FIRST AMENDMENT TO 1996 TERM CREDIT AGREEMENT


         THIS  FIRST  AMENDMENT  TO  1996  TERM  CREDIT  AGREEMENT  (the  "First
Amendment"),  dated as of July,  17, 1996, is intended to amend the terms of the
1996 Term Credit  Agreement (the  "Agreement")  dated as of May, 3, 1996,  among
DATA  TRANSMISSION  NETWORK  CORPORATION,  FIRST  NATIONAL BANK OF OMAHA,  FIRST
NATIONAL BANK,  WAHOO,  NEBRASKA,  NBD BANK,  NORWEST BANK NEBRASKA,  N.A., FARM
CREDIT  SERVICES OF THE MIDLANDS,  PCA, and BROADCAST  PARTNERS.  The parties to
this Amendment shall include the original parties to the Agreement, THE SUMITOMO
BANK,  LIMITED,  a Japanese  bank being  represented  by its office at 200 North
Broadway,  Suite 1625, St. Louis,  Missouri 63102 and acting through its Chicago
branch  ("Sumitomo"),  MERCANTILE  BANK OF ST. LOUIS,  N.A., a national  banking
association having its principal place of business at One Mercantile Center, 7th
and Washington  Streets,  St. Louis,  Missouri,  63101 and FIRST BANK,  NATIONAL
ASSOCIATION  (successor in interest to FirsTier Bank, National  Association),  a
national banking  association having its principal place of business at 13th and
M Streets,  Lincoln,  Nebraska 68508.  All terms and conditions of the Agreement
shall remain in full force and effect except as expressly  amended  herein.  All
capitalized  terms herein shall have their respective  meanings set forth in the
Agreement. The Agreement shall be amended as set forth below.

         Section 1.        "Article I: Definitions" of the Agreement shall be
                           amended by adding the following definitions:

         Mercantile:       Mercantile Bank of St. Louis, N.A., a national
                           banking  association  having its  principal  place of
                           business at One Mercantile Center, 7th and Washington
                           Streets, St. Louis, Missouri 63101.
         New York
                                    Prime: The floating  interest rate published
                                    as   the"Prime   Rate"  (the  base  rate  on
                                    corporate  loans  posted  by at least 75% of
                                    the  nation's 30 largest  banks) in the Wall
                                    Street  Journal  on the  first  day of  each
                                    month,  or if no  rate is  published  on the
                                    first  day of any  month,  on the  first day
                                    thereafter when such rate is published.  For
                                    purposes of this  Agreement,  New York Prime
                                    shall fluctuate on a monthly basis.  Changes
                                    to New York Prime shall be  effective on the
                                    first day of each month  based on the "Prime
                                    Rate" in effect on such day.

         Release:                   The Federal Reserve Statistical Release.

         Subsidiaries:              Any   corporation,   business   association,
                                    partnership,    joint    venture,    limited
                                    liability  company or other business  entity
                                    in which the Borrower, or one or



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<PAGE>


                                    more of its  Subsidiaries,  or the  Borrower
                                    and  one or  more  of its  Subsidiaries  has
                                    either  (i)  more  than  50% of  the  equity
                                    ownership  thereof,  or (ii)  the  power  to
                                    elect  a  majority  of the  directors  or to
                                    control the  identification  of the managing
                                    or general  partners  or  similar  governing
                                    persons thereof.

         Sumitomo:                  The Sumitomo Bank, Limited, a Japanese bank
                                    being represented by its office at 200 North
                                    Broadway,  Suite 1625,  St. Louis,  Missouri
                                    63102 and acting through its Chicago branch.

The following definitions shall be amended to read as follows:

         Banks:                     FNB-O, FNB-W, First Bank, Mercantile,  NBD,
                                    Norwest, Farm Credit, AgAmerica and Sumitomo
                                    and  such  additional  banks as may be added
                                    hereto  from time to time by mutual  written
                                    agreement of the parties.

         Net Worth:                 The  Borrower's  consolidated  net worth as
                                    determined  in  accordance   with  generally
                                    accepted    accounting    principles    plus
                                    subordinated  debt.  For  purposes  of  this
                                    definition,    "subordinated   debt"   means
                                    indebtedness   of  the  Borrower   which  is
                                    subordinate, in a manner satisfactory to the
                                    Lenders,  to  the  indebtedness  due  to the
                                    Lenders,  and  the  repayment  of  which  is
                                    forbidden  during the existence of any Event
                                    of Default hereunder; provided however, that
                                    any such  indebtedness  shall  not be deemed
                                    subordinated  debt  to  the  extent  of  the
                                    amount of  principal  payments  that are due
                                    thereon within one (1) year from the date of
                                    determination.

         Notes:                     Those certain promissory notes from the Bor-
                                    rower to the Lenders dated as of May 3, 1996
                                    and  July 17,   1996,   including,   without
                                    limitation,  the  Notes to the  Banks and to
                                    Broadcast  Partners as referenced in Section
                                    2.1 hereof,  and such  additional term notes
                                    as the  parties may  hereafter  agree to add
                                    hereto as Notes.
         Operating
         Cash Flow:                 The Borrower's consolidated average monthly
                                    earnings    or   loss    before    interest,
                                    depreciation,  amortization and taxes,  less
                                    current  tax  expense  and plus or minus any
                                    non-ordinary  non-cash charges or credits to
                                    earnings,  which  average  shall be based on
                                    the Borrower's  actual financial  results in
                                    the two (2) full calendar  months  preceding
                                    the date of  determination.  For purposes of
                                    calculating  Operating  Cash  Flow  for this
                                    Agreement,  the  Borrower  shall not  permit
                                    deferred    commission    expenses   to   be
                                    capitalized  for any  period  in  excess  of
                                    twelve (12) months.

