AMENDMENT NO. 7


      This Amendment No. 7 entered into as of March 31, 2000 (this "Amendment")
by and among GALAXY TELECOM, L.P., ("GTLP"), GALAXY TELECOM CAPITAL CORP.
("Capital Corp."); and together with GTLP, the "Borrower"), the financial
institutions party to the Loan Agreement referred to below (the "Lenders"), and
FLEET NATIONAL BANK ("Fleet"), a national banking association organized under
the laws of the United States of America, as agent for itself and the other
Lenders (the "Agent").

PRELIMINARY STATEMENTS:

      WHEREAS, the Borrower, the Lenders, and the Agent have entered into an
Amended and Restated Loan Agreement dated as of September 28, 1995, as amended
by Amendment No. 1 dated as of October 21,1996, Amendment No. 2 dated as of
March 28, 1997, Amendment No. 3 dated as of November 14, 1997 and Amendment No.
4 dated as of March 30, 1998, Amendment No. 5 dated as of August 31, 1998 and
Amendment No. 6 dated as of March 31, 1999 (as amended, the "Loan Agreement");

      WHEREAS,  capitalized  terms used herein and not  otherwise  defined shall
have the meanings specified in the Loan Agreement; and

      WHEREAS, the Borrower has requested that the Lenders amend certain
provisions of the Loan Agreement;

      NOW, THEREFORE,  in consideration of the mutual covenants herein contained
and good and  valuable  consideration,  the  receipt  and  adequacy of which are
hereby acknowledged, the parties hereto hereby agree as follows:

      1.    Definitions.  The following definitions contained in Section 1.1 of
the Loan Agreement are amended as follows:

      (a)   The definition of "Annualized Operating Cash Flow" is amended in its
            entirety, effective as of December 31, 1999, to read as follows:

            ""Annualized  Operating Cash Flow" means Operating Cash Flow for the
            most  recently  ended  calendar  month  and for the two  immediately
            preceding  calendar months based on the Borrower's  accurate monthly
            financial  statements  provided  to the Lenders in  accordance  with
            Sections  5.3.3(a)  and 5.3.7 for the  calendar  months in  question
            times four (4)."

      (b)   The  definition  of  "Converted  Loan  Repayment  Date" is  amended,
            effective  as of December  31, 1999,  by changing  "...December  31,
            2002..." to "...December 31, 2000...".

       (c)  The  definition  of  "Effective  Prime" is amended in its  entirety,
            effective as of March 31, 2000, to read as follows:

            ""Effective  Prime" means the Prime Rate plus two percent (2.0%) per
            annum until the close of  business  on June 30, 2000 and  thereafter
            means the Prime Rate plus four percent (4.0%) per annum."

      (d)   The definition of "Federal  Funds Rate" is amended,  effective as of
            March 31, 2000, by inserting  "...plus  one-half percent  (.50%)..."
            immediately  prior  to  "...provided"  in the  sixth  line  of  such
            definition.

      (e)   The  definition  of  "Fixed  Charge   Coverage  Ratio"  is  amended,
            effective  as of  December  31,  1999,  in its  entirety  to read as
            follows:

            ""Fixed  Charge  Coverage  Ratio" means,  as of the last day of each
            calendar  month,  a  fraction,  the  numerator  of which shall be an
            amount equal to  Operating  Cash Flow for such month and each of the
            two  immediately  preceding  calendar months times four (4) less (a)
            Capital  Expenditures made by the Borrower (other than those Capital
            Expenditures  paid for with (i) purchase  money  Indebtedness,  (ii)
            Loans,  (iii) cash  (except to the extent that the  Borrower's  cash
            balance at the end of such calendar month is less than  $1,500,000),
            or (iv) Capitalized Lease Obligations  permitted to exist under this
            Agreement)  and its  Subsidiaries  times four (4) and (b)  Permitted
            Restricted  Payments paid during such three calendar month period in
            each case times four (4), and the  denominator  of which shall be an
            amount  equal  to  Total  Debt  Service   (exclusive   of  voluntary
            prepayments  of  principal  on the Loans and  exclusive  of  Closing
            Costs) for such three calendar month period times four (4)."

