NEW YORK,
                                              as Trustee

                                            By:
                                                --------------------------------
                                                Authorized Signatory

<PAGE>


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


                                            MILLICOM INTERNATIONAL CELLULAR S.A.


                                            By:
                                                --------------------------------
                                                Name:
                                                Title:

Attest:


- --------------------------------
By

                                            By:
                                                --------------------------------
                                                Name:
                                                Title:

Attest:


- --------------------------------
By


                                            THE BANK OF NEW YORK,
                                              as Trustee

                                            By:
                                                --------------------------------
                                                Name:
                                                Title:

Attest:


- --------------------------------
By



<PAGE>


                                                              ANNEX A -- Form of
                                                        Regulation S Certificate

                            REGULATION S CERTIFICATE

     (For transfers pursuant to ss. 3.06(b)(i) and (iii) of the Indenture) The
Bank of New York 101 Barclay Street, 21st Floor New York, New York 10286

Re:     2% Senior Convertible Notes due 2006 of Millicom
        International Cellular S.A. (the "Securities")

     Reference is made to the Indenture, dated as of __________________ (the
"Indenture"), from Millicom International Cellular S.A. (the "Company") to The
Bank of New York, as Trustee. Terms used herein and defined in the Indenture or
in Regulation S or Rule 144 under the U.S. Securities Act of 1933 (the
"Securities Act") are used herein as so defined.

     This certificate relates to U.S. $_____________ principal amount of
Securities, which are evidenced by the following certificate(s) (the "Specified
Securities"):

     CUSIP No(s).__________________________________________________

     CERTIFICATE No(s).____________________________________________

The person in whose name this certificate is executed below (the "Undersigned")
hereby certifies that either (i) it is the sole beneficial owner of the
Specified Securities or (ii) it is acting on behalf of all the beneficial
owners of the Specified Securities and is duly authorized by them to do so.
Such beneficial owner or owners are referred to herein collectively as the
"Owner". If the Specified Securities are represented by a Global Security, they
are held through the Depository or an Agent Member in the name of the
Undersigned, as or on behalf of the Owner. If the Specified Securities are not
represented by a Global Security, they are registered in the name of the
Undersigned, as or on behalf of the Owner.

     The Owner has requested that the Specified Securities be transferred to a
person (the "Transferee") who will take delivery in the form of a Regulation S
Security. In connection with such transfer, the Owner hereby certifies that,
unless such transfer is being effected pursuant to an effective registration
statement under the Securities Act, it is being effected in accordance with
Rule 904 or Rule 144 under the Securities Act and with all applicable
securities laws of the states of the United States and other jurisdictions.
Accordingly, the Owner hereby further certifies as follows:

<PAGE>


          (1) Rule 144 Transfers. If the transfer is being effected pursuant to
     Rule 144: (

               A) the transfer is occurring after ____________________ and is
          being effected in accordance with the applicable amount, manner of
          sale and notice requirements of Rule 144; or

               (B) the transfer is occurring after _____________________ and
          the Owner is not, and during the preceding three months has not been,
          an affiliate of the Company.

          (2) Other Transfers. If the transfer is being effected pursuant to an
     exemption from the registration requirements of the Securities Act,
     evidence that such exemption exists and is available.

<PAGE>


     This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.


Dated:                               -------------------------------------------
                                     (Print the name of the Undersigned, as such
                                     term is defined in the second paragraph of
                                     this certificate.)


                                     By:
                                         ---------------------------------------
                                         Name:
                                         Title:
                                        (If the Undersigned is a corporation,
                                         partnership or fiduciary, the title of
                                         the person signing on behalf of the
                                         Undersigned must be stated.)

<PAGE>


                                                   ANNEX B -- Form of Restricted
                                                   Securities Certificate


                       RESTRICTED SECURITIES CERTIFICATE

                   (For transfers pursuant toss.3.06(b) (ii),
                     (iii), (iv) and (v) of the Indenture)

The Bank of New York
101 Barclay Street, 21st Floor
New York, New York 10286

        Re: 2% Senior Convertible PIK Notes due 2006 of
            Millicom International Cellular S.A. (the "Securities")

     Reference is made to the Indenture, dated as of May 8, 2003 (the
"Indenture"), from Millicom International Cellular S.A. (the "Company") to The
Bank of New York, as Trustee. Terms used herein and defined in the Indenture or
in Regulation S or Rule 144 under the U.S. Securities Act of 1933 (the
"Securities Act") are used herein as so defined.

     This certificate relates to U.S. $_______________ principal amount of
Securities, which are evidenced by the following certificate(s) (the "Specified
Securities"):

        CUSIP No(s).__________________________________________________

        CERTIFICATE No(s).____________________________________________

The person in whose name this certificate is executed below (the "Undersigned")
hereby certifies that either (i) it is the sole beneficial owner of the
Specified Securities or (ii) it is acting on behalf of all the beneficial
owners of the Specified Securities and is duly authorized by them to do so.
Such beneficial owner or owners are referred to herein collectively as the
"Owner". If the Specified Securities are represented by a Global Security, they
are held through the Depository or an Agent Member in the name of the
Undersigned, as or on behalf of the Owner. If the Specified Securities are not
represented by a Global Security, they are registered in the name of the
Undersigned, as or on behalf of the Owner.

     The Owner has requested that the Specified Securities be transferred to a
person (the "Transferee") who will take delivery in the form of a Restricted
Security. In connection with such transfer, the Owner hereby certifies that,
unless such transfer is being effected pursuant to an effective registration
statement under the Securities Act, it is being effected in accordance with
Rule 144A or Rule 144 under the Securities Act and all applicable securities
laws of the states of the United States and other jurisdictions. Accordingly,
the Owner hereby further certifies as:

               (1) Rule 144 Transfers. If the transfer is being effected
          pursuant to Rule 144:

<PAGE>


                    (A) the transfer is occurring after ________________ and is
               being effected in accordance with the applicable amount, manner
               of sale and notice requirements of Rule 144; or

                    (B) the transfer is occurring after _________________ and
               the Owner is not, and during the preceding three months has not
               been, an affiliate of the Company.

               (2) Other Transfers. If the transfer is being effected pursuant
          to an exemption from the registration requirements of the Securities
          Act, evidence that such exemption exists and is available.

     This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.


Dated:                                    ------------------------------------
                                          (Print the name of the Undersigned,
                                          as such term is defined in the
                                          second paragraph of this certificate.)


                                          By:
                                              ----------------------------------
                                              Name:
                                              Title:
                                         (If the Undersigned is a corporation,
                                          partnership or fiduciary, the title of
                                          the person signing on behalf of the
                                          Undersigned must be stated.)

<PAGE>


                                                 ANNEX C -- Form of Unrestricted
                                                 Securities Certificate

                      UNRESTRICTED SECURITIES CERTIFICATE
        (For removal of Securities Act Legends pursuant to ss.3.06(c))

The Bank of New York
101 Barclay Street, 21st Floor
New York, New York 10286

        Re: 2% Senior Convertible PIK Notes due 2006 of
            Millicom International Cellular S.A. (the "Securities")

     Reference is made to the Indenture, dated as of May 8, 2003 (the
"Indenture"), from Millicom International Cellular S.A. (the "Company") to The
Bank of New York, as Trustee. Terms used herein and defined in the Indenture or
in Regulation S or Rule 144 under the U.S. Securities Act of 1933 (the
"Securities Act") are used herein as so defined.

     This certificate relates to U.S. $_______________ principal amount of
Securities, which are evidenced by the following certificate(s) (the "Specified
Securities"):

        CUSIP No(s). __________________________________________

        CERTIFICATE No(s)._____________________________________

The person in whose name this certificate is executed below (the "Undersigned")
hereby certifies that either (i) it is the sole beneficial owner of the
Specified Securities or (ii) it is acting on behalf of all the beneficial
owners of the Specified Securities and is duly authorized by them to do so.
Such beneficial owner or owners are referred to herein collectively as the
"Owner". If the Specified Securities are represented by a Global Security, they
are held through the Depository or an Agent Member in the name of the
Undersigned, as or on behalf of the Owner. If the Specified Securities are not
represented by a Global Security, they are registered in the name of the
Undersigned, as or on behalf of the Owner.

     The Owner has requested that the Specified Securities be exchanged for
Securities bearing no Securities Act Legend pursuant to Section 3.06(c) of the
Indenture. In connection with such exchange, the Owner hereby certifies that
the exchange is occurring after _______________________ and the Owner is not,
and during the preceding three months has not been, an affiliate of the
Company. The Owner also acknowledges that any future transfers of the Specified
Securities must comply with all applicable securities laws of the states of the
United States and other jurisdictions.

<PAGE>


     This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.


Dated:                                    --------------------------------------
                                          (Print the name of the Undersigned, as
                                          such term is defined in the second
                                          paragraph of this certificate.)