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Related Loan
Agreements:                         The Loan Agreement dated as of October 9,
                                    1992,   between  the   Borrower  and  FNB-O,
                                    FirsTier  and  FNB-W  and the 1995  Restated
                                    Loan  Agreement  dated as of June  29,  1995
                                    between the  Borrower  and FNB-O,  FirsTier,
                                    FNB-W, NBD, Norwest, AgAmerica and Boatmen's
                                    and any loan agreements issued in extension,
                                    renewal,  replacement,  or  reinstatement of
                                    the foregoing,  including the 1996 Revolving
                                    Credit  Agreement  dated as of June 28, 1996
                                    among the Borrower,  FNB-O and certain other
                                    banks named therein (the "1995 Restated Loan
                                    Agreement").

         Revolving
         Credit Rate:               The floating  interest rate  announced from
                                    time to time by FNB-O as its "National  Base
                                    Rate."  The  National  Base  Rate  is set by
                                    FNB-O, solely in its discretion,  to reflect
                                    generally  the  rates  charged  by  national
                                    money center banks as their reference rates.
                                    (Previously, the rate was announced by FNB-O
                                    as its "New York Base Rate.")  Rates charged
                                    by  FNB-O  may be at,  above  or  below  the
                                    National  Base Rate,  as determined by FNB-O
                                    as to each respective customer.
         Total
         Indebtedness:              All loans and other obligations of the Bor-
                                    rower   and   its   Subsidiaries,    without
                                    duplication,  for borrowed money (including,
                                    without limitation,  the indebtedness due to
                                    the  Lenders  and the holders of the Related
                                    Bank  Debt)   regardless   of  the  maturity
                                    thereof  but such  term  shall  not  include
                                    subordinated  debt of the Borrower,  as such
                                    term is  defined  in the  definition  of Net
                                    Worth,    up   to    $15,000,000   if   such
                                    subordinated  debt  is  existing  on  May 3,
                                    1996.

         Section 2.        Section 2.1 of the Agreement shall be amended to read
                           as follows:

                  2.1.     Term Credit.  The Banks agree to advance $44,119,900
                  to the Borrower for the purchase of  substantially  all of the
                  assets of Broadcast Partners.  Such advances shall be made, in
                  one or more closings,  on a pro rata basis by the Banks, based
                  on the following  maximum advance limits for each Bank: (1) as
                  to FNB-O, $10,780,000; (ii) as to FNB-W, $245,000; (iii) as to
                  NBD,  $6,223,000;  (iv) as to Norwest,  $4,047,000;  (v) as to
                  Farm Credit, $10,388,000;  (vi) as to Mercantile,  $5,333,900;
                  (vii) as to  Sumitomo,  $5,170,000,  (viii) as to First  Bank,
                  $1,933,000.  In addition,  Broadcast  Partners  will receive a
                  replacement note for $4,070,100, representing a portion of the
                  purchase price  consideration due to Broadcast  Partners under
                  the Purchase Agreement.

                           It is understood and agreed by the parties  that the
                  foregoing advances by FNB-O,  FNB-W, NBD, and Farm Credit were
                  made at the  initial  closing  under the  Agreement  on May 3,
                  1996.  The  foregoing  advance  by  Norwest  represents  a new
                  advance of $2,225,000,  which is in addition to the advance of


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                                    - 155 -
<PAGE>
                  $1,822,000  made at the initial closing under the Agreement on
                  May 3, 1996. The foregoing  advances by  Mercantile,  Sumitomo
                  and First Bank represent new advances,  the proceeds of which,
                  along  with  the new  advance  by  Norwest,  shall  be used to
                  partially prepay the existing Note held by Broadcast  Partners
                  in the original  principal  amount of  $18,732,000.  principal
                  amount of $18,732,000.

         Section 3.        The Borrower shall, upon the effective date hereof,
pay a fee of  $7,330.95  to FNB-O,  for  distribution  to the Banks  making  new
advances as follows:  (i) $1,112.50 to Norwest;  (ii)  $2,666.95 to  Mercantile;
(iii) $2,585.00 to Sumitomo; and (iv) $966.50 to First Bank.

         Section 4.        Notwithstanding  Section  2.2   of   the   Agreement,
interest  on the Notes  issued to First Bank and  Broadcast  Partners  hereunder
shall bear interest on the principal loan amount thereof at the following  rates
until June 30,  1999 (whereupon the interest rate reset described in Section 2.2
of the Agreement shall be applicable):

         (a)      as to Broadcast Partners, the interest rate shall continue to
                  be 8.25% per annum; and

         (b)      as to First Bank, the rate shall be 8.36% per annum.

Notwithstanding Section 2.2 of the Agreement, the  Notes issued  to  Mercantile,
NBD, Sumitomo,  Norwest and FNB-W hereunder shall bear interest on the principal
loan amount  thereof at a variable  rate per annum equal to New York Prime minus
one-half of one percent  (0.5%).  After an Event of Default,  such floating rate
Notes will bear interest at a rate per annum equal to three and one-half percent
(3.5%) above New York Prime.

         Section 5.        The  following  provisions  of the Agreement shall be
                           amended as follows:

         (a)      Section 2.6 of the Agreement shall be amended to read as
                  follows:

                           Prepayment.  Prepayments of the Notes may be made in
                           full  or in  part at any  time  upon  10  days  prior
                           written  notice to the  Lenders;  provided,  however,
                           that  unanimous  consent  of  the  Lenders  shall  be
                           required for any prepayment  (other than a prepayment
                           to Broadcast Partners in accordance with Section 2.6A
                           below)  which is not  applied pro rata to the Lenders
                           in accordance with Section 8.2. Prepayment  penalties
                           will be required as indicated below:

                  (a)      The Borrower may prepay in full without  penalty  the
                           principal  loan amounts  outstanding  under all Notes
                           which bear  interest  at a fixed  rate in  accordance
                           with Section 2.2 hereof, if such prepayment occurs on
                           June 30, 1999 and the Borrower has given the Banks at
                           least 30 days prior  written  notice of its intention
                           to make such prepayment.