      (f)   The  definition  of "Interest  Expense" is amended,  effective as of
            December 31, 1999, in its entirety to read as follows:

            ""Interest Expense" means, with respect to any period, the aggregate
            amount  required  to be  paid  in  cash  by  the  Borrower  and  its
            Subsidiaries  for  interest,  fees,  charges and  expenses,  however
            characterized,  on its Indebtedness,  including, without limitation,
            all such interest,  fees,  charges and expenses accrued and required
            to be paid in cash with respect to Indebtedness  under the Financing
            Documents  (but not including fees  associated  with the purchase of
            any interest rate protection arrangement)."

      (g)   The  definition of "Prime Rate" is amended in it entirety  effective
            as of March 31, 2000 to read as follows:

            ""Prime  Rate" means the higher of (i) the floating rate of interest
            per  annum  designated  from  time to time by the Agent as being its
            "prime rate" of interest,  such  interest rate to be adjusted on the
            effective  date  of any  change  thereof  by  the  Agent,  it  being
            understood  that such rate of interest may not be the lowest rate of
            interest from time to time charged by the Agent and (ii) the Federal
            Funds Rate plus one-half  percent  (.50%),  such interest rate to be
            adjusted on the effective  date of any change thereof by the Federal
            Reserve Bank of New York."

      (h)   The  definition  of  "Total  Cash  Interest   Expense"  is  amended,
            effective  as of  December  31,  1999,  in its  entirety  to read as
            follows:

            ""Total Cash Interest  Expense"  means,  with respect to any period,
            Interest Expense for such period. "

      (h)   The  definition of "Total Debt Service" is amended,  effective as of
            December 31, 1999, in its entirety to read as follows:

            ""Total  Debt  Service"  means,  for  any  period,  the  sum  of the
            Borrower's  and its  Subsidiaries'  Total Cash Interest  Expense for
            such  period  (exclusive  of any  Closing  Costs),  plus the  amount
            necessary to meet the regularly scheduled principal  amortization on
            the Loans, plus regularly  scheduled  payments on other Indebtedness
            and   Capitalized   Lease   Obligations  of  the  Borrower  and  its
            Subsidiaries for such period."

      2.    Principal Amortization.

      (a)   Section  2.1.2(b) of the Loan Agreement is amended,  effective as of
            January 1, 2000,  by deleting  the second  sentence  thereof and the
            columns  entitled  "Repayment  Dates" and "Percentage of Outstanding
            Principal" and replacing same with the following language:

            "On the Converted  Loan  Repayment  Date the Borrower  shall pay the
            outstanding  principal  balance of the Converted  Loan together with
            all accrued and unpaid  interest,  fees and expenses thereon in full
            and prior thereto the Borrower shall make the mandatory payments and
            prepayments required by Section 2.7, as amended."

      (b)   Notwithstanding  anything  to  the  contrary  contained  in  Section
            2.7.1.2 of the Loan Agreement, the Borrower shall not be required to
            make any principal  payment with respect to its Excess Cash Flow for
            its 1999 fiscal year.

      (c)   Notwithstanding anything to the contrary set forth in the Loan
            Agreement, the paragraphs entitled "Principal Amortization" i.e.
            paragraph 3(e) of Amendment No. 5 of the Loan Agreement and
            paragraph 3 of Amendment No. 6 shall, for the periods commencing
            January 1, 2000, be of no further force or effect and shall be
            replaced in their entirety by the following paragraph:

            Notwithstanding  anything  to the  contrary  set  forth  in the Loan
      Agreement,  the net cash proceeds (after reasonable expenses) of all Asset
      Sales and System Asset Sales  occurring  after  December 31, 1999 and (ii)
      the  net  cash  proceeds  (after  reasonable  expenses)  received  by  the
      Borrower, GTI and/or LLC from any equity investment in or Indebtedness for
      Borrowed  Money  incurred by any of the Borrower,  GTI and/or LLC shall be
      applied to repay on a pro rata basis (i) the Loans in the inverse order of
      maturity  and (ii) that  certain  $5,000,000  term loan to be funded on or
      about April 3, 2000 to the  Borrower by certain of the Lenders and secured
      on a pari  passu  basis  with the Loans by  collateral  for the Loans (the
      "Other  Loan").  Any  amendment to or waiver of the terms of the foregoing
      sentence  shall be deemed to require  the consent of all of the Lenders as
      provided for under Section  9.5(ii) and (vii) of the Loan  Agreement.  The
      Borrower,  the  Lenders  and the  Agent  acknowledge  and  agree  that the
      Borrower has made all payments of principal  required by Section  2.1.2(b)
      and 2.7.1, as amended,  through December 31, 1999 except for approximately
      $475,000 of purchase price holdbacks which are in escrow and which will be
      paid to the Agent upon  release from escrow to be applied to the Loans and
      the  Other  Loan as set forth  above in this  paragraph  and the  Borrower
      acknowledges  and agrees that all payments of principal  made prior to the
      date of this  Amendment  have been  applied  in  accordance  with the Loan
      Agreement.