                                          By:
                                              ----------------------------------
                                              Name:
                                              Title:
                                          (If the Undersigned is a corporation,
                                          partnership or fiduciary, the title of
                                          the person signing on behalf of the
                                          Undersigned must be stated.)


<PAGE>

                                                                        ANNEX D


                      MILLICOM INTERNATIONAL CELLULAR S.A.

                                                          _____________, 1996

The Depository Trust Company
 55 Water Street, 49th Floor
New York, New York 10041

The Bank of New York,
  As Trustee
101 Barclay Street, 21st Floor
New York, New York 10286

        Re:  2%  Senior Convertible PIK Notes due 2006

Ladies and Gentlemen:

     Reference is hereby made to the Indenture dated as of May 8, 2003 (the
"Indenture"), between Millicom International Cellular S.A., as Issuer, and The
Bank of New York, as Trustee. Capitalized terms used and not defined herein
shall have the meanings given them in the Indenture.

     This letter relates to U.S. $______________ principal amount of Securities
represented by the Regulation S Global Security, held by the Trustee pursuant
to Section 2.01 of the Indenture. We hereby certify that the offering of the
Securities closed on ________________ and therefore, the restricted period (as
defined in Regulation S) with respect to the offer and sale of the Securities
will terminate on _________, ________.


                                          MILLICOM INTERNATIONAL CELLULAR S.A.


                                          By:
                                              ----------------------------------
                                              Name:
                                              Title:

cc:  Euroclear
     Clearstream

<PAGE>


                                                                         ANNEX E


                                    GUARANTEE

     GUARANTEE, dated as of May 7, 2003 made by Millicom International
Operations, B.V., a corporation incorporated under the laws of the Netherlands
(the "Guarantor") the undersigned indirect wholly-owned subsidiary of Millicom
International Cellular, S.A. (the "Company") in favor of the Holders and the
Trustee (each as defined in the Indenture referred to below).

     Reference is made to the Indenture between the Company and the Trustee,
dated as of May 8, as amended and supplemented from time to time (the
"Indenture"), covering the Company's 2% Senior Convertible PIK Notes due 2006
(collectively the "Securities," each a "Security").

                              W I T N E S S E T H:

     WHEREAS the Company is restructuring its 13 1/2% Senior Subordinated
Discount Notes by way of exchanging them for certain new notes including the
Securities in an exchange offer and consent solicitation and in consideration
thereof, the Guarantor has agreed to enter into this Guarantee to guarantee the
obligations of the Company under the Indenture for the benefit of the Holders
and the Trustee in the manner set out in this Guarantee;

     WHEREAS, under the terms of Section 10.20 of the Indenture, the Company is
required to cause the Guarantor to enter into this Guarantee; and

     NOW THEREFORE, in consideration of the promises therein, the Guarantor
hereby agrees with and for the benefit of the Holders as follows:

                                   Article I.

                                   Definitions

     Section 1.1. Defined Terms. Capitalized terms used herein and not otherwise
defined shall have the meaning ascribed to them in the Indenture.

                                  Article II.

                 Representations and Warranties of the Guarantor

     The Guarantor hereby represents and warrants to the Trustee and the Holders
as follows:

     Section 2.1. Due Existence; Compliance. The Guarantor is a corporation
incorporated under the laws of the Netherlands and is validly existing under the
laws of such jurisdiction and has all requisite power and authority under such
laws to own or lease and operate its properties and to carry on its business as
now conducted and as proposed to be conducted, and to execute,

<PAGE>

deliver and perform its obligations under this Guarantee. The Guarantor is in
compliance in all material respects with all applicable law, rules, regulations
and orders.

     Section 2.2. Corporate Authorities; No Conflicts. The execution, delivery
and performance by the Guarantor of this Guarantee is within its corporate
powers and has been duly authorized by all necessary corporate and stockholder
approvals or partnership or other approvals and (i) does not contravene its
organizational documents or any law, rule, regulation, judgment, order or decree
applicable to or binding on the Guarantor and (ii) does not contravene, and will
not result in the creation of any lien under, any provision of any contract,
indenture, mortgage or agreement to which the Guarantor is a party, or by which
it or any of its properties are bound, other than liens permitted under the
Indenture. Without prejudice to the generality of the foregoing, the Guarantor
represents and warrants that this Guarantee will not be voidable under the
Netherlands Commercial Code, including without limitation Section 2.7 of such
code. For purposes of this Section 2.2, "lien" means, with respect to any asset,
an in rem security interest (zakelijk zekerheidsrecht) such as a mortgage
(hypotheek), pledge (pandrecht) or attachment (beslag).

     (a) Government Approvals and Authorizations. No authorization or approval
or other action by, and no notice to or filing with, any governmental authority
or regulatory body is required for the due execution, delivery and performance
by or enforcement against the Guarantor of this Guarantee (except such
governmental approvals or authorizations as have been duly obtained or made and
remain in full force and effect).

     (b) Legal, Valid and Binding. This Guarantee is the legal, valid and
binding obligation of the Guarantor, enforceable against the Guarantor in
accordance with its terms.

     (c) Ranking. The obligations of the Guarantor under this Guarantee rank
pari passu with other non-subordinated, senior, unsecured obligations of the
Guarantor (subject to any rights of set-off or counterclaim that may exist).

     (d) Immunities. Neither the Guarantor nor its property has any immunity
from jurisdiction of any court or from any legal process (whether through
service or notice, attachment prior to judgment, attachment in aid of execution,
execution or otherwise) under applicable law.

     (e) No Filing. To ensure the legality, validity, enforceability or
admissibility in evidence of this Guarantee in the Netherlands and the United
States or any other jurisdiction in which the Guarantor conducts business, it is
not necessary that this Guarantee be filed or recorded with any court or other
authority in such jurisdiction, or that any stamp or similar tax be paid on or
with respect to this Guarantee, or, if such actions are necessary, they have
been taken.

     (f) Solvency. The Guarantor is able to pay its debts as they fall due and
is not currently insolvent on a balance sheet basis and is not the subject of
any petitions/actions/resolutions pending or presently before a court which seek
to subject the Guarantor to: voluntary or involuntary liquidation; dissolution;
the sale of any collateral; receivership; bankruptcy (or faillissement in The
Netherlands); assignment for the benefit of creditors; reorganization;
administration (or surseance van betaling in The Netherlands); any arrangement,
composition or readjustment of debt of, or other similar proceedings affecting,
the Guarantor.


                                      -2-
<PAGE>


                                  Article III.

                                    Guarantee

     Section 3.1. Guarantee. The Guarantor hereby absolutely, irrevocably and
unconditionally agrees, subject only to the limitations expressly set forth in
this Guarantee, to pay, as primary obligor and not as a surety, in full basis to
the Holders of Securities from time to time, whether such rights under this
Guarantee are asserted by the Trustee or directly by any such Holder (without
duplication of amounts theretofore paid by the Company or the Guarantor
(including without duplication of amounts theretofore paid under this
Guarantee)), if, as and when due, regardless of any defense, right of setoff,
deduction, withholding or counterclaim that the Guarantor may have or assert
(other than the defense of payment having been made) and without abatement,
suspension, deferment or diminution on account of any event or condition
whatsoever:

     (a) any due and payable interest payments required to be paid on the
Securities in accordance with their terms (including without limitation Special
Interest and Additional Amounts);

     (b) the Redemption Price required to be paid for each Security called for
redemption, plus an amount equal to accrued interest, if any, from the last
Interest Payment Date accrued on a daily basis to the Redemption Date, and all
other amounts outstanding thereon; and

     (c) upon Maturity of the Securities, or a dissolution, winding up or
liquidation or bankruptcy or similar proceeding of the Company, the aggregate
principal amount of the Securities, plus any accrued interest at the stated rate
from the last Interest Payment Date, through the date of payment, and all other
amounts outstanding thereon (collectively, the "Guarantee Payments").

     This Guarantee is a guarantee of payment and not of collection.

     All Guarantee Payments shall include interest accrued on such Guarantee
Payments (including Special Interest), at a rate per annum equal to the stated
interest rate of the Securities, since the date of the claim asserted under this
Guarantee relating to such Guarantee Payments through the date of payment of or
the date full payment is offered on such claim.

     The Guarantor's obligations to make any of the Guarantee Payments may be
satisfied by direct payment of the required amounts by the Guarantor to the
Holders or by causing the Company to pay such amounts to the Holders. In
addition, the Guarantor's obligations to make the payments described above will
exist regardless of any defense, right of set-off or counter claim that the
Company may have or assert (other than payment).

     No reference herein to the Indenture and no provision of this Guarantee or
of the Indenture shall alter or impair the Guarantee of the Guarantor, which is
absolute and unconditional, independent from the due and punctual payment of the
principal of and interest on the Securities.


                                      -3-
<PAGE>


     The obligations of the Guarantor under this Guarantee rank pari passu with
other senior unsecured obligations of the Guarantor.