                                       4

                                    - 156 -
<PAGE>

                  (b)      If a  prepayment  of a Note which bears interest at a
                           fixed  rate in  accordance  with  Section  2.2 hereof
                           occurs other than in accordance  with (a) above,  the
                           Borrower  shall  pay to  the  respective  Bank  payee
                           thereof,  at such  payee's  option,  either:  (1) the
                           Make-Whole Premium due in respect of such prepayment;
                           or (2) a  prepayment  fee  equal to one and  one-half
                           percent (1.50%) of the amount of such prepayment.

                  (c)      The Borrower shall not be obligated to pay a Make-
                           Whole Premium or prepayment fee to Broadcast Partners
                           or to any Bank payee of a Note which  bears  interest
                           at a floating rate indexed to New York Prime.

                  (b)      The sections of Articles IV, V, and VII of the Agree-
                           ment  set  forth  on  Attachment  A  hereto  shall be
                           amended  to read as set  forth on  Attachment  A. All
                           other  sections  of such  articles  of the  Agreement
                           shall remain in full force and effect.

                  (c)      The last sentence of Section 8.1  of  the  Agreement
                           shall be deleted in its  entirety  and the  following
                           shall be inserted in its place:

                           Notwithstanding  the  foregoing, unanimous   approval
                           shall  be  required   for:   (i)  any   reduction  or
                           compromise of the principal loan amount of the Notes,
                           the amount or rate of  interest  accrued or  accruing
                           thereon or the fees due hereunder;  (ii) extension of
                           the date of any scheduled  payment;  (iii) permitting
                           the sale of or releasing the security interest of the
                           Lenders in Collateral  which  comprises more than ten
                           percent  (10%) of net book  value of fixed  assets of
                           the  Borrower;  (iv) any amendment of Sections 8.1 or
                           8.2 hereof. A Lender's  commitment  hereunder may not
                           be increased  without the consent of such Lender,  it
                           being  understood,  however,  that  increases  in the
                           total facility hereunder may be made with the consent
                           of  the  holders  of  more  than  two-thirds  of  the
                           aggregate  total   outstanding   obligations  of  the
                           Borrower to the Lenders under the Agreement,  so long
                           as such  increase  does not result in the increase of
                           any non-consenting Lender's commitment hereunder.

                  (d)      Add the following to the end of clause (a) of Section
                           8.2:

                           "and  fees  due  to  the  Lenders and  holders of the
                           Related Bank Debt"

         Section 6.        The Borrower hereby restates for  the benefit of  the
Lenders  the  representations  and  warranties  contained  in  Article IV of the
Agreement,   as  amended  by  this  First  Amendment,   and  affirms  that  such
representations and warranties are true and correct as of the date of this First
Amendment.

         Section 7.        This  First  Amendment  may  be  executed  in several
counterparts  and such  counterparts  together shall constitute one and the same
instrument.

                                       5


                                    - 157 -
<PAGE>

         Section 8.        This  First  Amendment  shall  be  effective upon the
execution  and  delivery  thereof by the parties  hereto and the delivery of the
applicable  Notes,  dated July 17,  1996, to Sumitomo,  Mercantile,  First Bank,
Norwest, NBD, FNB-W and Broadcast Partners. Upon receipt of its replacement note
and accrued and unpaid  interest  thereof  through July 17, 1996, each of FNB-O,
Farm Credit, FNB-W, NBD and Norwest agrees to surrender to the Borrower the Note
dated May 3, 1996 which the Borrower had previously delivered to such Bank. Upon
receipt  of its  replacement  note  and  $14,661,900  plus  accrued  and  unpaid
interest,  Broadcast Partners agrees to surrender to the Borrower the Note dated
May 3, 1996 which the Borrower had previously  delivered to Broadcast  Partners.
References in the Notes to the Loan  Agreement  shall be deemed amended to refer
to the Loan  Agreement  as amended by this First  Amendment.  References  in the
Notes to the Security Agreement shall be deemed amended to refer to the Security
Agreement as amended by the First Amendment to 1996 Restated Security  Agreement
dated as of June 28, 1996.

         IN WITNESS WHEREOF, the undersigned have executed this FIRST AMENDMENT
TO 1996 TERM CREDIT AGREEMENT dated as of July 17, 1996.


                                            DATA TRANSMISSION NETWORK
                                            CORPORATION


                                            By
                                               Title:

4511J




                                       6

                                    - 158 -
<PAGE>



                                            FIRST NATIONAL BANK OF OMAHA


                                            By
                                               Title:






NOTICE:  A credit agreement must be in writing to be enforceable under Nebraska
law. To protect you and us from any  misunderstandings  or disappointments,  any
contract,  promise,  undertaking,  or offer to forebear repayment of money or to
make any other financial  accommodation in connection with this loan of money or
grant or extension of credit,  or any amendment of,  cancellation of, waiver of,
or  substitution  for any or all of the terms or provisions of any instrument or
document executed in connection with this loan of money or grant or extension of
credit, must be in writing to be effective.

                                            INITIALED:


                                            Borrower



                                       7

                                    - 159 -
<PAGE>

                                            THE SUMITOMO BANK, LIMITED


                                            By
                                               Title:


                                            By
                                               Title:







NOTICE:  A credit agreement must be in writing to be enforceable under Nebraska
law. To protect you and us from any  misunderstandings  or disappointments,  any
contract,  promise,  undertaking,  or offer to forebear repayment of money or to
make any other financial  accommodation in connection with this loan of money or
grant or extension of credit,  or any amendment of,  cancellation of, waiver of,
or  substitution  for any or all of the terms or provisions of any instrument or
document executed in connection with this loan of money or grant or extension of
credit, must be in writing to be effective.