      3. The  Lenders  hereby  consent to the System  Asset  Sale  described  on
Exhibit A hereto; provided that (i) if the Other Loan is closed and funded on or
before April 3, 2000 a portion of the net  proceeds  thereof in the amount of at
least  $2,400,000 is applied to repay the Loans and the Other loan on a pro rata
basis and the balance in the amount of  approximately  $1,000,000  is applied by
the Borrower to repay certain  Capitalized  Leases and (ii) if the Other Loan is
not closed and funded on or before April 3, 2000,  net proceeds in the amount of
at least $3,400,000 are applied,  to repay the Loans and the Other Loan on a pro
rata basis and provided further that in any event the net proceeds in the amount
of $3,400,000  are initially  transferred to the Agent to be held subject to the
Agent's first Lien thereon for application as set forth above. The references to
"pro rata basis" in this paragraph and the immediately preceding paragraph shall
have the meaning set forth in paragraph 13, below.

      4.    Notwithstanding anything to the contrary set forth in the Loan
Agreement, paragraph 3(d) of Amendment No. 5 of the Loan Agreement is amended,
effective as of June 30, 1999 to read in its entirety as follows:

      "(d)  Conversion Date.  Effective as of the date hereof, the defined term
      "Conversion Date" set forth in the Loan Agreement is amended to read as
      follows:

            "Conversion Date" means June 30, 1999."

            After the  Conversion  Date the  Borrower  shall not be permitted to
            borrow  Revolving  Loans without the prior written consent of all of
            the Lenders."

      5.    Section 2.3.1 of the Loan Agreement is amended, effective as of
December 31, 1999, by adding at the end thereof the following:

            "Notwithstanding  the foregoing  provisions of this Section 2.3.1 or
            any other  provisions  of this  Agreement,  effective(i)  as to each
            Prime  Rate Loan,  on March 31,  2000 and (ii) as to each Libor Loan
            outstanding on March 31, 2000, the Interest Adjustment Date for such
            Libor Loan and,  in all such  cases,  until the close of business on
            June 30, 2000,  interest shall accrue and be paid on the outstanding
            principal balances of the Loans at Effective Prime."

      6.    Financial Covenant Amendments.  The sections of the Loan Agreement
identified below are hereby amended as set forth below:

      (a)   Section  5.1.10.  Maximum  Total  Indebtedness  and  Maximum  Senior
            Indebtedness  to  Annualized  Operating  Cash Flow.  Effective as of
            December 31, 1999,  Section  5.1.10 of the Loan  Agreement is hereby
            amended (i) by replacing the required ratio at December 31, 1999 and
            for the period  commencing  January 1, 2000 and thereafter  with the
            periods set forth below and the ratios set forth below opposite such
            period is:

                                                Total             Senior
                                                Indebtedness
      Indebtedness

                                                Ratio             Ratio


            December 31, 1999 7.25:1.00   2.00:1.00



            January 1, 2000 through             7.65:1.00         1.65:1.00


            August 31, 2000



            September 1, 2000 and thereafter    7.35:1.00         1.65:1.00


and (ii) by adding the following text at the end of said Section:

"The Borrower shall be in compliance with the foregoing  covenant as of the last
day of each calendar month."

      (b)   Section 5.1.11.  Maximum Senior Indebtedness to Basic Subscribers.
            Effective as of December 31, 1999, Section 5.1.11 of the Loan
            Agreement is hereby amended in its entirety to read as follows:

"Section 5.1.11.  Total Indebtedness for Borrowed Money to Basic Subscribers."