     The Guarantor waives any right or remedy to require that any action be
brought first against the Company or any other Person or entity before
proceeding directly against the Guarantor. The Guarantor hereby further
expressly waives any right of protest, presentment, notice or demand whatsoever,
and any claims of waiver, release, surrender, alteration or compromise and all
defenses (other than payment), set-offs, counterclaims, recoupments, reductions,
limitations, impairments or terminations, whether arising hereunder or
otherwise. This Guarantee shall continue to be effective or be reinstated if any
payment to the Holders or the Trustee by the Company on account of any
Guaranteed Payment is returned to the Company or is rescinded upon the
dissolution, winding-up, liquidation or bankruptcy of the Company.

     Upon making any payment pursuant this Guarantee, the Guarantor shall be
subrogated to the rights of the payee against the Company with respect to such
payment; provided, however, that the Guarantor shall not claim or enforce any
payment by way of subrogation if and as long as any amounts under or in
connection with the Securities are outstanding.

     Section 3.2. No Waiver, etc. The obligations, covenants, agreements and
duties of the Guarantor under this Guarantee shall in no way be affected or
impaired by reason of the happening from time to time of any of the following:

     (i)  the release or waiver, by operation of law or otherwise, of the
          performance or observance by the Company of any express or implied
          agreement, covenant, term or condition relating to the Securities to
          be performed or observed by the Company under the Securities, the
          Indenture or otherwise;

     (ii) any failure, omission, delay or lack of diligence on the part of the
          Trustee or the Holders to enforce, assert or exercise any right,
          privilege, power or remedy conferred on the Trustee or the Holders
          pursuant to the terms of the Securities, or any action on the part of
          the Company granting indulgence or extension of any kind;

    (iii) the voluntary or involuntary liquidation, dissolution, sale of any
          collateral, receivership, insolvency, bankruptcy, assignment for the
          benefit of creditors, reorganization, arrangement, composition or
          readjustment of debt of, or other similar proceedings affecting, the
          Company or any of the assets of the Company;

     (iv) any invalidity, illegality or unenforceability of, or defect or
          deficiency in, the Securities;

     (v)  the settlement or compromise of any obligation guaranteed hereby or
          hereby incurred; or

     (vi) any other circumstance whatsoever that might otherwise constitute a
          legal or equitable discharge or defense of a guarantor, it being the
          intent that the obligations of each of the Guarantor hereunder shall
          be absolute and unconditional under any and all circumstances.


                                      -4-
<PAGE>


     There shall be no obligation of the Holders or the Trustee to give notice
to, or obtain consent of, the Guarantor with respect to the happening of any of
the foregoing.

     The Guarantor acknowledges that its obligations hereunder are independent
of the obligations of the Company with respect to the Securities, and that the
Guarantor shall be liable as principal and as debtor hereunder to make Guarantee
Payments pursuant to the terms of this Guarantee notwithstanding the occurrence
of any event referred to in paragraphs (i) through (vi) above.

     Section 3.3. Enforcement by Trustee. Should the Guarantor default in
respect of any of its obligations under this Guarantee, including any covenants
the Trustee will have the right to enforce the terms of the Guarantee for the
benefit of the Holders. The Holders of not less than a majority in total
principal amount of the outstanding Securities have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee regarding the Guarantor's obligations under the Guarantee or to
direct the exercise of any trust or power conferred upon the Trustee under this
Guarantee. If the Trustee fails to enforce the Guarantee, then any holder of
Securities may institute a legal proceeding directly against the Guarantor to
enforce the relevant trustee's rights under the guarantee, without first
instituting a legal proceeding against the Company, the Trustee or any other
person or entity.

     Section 3.4. Limitation on Liability. Any term or provision of this
Guarantee to the contrary notwithstanding, the maximum aggregate amount of the
Guarantee Payments guaranteed hereunder by the Guarantor shall not exceed the
maximum amount that can be hereby guarantied without rendering this Guarantee,
as it relates to such Guarantor, voidable under applicable law relating to
fraudulent conveyance or fraudulent transfer.

                                  Article IV.

                                  Miscellaneous

     Section 4.1. Successors and Assigns. This Agreement shall be continuing,
irrevocable and binding on the Guarantor and its successors and assigns and
shall inure to the benefit of the Holders and their successors and assigns and,
in the event of any transfer or assignment of rights by any Holder in accordance
with the terms of the Indenture, the rights and privileges conferred upon that
party in this Guarantee and in the Securities shall automatically extend to and
be vested in such transferee or assignee, all subject to the terms and
conditions of this Guarantee and the Indenture. The Guarantor may not assign or
transfer any of its rights and obligations under this Guarantee, without the
prior written consent of the Trustee. This Guarantee is an irrevocable
continuing guarantee of the Guarantee Payments which shall continue in effect
until all of the Guarantee Payments have been fully, finally and indefeasibly
paid.

     Section 4.2. Notices. All notices and other communications provided for
hereunder shall be given to in the manner and subject to the other notice
provisions set forth in the Indenture, provided however, that such notices shall
be delivered (i) if to the Trustee, the Holders or the Company, in the manner
provided in the Indenture and (ii) if to the Guarantor, at its address set forth
below:


                                      -5-
<PAGE>


                  Millicom International Operations B.V.
                  Att: The Managing Director
                  Locatellikade 1, Parnassustoren
                  1076 AZ Amsterdam

     Section 4.3. Parties. This Guarantee shall be binding upon and shall inure
to the benefit of the parties hereto and their respective successors and
assigns, including, without limitation, the Holders and the Trustee. Nothing
expressed or mentioned in this Guarantee is otherwise intended or shall be
construed to give any other Person any legal or equitable right, remedy or claim
under or in respect of this Guarantee or any provisions herein contained.

     Section 4.4. Waivers, Amendments and Remedies. The failure to insist in any
one or more instances upon strict performance of any of the provisions of this
Guarantee or to take advantage of any rights hereunder shall not be construed as
a waiver of any such provisions or the relinquishment of any such rights, but
the same shall continue and remain in full force and effect. Except as otherwise
expressly limited in this Guarantee, all remedies under this Guarantee shall be
cumulative and in addition to every other remedy provided for herein or by law.
No provisions of this Guarantee may be amended or waived except by a written
instrument executed by the Guarantor and the Trustee, on behalf of the Holders.

     Section 4.5. Governing Law. The Guarantee shall be governed by and
construed in accordance with the laws of the State of New York, except for the
ranking provisions as set forth in Section 2.2 subparagraph (c), which shall be
governed by the laws of The Netherlands. Any claim or proceeding brought to
enforce the Guarantor's obligations herein shall be brought exclusively before
any federal or state court in the Borough of Manhattan, The City of New York.
The Guarantor will irrevocably and unconditionally (i) submit itself and its
property in any legal action or proceeding relating to the Guarantee to which it
is a party, or for recognition and enforcement of any judgment in respect
thereof, to the general jurisdiction of the Courts of the State of New York, the
courts of the United States of America for the Southern District of New York,
appellate courts from any thereof and courts of its own corporate domicile, with
respect to actions brought against it as defendant; (ii) consent that any such
action or proceeding may be brought in such courts and waive any objection that
it may now or hereafter have to the venue of any such action or proceeding in
any such court or that such action or proceeding was brought in an inconvenient
court and agrees not to plead or claim the same; and (iii) appoint CT
Corporation System, currently having an office at 111 Eighth Avenue, New York,
New York 10011, as its agent to receive on its behalf service of all process in
any such action or proceeding, such service being hereby acknowledged by the
Guarantor to be effective and binding in every respect.

     Section 4.6. Partial Invalidity. If any provision of this Guarantee or the
application thereof to any party or circumstance is held invalid or
unenforceable, the remainder of this Guarantee and the application of such
provision or provisions to the other parties and circumstances will not be
affected thereby, the provisions of this Guarantee being severable in any such
instance.


                                      -6-
<PAGE>


     Section 4.7. Entire Agreement. This Guarantee embodies the entire agreement
of the parties and supersedes all prior agreements and understandings relating
to the subject matter hereof.

     Section 4.8. Expenses, Etc. The Guarantor agrees to pay or to reimburse the
Holders and the Trustee for all reasonable out of pocket costs and expenses
(including reasonable attorneys' fees and expenses) that may be incurred by any
of them in any effort to enforce any of the obligations of Guarantor under this
Guarantee, whether or not any lawsuit is filed, including all such out of pocket
costs and expenses (and reasonable attorneys' fees and expenses) incurred by
such party in any bankruptcy, reorganization, workout or similar proceeding of
Guarantor.


                                      -7-
<PAGE>


     IN WITNESS WHEREOF, the Guarantor has executed this Guarantee as of the
date first above written.


MILLICOM INTERNATIONAL OPERATIONS B.V.