                                            INITIALED:


                                            Borrower





                                       8

                                    - 160 -
<PAGE>





                                            FIRST NATIONAL BANK, WAHOO,
                                            NEBRASKA


                                            By
                                               Title:








NOTICE:  A credit agreement must be in writing to be enforceable under Nebraska
law. To protect you and us from any  misunderstandings  or disappointments,  any
contract,  promise,  undertaking,  or offer to forebear repayment of money or to
make any other financial  accommodation in connection with this loan of money or
grant or extension of credit,  or any amendment of,  cancellation of, waiver of,
or  substitution  for any or all of the terms or provisions of any instrument or
document executed in connection with this loan of money or grant or extension of
credit, must be in writing to be effective.

                                            INITIALED:


                                            Borrower





                                       9

                                    - 161 -
<PAGE>




                                            NBD BANK


                                            By
                                               Title:










NOTICE:  A credit agreement must be in writing to be enforceable under Nebraska
law. To protect you and us from any  misunderstandings  or disappointments,  any
contract,  promise,  undertaking,  or offer to forebear repayment of money or to
make any other financial  accommodation in connection with this loan of money or
grant or extension of credit,  or any amendment of,  cancellation of, waiver of,
or  substitution  for any or all of the terms or provisions of any instrument or
document executed in connection with this loan of money or grant or extension of
credit, must be in writing to be effective.

                                            INITIALED:


                                            Borrower





                                       10

                                    - 162 -
<PAGE>





                                            NORWEST BANK NEBRASKA, N.A.


                                            By
                                               Title:












NOTICE:  A credit agreement must be in writing to be enforceable under Nebraska
law. To protect you and us from any  misunderstandings  or disappointments,  any
contract,  promise,  undertaking,  or offer to forebear repayment of money or to
make any other financial  accommodation in connection with this loan of money or
grant or extension of credit,  or any amendment of,  cancellation of, waiver of,
or  substitution  for any or all of the terms or provisions of any instrument or
document executed in connection with this loan of money or grant or extension of
credit, must be in writing to be effective.

                                            INITIALED:


                                            Borrower





                                       11

                                    - 163 -
<PAGE>



                                            FARM CREDIT SERVICES OF THE
                                            MIDLANDS, PCA


                                            By
                                               Title:










NOTICE:  A credit agreement must be in writing to be enforceable under Nebraska
law. To protect you and us from any  misunderstandings  or disappointments,  any
contract,  promise,  undertaking,  or offer to forebear repayment of money or to
make any other financial  accommodation in connection with this loan of money or
grant or extension of credit,  or any amendment of,  cancellation of, waiver of,
or  substitution  for any or all of the terms or provisions of any instrument or
document executed in connection with this loan of money or grant or extension of
credit, must be in writing to be effective.

                                            INITIALED:


                                            Borrower






                                       12

                                    - 164 -
<PAGE>



                                            MERCANTILE BANK OF
                                             ST. LOUIS, N.A.


                                            By
                                               Title:










NOTICE:  A credit agreement must be in writing to be enforceable under Nebraska
law. To protect you and us from any  misunderstandings  or disappointments,  any
contract,  promise,  undertaking,  or offer to forebear repayment of money or to
make any other financial  accommodation in connection with this loan of money or
grant or extension of credit,  or any amendment of,  cancellation of, waiver of,
or  substitution  for any or all of the terms or provisions of any instrument or
document executed in connection with this loan of money or grant or extension of
credit, must be in writing to be effective.

                                            INITIALED:


                                            Borrower





                                       13

                                    - 165 -
<PAGE>



                                            FIRST BANK, NATIONAL
                                             ASSOCIATION


                                            By
                                               Title:










NOTICE:  A credit agreement must be in writing to be enforceable under Nebraska
law. To protect you and us from any  misunderstandings  or disappointments,  any
contract,  promise,  undertaking,  or offer to forebear repayment of money or to
make any other financial  accommodation in connection with this loan of money or
grant or extension of credit,  or any amendment of,  cancellation of, waiver of,
or  substitution  for any or all of the terms or provisions of any instrument or
document executed in connection with this loan of money or grant or extension of
credit, must be in writing to be effective.

                                            INITIALED:


                                            Borrower





                                       14

                                    - 166 -
<PAGE>



                                            BROADCAST PARTNERS


                                            By
                                               Title:










NOTICE:  A credit agreement must be in writing to be enforceable under Nebraska
law. To protect you and us from any  misunderstandings  or disappointments,  any
contract,  promise,  undertaking,  or offer to forebear repayment of money or to
make any other financial  accommodation in connection with this loan of money or
grant or extension of credit,  or any amendment of,  cancellation of, waiver of,
or  substitution  for any or all of the terms or provisions of any instrument or
document executed in connection with this loan of money or grant or extension of
credit, must be in writing to be effective.

                                            INITIALED:


                                            Borrower




4511J




                                       15

                                    - 167 -
<PAGE>


                                  ATTACHMENT A
                                       TO
                  FIRST AMENDMENT TO 1996 TERM CREDIT AGREEMENT


         4.1  Corporate Existence.  It and each of its Subsidiaries, if any, is
a corporation  duly organized,  validly  existing and in good standing under the
laws of the State of Delaware  and duly  qualified  and in good  standing in all
states  where it is doing  business  except where the failure to be so qualified
would  not  have a  material  adverse  effect  on it and it has full  power  and
authority to own and operate its properties and to carry on its business.  As of
July 12, 1996, the Borrower has no Subsidiaries.