Maintain  at the  last  day  of  each  calendar  month  a  ratio  of  (i)  total
Indebtedness for Borrowed money (in dollars) to the number of Basic  Subscribers
of not greater than (A)  $1,175:1:00  at December  31, 1999 and (B)  $1,299:1:00
thereafter.

       (c)  Section 5.1.12.  Minimum Ratio of Operating Cash Flow to Interest
            Expense.

            Effective  as of  December  31,  1999,  Section  5.1.12  of the Loan
            Agreement  is hereby  amended (i) by deleting the periods and ratios
            set forth therein and replacing them with the following:

October 1, 1999 through                                     1.15:1.00


December 31, 1999


                  January 1, 2000                           1.05:1.00
                  and thereafter

            and (ii)    by adding the following text at the end of said Section:

"The  Borrower  shall  be  in  compliance  with  the  foregoing  covenant  on an
annualized  basis as of the last day of each  calendar  month so that  Operating
Cash Flow,  Total Cash Interest Expense and each component of each of said terms
are calculated  for the calendar  month in question and for the two  immediately
preceding  calendar months and the results of said calculation are multiplied by
four (4)."

      (d)   Section  5.1.14 of the Loan  Agreement  is amended,  effective as of
            December 31, 1999 in its entirety to read as follows:

            "Section 5.1.14.  Minimum Fixed Charge Coverage.  Maintain at the
            last day of each calendar month a Fixed Charge Coverage Ratio of not
            less than 1.05:1.00."

            (e) Section  5.1.13 and  Section  5.1.15 of the Loan  Agreement  are
            deleted as of December 31, 1999 and shall be of no further  force or
            effect.

      (f)   Section  5.2.8.5 of the Loan Agreement is deleted as of December 31,
            1999,  shall be of no further  force or effect and any past failures
            of the Borrower to be in compliance  therewith are hereby waived and
            shall not constitute Defaults or Events of Defaults.

      7. Section 5.2.11. Dividends,  Payments and Distributions.  Section 5.2.11
is amended,  effective as of December 31, 1999, by changing the Period "1998 and
thereafter" to "1998 and through June 30, 1999",  adding immediately  thereafter
the period "July 1, 1999 through June 30, 2000", inserting in the "Percentage of
Gross Revenues" column "3.00%"  immediately  opposite "July 1, 1999 through June
30, 2000" and adding the Period "July 1, 2000 and  thereafter"  and inserting in
the "Percentage of Gross Revenues" column "2.50%" immediately  opposite "July 1,
2000 and thereafter".

      8.  Section  5.2.17.  Capital  Expenditures.  Effective as of December 31,
1999, Section 5.2.17 of the Loan Agreement is hereby amended to provide that for
Borrower's  fiscal year ending  December 31,  1999,  maximum  permitted  Capital
Expenditures shall be $13,700,000 and for Borrower's fiscal year ending December
31,  2000,   maximum  permitted  Capital   Expenditures   shall  be  $8,000,000.
Notwithstanding  anything to the contrary  contained in the Loan  Agreement,  no
unexpended portion of the amounts of Capital  Expenditures  permitted to be made
pursuant  to the  foregoing  in a fiscal  year  may be  carried  forward  to any
succeeding fiscal year.

      8.1.  Section  5.3.2 of the Loan  Agreement  is amended,  effective  as of
December 31, 1999 by changing "...90 days..." to "... 105 days...".

      9. Section 6.1 of the Loan Agreement is amended, effective as of March 31,
2000 by adding thereto Section 6.1.17 and 6.1.18 which shall read as follows:

            "Section 6.1.17. A definitive agreement for the sale of the Borrower
            and Galaxy  Telecom L.P. II or System  Asset Sales of  substantially
            all the Systems owned by the Borrower and Galaxy Telecom L.P. II has
            not been  executed  and  delivered  on or before,  or is not in full
            force and  effect  on May 31,  2000  between  the  Borrower,  Galaxy
            Telecom  L.P. II and/or the owners of each of said  entities  and an
            unaffiliated  third  party  buyer in form and  substance  reasonably
            satisfactory  in all  respects  to the  Majority  Lenders  including
            without limitation (i) that any such agreement and transaction shall
            contain  sufficient  provision  for  repayment  of the Loans and any
            Indebtedness  of Galaxy Telecom L.P. II to the Agent and each of the
            Lenders and all interest,  fees and expenses in connection therewith
            in full and (ii) that any such agreement and any related  documents,
            instruments  or  agreements  contain no  contingencies  allowing the
            purchaser to terminate such agreement or any such related  document,
            instrument  or  agreement  (a)  arising  from  the  failure  of such
            purchaser to obtain the financing  necessary for such purchase,  (b)
            arising from the failure of such  purchaser to obtain the  approvals
            necessary for such purchase  other than  approvals  customarily  not
            obtained   until  after   signing  of  such  an  agreement  in  like
            transactions  or (c) relating to the completion of any due diligence
            review by such  purchaser  other than  completion of reasonable  due
            diligence  customarily  to be completed in such  transactions  after
            signing such an  agreement;  it shall also be  considered  "Event of
            Default"  hereunder if said purchase  agreement  fails to be in full
            force and effect at any time after being entered into; or.

            "Section  6.1.18." If the Borrower,  GTLP, GTI, LLC or Capital Corp.
            or any Subsidiary  thereof shall,  without the prior written consent
            of all of the Lenders,  become liable for  Indebtedness for Borrowed
            Money which the Borrower would not be permitted to have  outstanding
            under the terms of Section 5.2.8.

      9.1 Section 9.5 of the Loan  Agreement  is amended,  effective as of March
31, 2000, by adding immediately after clause (ix) thereof the following:

            "...(x) waive, amend or terminate Section 6.1.17 or Section 6.1.18."

      10.  Exhibit 1.8 to the Loan  Agreement is amended,  effective as of March
31, 2000, in its entirety to read as set forth on Exhibit 1.8 to this Amendment.

      11. On the date hereof,  the Borrower shall be and remain  unconditionally
liable for (a) an amendment fee in the amount of $125,000,  to the Agent for the
pro rata accounts of the Lenders in accordance  with their Pro Rata Shares,  and
(b) reimbursement of the fees and  out-of-pocket  disbursements of legal counsel
to each Lender up to $1,500 per Lender  which fees  described  in each of clause
(a) and clause (b) shall thereupon be fully earned and  nonrefundable  and shall
be paid in full on the first to occur of (i)  repayment of the Loans in full and
(ii) acceleration of the maturity of the Loans.

      12. The  Lenders,  the Agent and the  Borrower  each  hereby  consent  to,
acknowledge   and  agree   that  the   Other   Loan  may  be   secured   by  and
cross-collateralized  with the Security  Documents  and the  collateral  for the
Obligations  (other than, at this time, the Borrower's real estate) and that the
Agent and the Borrower are  authorized and directed by the Lenders to enter into
such  documents,  instruments and agreements as may be necessary or desirable to
accomplish such cross-collateralization  including without limitation amendments
and/or restatements of any of the Security Documents.

      13. The Borrower, the Agent and the Lenders acknowledge and agree that the
Other Loan and the  Obligations  shall be  secured on a pari passu  basis by the
Security Documents, but that the Obligations and the Other Loan shall be treated
on a pari passu basis with respect to any payments,  prepayments  or proceeds of
the  collateral  for the Loans and the Other Loan so that any such  amounts  are
applied to the Loans and the Other Loan pro rata,  i.e.,  in  proportion  to the
relative amounts of Indebtedness owing on the Loans and the Other Loan, so that,
for example,  the amount to be applied to the Loans is equal to:  total  payment
received  multiplied  by a  fraction,  the  numerator  of which is the amount of
outstanding  Indebtedness  of the  Loans and the  denominator  is the sum of the
numerator and the amount of outstanding Indebtedness of the Other Loan.

      14. The Borrower  represents  and  warrants  that (i) prior to January 15,
2000, the Borrower listed  substantially  all of Borrower's assets for sale with
Communications  Equity Associates,  a nationally recognized seller's broker with
experience in transactions  involving large rural cable television systems, (ii)
concurrently  herewith  the  Borrower has provided the Agent with true copies of
all of Borrower's  agreements with such broker,  (iii) such agreements with said
broker are in full  force and effect as of the date  hereof and (iv) on the date
of this  Amendment a letter of intent  dated March 9, 2000 with  Classic  Cable,
Inc., a Delaware  corporation,  for the purchase of all outstanding  general and
limited partnership  interests of the Borrower and Galaxy Telecom L.P., II is in
full force and effect.