By:
    ----------------------------------
    Name:
    Title:

<PAGE>

                                                                         ANNEX F


                          REGISTRATION RIGHTS AGREEMENT

     THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement"), attached as Annex F
to this Indenture (as defined below) is being entered into in connection
therewith and is being made part thereof, as set forth in Section 1.01 of each
of the Indentures covering the Company's 11% Senior Notes Due 2006 (the "11%
Notes" and such Indenture the "11% Indenture") and the Company's 2% Senior
Convertible PIK Notes Due 2006 (the "2% Notes" and together with the 11% Notes,
the "Notes" and such Indenture the "2% Indenture" and together with the 11%
Indenture the "Indentures," each an "Indenture"), respectively, in the
definition of "Registration Rights Agreement." Any Holder of Notes pursuant to
the Indentures, by virtue of holding such Notes, is deemed to have accepted and
agreed and being made subject to the terms and obligations and is entitled to
the rights under this Agreement as set forth herein.

                                 R E C I T A L S

     1. This Agreement is made in accordance with the Company's private amended
and restated Offering Memorandum, dated April 16, 2003, (the "Offering
Memorandum") under which the Company offered to holders of its existing 13-1/2%
Senior Subordinated Discount Notes due 2005 (the "Old Notes") who are not U.S.
persons, or who are U.S. persons that are either "qualified institutional
buyers" or institutional "accredited investors" (as each of those terms are
defined under the Securities Act of 1933, as amended (the "Securities Act")) and
who can make the representations to exchange upon the terms and subject to the
conditions set forth in the Offering Memorandum, to exchange their Old Notes for
Notes without registration under the Securities Act, in reliance upon the
exemption from registration provided by Section 4(2) of the Securities Act and
the provisions of Rule 506 of Regulation D, promulgated under the Securities Act
(the "Exchange Offer and Consent Solicitation").

     2. In accordance with the Section "Notice to Investors and Transfer
Restrictions" in Offering Memorandum, each holder of Notes (each a "Holder" and
collectively the "Holders") is deemed to make the representations and further
acknowledgments and agreements set forth in such section.

     3. In order to induce the Holders to tender their Old Notes in the Exchange
Offer and Consent Solicitation, the Company has agreed with certain Holders to
provide to the Holders (and their permitted transferees, if any) the
registration rights set forth in this Agreement with respect to the resale of
the Notes, as well as with respect to the resale of the common stock of the
Company issuable upon conversion of the 2% Notes (the "Conversion Shares").

     4. Capitalized terms used but not defined herein shall have the meaning
provided in the indentures governing the Notes, each dated May [8], 2003,
between the Company and the Trustee, as the same may be amended from time to
time (the "Indentures").

     In consideration of the foregoing premises and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Company and the Holders intending to be legally bound, agree as follows:
<PAGE>


                                   Article I.

                               Registration Rights

     Section 1.1. Filing of Form F-3 Resale Registration Statement. As soon as
practicable and, in no event later than December [4], 2003 (the "Effective
Date"), the Company shall file with the Securities and Exchange Commission (the
"SEC" or the "Commission") a registration statement on Form F-3 pursuant to Rule
415 under the Securities Act, or, in the event that Form F-3 is unavailable to
the Company, a registration statement on such other SEC Form that is available
to the Company (together with any exhibits, amendments or supplements thereto,
and any documents incorporated by reference therein, the "Registration
Statement"), with respect to the resale of the Notes and the Conversion Shares,
and any securities of the Company issued as a dividend or other distribution
with respect to, or in exchange for or in replacement of, the Notes and
Conversion Shares, provided that at least 50% of holders of Registrable
Securities (as defined below) have submitted the information required by Article
II for inclusion in such Registration Statement. The securities described in the
preceding sentence are collectively referred to herein as the "Registrable
Securities"; provided, that the term "Registrable Securities" shall not include
securities transferred to a person other than a permitted transferee under the
Offering Memorandum and the Indentures.

     Section 1.2. Effectiveness of Registration Statement. The Company shall,
subject to Article VI hereof, use its commercially reasonable efforts to cause
the Registration Statement to become effective as soon as practicable and within
90 days after the filing thereof, and shall use its commercially reasonable
efforts to keep the Registration Statement continuously effective from the date
such Registration Statement becomes effective until the earlier of (i) the sale
of all the securities registered thereunder, (ii) two years after the Effective
Date and (iii) the holding period mandated in Rule 144(k) of the Securities Act
of 1933 or any successor provision thereof "Effectiveness Period").

     Section 1.3. Supplements; Amendments. Subject to Sections V and VI hereof,
the Company shall supplement or amend the Registration Statement, (i) as
required by Form F-3 (or such other form as is available to the Company at such
time), including, without limitation, the instructions applicable to Form F-3,
or by the Securities Act, the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), or the rules and regulations promulgated under the Securities
Act or the Exchange Act, respectively, (ii) upon receipt of the information set
forth in Article II below, as is necessary to permit at least 5% of holders of
the then-outstanding 11% Notes, 2% Notes or Conversion Shares, respectively, at
any time and from time to time, to be included in the prospectus contained in
such Registration Statement and to deliver such prospectus to purchasers of the
Notes or the Conversion Shares, as the case may be, and (iii) to include in the
Registration Statement any additional securities that become Registrable
Securities by operation of the definition thereof. The Company shall furnish to
the Holders of such Registrable Securities to which the Registration Statement
relates copies of any such supplement or amendment sufficiently in advance of
its use and/or filing with the Commission.


                                      -2-
<PAGE>


                                  Article II.

                     Provision of Information by the Holders

     Section 2.1. Information To Be Provided By Holders. Each of the Holders
whose Registrable Securities are included in the Registration Statement shall
furnish to the Company at least five (5) business days prior to each of (i) the
initial filing of the Registration Statement and (ii) any supplement or
amendment to such Registration Statement in accordance with Section 1.3., a
completed questionnaire set forth on Annex A hereto (the "Questionnaire") and
such other information regarding such Holder as the Company may reasonably
request in writing and as shall be reasonably required or advisable in
connection with any registration, qualification or compliance referred to in
this Agreement (such information together with the Questionnaire the "Holder
Information"), and shall promptly notify the Company if such Holder Information
becomes incorrect or misleading, or requires amendment or updating; provided
that such Holder Information shall only be used in connection with the
completion of the Registration Statement. Subject to the foregoing, Holders
hereby also waive any notice of the initial filing of the Registration Statement
and agree that such Holders and their successors and assigns will promptly
notify the Company of any changes in such Holder Information.

     Section 2.2. Special Interest. Any Holder that does not complete and
deliver the Holder Information will not be named as a selling security holder in
the prospectus and therefore will not be permitted to sell the Notes or the
Conversion Shares pursuant to the Registration Statement and will not be
entitled to receive, and the Company shall not be obligated to pay, Special
Interest (as defined in the Indentures). Further, the Holders shall not be
entitled to receive, and the Company shall not be obligated to pay, Special
Interest if the Company is not required to file a Registration Statement because
the 50% threshold set forth in Section 1.1 is not met.

     Section 2.3. Transfer Restrictions. Each Holder further acknowledges the
restrictions set forth in the Offering Memorandum in the Section "Notice to
Investors and Transfer Restrictions" and that such Holder will not resell any
Registrable Securities pursuant to the Registration Statement in any manner
other than as provided therein or herein.

                                  Article III.

                             Registration Procedures

     Section 3.1. Registration. The Company will advise the Holders as to the
status of the preparation, filing and effectiveness of the Registration
Statement and, at the Company's expense, will do the following:

     (a) make available to each Holder upon their request a copy of the
Registration Statement (including all exhibits thereto) and any prospectus
forming a part thereof and any amendments and supplements thereto (including all
documents incorporated or deemed incorporated by reference therein prior to the
effectiveness of the Registration Statement and including each preliminary
prospectus) and any other prospectus filed under Rule 424 under the Securities
Act, which documents, other than documents incorporated or deemed incorporated
by


                                      -3-
<PAGE>


reference, will be subject to the review of the information contained therein
regarding the Holders and any plan for resale of the Registrable Securities by
the Holders for a period of at least seven (7) business days from the Holder's
receipt of such documents, and the Company shall not file the Registration
Statement or such prospectus or any amendment or supplement to the Registration
Statement or prospectus if any Holder shall reasonably object within a seven (7)
business day period after the receipt thereof unless the Company shall have been
advised by its counsel that the Registration Statement or such prospectus or
amendment or supplement thereto is required under the Securities Act or the
rules or regulations adopted thereunder in connection with the distribution of
Registrable Securities by the Holders or the Company. A Holder shall be deemed
to have reasonably objected to such filing only if the Registration Statement,
amendment, prospectus or supplement, as applicable, as proposed to be filed,
contains a material misstatement or omission with respect to such Holder or its
plan of resale;

     (b) make available to each Holder upon their request one copy of the
Registration Statement and of each amendment and supplement thereto (in each
case including all exhibits) and such number of copies of the prospectus forming
a part of the Registration Statement and any prospectus filed under Rule 424
under the Securities Act, in conformity with the requirements of the Securities
Act;

     (c) use its commercially reasonable efforts (i) to register or qualify all
Registrable Securities covered by the Registration Statement under state
securities, or "blue sky," laws of such States of the United States of America
where required and where an exemption is not available and as the Holders of
Registrable Securities covered by the Registration Statement shall reasonably
request, (ii) to keep such registration or qualification in effect for the
Registration Period, and (iii) to take any other action which may be reasonably
necessary or advisable to enable the Holders to consummate the disposition of
the securities to be sold by the Holders in such jurisdictions, consistent with
the plan of distribution described in the prospectus included in the
Registration Statement, except that the Company shall not for any such purpose
be required to qualify generally to do business as a foreign corporation in any
jurisdiction where it is not so qualified, or to execute a general consent to
service of process in effecting such registration, qualification or compliance,
unless the Company is already subject to service in such jurisdiction and except
as may be required by the Securities Act or applicable rules or regulations
thereunder;

     (d) use its commercially reasonable efforts to cause all Registrable
Securities covered by the Registration Statement to be registered or qualified
with or approved by all other applicable governmental authorities as may be
necessary, in the opinion of counsel to the Company and counsel to the Holders
of Registrable Securities, to enable the Holders thereof to consummate the
disposition of such Registrable Securities;

     (e) subject to Article VI hereof, promptly notify the Trustee on behalf of
the Holders and each Holder selling Registrable Securities covered by the
Registration Statement (i) upon discovery that, or upon the occurrence of any
event as a result of which, the prospectus forming a part of the Registration
Statement, as then in effect, includes an untrue statement of a material fact or
omits to state any material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, (ii) of the issuance by the Commission of any stop
order suspending the


                                      -4-
<PAGE>


effectiveness of the Registration Statement or the initiation of proceedings for
that purpose, (iii) of any request by the Commission for (A) amendments to the
Registration Statement or any document incorporated or deemed to be incorporated
by reference in the Registration Statement, or (B) supplements to the prospectus
forming a part of the Registration Statement, or (C) additional information, or
(iv) of the receipt by the Company of any notification with respect to the
suspension of the registration, qualification or exemption from registration or
qualification of any of the Registrable Securities for sale in any jurisdiction
or the initiation of any proceeding for such purpose, and at the request of the
Trustee as directed by such Holders or any such selling Holder promptly prepare
and file an amendment to the Registration Statement or a supplement to the
prospectus, as the Company may deem necessary so that, as thereafter delivered
to the purchasers of such securities, such prospectus shall not include an
untrue statement of a material fact or omit to state a material fact relating to
any holder of Registrable Securities required to be stated therein or necessary
to make the statements therein, in the light of the circumstances under which
they were made, not misleading; and make available to each Holder upon their
request a reasonable number of copies of such supplement to, or amendment of,
such registration statement and prospectus, and, in the event of a stop order,
use its commercially reasonable efforts to obtain the withdrawal of any order
suspending the effectiveness of any the Registration Statement, or the lifting
of any suspension of the qualification (or exemption from qualification) of any
of the Registrable Securities for sale in any jurisdiction;

     (f) if reasonably requested by any Holder or if required by law or SEC or
other applicable rule or regulation, promptly incorporate in the Registration
Statement such appropriate information as the Holder may reasonably request to
have included therein by filing a Form 6-K, or filing a supplement to the
prospectus, to reflect any change in the information regarding the Holder, and
make all required filings with the Commission in respect of any offer or sale of
Registrable Securities or any amendment or supplement to the Registration
Statement or related prospectus provided, however that the Company shall only be
obligated to include the information of Holders of Registrable Securities in
such prospectus who, from time to time, collectively hold collectively at least
5% of the then-outstanding 11% Notes, the 2% Notes and/or the Conversion Shares,
respectively and have provided the Holder Information to the Company for
inclusion in the prospectus;

     (g) use its commercially reasonable efforts to cause all Registrable
Securities included in the Registration Statement to be listed on The Nasdaq
National Market ("Nasdaq") and each securities exchange on which securities of
the same class are then listed, or, if not then listed on any securities
exchange or Nasdaq, to be eligible for trading in any over-the-counter market or
trading system in which securities of the same class are then traded;

     (h) the Trustee shall have no duty to monitor the Company's performance of
its obligations under this Agreement; and

     (i) Article VI of each of the Indentures is incorporated herein by
reference.


                                      -5-
<PAGE>


                                   Article IV.

                                 Indemnification

     Section 4.1. Indemnification by the Company. The Company will indemnify and
hold harmless to the fullest extent permitted by law:

     (a) the Trustee;

     (b) each of the Holders, as applicable, and

     (c) each of the Holder's officers, directors, members and general and
limited partners,

with respect to the Registration Statement, against all expenses, claims,
losses, damages and liabilities (joint or several) (or actions, investigations
or proceedings in respect thereof) (collectively, a "Claim") arising out of or
based on any actual or alleged untrue statement of a material fact, or any
omission of a material fact required to be stated therein or necessary in order
to make the statements included therein not misleading, contained in the
Registration Statement, any prospectus or other offering document (including any
related registration statement, notification or the like) incident to the
registration, qualification or compliance, or any violation by the Company of
the Securities Act or the Exchange Act or any other laws or any rule or
regulation thereunder applicable to the Company and relating to action or
inaction required of the Company in connection with any such registration,
qualification or compliance, and will reimburse each of the Holders, each of its
officers, directors, members and partners, and each Person controlling each of
the Holders, for any legal and any other expenses reasonably incurred in
connection with investigating and defending any such Claim; provided, however,
that the Company will not be liable in any such case to the extent that any such
Claim (i) arises out of or is based on any untrue statement or omission based
upon the Holder Information or any other written information furnished to the
Company by the Holders or their representatives and stated to be specifically
for use therein, or (ii) is finally judicially determined to have resulted
primarily from the gross negligence or willful misconduct of any person or
entity set forth in subsections (a) through (c) above.

     Section 4.2. Indemnification by the Holders. Each of the Holders will, if
Registrable Securities held by it are included in the securities as to which
such Registration Statement is being effected, severally and not jointly,
indemnify the Company, each of its directors and officers, and each Person who
"controls" the Company within the meaning of SEC Rule 405 under the Securities
Act, Section 15 of the Securities Act or Section 20 of the Exchange Act, and
each other Holder, against all Claims arising out of or based on any actual or
alleged untrue statement of a material fact, or any omission or a material fact
required to be stated therein or necessary in order to make the statement
included or incorporated therein not misleading, contained in the Registration
Statement, prospectus, or other offering document made by or on behalf of such
Holder, and will reimburse the Company and each other Holder, its respective
directors, officers, partners, members or control Persons for any legal or any
other expenses reasonably incurred in connection with investigating and
defending any such Claim, in each case to the extent, but only to the extent,
that such untrue statement (or alleged untrue statement) or omission (or alleged
omission) is made in the Registration Statement, prospectus, offering


                                      -6-
<PAGE>


memorandum or other document in reliance upon and in conformity with written
information furnished to the Company by or on behalf of such Holder and stated
to be specifically for use therein; provided, however, that the several
obligations of each of the Holders hereunder shall be limited to an amount equal
to the net proceeds received by such Holder from the sale of the Registrable
Securities pursuant to the Registration Statement.

     Section 4.3. Procedures. Each party entitled to indemnification under this
Agreement (each, an "Indemnified Party") shall give written notice to the party
required to provide indemnification (the "Indemnifying Party") promptly after
such Indemnified Party has actual knowledge of any Claim as to which indemnity
may be sought, and shall permit the Indemnifying Party to assume the defense of
any such Claim; provided that counsel for the Indemnifying Party, who shall
conduct the defense of such Claim, shall be approved by the Indemnified Party
(whose approval shall not unreasonably be withheld), and the Indemnified Party
may participate in such defense at such party's expense (unless the Indemnified
Party shall have reasonably concluded that there may be a conflict of interest
between the Indemnifying Party and the Indemnified Party in such action, in
which case the fees and expenses of one such counsel for all Indemnified Parties
shall be at the expense of the Indemnifying Party), and provided further that
the failure of any Indemnified Party to give notice as provided herein shall not
relieve the Indemnifying Party of its obligations under this Agreement unless
the Indemnifying Party is materially prejudiced thereby. No Indemnifying Party,
in the investigation or defense of any such Claim shall, except with the consent
of each Indemnified Party (which consent shall not be unreasonably withheld or
delayed), consent to entry of any judgment or enter into any settlement or
compromise which does not include an unconditional release of the Indemnifying
Party from all liability in respect to such Claim. Each Indemnified Party shall
furnish such information regarding itself or the Claim in question as an
Indemnifying Party may reasonably request in writing and as shall be reasonably
required in connection with the investigation and defense of such Claim.

     Section 4.4. Contribution. If the indemnification provided for in this
Agreement is held by a court of competent jurisdiction to be unavailable to an
Indemnified Party with respect to any Claim or expense, then the Indemnifying
Party, in lieu of indemnifying such Indemnified Party hereunder, shall
contribute to the amount paid or payable by such Indemnified Party as a result
of such loss, liability, claim, damage or expense in such proportion as is
appropriate to reflect the relative fault of the Indemnifying Party on the one
hand and of the Indemnified Party on the other in connection with the statements
or omissions which resulted in such Claim, as well as any other relevant
equitable considerations; provided, however, that the Company will not be liable
in any such case to the extent that any such Claim (i) arises out of or is based
on any untrue statement or omission based upon written information furnished to
the Company by the Holders or their Representatives and stated to be
specifically for use therein, or (ii) is finally judicially determined to have
resulted primarily from the gross negligence or willful misconduct of any person
or entity set forth in Section 4.1(a) through 4.1(c) above. The relative fault
of the Indemnifying Party and of the Indemnified Party shall be determined by
reference to, among other things, whether the untrue (or alleged untrue)
statement of a material fact or the omission (or alleged omission) to state a
material fact relates to information supplied by the Indemnifying Party or by
the Indemnified Party and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission,
and provided that each Holder shall not be required to contribute, in the
aggregate, more than the net proceeds


                                      -7-
<PAGE>

received by such Holder from the sale of its Registrable Securities pursuant to
the Registration Statement and further provided that the obligations of the
Holders under this Section 4.4 shall be several and not joint.

     Section 4.5. Periodic Payments. The indemnification and contribution
required by this Article IV shall be made by periodic payments of the amount
thereof during the course of the investigation or defense, as and when bills are
received or expense, loss, damage or liability is incurred.

                                   Article V.

                                    Marketing

     The Company shall use its commercially reasonable efforts to undertake such
marketing efforts, in consultation with the holders of Registrable Securities
listed on Schedule V hereto1, as are appropriate for similar securities of
comparable issuers, provided, however, that the Company shall only be required
to undertake any such efforts at the request of at least 5% of Holders of
then-outstanding Registrable Securities who have provided to the Company the
Holder Information for inclusion in the prospectus and provided further,
however, that the Company shall only be obligated to undertake one such effort
pursuant to this Agreement.

                                   Article VI.

                                    Expenses

     Section 6.1. The Company shall pay all expenses, fees and costs incurred in
connection with the preparation, filing, distribution and effectiveness of the
Registration Statement and any supplements or amendments thereto, whether or not
the Registration Statement becomes effective, and whether all, none or some of
the Registrable Securities are sold pursuant to the Registration Statement,
including, without limitation, all registration and filing fees, printing
expenses, fees and disbursements of counsel for the Company, fees and state
securities, or "blue sky," fees, and the expense of any special audits incident
to or required by, or in connection with the filing and effectiveness of the
Registration Statement. The Holders shall, severally and not jointly, pay all
selling commissions, brokerage fees and stock transfer taxes applicable to the
Registrable Securities sold by such Holder.

                                  Article VII.

                             Holdback; Postponement

     Notwithstanding the other provisions of this Agreement, if (a) there is
material non-public information regarding the Company which the Company's Board
of Directors reasonably and in good faith determines not to be in the Company's
best interest to disclose and which the Company is not otherwise required to
disclose, or (b) there is a extraordinary business


                                      -8-
<PAGE>


opportunity (including but not limited to the acquisition or disposition of
assets (other than in the ordinary course of business) or any merger,
consolidation, tender offer or other similar extraordinary transaction not in
the ordinary course of business) available to the Company which the Company's
Board of Directors reasonably and in good faith determines not to be in the
Company's best interest to disclose, then the Company may postpone or suspend
filing or effectiveness of a registration statement for a period not to exceed
30 days in any 90 day period, provided that the Company may not postpone or
suspend filing or effectiveness of a registration statement for more than 180
days in the aggregate during any 365-day period and there shall be an aggregate
of not more than two (2) suspensions during any 365-day period; provided,
however that no postponement or suspension shall be permitted for consecutive 90
day periods arising out of the same set of facts, circumstances or transactions.

                                 Article VIII.

                            Rule 144 Reporting, Etc.

     Section 8.1. SEC Reporting Compliance.

     (a) During the Effectiveness Period and with a view to making available the
benefits of certain rules and regulations of the Commission which may at any
time permit the sale of the Registrable Securities to the public without
registration, the Company will:

     (i)  make and keep "current public information" regarding the Company
          available, as defined in Commission Rule 144(c) under the Securities
          Act, and cooperate with the Holders and take such further reasonable
          action as the Holders may reasonable request in writing (including,
          without limitation, making such reasonable representations as the
          Holders may reasonably request);

     (ii) use its commercially reasonable efforts to file with the Commission in
          a timely manner all SEC Reports and other filings and documents
          required of the Company under the Securities Act and the Exchange Act;
          and

    (iii) so long as a Holder owns any Registrable Securities, furnish to such
          Holder and the Trustee forthwith upon request a written statement by
          the Company as to its compliance with the reporting requirements under
          the Securities Act and the Exchange Act, including compliance with SEC
          Rule 144(c), a copy of the most recent annual or quarterly report of
          the Company, and such other reports and documents of the Company and
          other information in the possession of, or reasonably obtainable by,
          the Company as a Holder may reasonably request in availing itself of
          any rule or regulation of the Commission allowing a Holder to sell any
          such securities without registration.

     Notwithstanding the foregoing, nothing in this Section 7.1(a) shall be
deemed to require the Company to register any of its securities (other than the
Conversion Shares) under any section of the Exchange Act, unless otherwise
required.


                                      -9-
<PAGE>


     (b) The Company shall timely file the reports required to be filed by it
under the Exchange Act and shall comply with all other requirements set forth in
the instruction to Form F-3 in order to allow the Company to be eligible to file
registration statements on Form F-3.

                                  Article IX.

                                  Miscellaneous

     Section 9.1. Assignment. The registration rights set forth herein may be
assigned, in whole or in part, to any transferee of Registrable Securities
permitted in accordance with the Indentures, which transferee, upon registration
on the Company's or its transfer agent's books and records as a holder of record
of Registrable Securities, shall be considered thereafter to be a Holder and
shall be bound by all obligations and limitations of this Agreement and the
Indentures.

     Section 9.2. Section Headings. The titles and headings of the sections and
subsections of this Agreement are inserted for convenience only and shall not be
deemed to constitute a part thereof.

     Section 9.3. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York without giving
effect to the conflict of law rules thereof to the extent that the application
of the law of another jurisdiction would be required thereby. Any claim or
proceeding brought to enforce the Company's obligations herein shall be brought
exclusively before any federal or state court in the Borough of Manhattan, The
City of New York. The Company will irrevocably and unconditionally (i) submit
itself and its property in any legal action or proceeding relating to the
Guarantee to which it is a party, or for recognition and enforcement of any
judgment in respect thereof, to the general jurisdiction of the Courts of the
State of New York, the courts of the United States of America for the Southern
District of New York, appellate courts from any thereof and courts of its own
corporate domicile, with respect to actions brought against it as defendant;
(ii) consent that any such action or proceeding may be brought in such courts
and waive any objection that it may now or hereafter have to the venue of any
such action or proceeding in any such court or that such action or proceeding
was brought in an inconvenient court and agrees not to plead or claim the same;
and (iii) appoint CT Corporation System , currently having an office at 111
Eighth Avenue, New York, New York 10011, as its agent to receive on its behalf
service of all process in any such action or proceeding, such service being
hereby acknowledged by the Company to be effective and binding in every respect.

     Section 9.4. Notices.

     (a) All communications under this Agreement shall be in writing and shall
be delivered by facsimile, by hand, by reliable overnight delivery service such
as UPS or FedEx or by registered or certified mail, postage prepaid, to the
address listed in the Indentures, or at such other address as it may have
furnished in writing to respective other party.

     (b) Any notice so addressed shall be deemed to be given (i) if delivered by
hand, on the date of such delivery, (ii) if sent by reliable overnight delivery
service such as UPS or FedEx,


                                      -10-
<PAGE>


on the first business day following the date of delivery to such service for
overnight delivery, (iii) if delivered by facsimile, on the date of such
facsimile, or (iv) if mailed by registered or certified mail, on the third
business day after the date of such mailing. In the event that any notice is
sent by facsimile transmission to the Company, such transmission shall be
followed immediately by overnight delivery to the Company of such notice.

     Section 9.5. Successors and Assigns; No Third Party Beneficiaries. This
Agreement shall inure to the benefit of and be binding upon the successors and
permitted assigns of each of the parties. No other person is intended to or
shall have any rights or remedies hereunder, whether as a third part beneficiary
or otherwise.

     Section 9.6. Severability. In the event that any provision contained herein
is unenforceable, the remaining provisions shall continue in full force and
effect.

     Section 9.7. Delays or Omissions. It is agreed that no delay or omission to
exercise any right, power or remedy accruing to the Holders, upon any breach or
default of the Company under this Agreement, shall impair any such right, power
or remedy, nor shall it be construed to be a waiver of any provision hereof, or
of any similar breach or default thereafter occurring; nor shall any waiver of
any single breach or default be deemed a waiver of any other breach or default
theretofore or thereafter occurring. It is further agreed that any waiver,
permit, consent or approval of any kind or character by a Holder of any breach
or default under this Agreement, or any waiver by a Holder of any provisions or
conditions of this Agreement, must be in writing and shall be effective only to
the extent specifically set forth in the writing, and that all remedies, either
under this Agreement, or by law or otherwise afforded to a Holder, shall be
cumulative and not alternative.

     Section 9.8. Entire Agreement; Amendment. This Agreement is a part of and
read to be in conjunction with the applicable Indenture to which it is attached.
This Agreement and the Indentures and any other document contemplated hereby or
thereby constitute the entire understanding and agreement of the parties with
respect to the subject matter hereof and supersede all prior understandings,
written or otherwise, among such parties. This Agreement may be amended only in
a writing signed by the Company and the Holders of at least a majority in
principal amount of the then outstanding Registrable Securities.

- --------
1 The Initial Participants.


                                      -11-
<PAGE>


                                     ANNEX A

             Form of Selling Securityholder Notice and Questionnaire

     The undersigned beneficial holder of 11% Senior Amortizing Notes due 2006
(the "11% Notes") and 2% Senior Convertible PIK Notes due 2006 (the "2% Notes"
and together with the 11% Notes the "New Notes") of Millicom International
Cellular, S.A. ("MIC" or the "Company") or shares of common stock issued upon
conversion of the 2% Notes, (together with the New Notes, the "Registrable
Securities"), of the Company understands that the Company has filed or intends
to file with the Securities and Exchange Commission a registration statement on
Form F-3, or, in the event that Form F-3 is unavailable to the Company, a
registration statement on such other SEC Form that is available to the Company,
(the "Shelf Registration Statement") for the registration and resale under Rule
415 of the Securities Act of 1933, as amended (the "Securities Act"), of the
Registrable Securities in accordance with the terms of the Registration Rights
Agreement (the "Registration Rights Agreement") between the Company and the
holders named therein. A copy of the Registration Rights Agreement is available
from the Company upon request at the address set forth below. All capitalized
terms not otherwise defined herein shall have the meaning ascribed thereto in
the Registration Rights Agreement.

     Each beneficial owner of Registrable Securities is entitled to the benefits
of the Registration Rights Agreement. In order to sell or otherwise dispose of
any Registrable Securities pursuant to the Shelf Registration Statement, a
beneficial owner of Registrable Securities generally will be required to be
named as a selling securityholder in the related prospectus, deliver a
prospectus to purchasers of Registrable Securities and be bound by those
provisions of the Registration Rights Agreement applicable to such beneficial
owner (including certain indemnification provisions, as described below).
Beneficial owners are encouraged to complete and deliver this Notice and
Questionnaire prior to the effectiveness of the Shelf Registration Statement so
that such beneficial owners may be named as selling securityholders in the
related prospectus at the time of effectiveness. Upon receipt of a completed
Notice and Questionnaire from a beneficial owner following the effectiveness of
the Shelf Registration Statement, the Company will, as promptly as practicable,
file such amendments to the Shelf Registration Statement or supplements to the
related prospectus as are necessary to permit such holder to deliver such
prospectus to purchasers of Registrable Securities. The Company has agreed to
pay liquidated damages pursuant to the Registration Rights Agreement under
certain circumstances as set forth therein.

     Certain legal consequences arise from being named as a selling
securityholder in the Shelf Registration Statement and the related prospectus.
Accordingly, holders and beneficial owners of Registrable Securities are advised
to consult their own securities law counsel regarding the consequences of being
named or not being named as a selling securityholder in the Shelf Registration
Statement and the related prospectus.

                                     Notice

     The undersigned beneficial owner (the "Selling Securityholder") of
Registrable Securities hereby gives notice to the Company of its intention to
sell or otherwise dispose of Registrable Securities beneficially owned by it and
listed below in Item 3 (unless otherwise specified under Item 3) pursuant to the
Shelf Registration Statement. The undersigned, by
<PAGE>


signing and returning this Notice and Questionnaire, understands that it will be
bound by the terms and conditions of this Notice and Questionnaire and the
Registration Rights Agreement.

     The undersigned hereby provides the following information to the Company
and represents and warrants that such information is accurate and complete:

                                  Questionnaire

                  1. Full legal Name of Selling Securityholder:

     ---------------------------------------------------------------------------
Full Legal Name of Registered Holder (if not the same as (a) above) through
which Registrable Securities listed in (3) below are held:

     ---------------------------------------------------------------------------
Full Legal Name of DTC Participant (if applicable and if not the same as (b)
above) through which Registrable Securities listed in (3) below are held:

        -----------------------------------------------------------------
                2. Address for Notices to Selling Securityholder:

         Telephone:_____________________________________________________________

         Fax:___________________________________________________________________

         Contact Person:________________________________________________________

               3. Beneficial Ownership of Registrable Securities:

Type and Principal Amount of Registrable Securities beneficially owned:

     ---------------------------------------------------------------------------
CUSIP No(s). of such Registrable Securities beneficially owned:

     ---------------------------------------------------------------------------
             4. Beneficial Ownership of other Company securities owned by the
Selling Securityholder:

Except as set forth below in this Item (4),the undersigned is not the beneficial
or registered owner of any securities of the Company other than the Registrable
Securities listed above in Item (3).

Type and Amount of Other Securities beneficially owned by the Selling
Securityholder:

     ---------------------------------------------------------------------------
CUSIP No(s). of such Other Securities beneficially owned:

     ---------------------------------------------------------------------------
                        5. Relationship with the Company:


                                      -2-
<PAGE>


Except as set forth below, neither the undersigned nor any of its affiliates,
directors or principal equityholders (5% or more) has held any position or
office or has had any other material relationship with the Company (or its
predecessors or affiliates) during the past three years.

State any exceptions here:

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

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

                            6. Plan of Distribution:

Except as set forth below, the undersigned (including its donees or pledgees)
intends to distribute the Registrable Securities listed above in Item (3)
pursuant to the Shelf Registration Statement only in accordance with the
following principles (if at all): Such Registrable Securities may be sold from
time to time directly by the undersigned or alternatively, through underwriters,
broker-dealers or agents. If the Registrable Securities are sold through
underwriters or broker-dealers, the Selling Securityholder will be responsible
for underwriting discounts or commissions or agent's commissions. Such
Registrable Securities may be sold in one or more transactions at fixed prices,
at prevailing market prices at the time of sale, at varying prices determined at
the time of sale, or at negotiated prices. Such sales may be effected in
transactions (which may involve block transactions) (i) on any national
securities exchange or quotation service on which the Registrable Securities may
be listed or quoted at the time of sale, (ii) in the over-the-counter market,
(iii) in transactions otherwise than on such exchanges or services or in the
over-the-counter market, or (iv) through the writing of options. In connection
with sales of the Registrable Securities or otherwise, the undersigned may enter
into hedging transactions with broker-dealers, which may in turn engage in short
sales of the Registrable Securities, short and deliver Registrable Securities to
close out such short positions, or loan or pledge Registrable Securities to
broker-dealers that in turn may sell such securities.

State any exceptions here:

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

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

Note:    In no event will such method(s) of distribution take the form of an
         underwritten offering of the Registrable Securities without the prior
         agreement of the Company.

     The undersigned acknowledges that it understands its obligation to comply
with the provisions of the Securities Exchange Act of 1934, as amended, and the
rules thereunder relating to stock manipulation, particularly Regulation M
thereunder (or any successor rules or regulations), in connection with any
offering of Registrable Securities pursuant to the Shelf Registration Statement.
The undersigned agrees that neither it nor any person acting on its behalf will
engage in any transaction in violation of such provisions.

     The Selling Securityholder hereby acknowledges its obligations under the
Registration Rights Agreement to indemnify and hold harmless certain persons as
set forth therein.


                                      -3-
<PAGE>


     Pursuant to the Registration Rights Agreement, the Company has agreed under
certain circumstances to indemnify the Selling Securityholders against certain
liabilities.

     In accordance with the undersigned's obligation under the Registration
Rights Agreement to provide such information as may be required by law for
inclusion in the Shelf Registration Statement, the undersigned agrees to
promptly notify the Company of any inaccuracies or changes in the information
provided herein that may occur subsequent to the date hereof at any time while
the Shelf Registration Statement remains effective. All notices hereunder and
pursuant to the Registration Rights Agreement shall be made in writing at the
address set forth below.

     By signing below, the undersigned consents to the disclosure of the
information contained herein in its answers to items (1) through (6) above and
the inclusion of such information in the Shelf Registration Statement and the
related prospectus. The undersigned understands that such information will be
relied upon by the Company in connection with the preparation or amendment of
the Shelf Registration Statement and the related prospectus.

     IN WITNESS WHEREOF, the undersigned, by authority duly given, has caused
this Notice and Questionnaire to be executed and delivered either in person or
by its duly authorized agent.

Dated:


                                                     Beneficial Owner


                                                     By:
                                                         -----------------------
                                                         Name:
                                                         Title:



PLEASE RETURN THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE TO MIC.


                                      -4-

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4.3
<SEQUENCE>6
<FILENAME>jun2703_ex0403.txt
<TEXT>

                                                                     EXHIBIT 4.3


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







                       MILLICOM INTERNATIONAL CELLULAR S.A

                                       and

                              THE BANK OF NEW YORK

                                   as Trustee

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


                          FIRST SUPPLEMENTAL INDENTURE

                             dated as of May 8, 2003

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


               13-1/2% Senior Subordinated Discount Notes due 2006

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

              Supplementing the Indenture dated as of May 23, 1996





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



<PAGE>


     FIRST SUPPLEMENTAL INDENTURE, dated as of May 8, 2003 (this "First
Supplemental Indenture"), between Millicom International Cellular S.A., a
corporation organized and existing under the laws of the Grand-Duchy of
Luxembourg (the "Company"), and The Bank of New York, a New York banking
corporation, as trustee (the "Trustee"). Capitalized terms used but not
otherwise defined herein shall have the meanings ascribed to such terms in the
Indenture (as defined below).

                                 R E C I T A L S

     The Company and the Trustee executed and delivered the Indenture, dated as
of May 23, 1996 (the "Indenture"), providing for the issuance thereunder by the
Company, and the authentication and delivery by the Trustee, of the Company's
13-1/2% Senior Subordinated Discount Notes due 2006 (the "Notes").

     The Company commenced an offer to holders of the Notes to exchange $720 of
newly issued 11% Senior Notes due 2006 and $81.7 of newly issued 2% Senior
Convertible PIK Notes due 2006, per $1000 of any and all outstanding Notes, and,
in connection therewith, the Company commenced a solicitation of consents from
the registered holders of the Notes (the "Holders") to certain amendments to the
Indenture, the particulars of which are more fully set forth herein (the
"Amendments").

     More than 50% of the holders of the Notes who are entitled to vote,
determined as provided in the Indenture, have validly consented to the
Amendments in accordance with the provisions of Section 902 of the Indenture,
and all other conditions set forth in the Indenture to the execution and
delivery of this First Supplemental Indenture have been fulfilled and satisfied.

     NOW, THEREFORE, in consideration of the foregoing and of the mutual
premises and covenants contained herein and for other good and valuable
consideration, the parties hereto agree, for the equal and ratable benefit of
the respective Holders from time to time of the Notes, as follows:

                                    ARTICLE 1

                           AMENDMENTS TO THE INDENTURE

     SECTION 1.1. Deleted Sections. Sections 1009, 1010 and 1014 are hereby
deleted in their entirety (the "Deleted Sections"). All terms defined in Section
101 of the Indenture that are used only in such Deleted Sections, or that are
used only in other defined terms that are used only in such Deleted Sections,
are hereby deleted and shall be of no further force and effect. All references
in the Indenture made to such Deleted Sections, including, but not limited to
the references in Sections 203, 301, 305, 306, 310, 501, 1008 and 1015 of the
Indenture, as well as the references to the Deleted Sections in the definitions
of "Cellular Operating Income," "Unrestricted Subsidiary," "Permitted
Investments" and "Pro Rata Portion," are hereby deleted.

     SECTION 1.2. Global Securities. The reference in Section 305(d) the
Indenture to Section 1015 of the Indenture is hereby replaced by a reference to
Section 1016 of the Indenture.


                                      -2-
<PAGE>


     SECTION 1.3. Transactions with Affiliates and Related Persons. The second
paragraph of Section 1015 of the Indenture is hereby deleted in its entirety and
replaced by the following:

"The foregoing restriction shall not apply to (i) reasonable and customary
payments on behalf of directors, officers or employees of the Company or any of
its Restricted Subsidiaries, Restricted Affiliates or Restricted Subsidiaries of
Restricted Affiliates, or in reimbursement of reasonable and customary payments
or reasonable and customary expenditures made or incurred by such Persons as
directors, officers or employees, (ii) any Permitted Investment; provided,
however, that any Investment (including any Permitted Investment) made in
reliance on this clause (ii) is in the best interests of the Company, and (iii)
any loan or advance by the Company or a Restricted Subsidiary of the Company,
Restricted Affiliate or Restricted Subsidiary of a Restricted Affiliate to
employees of any of them in the ordinary course of business."


                                   ARTICLE 2

                                  MISCELLANEOUS

     SECTION 2.1. Effectiveness and Effect.

     (a) This First Supplemental Indenture shall take effect on the date hereof.

     (b) The provisions set forth in this First Supplemental Indenture shall be
deemed to be, and shall be construed as part of, the Indenture to the same
extent as if set forth fully therein. All references to the Indenture in the
Indenture or in any other agreement, document or instrument delivered in
connection therewith or pursuant thereto shall be deemed to refer to the
Indenture as amended by this First Supplemental Indenture. Except as amended
hereby, the Indenture shall remain in full force and effect.

     SECTION 2.2. Trust Indenture Act Controls. If any provision of this First
Supplemental Indenture limits, qualifies or conflicts with another provision
that is required by or deemed to be included in this First Supplemental
Indenture by the Trust Indenture Act of 1939, the required or incorporated
provision shall control.

     SECTION 2.3. Governing Law. THIS FIRST SUPPLEMENTAL INDENTURE SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

     SECTION 2.4. Counterparts. The parties may sign any number of copies of
this First Supplemental Indenture. Each signed copy shall be an original, but
all of them together represent the same agreement.

     SECTION 2.5. Severability. In case any provision in this First Supplemental
Indenture shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.

     SECTION 2.6. Effect of Headings. The headings of the Articles and Sections
of this First Supplemental Indenture have been inserted for convenience of
reference only, are not to be
<PAGE>


considered a part hereof and shall in no way modify or restrict any of the terms
or provisions hereof.

     [The remainder of this page intentionally left blank.]


                                      -3-
<PAGE>



     [First Supplemental Indenture signature page]

Dated as of May __, 2002

                                               MILLICOM INTERNATIONAL
                                               CELLULAR S.A.


                                               By:
                                                   -----------------------------
                                                   Name:
                                                   Title:

Attest:

- ----------------------------
By:
                                               THE BANK OF NEW YORK,
                                               as Trustee


                                               By:
                                                   -----------------------------
                                                   Name:
                                                   Title:

Attest:

- ----------------------------
By:


                                      -4-



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-7.1
<SEQUENCE>7
<FILENAME>jun2703_ex0701.txt
<TEXT>


Exhibit 7.1 Explanation of the calculation of (loss) earnings per share

Basic (loss) earnings per common share is based on the net (loss) profit after
taxes divided by the weighted average number of common shares outstanding
during the year. Diluted (loss) earnings per share is calculated by dividing
the net income attributable to ordinary shareholders by the sum of the weighted
average number of common shares outstanding and the dilutive effect of the
weighted average number of dilutive potential ordinary shares.





</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>8
<FILENAME>jun2703_ex9901.txt
<TEXT>


                                                                   Exhibit 99.1



June 30, 2003

Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549

Ladies and gentlemen:

The certification set forth below is being submitted to the Securities and
Exchange Commission solely for the purpose of complying with Section 1350 of
Chapter 63 of Title 18 of the United States Code. This certification is not to
be deemed filed pursuant to the Securities Exchange Act of 1934 and does not
constitute a part of the Annual Report on Form 20-F (the "Report") accompanying
this letter.

Marc Beuls, the Chief Executive Officer, John Ratcliffe, the Chief Financial
Controller and Judy Tan, Chief of Finance - Global Operations, each certifies
that, to the best of his or her knowledge:

     1.   the Report fully complies with the requirements of Section 13(a) or
          15(d) of the Securities Exchange Act of 1934: and

     2.   the information contained in the Report fairly presents, in all
          material respects, the financial condition and results of operations
          of Millicom international Cellular S.A.


                                           /s/ Marc Beuls
                                           ------------------------------
                                           Name: Marc Beuls
                                           Chief Executive Officer

                                           /s/ John Ratcliffe
                                           ------------------------------
                                           Name: John Ratcliffe
                                           Chief Financial Controller

                                           /s/ Judy Tan
                                           ------------------------------
                                           Name: Judy Tan
                                           Chief of Finance - Global Operations

A signed original of this written statement required by Section 906, or other
document authenticating, acknowledging, or otherwise adopting the signature that
appears in typed form within the electronic version of this written statement
required by Section 906, has been provided to Millicom and will be retained by
Millicom and furnished to the Securities and Exchange Commission or its staff
upon request.




</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