         4.2  Corporate Authority.  It has full corporate power, authority and
legal right to execute,  deliver and perform the Operative Documents to which it
is a party,  and all other  instruments and agreements  contemplated  hereby and
thereby,  and to perform its  obligations  hereunder  and  thereunder;  and such
actions have been duly authorized by all necessary corporate action, and are not
in conflict with any  applicable law or  regulation,  or any order,  judgment or
decree  of any court or other  governmental  agency  or  instrumentality  or its
articles of  incorporation  or bylaws,  or with any provisions of any indenture,
contract or  agreement to which it or any of its  Subsidiaries  is a party or by
which  it or any of its  Subsidiaries  or any of its or  their  property  may be
bound.

         4.3  Validity of Agreements.  The Borrower's Operative Documents have
been duly authorized, executed and delivered and constitute its legal, valid and
binding  agreements,  enforceable  against the Borrower in accordance with their
respective terms (except to the extent that  enforcement  thereof may be limited
by any applicable bankruptcy, reorganization,  moratorium or similar laws now or
hereafter in effect, or by principles of equity).

         4.4  Litigation.  Neither the Borrower nor any Subsidiary  is a party
to any pending lawsuit or proceeding before or by any court or governmental body
or agency, which is likely to have a materially adverse effect on the Borrower's
ability to perform its  obligations  under its Operative  Documents;  nor is the
Borrower  aware of any  threatened  lawsuit  or  proceeding,  to which it or any
Subsidiary  may  become  a  party  or of  any  investigation  of  any  Court  or
governmental  body or agency into its affairs,  which if instituted would have a
material  adverse effect upon the Borrower's  ability to perform its obligations
under its Operative Documents.

         4.6  Defaults Under Other Documents.  Neither the Borrower nor any Sub-
sidiary is in default or in violation  (nor has any event occurred  which,  with
notice or lapse of time or both,  would constitute a default or violation) under
any document or any  agreement or instrument to which it may be a party or under
which it or any of its  properties  may be bound and the  result of which  would
have a material  adverse  effect  upon the  Borrower's  ability  to perform  its
obligations under its Operative Documents.

         4.7  Judgments.  There are no outstanding or unpaid judgments (which
are not adequately  bonded) of the Borrower or any Subsidiary which would have a
material  adverse effect upon the Borrower's  ability to perform its obligations
under its Operative Documents.


                                       16

                                    - 168 -
<PAGE>

         4.8  Compliance with Laws.  Neither the Borrower nor any Subsidiary is
in violation of any laws, regulations or judicial or governmental decrees in any
respect  which  could have any  material  adverse  effect  upon the  validity or
enforceability  of any of the terms of the  Borrower's  Operative  Documents  or
which  could have a  material  adverse  effect  upon the  Borrower's  ability to
perform its obligations under its Operative Documents.

4.9 Taxes.  All tax returns of the  Borrower and its  Subsidiaries  for material
taxes  required to be filed have been filed or extensions  permitted by law have
been  obtained;  all taxes of the  Borrower and its  Subsidiaries  of a material
nature and which are due and  payable as  reflected  on such  returns  have been
paid,  other than taxes which are due but for which only a nominal  late payment
penalty is payable  and for which the taxing  authority  is not yet  entitled to
enforce its remedies for payment thereof and other than taxes being contested in
good faith and with respect to which  adequate  reserves have been  established;
and no  material  amounts  of taxes of the  Borrower  and its  Subsidiaries  not
reflected  on such  returns are  payable.  4.11  Pension  Benefits.  Neither the
Borrower  nor any  Subsidiary  maintains a "Plan" as defined in Section 3 of the
Employees Retirement Income Security Act of 1974 ("ERISA"),  or each such entity
is in compliance with the minimum funding  requirements with respect to any such
"Plan"  maintained  by it and it has not incurred any material  liability to the
Pension  Benefit  Guaranty  Corporation  ("PBGC")  or  otherwise  under ERISA in
connection with any such Plan.

         4.13  Financial Condition.  The financial condition of the Borrower an
its  Subsidiaries is truly and accurately set forth in the most recent financial
statement which has been provided to the Lenders and no material  adverse change
has occurred which would make such financial statement inaccurate or misleading.

         5.1  Financial Reports.

                  (a)  Within forty-five (45) days after the end of each month,
         the  Borrower,  at its  sole  expense,  shall  furnish  the  Lenders  a
         consolidated  balance  sheet and  statement of earnings of the Borrower
         and its consolidated  Subsidiaries,  and such financial statements on a
         consolidating basis as to the Borrower,  all such financial  statements
         to  be  prepared  in  accordance  with  generally  accepted  accounting
         principles consistently applied and certified as completed and correct,
         subject to normal changes resulting from year-end audit adjustments, by
         the chief financial officer of the Borrower.

                  (b)  Within ninety (90) days after the close of the Borrower's
         fiscal year,  the  Borrower,  at its sole  expense,  shall  furnish the
         Lenders:  (i) a consolidated balance sheet and statement of earnings of
         the Borrower and its consolidated Subsidiaries, certified by Deloitte &
         Touche, or other independent certified public accountants acceptable to
         the Lenders,  that such financial  reports fairly present the financial
         condition of the Borrower and its  consolidated  Subsidiaries  and have
         been  prepared  in  accordance  with  generally   accepted   accounting
         principles  consistently  applied;  and (ii) a  certificate  from  such
         accountants   certifying   that  in  making  the  requisite  audit  for
         certification  of the  Borrower's  financial  statements,  the auditors
         either (1) have obtained no knowledge, and are not


                                       17

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         otherwise aware of, any condition or event which constitutes an Event
         of Default  or which  with the  passage of time or the giving of notice
         would  constitute  an Event of Default  under  Sections  5.3, 5.4, 5.7,
         5.9(b), 5.9(d) or 5.11; or (2) have discovered such condition or event,
         as specifically  set forth in such  certificate,  which  constitutes an
         Event of  Default  or which  with the  passage of time or the giving of
         notice would  constitute an Event of Default under such  Sections.  The
         auditors  shall not be liable to the Lenders by reason of the auditors'
         failure to obtain  knowledge of such event or condition in the ordinary
         course of their audit unless such  failure is the result of  negligence
         or willful misconduct in the performance of the audit.

                  (c) Within thirty (30) days after submission to the Securities
         and  Exchange  Commission,  the Borrower  shall  provide to the Lenders
         copies of its Forms 10K and 10Q, as  submitted  to the  Securities  and
         Exchange Commission during the term of this Agreement.

                  (d)  Within  twenty  (20)  days after the end of each quarter,
         the Borrower,  at its expense,  shall furnish the Lenders a certificate
         of the chief  financial  officer of the Borrower in the form of Exhibit
         C, setting forth such  information  (including  detailed  calculations)
         sufficient to verify the  conclusions of such officer after due inquiry
         and review, that:

                           (i)  The Borrower and each Subsidiary, either (y) is
         in compliance with the  requirements set forth in this Agreement or (z)
         is NOT in compliance  with the foregoing for reasons  specifically  set
         forth therein; and

                           (ii)  The chief financial officer of the Borrower has
         reviewed  or caused to be  reviewed  all of the terms of the  Operative
         Documents  of the  Borrower  and that such  review  either  (1) has NOT
         disclosed the existence of any condition or event which  constitutes an
         event of default or any  condition  or event  which with the passage of
         time or the giving of notice would constitute an event of default under
         the  Operative  Documents  or (2)  has  disclosed  the  existence  of a
         condition  or  event  which  constitutes  an  event  of  default,  or a
         condition  or event  which  with the  passage  of time or the giving of
         notice  would  constitute  an event of  default,  under  the  aforesaid
         instrument  or  instruments  and the  specific  condition  or  event is
         specifically set forth.

                  (e)  The Borrower shall provide the Lenders with such other
         financial reports and statements as the Lenders may reasonably request.

         5.4  Indebtedness.

                  (a)  The Borrower shall not at any time permit the sum of the
         Total  Indebtedness  to the Lenders and the holders of the Related Bank
         Debt to exceed forty-eight (48) times Operating Cash Flow.




                                       18

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                  (b)  The Borrower shall not at any time permit consolidated
         Total Indebtedness to exceed 350% of Net Worth.

                  (c)  On the day the Borrower or a Subsidiary becomes liable
         with respect to any debt and  immediately  after giving effect  thereto
         and to the  concurrent  retirement of any other debt,  the sum of Total
         Indebtedness,  plus the amount of any outstanding  subordinated debt of
         the Borrower and its Subsidiaries,  plus the contingent  obligations of
         the Borrower and its Subsidiaries under any guaranty of the debt of any
         other  person or entity  (other  than  unsecured  debt of a  Subsidiary
         incurred in the  ordinary  course of business  for other than  borrowed
         money or to finance the  purchase  price of any  property or  business)
         shall not exceed an amount  equal to sixty (60)  times  Operating  Cash
         Flow at such date.

         5.6  Notice of Default.  The Borrower shall give to the Lenders prompt
         written notification of the existence or occurrence of:

                  (a)  any fact or event which results, or which with notice or
         the  passage  of time,  or both,  would  result in an Event of  Default
         hereunder;

                  (b)  any proceedings instituted by or against the Borrower in
         any federal,  state or local court or before any  governmental  body or
         agency,  or  before  any  arbitration  board,  or any such  proceedings
         threatened  against the Borrower by any governmental  agency,  which is
         likely to have a material adverse effect upon the Borrower's ability to
         perform its obligations under its Operative Documents;

                  (c)  any default or event of default involving the payment of
         money  under any  agreement  or  instrument  which is  material  to the
         Borrower or any  Subsidiary to which such entity is a party or by which
         it or any of its property may be bound,  and which  default or event of
         default  would  have a  material  adverse  effect  upon the  Borrower's
         ability to perform its obligations under its Operative Documents; and
                  (d)  the Borrower shall give immediate notice of the commence-
         ment of any proceeding under the Federal  Bankruptcy Code by or against
         the Borrower or any Subsidiary.

         5.7  Distributions.

                  (a)  Neither Borrower nor any Subsidiary shall declare any
         dividends or make any cash distribution in respect of any shares of its
         capital  stock or  warrants  of its  capital  stock,  without the prior
         written consent of the Lenders;  provided,  however,  that the Borrower
         may declare stock dividends;  provided, further, that the Borrower need
         not obtain the Lenders'  consent  with respect to (i)  dividends in any
         one (1) year which are, in aggregate,  less than 25% of the  Borrower's
         net operating profit after taxes in the previous four (4) quarters,  as
         reported to the Lenders  pursuant to Section 5.1; or (ii)  dividends or
         distributions from any consolidated Subsidiary.




                                       19

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                  (b)  Neither the Borrower nor any Subsidiary other than a Sub-
         sidiary which is wholly-owned  by the Borrower shall purchase,  redeem,
         or otherwise  retire any shares of its capital stock or warrants of its
         capital  stock if,  immediately  after the making of such  purchase  or
         redemption,  the Borrower or any  Subsidiary  will be in default of any
         other  covenant or  provision  of this  Agreement  (including,  without
         limitation,  the  covenants  and  provisions  pertaining to minimum net
         worth and limitations on indebtedness).

         5.8  Compliance with Law and Regulations.  The Borrower and each Sub-
         sidiary  shall  comply in all  material  respects  with all  applicable
         federal and state laws and regulations.

         5.9  Maintenance of Property; Accounting; Corporate Form;
                  Taxes; Insurance.

                  (a)  The Borrower and each Subsidiary shall maintain its pro-
         perty in good  condition in all material  respects,  ordinary  wear and
         tear  excepted,  and  make  all  renewals,   replacements,   additions,
         betterments  and  improvements  thereto  necessary  for  the  efficient
         operation of its business.

                  (b)  The Borrower and each Subsidiary shall keep true books of
         record and accounts in which full and correct  entries shall be made of
         all  its  business  transactions,  all  in  accordance  with  generally
         accepted accounting principles consistently applied.

                  (c)  The Borrower and each Subsidiary shall do or cause to be
         done all things necessary to preserve and keep in full force and effect
         its corporate form of existence as is necessary for the continuation of
         its business in substantially  the same form, except where such failure
         to do so with  respect  to any  Subsidiary  would  not have a  material
         adverse   effect  on  the  ability  of  the  Borrower  to  perform  its
         obligations under the Operative Documents.

                  (d) The Borrower and each Subsidiary shall pay all taxes, as-
         sessments  and  governmental  charges or levies  imposed upon it or its
         property;  provided, however, that the Borrower or any Subsidiary shall
         not be  required  to pay any of the  foregoing  taxes  which  are being
         diligently contested in good faith by appropriate legal proceedings and
         with respect to which adequate reserves have been established.

                  (e)  The Borrower shall maintain or cause to be maintained
         liability   insurance  and  casualty   insurance  upon  the  Collateral
         (excluding  equipment  or  inventory  provided  to  Subscribers  in the
         ordinary  course of business) and other tangible assets owned by it and
         its  Subsidiaries.  The  Borrower  shall  name  FNB-O as agent  for the
         Lenders and the  holders of the Related  Bank Debt as the loss payee on
         all such casualty  insurance,  and as an additional insured on all such
         liability insurance and shall provide the Lenders with evidence of such
         insurance upon request.

         5.11  Guaranties.  Neither the Borrower nor any Subsidiary shall guar-
         anty or become  responsible for the indebtedness of any other person or
         entity; provided, however, that a



                                       20

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<PAGE>
Subsidiary may guaranty the obligation of the Borrower; provided further, that
the Borrower may guaranty the obligations of a Subsidiary so long as no Event of
Default (or not event or occurrence which with the passage of time or notice, or
both,  would become an Event of Default)  has occurred or will occur  hereunder,
taking into account such guaranty and indebtedness.

         5.12  Collateral.  Neither the Borrower nor any Subsidiary shall incur
or  permit to exist any  mortgage,  pledge,  lien,  security  interest  or other
encumbrance on the  Collateral,  except as permitted in the Security  Agreement.
Subject to Section 5.4(b),  the foregoing shall not be construed to prohibit the
Borrower or any  Subsidiary  from  acquiring  leased  equipment  in the ordinary
course of  business.  Without  limiting the  generality  of the  foregoing,  the
Borrower  covenants and agrees that it shall on request  enforce for the benefit
of the Lenders and the holders of the Related Bank Debt, but at the sole expense
of the Borrower, any and all rights and remedies (including, without limitation,
rights to  indemnity),  that it may have with  respect to the  existence  of any
liens,  security  interests or other encumbrances that may exist on the property
of the Borrower acquired from Broadcast  Partners under the Purchase  Agreement.
Notwithstanding  anything  else  to the  contrary  herein  or in  the  Operative
Documents,  Broadcast  Partners  shall have no right to share in the proceeds of
any such recovery which  constitutes  the proceeds of any indemnity claim by the
Borrower under the Purchase Agreement.

         5.14  Notice of Change in Ownership or Management.  During the term of
this Agreement,  the Borrower shall give the Lenders notice of the occurrence of
any of the following  described  events,  which notice shall be given as soon as
the Borrower obtains notice or knowledge thereof:

                  (a)  any change, directly or indirectly, in the existing con-
         trolling interest in the Borrower; or

                  (b)  any material adverse change in its management personnel.
         A material adverse change in the Borrower's  management personnel shall
         be deemed to have occurred if any one (1) of the following has occurred
         with respect to two of the four (4)  individuals  who are both officers
         and  members  of the  Board  of  Directors  of the  Borrower:  (i)  the
         resignation,  retirement,  or voluntary or  involuntary  termination of
         employment  and/or  status of such persons as officers and directors of
         the Borrower;  (ii) any announcement,  notice of intent,  resolution or
         similar  advance  notice with respect to the matters  referenced in the
         foregoing clause; or (iii) the death,  disability or legal incompetence
         of such persons.

         5.16  Subordinated Debt.  Neither the Borrower nor any Subsidiary shall
incur  any  subordinated  debt or issue  any  preferred  stock or  warrants  for
preferred  stock except upon the prior written  consent of the Lenders.  Neither
the Borrower nor any Subsidiary shall make any voluntary or optional  prepayment
on any  subordinated  debt  without the prior  written  consent of the  Lenders.
Similarly,  the Borrower  shall not amend its articles of  incorporation  or any
other  documents or agreements  relating to the issuance of  subordinated  debt,
preferred  stock or warrants  for  preferred  stock  without  the prior  written
consent of the Lenders.  The indebtedness to Broadcast  Partners under the Notes
shall not be considered subordinated debt.




                                       21

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         5.17  Subsidiaries.  The Borrower shall give prompt written notice to
the Lenders of the Borrower's intent to acquire,  or the Borrower's  acquisition
of, any Subsidiary. Prior to the creation or acquisition of such Subsidiary, the
Borrower  (i)  shall  cause a first  security  interest  in the  assets  of such
Subsidiary  to be perfected in favor of FNB-O,  as agent for the Lenders and the
holders of the Related Bank Debt,  and (ii) shall cause the  Subsidiary to enter
into a security agreement,  to execute and file such financing statements and to
provide opinions all in form  satisfactory to the Lenders and the holders of the
Related Bank Debt, as to compliance with this section.

         5.18  Amendments to Purchase Agreement.  The Borrower shall not amend
the Purchase Agreement without the prior written consent of the Lenders.

         7.1  Events of Default.  Any of the following shall be deemed an event
of default under this Agreement (an "Event of Default"):

                  (a)  Any payment of principal required by any of the Operative
Documents shall not be paid when due.

                  (b)  Any payment of interest or other fees due hereunder or
         under any of the Operative  Documents  shall not be paid within fifteen
         (15) calendar days after the date on which such payment was invoiced or
         due.

                  (c)  Any representation or warranty of the Borrower under any
         of the Operative  Documents,  or any financial reports or statements or
         certificates submitted pursuant to this Agreement,  shall prove to have
         been false in any material respect when made.

                  (d)  A failure of the Borrower or any Subsidiary to comply
         with any  requirement  or  restriction  applicable  to such  entity and
         contained in Sections 5.1, 5.2, 5.3, 5.4, 5.7, 5.11,  5.12, 5.13, 5.14,
         5.15 or 5.16 of this Agreement.

                  (e)  A failure of the Borrower or any Subsidiary to comply
         with any  requirement or restriction  contained in any provision of the
         Operative  Documents not otherwise  specified in this Article VI, which
         failure  remains  unremedied  for ten (10) days  following  receipt  of
         notice from FNB-O on behalf of the Lenders.

                  (f)  The occurrence of a default or a breach of any of the ob-
         ligations of the Borrower or any Subsidiary  (other than obligations of
         such  Subsidiary  to the  Borrower)  under  any note,  loan  agreement,
         preferred  stock,  subordinated  debt  instrument or agreement,  or any
         other agreement evidencing an obligation to repay borrowed money.

                  (g)  The entry of a final judgment against the Borrower or any
         Subsidiary for the payment of money, which is not covered by insurance,
         and the  expiration  of thirty  (30)  days from the date of such  entry
         during which the judgment is not discharged in full or stayed.


                                       22

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                  (h)  The occurrence of any one or more of the following:

                           (1)  The Borrower or any Subsidiary shall file a vol-
                  untary  petition in bankruptcy or an order for relief shall be
                  entered in a  bankruptcy  case as to such entity or shall file
                  any  petition  or  answer   seeking  or   acquiescing  in  any
                  reorganization,    arrangement,   composition,   readjustment,
                  liquidation,  dissolution  or similar  relief for itself under
                  any present or future federal,  state or other statute, law or
                  regulation relating to bankruptcy,  insolvency or other relief
                  for  debtors;  or shall seek or consent to or acquiesce in the
                  appointment  of any trustee,  receiver or  liquidator  of such
                  entity or of all or any part of its property, or of any or all
                  of the royalties,  revenues, rents, issues or profits thereof,
                  or shall  make  any  general  assignment  for the  benefit  of
                  creditors,  or shall admit in writing its inability to pay its
                  debts or shall generally not pay its debts as they become due;
                  or

                           (2)  A court of competent jurisdiction shall enter an
                  order,  judgment or decree  approving a petition filed against
                  the  Borrower or any  Subsidiary  seeking any  reorganization,
                  dissolution  or  similar  relief  under any  present or future
                  federal, state or other statute, law or regulation relating to
                  bankruptcy,  insolvency or other relief for debtors,  and such
                  order,  judgment or decree shall remain unvacated and unstayed
                  for  an  aggregate  of  thirty  (30)  days   (whether  or  not
                  consecutive)  from the  first  date of entry  thereof;  or any
                  trustee,  receiver  or  liquidator  of  the  Borrower  or  any
                  Subsidiary or of all or any part of its property, or of any or
                  all of the  royalties,  revenues,  rents,  issues  or  profits
                  thereof,   shall  be   appointed   without   the   consent  or
                  acquiescence of such entity and such appointments shall remain
                  unvacated  and  unstayed  for an aggregate of thirty (30) days
                  (whether or not consecutive); or

                           (3)  A writ of execution or attachment or any similar
                  process  shall be issued or levied  against all or any part of
                  or  interest  in the  Collateral,  or any  judgment  involving
                  monetary  damages shall be entered against the Borrower or any
                  Subsidiary  which shall become a lien on the Collateral or any
                  portion  thereof  or  interest  therein  and  such  execution,
                  attachment  or similar  process or judgment  is not  released,
                  bonded,  satisfied,  vacated or stayed within thirty (30) days
                  after its entry or levy.

                  (i) Any event of  default  shall  occur  under  any  Operative
                  Document.

                  (j)  A change shall occur after November 8, 1993, directly or
                  indirectly,  in the  ownership  or  control  of the  Borrower;
                  provided,  however,  that changes in the  ownership or control
                  of, or new  issuances  of,  voting  common  stock which do not
                  exceed, cumulatively,  50% of the total issued and outstanding
                  shares of the Borrower as of  September  30, 1993 shall not be
                  deemed an Event of Default under this Section 7.1(j); provided
                  further,  that acquisitions of additional shares by members of
                  the existing executive  management group of the Borrower shall
                  not be counted as changes in the  ownership  or control of the
                  Borrower under this Section 7.1(j).  For purposes of computing
                  the total issued and  outstanding  shares as of September  30,
                  1993, warrants and options for such shares shall be included.


                                       23

                                    - 175 -
<PAGE>

                  (k)  An Event of Default shall occur under any Related Bank
                  Debt or the Related Loan  Agreement and the  expiration of any
                  applicable cure period thereunder.

                  (l)  The Borrower shall be obligated to prepay all or any por-
                  tion of its  subordinated  debt as a  result  of a  Change  of
                  Control.

                  (m)  The Borrower pays, or is determined to be obligated to
                  pay, any  indemnity to Broadcast  Partners  under the Purchase
                  Agreement in excess of $1,000,000 in the aggregate.

4511J/27





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