      15.   Conditions.  This Amendment is subject to the provisions of Section
9.5 of the Loan Agreement, and shall become effective, as of the date first
above written, upon the satisfaction of the following conditions precedent:

      (a) receipt by the Agent of counterparts of this Amendment executed by the
Borrower  and the  Lenders,  and  counterparts  of the Consent  appended  hereto
executed by the Guarantors;

            (b)   receipt by the Agent of such other items or documents as may
                  be requested by the Agent or the Lenders; and

            (c)   the  Borrower  shall  have paid to Messrs.  Hinckley,  Allen &
                  Snyder LLP, counsel to the Agent, all outstanding  fees, costs
                  and  expenses  and all fees,  costs and  expenses  incurred in
                  connection with the preparation, negotiation and execution of,
                  this Amendment and any and all  agreements,  instruments,  and
                  other documents executed in connection herewith.

      16.  Miscellaneous.  This Amendment  shall be governed by and construed in
accordance with the laws of The Commonwealth of Massachusetts.  All parts of the
Loan Agreement not affected by this  Amendment are hereby  ratified and affirmed
in all  respects;  provided that if any  provision of the Loan  Agreement  shall
conflict or be  inconsistent  with this  Amendment,  the terms of this Amendment
shall  supersede  and  prevail.  Upon and after the date of this  Amendment  all
references to the Loan Agreement in that document, or in any Financing Document,
shall mean the Loan Agreement as amended by this Amendment.  Except as expressly
provided in this  Amendment,  the execution and delivery of this  Amendment does
not and will not amend,  modify or supplement  any provision of, or constitute a
consent  to or  waiver  of any  noncompliance  with the  provisions  of the Loan
Agreement,  and,  except as specifically  provided in this  Amendment,  the Loan
Agreement shall remain in full force and effect.

      17.  Representations  and Warranties.  The Borrower hereby  represents and
warrants to the Lenders and the Agent that the  representations  and  warranties
set  forth in  Section  4 of the Loan  Agreement  are  true and  correct  in all
material respects as of the date hereof. The Borrower hereby agrees to indemnify
and hold the Lenders and the Agent  harmless  from and against any claim,  cost,
damage (including without limitation consequential damages),  expense (including
without limitation reasonable attorneys' fees and expenses), loss, liability, or
judgment now or hereafter arising as a result of any claim against the Borrower,
the Lenders  and/or the Agent arising out of the  transactions  contemplated  by
this  Amendment.  The  provisions of this Section  shall  continue in effect and
shall  survive  (among  other  events)  any   termination  of  this   Agreement,
foreclosure,  a deed in lieu transaction,  payment and satisfaction of the Notes
and other obligations of the Borrower  hereunder,  and release of any collateral
for the Loans.

      18.  Counterparts.   This  Amendment  may  be  executed  in  one  or  more
counterparts, each of which when so executed and delivered shall be deemed to be
an original and all of which taken  together  shall  constitute  but one and the
same agreement.  Delivery of an executed counterpart of a signature page to this
Amendment by  telecopier  shall be effective as delivery of a manually  executed
counterpart of this Amendment.

               [THE REST OF THIS PAGE IS INTENTIONALLY LEFT BLANK]




<PAGE>




      IN WITNESS  WHEREOF, the parties hereto have executed this Amendment as of
the

day and year first above written, under seal.

                                   BORROWERS:

                                    GALAXY TELECOM, L.P.

                                   By: Galaxy Telecom, Inc., its general partner

                                    By:____________________________
                                      Name:

                                     Title:

                                    GALAXY TELECOM CAPITAL CORP.


                                    By:_______________________
                                      Name:

                                     Title:


<PAGE>




                                    LENDERS:

                                   FLEET NATIONAL BANK, as Agent and as a Lender


                                    By:____________________________
                                      Name:

                                     Title:

                                    CITIZENS BANK OF MASSACHUSETTS (as assignee
                                    of State Street Bank and Trust Company)


                                    By:____________________________
                                      Name:

                                     Title:

                                    UNION BANK OF CALIFORNIA, N.A.


                                    By:____________________________
                                      Name:

                                     Title:

                                    BANK ONE, N.A. (as successor to The First
                                    National Bank of Chicago)


                                    By:____________________________
                                      Name:

                                     Title: