EXHIBIT 10.17


                               PURCHASE AGREEMENT

         THIS  PURCHASE  AGREEMENT  ("Agreement")  is made and entered into this
31st day of August, 2001, by and among GRANDE  COMMUNICATIONS,  INC., a Delaware
corporation,  (hereinafter  referred to as "Buyer")  and USOL,  INC., a Delaware
corporation,  (hereinafter  referred to as "Seller") joined by U.S.-Austin Cable
Associates I, Ltd. ("US-Austin Cable, Ltd.").


                                    RECITALS:

         A. Seller is engaged in the business of marketing and  providing  cable
television,  digital cable,  local dial tone,  long distance,  dial-up  internet
access,  and/or high speed  internet  access  services  (collectively,  "Bundled
Communication  Services") to the multi-family development unit ("MDU") market in
the Austin/San Antonio Corridor (the "Business").

         B. Seller owns and operates the Bundled Communication  Services systems
(together the  "Systems"  and each a "System")  located on and serving those MDU
properties (the "MDU Properties") as listed on Schedule A attached hereto.

         C.  Seller  desires to sell and assign to Buyer,  and Buyer  desires to
purchase from Seller,  all of the assets  comprising each of the Systems,  other
than the Excluded Assets (as hereinafter  defined) upon the terms and conditions
set forth in this Agreement.  It is the intent of the Seller and Buyer that this
transaction  constitutes an "occasional sale" pursuant to Texas Tax Code Section
151.304.

         D. In  consideration  of Buyer's  agreement  to retain the  services of
Seller under a services agreement (the "Services  Agreement") between Seller and
Buyer and Buyer's  agreement to extend  Bundled  Communications  Services to the
Contracted  MDU  Properties  (as herein  defined),  Seller agrees to transfer to
Buyer  various  agreements  which  Seller has entered  into with the  respective
owners  of  the  Contracted  MDU  Properties  (subject  to  the  terms  of  this
Agreement).  The  "Contracted  MDU Properties" are listed in Schedule B attached
hereto.


                                   AGREEMENTS:

         In  consideration  of  the  mutual   representations,   warranties  and
covenants and subject to the conditions  herein  contained,  the parties hereto,
intending to be legally bound hereby, agree as follows:



<PAGE>


                                    ARTICLE I
                               Certain Definitions

         As used in this  Agreement,  the following  terms  whether  singular or
plural forms, shall have the following meanings:

         "Affiliate"  shall mean,  with respect to any person,  any other Person
controlling,  controlled  by or under  common  control  with such  Person,  with
"control" for such person meaning the possession, directly or indirectly, of the
power to direct or cause the  direction  of the  management  and  policies  of a
Person,  whether through the ownership of voting securities or voting interests,
by contract or otherwise.

         "Agreement"  means this Agreement  including all schedules and exhibits
attached hereto, as may be amended from time to time.

         "Assumed Liabilities" shall have the meaning given in Section 3.2.

         "Austin/San  Antonio  Corridor"  shall  mean  the  cities,   towns  and
municipalities  described on Schedule C attached  hereto and the  unincorporated
areas lying adjacent and contiguous to such cities, towns and municipalities.

         "Bundled  Communication  Services" shall have the meaning  specified in
Recital A of this Agreement.

         "Business"  shall  mean the  Bundled  Communication  Services  business
conducted by Seller through the Systems in the Austin/San Antonio Corridor.

         "Business Day" shall mean any day other than Saturday,  Sunday or a day
on  which  federal  Banking  institutions  in  Austin,  Texas  are  required  or
authorized to be closed.

         "Closing" has the meaning given in Section 5.1.

         "Closing Date" has the meaning given in Section 5.1.

         "Commercially  Reasonable Best Efforts" shall mean such reasonable best
efforts  as do  not  require  the  party,  to  (i)  undertake  extraordinary  or
unreasonable  measures,   including,   without  limitation,  the  initiation  or
prosecution of legal  proceedings or the payment of fees in excess of normal and
usual filing and processing fees or (ii) assume any additional liability or make
any additional commitment.

         "Contracted MDU Properties" means the MDUs with respect to which Seller
has obtained Rights of Entry but which have not been  completely  wired and have
not been included in a System which is currently operating,  said Contracted MDU


                                       2
<PAGE>

Properties  being described in Schedule B (or in an amended  Schedule B provided
by Seller  pursuant  to  Section  2.3) and  covering  at least 720  multi-family
residential dwelling units.

         "Contracts" shall have the meaning given in Section 2.1.6.

         "Cut-Over" shall have the meaning set forth in Section 4.4.

         "Cut-Over Date" shall have the meaning set forth in Section 3.7.2.

         "Cut-Over Procedures" shall have the meaning set forth in Section 4.4.

         "Door Fee" shall mean an amount equal to *[intentionally omitted].

         "Deferred Property" has the meaning given in Section 5.3.

         "Effective Date" shall mean August 31, 2001.

         "Effective  Time  of a  Closing"  shall  mean  5:00  p.m.  CST  on  the
applicable Closing Date.

         "Equipment" has the meaning given in Section 2.1.1.

         "Excluded Assets" has the meaning given in Section 2.2.

         "Excluded Liabilities" has the meaning given in Section 3.3.

         "FAA" means the Federal Aviation Administration.

         "FCC" means the Federal Communication Commission.

         "FCC Licenses" has the meaning set forth in Section 6.10(f).

         "Final Closing" has the meaning given in Section 5.1.4.

         "Final Closing Date" has the meaning given in Section 5.1.4.

         "Governmental Authority" means the United States of America, any state,
commonwealth,  territory,  or possession  thereof,  and any city,  municipality,
political subdivision or quasi-governmental authority of any of the same.

         "Initial Closing" has the meaning given in Section 5.1.2.

         "Initial Closing Date" has the meaning given in Section 5.1.2.


                                       3


*Confidential  Treatment Requested.  Confidential portions of this document have
been redacted and filed separately with the Commission.
<PAGE>

         "Interim Closing" has the meaning given in Section 5.1.3.

         "Interim Closing Date" has the meaning given in Section 5.1.3.

         "Legal  Requirements"  means  applicable  common  law and any  statute,
ordinance,  code or other law, rule,  regulation,  or order enacted,  adopted or
promulgated by any Governmental Authority.

         "Lien" means any security agreement, financing statement filed with any
Governmental Authority, conditional sale or other title retention agreement, any
lease,  consignment  or  bailment  given for  purposes  of  security,  any lien,
security interest,  mortgage,  indenture,  pledge, option, encumbrance,  adverse
interest, constructive trust or other trust, claim, attachment,  exception to or
defect  in  title  or  ownership   interest   (including  but  not  limited  to,
reservations,  rights  of  entry,  right  of  first  refusal,  possibilities  of
reverter,  encroachment,  easements, right of way, restrictive covenants, leases
and  licenses)  of any  kind  which  in the  case of any of the  above  would be
reasonably  expected  to  materially  and  adversely  affect  Buyer's use of the
Transferred Assets, whether arising pursuant to any Legal Requirement, under any
Contract  or  otherwise;  provided,  however,  that such term  excludes  (i) any
restrictive  provisions of the ROEs or Contracts  included in the copies of such
ROE and  Contracts  provided  by  Seller to Buyer and (ii) any deeds of trust or
mortgages between lenders and owners of the MDU Properties filed of record prior
to the recordation of any memorandum evidencing the ROEs.

         "MDU Properties"  shall mean the Multi-family  Dwelling Unit properties
served by the Systems pursuant to the Rights of Entry and identified on Schedule
A.

         "Multi-family  Dwelling  Unit"  or  "MDU"  shall  mean  a  multi-family
residential  complex  served  by a  System  and  included  in  one  of  the  MDU
Properties.

          "Other Agreements" has the meaning given on Section 6.5.

         "Permitted  Liens" (i) liens for taxes not yet due and payable or being
contested in good faith by appropriate proceedings;  (ii) rights reserved to any
Governmental  Authority to regulate the  affected  property;  (iii) as to leased
Transferred  Assets,  interests of the lessors  thereof and Liens  affecting the
interests  of the lessors  thereof;  (iv)  inchoate  materialmen's,  mechanics',
workmen's,  repairmen's  or other like liens  arising in the ordinary  course of
business; and (v) any Liens to be released at or prior to any Closing.

         "Person" means any natural person, Governmental Authority, corporation,
general or limited partnership,  limited liability  partnership,  joint venture,
trust,  association,  limited liability company, or unincorporated entity of any
kind.

                                       4
<PAGE>

         "Purchase Price" has the meaning given in Section 3.1.

         "Rights of Entry" or "ROEs" shall mean those certain agreements between
Seller and the  respective  owners of each of the MDU  Properties and Contracted
MDU Properties  granting Seller and Seller's permitted  successors and permitted
assigns  (i) an  easement,  license  or  similar  right  for  the  installation,
construction,  reconstruction,  operation, maintenance, inspection, replacement,
repair,  upgrade,  and  partial  removal  of a  System  on a MDU  Property  or a
Contracted  MDU Property  (as  described  in the ROE  agreements);  and (ii) the
rights to provide  one or more of the  Bundled  Communications  Services  to the
residents of the MDU  Properties or the  Contracted MDU Properties (as described
in the ROE agreements).

         "Services  Agreement" shall mean that one certain Services Agreement by
and among Buyer and Seller, with a contract date of August 31, 2001.

         "Subscriber"  shall  mean  a  separately  billed  individual  within  a
residential  household within any of the MDU Properties that subscribes and pays
monetary  amounts for one or more of the Bundled  Communication  Services and is
served  by a  System;  provided  if such  household  is  assigned  more than one
customer account number, each such customer account number shall be considered a
Subscriber.

         "Subscriber Agreements" has the meaning given in Section 2.1.4.

         "Subscriber Door" shall mean an individual residential household within
any of  the  MDU  Properties  capable  of  being  individually  billed  for  any
combination of the Bundled Communication Services.

         "System" or  "Systems"  shall mean the Bundled  Communication  Services
reception and distribution systems consisting of one or more headends, microwave
receivers,  switches,  cabling,  Subscriber drops and associated  electronic and
other  equipment  which  provide  the  Bundled  Communication  Services  to  the
Subscribers at each of the MDU Properties.

         "Take-Down Schedule" has the meaning given in Section 5.1.1.

         "Telephone Numbers" has the meaning given in Section 2.1.5.

         "Transferred Assets" has the meaning given in Section 2.1.



                                       5
<PAGE>

                                   ARTICLE II
    Purchase and Sale of Assets; Rights Related to Contracted MDU Properties

         2.1.  Purchase and Sale of Assets.  Subject to the terms and conditions
set forth in this Agreement,  Seller shall sell,  convey,  transfer,  assign and
deliver to Buyer and Buyer shall purchase and acquire from the Seller,  free and
clear of all Liens (except for Permitted Liens) all right, title and interest of
Seller in and to all of the assets listed or described below in this Section 2.1
and located on the MDU  Properties  (except those assets of the Seller which are
specifically  excluded  from this sale  pursuant  to Section  2.2).  The rights,
properties,  and assets  listed  below in this Section  2.1,  together  with the
rights,  properties,  and assets  described  in Section  2.3,  are  collectively
referred to in this Agreement as the "Transferred Assets."

                  2.1.1. *The equipment and other tangible personal  property of
Seller that is located on the MDU Property for each ROE being purchased and that
is described in Schedule  2.1.1  ("Equipment")  attached  hereto,  together with
Seller's interest (if any) in any warranties covering the Equipment;

                  2.1.2.  [Intentionally Omitted.]

                  2.1.3. All of the Rights of Entry owned or held by Seller that
are related to the MDU Properties  including those  identified on Schedule 2.1.3
attached hereto;

                  2.1.4. All of Seller's agreements with Subscribers for Bundled
Communication Services related to the ROEs, MDU Properties and the Systems as of
the respective Closing Date for each System ("Subscriber Agreements");  the list
of current  Subscribers as of August 29, 2001, is identified on a
that is being  delivered  by  Seller to Buyer as a  separate  item and not as an
attachment to this  Agreement.  Seller  recognizes  that the list of Subscribers
changes  each day and that the  Subscriber  Agreements  being  purchased at each
Closing will be those  Subscriber  Agreements  in effect as of each Closing Date
with respect to the ROEs being purchased on each such Closing Date.

                  2.1.5. All of Seller's  telephone numbers  associated with the
Subscriber  Agreements  being  purchased  as of  each  respective  Closing  Date
("Telephone Numbers");

                  2.1.6.   The   agreements    described   on   Schedule   2.1.6
(collectively, the "Contracts");

                  2.1.7.  [Intentionally Omitted.]

                  2.1.8.  [Intentionally Omitted.]

                                       6


<PAGE>

                  2.1.9.  [Intentionally Omitted.]; and

                  2.1.10.  Seller's  Subscriber lists and Subscriber  records as
they  relate  to any ROE  being  purchased  on  each  respective  Closing  Date;
construction  and  engineering  maps  and  data,   schematics  and  blue  prints
pertaining to each ROE being purchased on each respective  Closing Date;  copies
of books and  financial  records  pertaining  to the operation of each ROE being
purchased  on  each  respective  Closing  Date;   correspondence  and  documents
pertaining  to  Subscribers,  governmental  authorities  and other third parties
relevant  to  Seller's  ongoing  relationships  with  Subscribers,  governmental
authorities  and other third parties  specific to the ROE being  purchased as of
each respective Closing Date.

         2.2.  Excluded  Assets.   Anything  to  the  contrary  in  Section  2.1
notwithstanding,  the Transferred Assets shall exclude all assets (the "Excluded
Assets") not described or identified in Section 2.1 or in the schedules  related
to Section 2.1,  including  equipment  identified  in Schedule  2.1.1 by general
equipment types and categories.  Without  limiting the preceding  sentence,  the
Excluded  Assets shall  include the  following:  (i) the Purchase  Price and the
Seller's other rights under this  Agreement;  (ii) the  organizational  records,
minute  books,  and  corporate  records  of the  Seller;  (iii) any cash or cash
equivalents of the Seller; (iv) Seller's trademarks, trade names, service marks,
service names and similar  proprietary rights; (v) insurance policies and rights
and claims  thereunder;  (vi) bonds,  letters of credit,  surety instruments and
other similar instruments;  (vii) any agreement,  right, asset or property owned
or leased by Seller and not primarily  used in connection  with its operation of
the Systems; (viii) the assets listed on Schedule 2.2 hereto.

         2.3. Transfer of Rights Related to Contracted MDU Properties;  Addition
to  Contracted  MDU  Properties.  In  consideration  of Buyer  entering into the
Services  Agreement and Buyer's  agreements with respect to extension of Bundled
Communication  Services  to the  Contracted  MDU  Properties,  Seller  agrees to
transfer  to Buyer at the Initial  Closing the Rights of Entry which  Seller has
obtained with respect to the Contracted MDU Properties  described in Schedule B.
Schedule B shall be amended to include any  Contracted  MDU Properties for which
ROEs are executed  after the Effective  Date and of this  Agreement and prior to
the Initial Closing.

         2.4.  Assignment  of  Contracts.   Notwithstanding   anything  in  this
Agreement to the contrary,  this Agreement shall not constitute an assignment of
any  contract,  license,  franchise,  lease,  commitment,   sales  order,  sales
contract,  service  agreement,  purchase  order  or  purchase  commitment  if an
attempted  assignment  thereof,  without the  consent of a third party  thereto,
would  constitute a breach thereof or in any way adversely  affect the rights of
the Buyer  thereunder  unless Buyer waives such  consent  requirement  after the
condition of Closing set forth in Section 10.1 (i.e.,  obtaining the consents on
80% of Subscriber Doors) has been satisfied.


                                       7


<PAGE>


                                   ARTICLE III
                    Purchase Price; Assumption of Liabilities

         3.1. Purchase Price. The aggregate consideration to be paid by Buyer to
Seller for the  Transferred  Assets  pursuant to this Agreement shall consist of
(i) FOURTEEN MILLION TWO HUNDRED FIFTY TWO THOUSAND SIX HUNDRED  TWENTY-FIVE AND
95/100 DOLLARS ($14,252,625.95) (the "Purchase Price"), subject to adjustment as
provided  in Section  3.1.2,  which shall be payable to Seller in the manner set
forth  in  Section  3.1.1.  and  (ii) the  assumption  by  Buyer of the  Assumed
Liabilities.

                  3.1.1.  The  conveyance  of the  Transferred  Assets  from the
Seller to the Buyer shall take place in a series of closings in accordance  with
the provisions of Article V hereof until all of the Transferred Assets have been
conveyed  to Buyer.  The  portion of the  Purchase  Price to be paid by Buyer to
Seller at each  respective  Closing shall be an amount equal to the total number
of Subscriber Doors included in each respective  Closing  multiplied by the Door
Fee.

                  3.1.2.  The Purchase Price shall be reduced by an amount equal
to  $875,000.00  (the  "Excluded   Equipment   Adjustment")  which  the  parties
acknowledge  and agree  represents  the fair market value of the equipment  (the
"Excluded  Equipment")  owned and used by Seller in the operation of the Systems
and included on Schedule 2.2 as part of the Excluded Assets.

         3.2. Assumed  Liabilities.  At each Closing, the Buyer shall assume and
agree to pay,  discharge and perform when lawfully due only those obligations of
the Seller under the contracts and agreements set forth in Schedule 3.2 attached
hereto and under the ROEs,  Other  Agreements and Contracts that are part of the
Transferred  Assets,  in each case only to the extent such obligations arise and
relate  to  periods  after  the  Effective  Time  of  a  Closing  (the  "Assumed
Liabilities").  None of the  obligations  of Seller  under  such  contracts  and
agreements  arising prior to the Effective Time of a Closing shall be assumed by
Buyer.  Notwithstanding  the foregoing  definition of Assumed  Liabilities,  (A)
Buyer will not assume any  obligation if Seller is in default under the terms of
the agreement creating such obligation, and (B) the Assumed Liabilities will not
include (i) any liabilities  with respect to breaches,  defaults or omissions of
Sellers  under  any  agreements  creating  the  Assumed  Liabilities,  (ii)  any
obligation relating to any contract or agreement of Seller which is entered into
by  Seller  after the  Effective  Date of this  Agreement  in  violation  of the
provisions of this Agreement, (iii) except as provided in Section 3.6, any taxes
of any kind owed by Seller, (iv) any obligation owed to any Affiliate of Seller,
(v)  the  obligation  of  Seller  to  make  payments  to the  owners  of the MDU
Properties  and Contracted MDU Properties so long as Seller is obligated to make
such payments under the terms of the Services Agreement,  or (vi) the obligation
of Seller to refund  prepayments  by  Subscribers as described in Section 3.7.3.
and to return  deposits  to  Subscribers  with  respect  to  analog  or  digital
converter boxes.

                                       8
<PAGE>

         3.3.  Excluded  Liabilities.  Buyer shall not assume any liabilities or
obligations  of Seller or any other  person or entity of any kind,  absolute  or
contingent, known or unknown, not expressly agreed to be assumed pursuant to the
provisions of Section 3.2 or any liability or obligation  that arises out of the
transactions  contemplated  by this  Agreement  or  results  from any  breach or
default by the Seller under this  Agreement  or any  agreement,  certificate  or
other  document or  instrument  that may be executed or delivered in  connection
with this Agreement or the transactions contemplated hereby, or any liability or
obligation where the existence,  imposition,  nature or extent of such liability
or obligation  gives rise to or constitutes a breach or default by the Seller or
any  other  person or  entity  under  this  Agreement  or any  other  agreement,
certificate or other document or instrument that may be executed or delivered in
connection  with this  Agreement or the  transactions  contemplated  hereby (the
"Excluded  Liabilities").  All  Excluded  Liabilities  shall be  timely  paid or
otherwise satisfied by Seller.

         3.4. No  Expansion of Third Party  Rights.  The (i)  assumption  by the
Buyer of the Assumed Liabilities,  (ii) transfer thereof by the Seller and (iii)
limitations in the  description of excluded  liabilities in Section 3.3 shall in
no way expand the rights or remedies of any third party against the Buyer or the
Seller as compared to the rights and remedies  which such third party would have
had  against  the Seller had the Buyer not  assumed  such  liabilities.  Without
limiting the generality of the preceding  sentence,  the assumption by the Buyer
of the Assumed Liabilities shall not create any third party beneficiary rights.

         3.5. Allocation of the Net Purchase Price Among the Transferred Assets.
The Buyer and the Seller agree that the Purchase Price shall be allocated  among
the Transferred  Assets in the manner set forth below and such allocation  shall
be used by Buyer and Seller for all relevant purposes, including the preparation
and filing of all applicable income tax returns and reports.

               Asset Type                               Percent Allocated

               ROEs Contract Rights                         90%
               Real Property Improvements                   10%
                  and Fixtures


         3.6. Sales Tax. If any sales, use, transfer, recording or other similar
taxes are due as a result of the  transactions  provided for herein,  such taxes
shall be paid by Buyer.

         3.7.     Collection and Proration Procedures.

                  3.7.1. Accounts Receivable. Subscribers within each respective
MDU Property will be timely  notified by Seller and Buyer of the transfer of the
Subscriber  Agreements to Buyer and directed to send all payments due prior to a

                                       9
<PAGE>

specified  date to Seller and all payments due subsequent to that specified date
to Buyer.  If Buyer  receives any payments  for Bundled  Communication  Services
provided  prior to the  Effective  Time of each  Closing,  Buyer shall  promptly
deliver  such  payments to Seller.  If Seller  receives any payments for Bundled
Communication Services provided after the Effective Time of each Closing, Seller
shall promptly  deliver such payments to Buyer.  Buyer shall not be obligated to
collect  any  payments  due and owing to  Seller,  or any of  Seller's  accounts
receivable, for Bundled Communication Services provided by Seller to Subscribers
within the MDU  Properties  prior to the  Effective  Time of each  Closing.  The
provisions of this Section 3.7.1 shall be subject to any contrary  provisions of
any  Systems  Management  Agreement  entered  into  pursuant to Section 5.3 with
respect to a Deferred Property.

                  3.7.2.  Proration of  Expenses.  Buyer will assume and pay all
invoices and bills issued after the date on which Buyer's Bundled Communications
Services begin on the  applicable  MDU Property and Seller's  services under the
Interim Systems Management  Agreement end (the "Cut-Over Date") which (i) relate
to contracts and agreements  included in the Transferred  Assets,  or (ii) cover
any sales, use, excise, utility, gross receipts, or property taxes on any assets
included in the Transferred Assets. Seller will promptly reimburse Buyer for any
portion of such payments which is allocable to the period prior to the Effective
Time of a Closing.  For purposes of making such  allocation the following  rules
shall apply:  If an amount  covered by the invoice or bill relates to a specific
time prior to or  subsequent  to the  Effective  Time of a Closing,  such amount
shall be allocated to Seller or Buyer as appropriate.  If the amounts covered by
the invoice or bill are not related to a specific time prior to or subsequent to
the Effective  Time of a Closing,  such amounts shall be allocated to Seller and
Buyer  based on the number of days  covered by the  invoice or bill prior to and
subsequent  to the  Effective  Time of a Closing.  If Seller  fails to  promptly
reimburse Buyer for Seller's  allocable share of such expenses and taxes,  Buyer
shall be entitled to deduct such amounts  from any sum owing to Seller  pursuant
to this Agreement.  The provisions of this Section 3.7.2 shall be subject to any
contrary  provision of a Systems  Management  Agreement entered into pursuant to
Section 5.3 with respect to a Deferred Property.

                  3.7.3.  Prepayments  by  Subscribers;   Return  of  Subscriber
Deposits.   In  the  event  that   Subscribers  have  prepaid  for  any  Bundled
Communication  Services to be provided  after the  Cut-Over  Date,  Seller shall
promptly  reimburse such  Subscribers  for the amount of such  prepayments  that
cover services  provided  subsequent to the Cut-Over Date.  Seller shall also be
responsible for returning all deposits of Subscribers,  including any related to
analog or digital converter boxes used by Seller's Subscribers.  With respect to
deposits made by Subscribers for analog converter boxes, Seller shall,  promptly
after the  applicable  Closing,  return the deposits to the  Subscriber  (either
directly or by giving the  Subscriber  a credit on the  Subscriber's  bill).  If
Seller fails to promptly  reimburse  Subscribers for such  prepayments or return
such deposits, Buyer shall be entitled to make such reimbursements or returns of
deposits to Subscribers and to deduct such amounts from any sums owing to Seller
pursuant to this Agreement.

                                       10
<PAGE>

                                   ARTICLE IV
                                 RELATED MATTERS

         4.1. [Intentionally Omitted].

         4.2.  Use of  Names  and  Logos.  Buyer  shall be  entitled  to use the
trademarks,  trade names,  service  marks,  service  names,  logos,  and similar
proprietary rights of Seller with respect a Deferred Property in accordance with
the provisions of the Interim  Systems  Management  Agreement  entered into with
respect to such Deferred Property.

         4.3. [Intentionally Omitted].

         4.4.  Cut-Over  Procedures.  Buyer and Seller  will  substantially  and
materially  comply with the  procedures  detailed on Schedule 4.4 (the "Cut-Over
Procedures") in order to facilitate the prompt and orderly cut-over ("Cut-Over")
of the  operation of each of the Systems from Seller to Buyer and to insure that
each Cut-Over will be  accomplished  without any  interruption of service to any
Subscriber.  After each Closing and prior to the Cut-Over of a System, USOL will
operate  each  System  for the  MDU  Property  pursuant  to an  Interim  Systems
Management Agreement.  Buyer agrees to give Seller thirty (30) days prior notice
of the  Cut-Over  of a System as  required  by the  Interim  Systems  Management
Agreement (as defined in Section 5.3).


                                    ARTICLE V
                                    Closings

         5.1.  Closing  Dates.  The  conveyance of the  Transferred  Assets from
Seller to Buyer shall take place in a series of four  closings  (each such event
sometimes  being  referred to as a "Closing"  and the date of each such  Closing
being referred to as a "Closing Date") as described in this Section 5.1.

                  5.1.1. The Take-Down  Schedule.  Schedule 5.1 lists all of the
MDU Properties  and the  Contracted MDU Properties and the calendar  quarters in
which Buyer projects that such  properties  will be completed.  The  Transferred
Assets  with  respect to the MDU  Properties  shall be  acquired at a Closing no
later than the end of the  calendar  quarter in which  Buyer  projects  that the
property  will be  completed.  The transfer of the ROEs for the  Contracted  MDU
Properties shall take place at the Initial Closing.


                                       11

<PAGE>

                  5.1.2. Initial Closing. The Initial Closing will take place on
a date (the  "Initial  Closing  Date") not later than  December 31, 2001. At the
Initial Closing, Seller and Buyer will execute and deliver to each other the (i)
assignments  and  assumptions of the Rights of Entry and  Subscriber  Agreements
with  respect to those MDU  Properties  described in the  Take-Down  Schedule as
being  completed  prior to December 31, 2001 and all Contracted MDU  Properties,
and (ii) the documents  contemplated by Sections 5.2.1 and 5.2.2 and by Articles
X and XI.

                  5.1.3.   Interim   Closings.   An  interim  closing  ("Interim
Closing")  shall occur (i) on or prior to March 31, 2002 and (ii) on or prior to
June 30, 2002. At each Interim Closing, the parties will execute and deliver (i)
assignments and  assumptions of the ROEs and Subscriber  Agreements with respect
to the MDU  Properties  described in the Take-Down  Schedule as being  completed
prior to such Closing, and (ii) the documents contemplated by Sections 5.2.1 and
5.2.2 and by Articles X and XI.

                  5.1.4.  Final Closing.  The Final Closing of the  transactions
contemplated by this Agreement will take place on or prior to September 30, 2002
(the  "Final  Closing  Date") at which time  Seller and Buyer will  execute  and
deliver (i)  assignments  and  assumptions  of all remaining ROEs and Subscriber
Agreements related to the MDU Properties, and (ii) the documents contemplated by
Sections 5.2.1 and 5.2.2 and by Articles X and XI.

                  5.1.5.  Effect of Absence of  Consents  to  Transfer  of ROEs.
Subject to satisfaction of the requirement  that consents have been obtained (or
are not needed) as to 80% of the Subscriber Doors (i.e.,  the Buyer's  Condition
of Closing set forth in Section 10.1) and Seller's satisfaction of Buyer's other
conditions of Closing,  the failure of Seller to have any  necessary  consent to
transfer a ROE will only entitle  Buyer to exclude the affected  ROE(s) from the
Transferred  Assets and not pay the Door Fee allocable to such ROE(s). If Seller
has  not  received  prior  to a  Closing  a  consent  from  any  owner  of a ROE
representing  the MDU Property and Seller has satisfied the other  Conditions of
Closing in Article X, Buyer will still be required to purchase  from Seller (for
the  consideration  specified  in Article  III) any such ROE for which a consent
from the applicable  owner is subsequently  obtained as long as Seller satisfies
the following  conditions:  (a) such consent is obtained  within 6 months of the
originally scheduled Closing Date for such ROE under this Agreement,  and (b) at
least three  years are left on the term of such ROE at the time such  consent is
obtained.  The Closing for the ROEs  described in the preceding  sentence  shall
occur within one-hundred twenty (120) days after the consent is obtained.

         5.2. Closing Procedure.  Subject to and after the fulfillment or waiver
of the conditions  set forth in Articles X and XI in each instance,  the Initial
Closing,  each Interim  Closing,  and the Final  Closing shall take place at the
offices of Bickerstaff,  Heath, Smiley,  Pollan,  Kever & McDaniel,  L.L.P., 816
Congress Avenue, Suite 1700, Austin,  Texas. Each Closing shall be effective for
accounting  purposes as of the  Effective  Time of a Closing.  At each  Closing,

                                       12
<PAGE>

Seller  shall  sell,  assign and convey to Buyer all of the  Transferred  Assets
attributable  to the  System or  Systems  made the  subject  of that  respective
Closing and the parties  shall take the  following  actions and all such actions
shall be deemed to have occurred simultaneously:

                  5.2.1.  Seller's  Deliveries.  At each  Closing,  Seller shall
deliver or cause to be delivered to Buyer the following:

                           (a)      An  Officer's  Certificate  dated  as of the
                                    Closing,  and  signed by a senior  executive
                                    officer of Seller,  and certifying  that the
                                    conditions  to the  obligations  of Buyer to
                                    purchase the Transferred Assets attributable
                                    to each  System from  Seller,  which are set
                                    forth in Article X, have been satisfied;

                           (b)      Evidence  reasonably  satisfactory  to Buyer
                                    that  Seller has taken all action  necessary
                                    to authorize the execution of this Agreement
                                    and  the  consummation  of the  transactions
                                    contemplated hereby;

                           (c)      An  Incumbency  Certificate  dated as of the
                                    Closing,  signed by the  Secretary of Buyer,
                                    evidencing the authority of the entities and
                                    individuals  who  are  signatories  to  this
                                    Agreement  and  all  documents  related  and
                                    collateral  hereto  to  which  Seller  is  a
                                    party;

                           (d)      Executed  counterparts of a Bill of Sale and
                                    Assignment and Assumption Agreement relating
                                    to   the   specific    Transferred    Assets
                                    attributable   to  the  Contracted  MDUs  or
                                    System(s) (as  applicable)  made the subject
                                    of the Closing in the form  attached  hereto
                                    as Exhibit A;

                           (e)      An opinion of Seller's counsel,  dated as of
                                    the  Closing  Date,  in  the  form  attached
                                    hereto as Exhibit B;

                           (f)      *[Intentionally Omitted].

                           (g)      Actual  possession and operating  control of
                                    the System(s)  which are  transferred in the
                                    Closing,   subject  to  the   provisions  of
                                    Section 5.3;

                           (h)      All existing blueprints, schematics, working
                                    drawings,       plans,       specifications,
                                    projections,     statistics,     engineering
                                    records,   original  plant  records,  System
                                    construction  and as-built  maps relating to
                                    the Systems, and all subscriber lists, files


                                       13

*Confidential  Treatment Requested.  Confidential portions of this document have
been redacted and filed separately with the Commission.

<PAGE>

                                    and records used by the Seller in connection
                                    with the operation of the Systems, including
                                    a list of all pending  subscriber  hook-ups,
                                    disconnects and repair orders, supply orders
                                    and  any  other  lists   pertinent   to  the
                                    operation of the Systems;

                           (i)      A  certificate  of No Tax Due  issued by the
                                    Texas State  Comptroller of Public Accounts;
                                    and

                           (j)      Such  other  documents  and  instruments  as
                                    Buyer may  reasonably  require to effect the
                                    intent of this  Agreement and consummate the
                                    transactions contemplated hereby, including,
                                    but not limited to any required  releases of
                                    Liens  as may  be  reasonably  requested  by
                                    Buyer.

                  5.2.2.  Buyer's  Deliveries.  At  each  Closing,  Buyer  shall
deliver or cause to be delivered to Seller the following:

                           (a)      An Officer's  Certificate  dated the date of
                                    the Closing and signed by a senior executive
                                    officer  of Buyer  and  certifying  that the
                                    conditions  to the  obligation  of Seller to
                                    sell the Transferred Assets  attributable to
                                    each System,  which are set forth in Article
                                    XI, have been satisfied.

                           (b)      Evidence, in such form as is satisfactory to
                                    Seller,  that each of the  conditions to the
                                    obligations    of   Seller   to   sell   the
                                    Transferred  Assets   attributable  to  each
                                    System  to  Buyer,  which  is set  forth  in
                                    Article XI, has been satisfied;

                           (c)      By wire transfer to an account identified by
                                    Seller on each  Closing  Date,  an amount in
                                    cash equal to that  portion of the  Purchase
                                    Price attributable to the respective Closing
                                    in accordance with the provisions of Section
                                    3.1.1;

                           (d)      Executed  counterparts of a Bill of Sale and
                                    Assignment and Assumption Agreement relating
                                    to the  Transferred  Assets  attributable to
                                    the  System(s)   made  the  subject  of  the
                                    respective  Closing  in  the  form  attached
                                    hereto as Exhibit A;

                           (e)      Evidence  reasonably  satisfactory to Seller
                                    that Buyer has taken all action necessary to
                                    authorize  the  execution of this  Agreement
                                    and  the  consummation  of the  transactions
                                    contemplated hereby.


                                       14
<PAGE>

                           (f)      An Incumbency  Certificate dated the date of
                                    the Closing and signed by the  Secretary  of
                                    Buyer   evidencing   the  authority  of  the
                                    entities and individuals who are signatories
                                    to this Agreement and all documents  related
                                    and  collateral  hereto to which  Buyer is a
                                    party.

                           (g)      An opinion of Buyer's  counsel,  dated as of
                                    the Closing Date, in the form of Exhibit C.

                           (h)      Such  other  documents  and  instruments  as
                                    Seller may reasonably  require to effect the
                                    intent of this  Agreement and consummate the
                                    transactions  contemplated  hereby as may be
                                    reasonably requested by Seller.

         5.3.  Interim Systems  Management  Agreement.  In the event Buyer shall
have  closed on the  purchase  of  Transferred  Assets  attributable  to any MDU
Property  or  Contracted  MDU  Property  and  Buyer,  in its sole  and  absolute
discretion, determines that Buyer desires certain post-closing services relating
to a MDU  Property or  Contracted  MDU Property (a  "Deferred  Property"),  then
Seller  shall  operate or continue to operate any  Deferred  Property on Buyer's
behalf for up to one hundred eighty (180) days in accordance  with the terms and
conditions of the Interim  Systems  Management  Agreement (the "Interim  Systems
Management Agreement") in the form of Exhibit B to the Services Agreement.


                                   ARTICLE VI
                  Representations and Warranties of the Seller

         To induce  Buyer to enter into this  Agreement  and to  consummate  the
transactions contemplated hereby, Seller makes the following representations and
warranties,  as of  the  Effective  Date  and as of  each  Closing  Date,  which
representations  and warranties shall survive each Closing and the Final Closing
to the extent  provided in Section 13.1.5 below;  provided,  however,  that with
respect to representations and warranties that only apply to Transferred Assets,
those  representations  will only be repeated as to the Transferred Assets being
conveyed at the Closing.

         6.1  Organization  and Good  Standing.  Seller  is a  corporation  duly
organized,  validly existing and in good standing under the laws of the State of
Delaware,  is duly  qualified  to do business  and validly  existing and in good
standing as a foreign  corporation in the State of Texas,  and has all requisite
power and  authority to own,  lease and use its  properties  and to carry on the
Business as it is now being conducted and to operate each of the Systems as each
System,  respectively,  is being  operated.  Seller is a 100% subsidiary of USOL

                                       15
<PAGE>

Holdings,  Inc. ("USOL  Holdings").  Except as set forth in Schedule 6.1, Seller
does not own any stock, membership interest or partnership interest in any other
entity.

         6.2.  Authority.  Subject to  Schedule  6.2,  Seller has all  requisite
corporate  power and authority to execute,  deliver,  and perform this Agreement
and,  subject to obtaining  the consents and  approvals  referred to herein,  to
consummate the transactions  contemplated hereby. The execution,  delivery,  and
performance  of  this  Agreement  and  the   consummation  of  the  transactions
contemplated  hereby on the part of Seller have been duly and validly authorized
by all necessary action on the part of Seller.  This Agreement has been duly and
validly executed and delivered by Seller,  and constitutes the legal,  valid and
binding obligations of Seller, enforceable against Seller in accordance with its
terms, except as may be limited by applicable bankruptcy,  insolvency or similar
laws affecting  creditors'  rights  generally or the  availability  of equitable
remedies.

         6.3. No Conflict;  Consents.  Subject to Schedule 6.3 and obtaining the
consents  and  approvals  referred  to  herein,  the  execution,  delivery,  and
performance  by Seller of this  Agreement do not and will not: (i) conflict with
or violate any provision of the articles of  incorporation  or bylaws of Seller;
(ii)  violate any  provision  of any Legal  Requirement;  (iii)  conflict  with,
violate,  result in a breach of, or  constitute  a default  under any  contract,
agreement or  understanding to which Seller is a party or by which Seller or the
Transferred Assets are bound or affected; (iv) require any consent,  approval or
authorization of, or filing of any certificate,  notice, application, report, or
other document with, any Governmental  Authority or other Person;  or (v) result
in the creation or imposition of any Lien (other than a Permitted  Lien) against
or upon any of the Transferred Assets.

         6.4. Title to  Transferred  Assets;  Sufficiency.  Seller (or US-Austin
Cable,  Ltd.) has good and indefeasible  title to (or in the case of Transferred
Assets that are leased,  valid leasehold  interests in) and possession of all of
the Transferred  Assets,  free and clear of all Liens,  except for (a) Permitted
Liens,  and (b) Liens described on Schedule 6.4, all of which Liens described in
Schedule 6.4 will be terminated or released (subject to obtaining the consent of
Seller's  lenders) at or prior to each  respective  Closing  Date.  The tangible
Transferred  Assets,  taken  as a whole,  are in good  operating  condition  and
repair,  ordinary  wear and tear and  obsolescence  excepted,  and  except  with
respect to the absence of the Excluded  Assets,  presently permit the Systems to
operate in  accordance  with the material  terms of the ROEs and the  Subscriber
Agreements.  Except for absence of the Excluded Assets,  the Transferred  Assets
constitute all property and rights, real and personal,  tangible and intangible,
necessary or required to operate the Systems as  currently  operated and conduct
the  business  of the  Systems as  currently  conducted.  None of the  equipment
included in the Transferred  Assets is subject to any lease  agreement.  No real
property  owned or leased by Seller or any  Affiliate of Seller  utilized in the
Systems  will be required  for Buyer to operate the Systems  other than  Buyer's

                                       16
<PAGE>

rights to  fixtures,  such as  conduits  and wiring,  located on the  properties
covered by the ROE.  Notwithstanding the foregoing, no representation is made as
to the  compatibility  or  sufficiency  of the  Transferred  Assets with Buyer's
existing or proposed systems and equipment.

         6.5. Contracts,  Agreements and Licenses. Seller has delivered to Buyer
true and complete  copies of each of the ROEs, and Contracts and all amendments,
assignments and consents  thereto,  together with copies of any other agreements
("Other Agreements") that require consents in order to complete the transactions
contemplated  by this  Agreement  and a list of the  Subscriber  Agreements  and
access to copies of the Subscriber Agreements. Seller is not a party to or bound
by any material contract, agreement or understanding that relates to the Systems
after the Closing and Cut-over,  or Buyer's use of the Systems after Closing and
Cut-over,  except the  Subscriber  Agreements,  the ROEs  described  in Schedule
2.1.3,  and the  Contracts  described  in  Schedule  2.1.6.  Each  of the  ROEs,
Subscriber  Agreements,  Contracts  and Other  Agreements  is in full  force and
effect, is valid,  binding and enforceable in accordance with its terms.  Except
as described on Schedule 6.5,  there has not occurred any default by Seller nor,
to the best of Seller's knowledge,  by any party to any of the ROEs,  Subscriber
Agreements (except for ordinary bad debts of Subscribers),  Contracts,  or Other
Agreements. There are no deposits given by Subscribers or with respect to any of
the equipment  included in the Transferred Assets other than deposits for analog
and digital converter boxes utilized by certain  Subscribers (which Subscribers'
deposits  shall be returned by Seller).  Each Right of Entry will provide  Buyer
with an  easement,  license  or  similar  right to  access  the  respective  MDU
Properties  which  allows  Buyer to (i) deliver  service to  Subscribers  to the
Systems (in accordance  with terms and  conditions of the  applicable  ROEs) and
(ii)  wire and equip  the  Contracted  MDU  Properties  which are not  presently
included  within a System (in  accordance  with the terms and  conditions of the
applicable  ROEs).  Except as  described  on  Schedule  6.5,  within the past 24
months,  Seller  has  received  no  notification  or  request  relating  to  the
disposition  of any cable home wiring or any home run wiring in any System which
has  not  been  resolved,  or  the  intended  use  of  such  wiring  by  another
multichannel video programming distributor which has not been resolved.

         6.6.  Employee  Benefits.  Neither Seller nor any Employee Benefit Plan
(as defined in the Employee  Retirement  Income Security Act of 1974, as amended
("ERISA"))  maintained by Seller is in violation of the provisions of ERISA;  no
reportable event, within the meaning of Sections 4043(c)(1), (2), (3), (5), (6),
(7), (10) or (13) of ERISA,  has occurred and is continuing  with respect to any
such Employee Benefit Plan; and no prohibited transaction, within the meaning of
Title I of ERISA,  has occurred with respect to any such Employee  Benefit Plan.
Buyer  is not  required  under  ERISA,  the  Code or any  collective  bargaining
agreement  to  establish,   maintain  or  continue  any  Employee  Benefit  Plan
maintained  by Seller or any  Affiliate of Seller.  Seller has made all required
contributions to its Employee Benefit Plans.


                                       17
<PAGE>

         6.7. Employees.

                  (a)      Except as set  forth on  Schedule  6.7,  there are no
                           collective  bargaining  agreements  applicable to any
                           person  employed by Seller that  renders  services in
                           connection  with the Systems,  and Seller has no duty
                           to bargain with any labor  organization  with respect
                           to any such persons. There are not pending any unfair
                           labor practice  charges against Seller,  nor is there
                           any demand for  recognition,  or any other request or
                           demand from a labor  organization for  representative
                           status with respect to any person  employed by Seller
                           that renders services in connection with the Systems.

                  (b)      Seller  is  in   substantial   compliance   with  all
                           applicable Legal Requirements  respecting  employment
                           conditions  and  practices,  has withheld all amounts
                           required  by any  applicable  Legal  Requirements  or
                           Contracts  to be withheld  from the wages or salaries
                           of its  employees,  and is not liable for any arrears
                           of wages or any taxes or  penalties  for  failure  to
                           comply with any of the foregoing.

                  (c)      Seller has not engaged in any unfair  labor  practice
                           within the meaning of the  National  Labor  Relations
                           Act  and  has  not  violated  any  Legal  Requirement
                           prohibiting  discrimination  on the  basis  of  race,
                           color,  national origin, sex, religion,  age, marital
                           status,  or handicap in its employment  conditions or
                           practices. Except as set forth on Schedule 6.7,

                           there  are no  pending  or,  to  Seller's  knowledge,
                           threatened   unfair   labor   practice   charges   or
                           discrimination  complaints  relating to race,  color,
                           national origin, sex, religion,  age, marital status,
                           or handicap  against  Seller before any  Governmental
                           Authority nor, to Seller's knowledge,  does any basis
                           therefor exist.

                  (d)      There  are no  existing  or, to  Seller's  knowledge,
                           threatened  labor  strikes,   disputes,   grievances,
                           arbitration  proceedings or other labor controversies
                           affecting the Systems or the  employees  employed for
                           the  Systems.  There are no pending  or, to  Seller's
                           knowledge,    threatened   representation   questions
                           respecting Seller's employees. To Seller's knowledge,
                           there exists no basis for any of the above.

                  (e)      Seller will give all notices and take all actions (if
                           any) as may be  necessary  to comply  with the Worker
                           Adjustment and Retraining Notification Act.

                                       18
<PAGE>

         6.8.  Litigation.  Except as set forth on  Schedule  6.8,  there are no
material  actions,  suits,  claims,  governmental  investigations or arbitration
proceedings  pending  or,  to the  best of the  Seller's  knowledge,  threatened
against or affecting any of the Transferred  Assets or Assumed  Liabilities,  or
which  question the validity or  enforceability  of this Agreement or any action
contemplated  hereby,  and  Seller  is not  aware of any  basis  for any of such
matters.  Except as set forth in Schedule 6.8,  there are not material  actions,
suits, claims,  governmental  investigations or arbitration proceedings pending,
or to the best of Seller's knowledge,  threatened against USOL Holdings,  Seller
or any  subsidiaries  of USOL  Holdings  or Seller  which  could  reasonably  be
expected to materially and adversely  affect the  Transferred  Assets or Assumed
Liabilities, and Seller is not aware of any basis for any such material matters.
There are no outstanding orders,  decrees or stipulations issued by any federal,
state,  local or foreign judicial or administrative  authority in any proceeding
to which the Seller is or was a party or which could  reasonably  be expected to
materially and adversely affect the Transferred Assets or Assumed Liabilities.

         6.9. Tax Returns;  Other Reports.  Seller and USOL Holdings have timely
filed all federal, state and local tax returns and other tax reports relating to
the Systems that are  required to be filed on or prior to the date  hereof,  and
has timely paid all taxes  shown  thereon to be due and  payable.  Except as set
forth on Schedule 6.9,  neither Seller nor USOL Holdings has received any notice
of deficiency or assessment of proposed deficiency or assessment from any taxing
Governmental  Authority  pertaining  to the  Systems.  All taxes with respect to
Seller,  USOL Holdings,  the Transferred Assets, or the business or operation of
the Systems that are due and payable have been timely paid.

         6.10. Compliance with Legal Requirements.

                  (a)      Seller has complied in all  material  respects and is
                           in compliance in all material respects with all Legal
                           Requirements  applicable  to it or  to  the  Systems,
                           including but not limited to the Communications  Act,
                           the Cable Act, the  Copyright  Act, the  Occupational
                           Safety  and  Health  Act,  the Texas  Public  Utility
                           Regulatory   Act  (the   "TPURA"),   and   rules  and
                           regulations  promulgated  thereunder.  Except  as set
                           forth  on  Schedule  6.10,  Seller  has not  received
                           notice  from  any   Governmental   Authority  of  any
                           material  violation  of  its  rules  and  regulations
                           insofar as they apply to the Systems.

                  (b)      Except  as set forth in  Schedule  6.10,  Seller  has
                           submitted  all  material   filings,   current  annual
                           reports and other  notices,  that are required  under
                           the rules and  regulations  of the FCC,  the FAA, and
                           the TPURA. The Systems are in substantial  compliance
                           with signal leakage criteria prescribed by the FCC,

                                       19
<PAGE>

                           and  the   must-carry  and   retransmission   consent
                           provisions  of the  Cable  Act and the FCC  rules and
                           regulations promulgated thereunder.

                  (c)      Seller has deposited with the U.S.  Copyright  Office
                           all   material   statements   of  account  and  other
                           documents and  instruments,  and paid all  royalties,
                           supplemental  royalties,  fees and other  sums to the
                           U.S.  Copyright  Office under the  Copyright Act with
                           respect to the business and operations of the Systems
                           as are  required  to obtain,  hold and  maintain  the
                           compulsory   license  for  cable  television  systems
                           prescribed in the  Copyright  Act. The Systems are in
                           substantial compliance with the Copyright Act and the
                           rules and  regulations of the U.S.  Copyright  Office
                           promulgated   thereunder,   except  as  to  potential
                           copyright  liability  arising  from the  performance,
                           exhibition  or carriage of any music on the  Systems.
                           To the  knowledge  of  Seller,  there is no  inquiry,
                           claim,  action  or  demand  pending  before  the U.S.
                           Copyright   Office  or  from  any  other  party  that
                           questions the  copyright  filings or payments made by
                           Seller with respect to any of the Systems. Seller has
                           provided Buyer or its  representatives  copies of all
                           such filings with the  Copyright  Office  relating to
                           the Systems for the following reporting periods:  the
                           first and second  calendar  quarter of the year 2001;
                           all four  calendar  quarters  of the year  2000;  the
                           third and fourth  calendar  quarter of the year 1999,
                           which are all the  periods  during  which  Seller has
                           been  required  to make  filings  with the  Copyright
                           Office.

                  (d)      All  necessary  material FAA and FCC  approvals  have
                           been obtained with respect to the height and location
                           of towers used in  connection  with the  operation of
                           the Systems  and are listed on  Schedule  6.10(f) and
                           such towers are being  operated in  compliance in all
                           material respects with applicable FAA and FCC rules.

                  (e)      The  rates  charged  by  Seller  to  the  Subscribers
                           materially  comply with all FCC  requirements and all
                           other Legal Requirements.

                  (f)      Schedule  6.10(f) sets forth all  licenses,  permits,
                           authorizations,   registrations  or  other  authority
                           issued by the FCC (the "FCC  Licenses") that are held
                           by Seller and used in, or related  to, the  operation
                           of  the  Systems.  The  FCC  Licenses  are  all  such
                           licenses  required  for Seller to operate the Systems
                           as currently  operated.  The FCC Licenses are in full
                           force and effect,  and Seller has  received no notice
                           of   any   investigation,    forfeiture,   or   other
                           administrative action relating to any FCC License.

                                       20
<PAGE>

                  (g)      Except as Seller has otherwise  disclosed to Buyer in
                           writing,  none of the Systems or  Equipment  uses any
                           public  streets or rights of way to distribute  cable
                           television  services.  No System is operated  under a
                           cable  franchise  issued  by  any  municipality,  and
                           Seller has  received no notice from any  municipality
                           relating to regulation of any Systems as a franchised
                           cable system.

         6.11.   System   Information.   The  Systems   satisfy  the   following
requirements and standards:

                  (a)      *[Intentionally Omitted].

                  (b)      Each  Subscriber  Door  (other  than  Contracted  MDU
                           Property  Subscriber  Doors) is presently  wired to a
                           System in material  compliance with the  requirements
                           of the applicable ROE; and

                  (c)      The status of various  aspects  of the  Systems  with
                           respect to equipment, wiring and other matters is set
                           forth in Schedule 6.11(c).

         6.12.  Environmental Matters.

                  (a)      Seller has  received  no notice  of, and to  Seller's
                           knowledge there are no circumstances relating to, any
                           past or present  condition,  circumstance,  activity,
                           practice or incident  (including without  limitation,
                           the presence, use, generation, manufacture, disposal,
                           release  or  threat  to  release  of  any   Hazardous
                           Substances from or on the Transferred  Assets),  that
                           could interfere with,  prevent  continued  compliance
                           with, or result in any material  losses  pursuant to,
                           any Legal  Requirement  with  respect to pollution or
                           protection of the environment,  or that is reasonably
                           likely to give rise to any  liability,  based upon or
                           related  to  the   processing,   distribution,   use,
                           treatment, storage, disposal, transport, or handling,
                           or the emission,  discharge,  release,  or threatened
                           release  into  the  environment,   of  any  Hazardous
                           Substance on, from or attributable to the Transferred
                           Assets.

                  (b)      "Hazardous  Substances"  has the meaning given in the
                           Comprehensive  Environmental  Response,  Compensation
                           and Liability Act of 1980 (42 U.S.C.A.  Sections 9601
                           et  seq.  ("CERCLA"),   as  amended,  and  rules  and
                           regulations promulgated thereunder.

                                       21

*Confidential  Treatment Requested.  Confidential portions of this document have
been redacted and filed separately with the Commission.

<PAGE>

                           (c) Seller has provided  Buyer with  complete  copies
                           of,  or a list of and  access  to,  (i) all  studies,
                           reports,   surveys  or  other  materials   either  in
                           Seller's  possession  or known to Seller and to which
                           Seller has access relating to the presence or alleged
                           presence of Hazardous  Substances at, on or affecting
                           the  Transferred  Assets,  (ii) all  notices or other
                           materials  either in Seller's  possession or known to
                           Seller  and to which  Seller  has  access  that  were
                           received from any  Governmental  Authority having the
                           power to administer or enforce any Environmental Laws
                           relating  to  current  or  past  ownership,   use  or
                           operation  of the  Transferred  Assets  and (iii) all
                           materials  either in Seller's  possession or known to
                           Seller and to which Seller has access relating to any
                           claim,  allegation  or  action by any  private  third
                           party  under  any  environmental  law  regarding  the
                           Transferred Assets.

        6.13.  Financial and  Operational  Information.  Seller has delivered to
Buyer for each of the Systems as of December 31, 2000,  and as of June 30, 2001,
and for the periods then ended,  financial  statements  in the form  attached as
Schedule  6.13 (the  "System  Financial  Statements").  The  Systems'  Financial
Statements have been prepared in the ordinary  course of business,  are based on
the books and records of the Systems, were prepared in accordance with generally
accepted  accounting  principles  (except for the omission of notes  thereto and
subject to normal year-end  adjustments  which will not be material in amount or
effect),  applied on a consistent  basis throughout the periods covered thereby,
and present  fairly,  in all material  respects,  the  financial  condition  and
results  of  operations  of the  Systems  as of the  dates  and for the  periods
indicated.

         6.14.  No Adverse  Change.  Since June 30, 2001,  (i) there has been no
material adverse change in the financial condition or the business operations of
a System from that  described by Sellers in USOL  Holdings,  Inc.'s 10-QSB filed
with the Securities and Exchange Commission on August 14, 2001, and no event has
occurred which could reasonably be expected to have a material adverse change in
the financial  condition or business  operations of any System; (ii) the Systems
have not been  materially  and  adversely  affected  as a  result  of any  fire,
explosion,  accident,  casualty,  labor trouble,  flood,  drought,  riot, storm,
condemnation,  or act of God or public force or otherwise;  and (iii) Seller has
not made any  sale,  assignment,  lease or  other  transfer  of any of  Seller's
properties  related to the Systems  other than in the normal and usual course of
business consistent with actual past practices.

         6.15.  Finders  and  Brokers.  Seller has not  employed  any  financial
advisor,  broker or finder or incurred any liability for any financial advisory,
brokerage,  finder's  or  similar  fee or  commission  in  connection  with  the
transactions contemplated by this Agreement for which Buyer will in any way have
any liability.

                                       22
<PAGE>


         6.16.   Taxpayer   Identification   Number.   *[Intentionally Omitted.]

         6.17.   [Intentionally Deleted.]

         6.18. Bonds,  Letters of Credit,  Certificates of Insurance.  Except as
set forth on Schedule  6.18,  there are no  franchise,  construction,  fidelity,
performance,  or other bonds or letters of credit  posted,  or  certificates  of
insurance issued, by Seller in connection with the Systems or the Assets.

         6.19. Rights in Assets.  Except as otherwise  described in the ROEs for
the MDU Properties and the Contracted MDU Properties,  no person  (including any
Governmental  Authority)  has any right to acquire an interest in the Systems or
any material  Transferred Asset (including any right of first refusal or similar
right),  other than rights of  condemnation  or eminent  domain  afforded by law
(none of which  have  been  exercised  and no  proceedings  therefor  have  been
commenced).

         6.20. Books and Records. All of the books, records, and accounts of the
Business are in all material  respects  true and  complete,  are  maintained  in
accordance with good business  practice and all applicable  Legal  Requirements,
accurately  present and reflect in all material respects all of the transactions
therein  described,  and  are  reflected  accurately  in  the  System  Financial
Statements.

         6.21. Accuracy of Information Furnished.  No representation,  statement
or  information  made or furnished by the Seller to the Buyer,  including  those
contained in this  Agreement and the other  information,  statements and notices
referred to herein or previously or subsequently  furnished by the Seller to the
Buyer  pursuant  hereto,  contains or shall  contain any untrue  statement  of a
material  fact or omits or shall omit any  material  fact  necessary to make the
information contained herein or therein not misleading. Seller does not have any
knowledge  of any fact that has  specific  application  to Seller or the Systems
(other than general  economic or industry  conditions)  that could reasonably be
expected to materially and adversely affect the financial  condition or business
operation of any System.

         6.22. No Implied Representations or Warranties. Buyer acknowledges that
Seller is making no warranties or  representations,  express or implied,  beyond
those set forth in the  Agreement.  With  respect to (i) the  value,  condition,
merchantabilty,  marketability,  profitability,  suitability  or  fitness  for a
particular use or purpose of the Transferred  Assets, (ii) the manner or quality
of the  construction  or  materials  incorporated  into  any of the  Transferred
Assets, or (iii) the manner,  quality,  state of repair or lack of repair of the
Transferred   Assets,   Seller  is  only  making  the  express   warranties  and
representations set forth in this Agreement and in the Bill of Sale,  Assignment

                                       23

*Confidential  Treatment Requested.  Confidential portions of this document have
been redacted and filed separately with the Commission.

<PAGE>

and  Assumption  Agreement  executed and delivered by Seller with respect to the
Transferred Assets.


                                   ARTICLE VII
                   Representations and Warranties of the Buyer

         To induce the Seller to enter into this Agreement and to consummate the
transactions  contemplated hereby, the Buyer makes the following representations
and  warranties  as of the  Effective  Date and as of each Closing  Date,  which
representations  and warranties shall survive each Closing and the Final Closing
to the extent provided in Section 13.2.5:

         7.1.  Organization  of Buyer.  Buyer is a corporation  duly  organized,
validly existing,  and in good standing under the laws of the State of Delaware,
is duly qualified to do business and validly  existing and in good standing as a
foreign corporation in the State of Texas, and has all requisite corporate power
and authority to own and lease the  properties  and assets it currently owns and
leases and to conduct its activities as such activities are currently conducted.
Buyer is duly qualified to do business as a foreign  corporation  and is in good
standing in all of the jurisdictions where the Systems are located.

         7.2.  Authority.  Buyer has all requisite corporate power and authority
to execute,  deliver, and perform this Agreement and consummate the transactions
contemplated hereby. The execution,  delivery, and performance of this Agreement
and the consummation of the transactions  contemplated hereby by Buyer have been
duly and validly  authorized  by all necessary  corporate  action on the part of
Buyer. This Agreement has been duly and validly executed and delivered by Buyer,
and is the valid and binding obligation of Buyer,  enforceable  against Buyer in
accordance  with its terms,  except as may be limited by applicable  bankruptcy,
insolvency  or  similar  laws  affecting  creditors'  rights  generally  or  the
availability of equitable remedies.

         7.3. No Conflict;  Consents. Except as will not have a material adverse
effect  on the  ability  of Buyer to  perform  its  obligations  hereunder,  the
execution,  delivery, and performance by Buyer of this Agreement do not and will
not: (i) conflict with or violate any provision of the articles of incorporation
or bylaws of Buyer; (ii) violate any provision of any Legal  Requirement;  (iii)
conflict with, violate, result in a breach of, or constitute a default under any
contract,  agreement,  or  understanding  to which  Buyer is a party or by which
Buyer or the assets or  properties  owned or leased by it are bound or affected;
or (iv) require any consent,  approval,  or  authorization  of, or filing of any
certificate,   notice,   application,   report,  or  other  document  with,  any
Governmental Authority or other Person.


                                       24
<PAGE>

         7.4. Finders and Brokers. Buyer has not employed any financial advisor,
broker  or  finder  or  incurred  any  liability  for  any  financial  advisory,
brokerage,  finder's  or  similar  fee or  commission  in  connection  with  the
transactions  contemplated  by this  Agreement  for which Seller will in any way
have any liability.

         7.5.   Taxpayer  Identification   Number.    *[Intentionally  Omitted.]

         7.6.  Buyer's  Ability to Perform.  Buyer has the  financial  and other
resources  needed to extend its system to the MDU  Properties and the Contracted
MDU Properties within the time frames contemplated by the Take-Down Schedule and
to pay Seller the cash consideration contemplated by this Agreement.

         7.7. No Material Adverse Change.  Since June 30, 2001 there has been no
material  adverse  change in the financial  condition or business  operations of
Buyer and Buyer is not aware of any event which could  reasonably be expected to
have a  material  adverse  change  in the  financial  condition  of or  business
operations of Buyer relating to the Austin/San Antonio Corridor.

         7.8.  Litigation.   There  are  no  material  actions,  suits,  claims,
governmental investigations or arbitration proceedings to which Buyer is a party
pending  or,  to the  best  of the  Buyer's  knowledge,  threatened  against  or
affecting  any of the  Buyer's  assets in or related to the  Austin/San  Antonio
Corridor,  or against or affecting Buyer's  operations in the Austin/San Antonio
Corridor,  or which question the validity or enforceability of this Agreement or
any action  contemplated  hereby, and Buyer is not aware of any basis for any of
the  matters.  There  are  no  material  actions,  suits,  claims,  governmental
investigations  or arbitration  proceedings  pending,  or to the best of Buyer's
knowledge,  threatened  against Buyer or any of its  Affiliates and Buyer is not
aware of any  basis for any such  material  matters.  There  are no  outstanding
orders,  decrees or stipulations issued by any federal,  state, local or foreign
judicial or administrative  authority in any proceeding to which the Buyer is or
was a party which materially and adversely affect the transactions  contemplated
by this Agreement.

         7.9. Accuracy of Information Furnished. No representation, statement or
information  made or  furnished  by the  Buyer to the  Seller,  including  those
contained in this  Agreement and the other  information,  statements and notices
referred to herein or previously or  subsequently  furnished by the Buyer to the
Seller  pursuant  hereto,  contains or shall  contain any untrue  statement of a
material  fact or omits or shall omit any  material  fact  necessary to make the
information contained herein or therein not misleading.  Buyer does not have any
knowledge of any fact that has specific  application  to Buyer or the Austin/San
Antonio Corridor (other than general economic or industry  conditions or similar
matters) that could  reasonably be expected to materially  and adversely  affect
the financial condition or business operation of Buyer.


                                       25

*Confidential  Treatment Requested.  Confidential portions of this document have
been redacted and filed separately with the Commission.

<PAGE>

                                  ARTICLE VIII
                               Seller's Covenants

         8.1.  Commercially   Reasonable  Best  Efforts.  Seller  will  use  its
Commercially  Reasonable  Best  Efforts  to  cause  to be  satisfied  as soon as
practicable and prior to each respective  Closing Date all of the conditions set
forth in Article X to the  obligation  of the Buyer to purchase the  Transferred
Assets hereunder.

         8.2.  Conduct of  Systems  Prior to Final  Closing.  From and after the
execution  and  delivery of this  Agreement  and until the Final  Closing  Date,
except as otherwise provided by the prior written consent of Buyer,  Seller will
(i) conduct its  Business and operate  each  respective  System in a prudent and
businesslike manner consistent with Seller's actual past practices; (ii) perform
all of its obligations under all of the ROEs and Subscriber  Agreements  without
material  breach or default;  (iii) operate the Business and each of the Systems
in substantial  compliance with all applicable  legal  requirements  and provide
Buyer with copies of all filings, reports, notices or correspondence relating to
the Systems submitted to, or received from, the FCC, the Copyright Office, TPURA
or  any  other  regulatory  agencies;  (iv)  continue  the  pricing,  marketing,
advertising,  promotion  and other  activities  with respect to the Business and
each System (including without limitation billing and collection)  substantially
and  materially in the normal and ordinary  course of business  consistent  with
Seller's past practices; and (v) use its Commercially Reasonable Best Efforts to
(A) preserve the current business organization of the Business intact, including
preserving existing commercial relationships, (B) keep available the services of
its  employees  providing  services  in  connection  with the  Business  and (C)
maintain  inventories of equipment and supplies  consistent  with past practices
and consistent with the terms of this Agreement;  provided however that,  unless
otherwise  approved  by Buyer,  Seller  shall cease all  special  promotions  to
Subscribers  thirty  (30)  days  prior to the date of  Buyer's  acquisition  (as
specified in the Take-Down Schedule attached as Schedule 5.1) of an ROE.

         8.3. (a)  Consents  from MDU Owners.  Seller will use its  Commercially
Reasonable Best Efforts with respect to each ROE to obtain all required consents
to transfer of ROEs to Buyer.  The form and  content of such  consents  shall be
reasonably  satisfactory  to Buyer.  Buyer  will  cooperate  with  Seller in its
efforts to obtain the consents and  amendments  described in this Section 8.3(a)
by providing USOL with a current  financial  balance sheets for Buyer, a current
list  of  officers  and  directors  of  Grande,  and a  current  list  of  major
shareholders of Buyer in such form as Buyer shall  reasonably  deem  appropriate
("Grande Financial  Information") Buyer agrees that Seller may provide copies of
the Grande Financial  Information to owners of MDU Properties in connection with
obtaining the consents described in this Section 8.3.(a).


                                       26
<PAGE>

                  (b) Efforts  Regarding  Amendments and Estoppel  Certificates.
Seller will use its  Commercially  Reasonable  Best Efforts with respect to each
ROE to (i) if an ROE has a term of less than 66 months,  obtain an  extension of
the  remaining  term to  ninety-six  (96)  months;  (ii)  amend the  ROE(s)  (if
necessary)  to expand the scope of services to include the right to  exclusively
provide and market video and the  non-exclusive  right to provide  telephone and
internet  services  and the  exclusive  right to market  telephone  and internet
services; (iii) obtain a Minimum Point of Entry for telephone and cable service,
(iv) eliminate or improve any buy-out options of the owner of the property;  (v)
obtain estoppel certificates,  and (vi) obtain subordination and non-disturbance
agreements  from holders of deeds of trust  covering the MDU  Properties  if not
already obtained. With respect to (v) and (vi), Buyer recognizes and understands
that Seller may use its sole and absolute  discretion  to determine  (a) whether
and, if so, when to approach  certain  owners of MDU  Properties or lien holders
regarding items (v) - (vi), and with respect to (v) and (vi),  Seller's  success
in  obtaining  one or more of items (v) and (vi) shall not be a condition of any
Closing.  Seller's  success in obtaining  any one or more of items (i) -(iv) and
the extent of any such items  obtained  shall not be a condition  to any Closing
and, so long as Seller exercises its Commercially  Reasonable Best Efforts,  any
failure to by Seller to obtain any such items shall not be  considered  a breach
of this Agreement. Buyer will cooperate with Seller in its efforts to obtain the
items  described  in this  Section  8.3(b) by  providing  USOL  with the  Grande
Financial  Information.  Buyer agrees that Seller may, to the extent approved in
writing by Grande,  provide copies of the Grande Financial Information to owners
of MDU  Properties  in  connection  with the matters  described  in this Section
8.3(b).

         8.4. Access to Properties and Records. From and after the execution and
delivery of this Agreement,  Seller will afford to  representatives of the Buyer
access,  during normal  business hours and upon reasonable  notice,  to Seller's
premises  sufficient  to enable  Buyer to inspect the  Transferred  Assets,  and
Seller  will  furnish  to such  representatives  during  such  period  all  such
information  relating to the  foregoing  investigation  as Buyer may  reasonably
request; provided, however, that any furnishing of such information to Buyer and
any  investigation  by Buyer  shall not affect the right of Buyer to rely on the
representations and warranties made by Seller in or pursuant to this Agreement.

         8.5. Publicity.  Seller and Buyer shall consult with and cooperate with
the other with respect to the content and timing of all press releases and other
public  announcements,  and any oral or written statements to Seller's employees
concerning  this Agreement and the  transactions  contemplated  hereby.  Neither
Seller  nor Buyer  shall  make any such  release,  announcement,  or  statements
without the prior written consent of the other,  which shall not be unreasonably
withheld or  delayed;  provided,  however,  that Seller or Buyer may at any time
make any  announcement  required  by Legal  Requirements  so long as such party,
promptly  upon  learning  of  such  requirement,  notifies  the  other  of  such
requirement  and  consults  with the other in good  faith  with  respect  to the
wording of such announcement.

                                       27
<PAGE>

         8.6. Notification of Certain Matters.

                  (a)      Seller will  promptly  notify Buyer in writing of any
                           fact,  event,  circumstance,  action or omission  (i)
                           which,  if  known  on  the  Execution  Date  of  this
                           Agreement,  would have been  required to be disclosed
                           in  or  pursuant  to  this  Agreement,  or  (ii)  the
                           existence or occurrence of which would cause Seller's
                           representations  or warranties  under this  Agreement
                           not to be  true in any  material  respect,  and  with
                           respect to clause (ii), Seller shall use Commercially
                           Reasonable Best Efforts to remedy the same.  Promptly
                           upon  becoming  aware  of such  matter,  Seller  will
                           notify   Buyer  in  writing   of  any  fact,   event,
                           circumstance,  action or omission which constitutes a
                           breach  by Seller  of any of the  representations  or
                           warranties  made by Seller in the  performance  of or
                           compliance with any covenant, agreement or obligation
                           required to be  performed  or complied  with prior to
                           the date of any Closing.

                  (b)      Seller will  promptly  notify Buyer in writing of any
                           material adverse change to the financial condition or
                           business operations of the Systems.

         8.7. Certain Negative Covenants of Seller.  Between the date hereof and
the Final Closing,  Seller shall not solicit or participate in negotiations with
any  third  party  with  respect  to the sale of the  Transferred  Assets or the
Systems or any transaction  inconsistent with those contemplated hereby and will
promptly notify Buyer of the specifics of any offers or inquiries  received from
third  parties  regarding  the  acquisition  of any of the  Transferred  Assets.
Additionally,   except  as  Buyer  may  otherwise  consent  in  writing,  or  as
contemplated by this Agreement, between the date of this Agreement and the Final
Closing Seller shall not (a) modify, terminate,  renew, suspend, or abrogate any
ROE,  Contract,  Other  Agreement or (b) modify,  terminate,  renew,  suspend or
abrogate  any  other  material  agreement  or  contract  if  such  action  would
reasonably be expected to adversely affect the Transferred Assets or Buyer's use
of the Transferred Assets after Closing,  (c) sell,  assign,  lease or otherwise
dispose of any of the Transferred  Assets,  unless such  Transferred  Assets are
consumed or  disposed of in the  ordinary  course of  business  consistent  with
actual  past  practice or disposed of in  conjunction  with the  acquisition  of
replacement  property  or are no  longer  used  or  useful  in the  business  or
operation  of the  Systems,  (d)  create,  assume,  or  permit to exist any Lien
(except for Permitted Liens) upon any Transferred  Asset, (e) change  subscriber
rates for any tier of  service  or  change  billing,  collection,  installation,
disconnect,  marketing  or  promotional  practices  with  respect  to any of the
Systems included in the Transferred Assets, (f) seek amendments or modifications
to existing ROEs,  Contracts or Other Agreements or accept or agree to accede to
any material  modification or amendment to, or any condition to the transfer of,

                                       28
<PAGE>

any of the ROEs,  Contracts,  Other Agreements that will adversely affect Buyer,
(g) enter into any  transaction  or permit  the taking of any action  that would
result in any of  Seller's  representations  and  warranties  contained  in this
Agreement  not being  materially  true and correct  when made or at any Closing,
including without limitation the Final Closing.

         8.8. Access to MDU Properties for Upgrades, Wiring and Cut-Over. Seller
and Buyer acknowledge that Buyer  anticipates (i) making any necessary  upgrades
and installing  additional  equipment for the MDU Properties and (ii) wiring the
Contracted  MDU  Properties,  so that  such  properties  will  have  all  needed
upgrades,   wiring,   and/or  new  equipment   installations  prior  to  Buyer's
acquisition  and  needed  to  facilitate  Cut-Over  of the MDU  Property  and/or
Contracted MDU Property.  Seller agrees to use its Commercially  Reasonable Best
Efforts to provide Buyer with the  necessary  access to the MDU  Properties  and
Contracted MDU  Properties in order to make such  upgrades,  install such wiring
and new  equipment  and Buyer agrees to pay and be  responsible  for any damages
suffered  by the owners of such  properties  or by Seller as a result of Buyer's
negligent or intentionally  wrongful  activities.  Subject to the Buyer's rights
with respect to any breaches of Seller's warranties and  representations,  Buyer
shall pay all of the costs and expenses (including any out-of-pocket third party
costs for construction  supervision incurred by Seller) of upgrades,  wiring and
installations  made  pursuant  to this  Section  8.8 to the  extent  needed  for
Cut-Over to, or with,  Buyer's  equipment and system;  provided,  however,  that
Buyer will not pay for (i) any improvements or repairs needed in order to comply
with the terms of Seller's ROEs, unless such upgrades are required for Cut-Over,
or (ii) any cost or  expenses of USOL's  employees.  In the event that Seller is
not able to obtain the access  contemplated by the foregoing  provisions of this
Section 8.8,  Buyer will acquire (i) the MDU  Properties in accordance  with the
Take-Down Schedule and (ii) the Contracted MDU Properties by September 30, 2002,
and (iii) accomplish the necessary  activities  contemplated by this Section 8.8
after the applicable Closing.

                                   ARTICLE IX
                                Buyer's Covenants

         9.1.  Commercially   Reasonable  Best  Efforts.   Buyer  will  use  its
Commercially  Reasonable  Best  Efforts  to  cause  to be  satisfied  as soon as
practicable and prior to each respective  Closing Date all of the conditions set
forth in Article XI to the  obligation  of the Seller to  transfer  and sell the
Transferred Assets hereunder.

         9.2.  Conduct of Business  Prior to Final  Closing.  From and after the
execution and delivery of this Agreement and until the Final Closing Date, Buyer
will (i) conduct its business in a prudent and  businesslike  manner  consistent
with Buyer's  actual past  practices;  (ii) operate its business in  substantial
compliance  with  all  applicable   legal   requirements;   and  (iii)  use  its
Commercially  Reasonable Best Efforts to preserve the current  business of Buyer
intact,  including  preserving  its existing  commercial  relationships  and its
franchise agreements.

                                       29
<PAGE>

         9.3.     Notification of Certain Matters.

                  (a)      Buyer will  promptly  notify Seller in writing of any
                           fact,  event,  circumstance,  action or omission  (i)
                           which  if  known  on  the  Execution   Date  of  this
                           Agreement,  would have been  required to be disclosed
                           in  or  pursuant  to  this  Agreement,  or  (ii)  the
                           existence or  occurrence of which would cause Buyer's
                           representations  or warranties  under this  Agreement
                           not to be  true in any  material  respect,  and  with
                           respect to clause (ii),  Buyer shall use Commercially
                           Reasonable Best Efforts to remedy the same.  Promptly
                           upon becoming aware of such matter, Buyer will notify
                           Seller in writing of any fact,  event,  circumstance,
                           action  or  omission  which  constitutes  a breach by
                           Buyer  of any of the  representations  or  warranties
                           made by Buyer  in the  performance  of or  compliance
                           with any covenant,  agreement or obligation  required
                           to be performed or complied with prior to the date of
                           any Closing.

                  (b)      Buyer will  promptly  notify Seller in writing of any
                           material adverse change to the financial condition or
                           business  operations of its business as it relates to
                           the Systems.


                                    ARTICLE X
                     Conditions to Obligations of the Buyer

         The  obligation  of Buyer to purchase  the  Transferred  Assets  shall,
subject to the provisions of Section 5.1.5,  be subject to the fulfillment at or
prior to each Closing Date of each of the following conditions:

         10.1.  Conditions  of  Initial  and Other  Closings.  Buyer  shall have
obtained,  and shall  hold at the time of the  Initial  Closing  and each  other
Closing,  consents from owners of the MDU Properties  which (together with those
MDU  Properties  where no consent is required)  represent ROEs covering at least
80%  (or  *[Intentionally   Omitted)  or  the  total  *[Intentionally   Omitted]
Subscriber Doors in the MDU Properties.  Further, Buyer shall have obtained, and
shall hold at the time of the Initial  Closing,  consents from owners of the MDU
Properties which represent all of the ROEs to be acquired at the Initial Closing
pursuant to the Takedown Schedule,

         10.2.   Consent  to   Transfer  of  ROE   Transferred   at  a  Closing.
Notwithstanding  satisfaction  of Section 10.1, but subject to the provisions of
Section 5.1.5, Seller shall have obtained all necessary consents to the transfer
of the ROEs to be transferred to Buyer at the Closing. The form and substance of
such consents shall be reasonably satisfactory to Buyer.

                                       30

*Confidential  Treatment Requested.  Confidential portions of this document have
been redacted and filed separately with the Commission.

<PAGE>

         10.3.  Accuracy of  Representations  and Warranties and Compliance With
Obligations.  (a)  All  of  Seller's  representations  and  warranties  in  this
Agreement  (considered  collectively),  and  each of these  representations  and
warranties (considered  individually),  shall have been accurate in all material
respects as of the date of this Agreement, and shall be accurate in all material
respects as of the time of each Closing as if then made without giving effect to
any revisions or supplements to Seller's disclosure schedules.

                  (b) Except as provided in Section  10.3(d) below,  each of the
representations  and  warranties  in Sections  6.2, 6.10 and 6.13 (except to the
extent  such  warranty  refers  to a  different  date),  and  each  of  Seller's
representations  and  warranties  in this  Agreement  that  contains  an express
materiality  qualification,  shall have been  accurate in all respects as of the
date of this Agreement,  and shall be accurate in all respects as of the time of
each  Closing  as if then  made,  without  giving  effect  to any  revisions  or
supplements to Seller's disclosure schedules.

                  (c) Seller shall have  performed  and complied with all of its
obligations  required by this  Agreement to be performed or complied  with at or
prior to each Closing  Date  including  Seller's  deliveries  as required  under
Section 5.2.1.

                  (d)   Notwithstanding   the   foregoing,   Seller   and  Buyer
acknowledge  and agree that because the Closings will occur over an  approximate
one year period,  the  representations  and  warranties  of Seller  contained in
Article VI may change because of events that may occur after the Effective Date.
Prior to each Closing  Seller will disclose to Buyer any changes with respect to
the  warranties  and  representations  in Article VI that have arisen because of
events  occurring  after the  Effective  Date.  Seller and Buyer  agree that any
changes in such  Article VI  information,  even if such  changes are  considered
material  as they  generally  relate to Seller or to USOL  Holdings,  Inc. or to
US-Austin Cable Ltd.,  shall not be considered a failure to satisfy this Section
10.3 condition to closing as long as any such new information does not adversely
affect (i) Seller's ability sell the Transferred  Assets to Buyer free and clear
of all Liens (other than Permitted  Liens),  (ii) Buyer's ability to utilize the
Transferred  Assets after the  applicable  Closing,  or (iii) any aspects of the
quality,  character  or  value of the  Transferred  Assets,  including,  but not
limited to, the matters  covered by Sections 6.4, 6.5, 6.10,  6.11,  6.12,  6.14
(ii) and (iii), 6.19 or 6.21 (as it relates to the Transferred Assets).

         10.4.  Receipt of Other  Necessary  Consents  or  Approvals.  All other
necessary  consents or approvals of third parties  (including without limitation
any Governmental  Authorities) in addition to those referred to in Sections 10.1
and 10.2, to any of the transactions  contemplated  hereby, the absence of which
would adversely affect Buyer's rights hereunder,  shall have been obtained.  The
form and  substance  of such  consents  and  documentation  shall be  reasonably
satisfactory to Buyer.

                                       31
<PAGE>

         10.5. No Adverse  Litigation.  There shall not be pending or threatened
any action or proceeding by or before any court or other governmental body which
shall seek to  restrain,  prohibit  or  invalidate  the sale of the  Transferred
Assets to Buyer or any other  transaction  contemplated  hereby,  or which might
materially  and adversely  affect the right of Buyer to own,  operate or control
the Transferred Assets.


                                   ARTICLE XI
                     Conditions to Obligations of the Seller

         The obligations of the Seller to sell the  Transferred  Assets shall be
subject  to the  fulfillment  at or  prior to each  Closing  Date of each of the
following conditions:

         11.1.  Accuracy of  Representations  and Warranties and Compliance With
Obligations. (a) All of Buyer's representations and warranties in this Agreement
(considered  collectively),  and each of these  representations  and  warranties
(considered individually),  shall have been accurate in all material respects as
of the date of this Agreement, and shall be accurate in all material respects as
of the  time of each  Closing  as if then  made  without  giving  effect  to any
revisions or supplements to Buyer's disclosure schedules.

                  (b) Each of the representations and warranties in Sections 7.2
and 7.7, and each of Buyer's  representations  and  warranties in this Agreement
that contains an express materiality qualification,  shall have been accurate in
all  respects  as of the date of this  Agreement,  and shall be  accurate in all
respects as of the time of each Closing as if then made,  without  giving effect
to any revisions or supplements to Buyer's disclosure schedules.

                  (c) Buyer shall have  performed  and complied  with all of its
obligations  required by this  Agreement to be performed or complied  with at or
prior to each  Closing  Date  including  Buyer's  deliveries  as required  under
Section 5.2.2.

         11.2. Consent of Seller's Lenders. Seller shall have obtained a consent
from the lenders under its Credit Agreement dated December 30, 1999, as amended,
to permit the transactions contemplated by this Agreement and to modify Seller's
financial covenants in a manner reasonably acceptable to Seller.


                                   ARTICLE XII
                          Certain Actions After Closing

         12.1.  Delivery of Property  Received After Closing.  In the event that
after Closing,  a party receives any checks or other payments that belong to the
other  party,  such party shall be entitled to deposit and collect  such amounts


                                       32
<PAGE>

but shall  promptly  transfer the amounts so deposited or collected to the party
entitled to receive same.

         12.2.  Buyer  Appointed  Attorney  for the  Seller.  Effective  on each
Closing Date,  Seller hereby  constitutes and appoints Buyer, its successors and
assigns,  the true and lawful attorney of Seller, in the name of either Buyer or
Seller (as Buyer shall determine in its sole discretion) but for the benefit and
at the expense of Buyer (except as otherwise herein provided),  (i) to institute
and prosecute all  proceedings  which Buyer may deem proper in order to collect,
assert or enforce any claim, right or title of any kind in or to the Transferred
Assets (or other related  rights  arising after the Closing  Date);  and (ii) to
defend or compromise any and all actions, suits or proceedings in respect of any
of  the  Transferred   Assets  which  arise  after  the  Closing  Date.   Seller
acknowledges that the foregoing powers are coupled with an interest and shall be
irrevocable.  Buyer  shall be entitled to retain for its own account any amounts
collected  pursuant to the foregoing  powers,  including any amounts  payable as
interest in respect thereof.

         12.3. Execution of Further Documents. From and after each Closing, upon
the reasonable request of Buyer,  Seller shall execute,  acknowledge and deliver
all  such  further  acts,  deeds,   bills  of  sale,   assignments,   transfers,
conveyances,  powers of attorney and assurances as may be required to convey and
transfer to and vest in Buyer and protect its right,  title and  interest in all
of the Transferred  Assets,  and as may be required or otherwise  appropriate to
carry out the  transactions  contemplated by this Agreement,  including  notices
signed by Seller and Buyer to be filed of record and to reflect the  transfer of
the ROEs to Buyer.

         12.4.   Employment   by   the   Buyer   of  the   Seller's   Employees;
Non-Solicitation

                  12.4.1. Buyer shall evaluate and consider for employment under
its own hiring  policies,  procedures  and standards  any of Seller's  technical
employees working in the Systems identified by Seller;  provided,  however, that
Buyer  shall  have  no  obligation  whatsoever,  to  employ  any of the  persons
currently  employed by Seller.  Nor shall Buyer have any obligation to continue,
or institute any  replacement  or  substitution  for, any  vacation,  severance,
incentive,  bonus,  profit  sharing,  pension or other employee  benefit plan or
program of Seller.  Seller shall compensate its employees for all amounts due to
such  employees  for  compensated  absences  accrued  as of each  Closing  Date,
including vacation, holiday and sick pay benefits.

                  12.4.2. Seller shall be solely responsible for compliance with
COBRA,  including the health care continuation coverage provisions thereof, with
respect to any  employee  of Seller who is  terminated  on or before any Closing
Date or with respect to whom a qualifying  event occurs before or on any Closing
Date, whether such termination or qualifying event occurs in connection with the
consummation  of this  transaction  or otherwise.  Moreover,  Seller will remain

                                       33
<PAGE>

solely liable with respect to any retiree  medical  obligations  concerning  the
employees of the Seller,  regardless of whether the Buyer subsequently hires any
such employee.

                  12.4.3.  Buyer  shall not  solicit  for  employment  of any of
Seller's  employees,  other than  Seller's  technical  employees  identified  by
Seller, who are employed with respect to Systems acquired by Buyer. Seller shall
not solicit for employment of any of Buyer's  employees.  The placing of general
advertisements by Seller or Buyer requesting  applications for employment or the
unsolicited   receipt  of  an  application  for  (or  an  inquiry  relating  to)
employment, shall not constitute solicitation that violates this Section 12.4.3.

         12.5. Payment of Obligations.  From and after each Closing,  the Seller
shall pay and  perform  all of its  obligations  with  respect  to the  Excluded
Liabilities (which include,  without  limitation,  trade payables of the Seller)
when due and prior to the time any thereof shall become  delinquent,  and Seller
shall provide evidence thereof to the Buyer from time to time as requested.

         12.6.  Buyer's  Right of  Set-off.  In the event that  Seller  fails to
promptly pay Buyer any sums due to Buyer pursuant to this Agreement,  Buyer may,
upon  notice to Seller  specifying  in  reasonable  detail the basis  therefore,
set-off  the amount to which  Buyer may be  entitled  pursuant  to Article  XIII
against amounts  otherwise  payable to Seller  pursuant to this  Agreement.  The
exercise  of such  right  of  set-off  by Buyer in good  faith,  whether  or not
ultimately determined to be justified,  will not constitute a default under this
Agreement.  No  exercise  or failure  to  exercise  such right of set-off  shall
constitute an election of remedies by Buyer.

         12.7.  Payments  with  Respect to  Buy-outs  of ROEs.  Seller and Buyer
acknowledge that certain of the ROEs for the MDU Properties  contain  provisions
allowing  the owner of the MDU  Property to buy the interest of the ROE owner in
the ROE and the  wiring  and  equipment  of the ROE  owner  utilized  in the MDU
Property. Attached as Schedule 12.7 is a list of the ROEs that Seller represents
are the ROEs that have such buy-outs,  excluding any buy-out that is tied to the
performance of the ROE owner.  If any buy-out of a ROE is exercised by the owner
of a MDU  Property  within the first  twelve  (12)  months  after the Closing of
Buyer's  acquisition of the related ROE, then Seller will pay to Buyer the total
Door Fees paid by Buyer  under this  Agreement  for such ROE and Buyer  shall be
entitled to retain all amounts  paid to Buyer by the owner of the MDU  Property.
If any such buy-out is  exercised by the owner of the MDU Property  after twelve
(12)  months,  but before  forty-eight  (48)  months,  following  the Closing of
Buyer's acquisition of the related ROE, Seller will pay to Buyer an amount equal
to the Door Fees paid by Buyer for such ROE,  less the amount  paid to the Buyer
by the owner of the MDU  Property.  If a buy-out is  exercised by the owner of a
MDU  Property  more than  forty-eight  (48) months  after the Closing of Buyer's
acquisition of the related ROE,  Seller will have no obligation to make payments
to Buyer with respect to such exercise of the owner's buy-out right.

                                       34
<PAGE>


                                  ARTICLE XIII
                                 Indemnification

         13.1.  Agreement  by Seller to  Indemnify.  Seller  agrees that it will
indemnify  and hold Buyer  harmless in respect of the  aggregate  of all Buyer's
Indemnifiable Damages (as herein defined).

                  13.1.1.   "Buyer's   Indemnifiable   Damages"  means,  without
duplication,  the  aggregate  of  all  expenses,  losses,  costs,  deficiencies,
liabilities  and  damages  (including  related  counsel and  paralegal  fees and
expenses)  incurred or  suffered by Buyer,  on a pre-tax  basis,  together  with
interest  thereon from the date of loss until paid at the rate of 10% per annum,
to the extent (i) resulting from any breach of a  representation  or warranty of
Seller in or pursuant to Article VI or elsewhere herein; (ii) resulting from any
breach of the  covenants or  agreements  of Seller in this  Agreement;  or (iii)
resulting from the failure of Seller to pay,  discharge or perform any liability
or obligation of Seller which is not expressly assumed by Buyer pursuant to this
Agreement  or  resulting  from any  dispute  concerning  any such  liability  or
obligation.

                  13.1.2. Without limiting the generality of the foregoing, with
respect to the measurement of Buyer's  Indemnifiable  Damages,  Buyer shall have
the right to be put in the same financial  position as it would have been in had
each of the  representations  and warranties of Seller been true and correct and
had each of the covenants of Seller been performed in full.

                  13.1.3. Within ten (10) business days after Buyer has received
written  notice of or has actual  knowledge of any claim by a person not a party
to this  Agreement  (a "Third  Person")  or the  commencement  of any  action or
proceeding by a Third  Person,  Buyer shall give Seller  written  notice of such
claim or the commencement of such action or proceeding.  Such notice shall state
the nature and the basis of such claim and a  reasonable  estimate of the amount
thereof.  Seller  shall have the right to defend and settle,  at its own expense
and by its own  counsel,  any such matter so long as Seller  pursues the same in
good faith and diligently.  If Seller  undertakes to defend or settle,  it shall
promptly  notify Buyer of its intention to do so and Buyer shall  cooperate with
Seller and its counsel in the defense  thereof  and in any  settlement  thereof.
Such cooperation  shall include,  but shall not be limited to, furnishing Seller
with any books,  records or information  reasonably requested by Seller that are
in Buyer's possession or control. Notwithstanding the foregoing, the Buyer shall
have the right to participate in any matter through  counsel of its own choosing
at its own expense (unless there is a conflict of interest that prevents counsel
for Seller from  representing  Buyer,  in which case Seller will  reimburse  the
Buyer for the expenses of its counsel);  provided that Seller's counsel shall be
lead counsel and shall determine  litigation and settlement steps,  strategy and
the like.  After Seller has notified the Buyer of its  intention to undertake to

                                       35
<PAGE>

defend  or  settle  any  such  asserted  liability,  and for so  long as  Seller
diligently  pursues such defense,  Seller shall not be liable for any additional
legal expenses incurred by Buyer in connection with any defense or settlement of
such asserted liability, except to the extent such participation is requested by
Seller,  in which  event  Buyer  shall be  reimbursed  by Seller for  reasonable
additional legal expenses and  out-of-pocket  expenses and except as provided in
the immediately  preceding sentence. If Seller does not undertake to defend such
matter  to which  Buyer  is  entitled  to  indemnification  hereunder,  or fails
diligently to pursue such defense,  the Buyer may undertake such defense through
counsel of its choice,  at the cost and expense of Seller,  and Buyer may settle
such  matter,  and Seller  shall  reimburse  Buyer for the  amount  paid in such
settlement and any other liabilities or expenses incurred by Buyer in connection
therewith.

                  13.1.4. A claim by Buyer for indemnification of any matter not
involving a claim by a Third Person, may be asserted by notice to Seller.

                  13.1.5.  Time  Limitations  on  Claims  Against  Seller.  If a
Closing occurs, Seller will have no liability (for indemnification or otherwise)
with respect to any representation or warranty,  or covenant or obligation to be
performed and complied with prior to such Closing,  other than those in Sections
6.2, 6.4 and claims relating to Seller's obligation to pay Excluded  Liabilities
(the  "Extended  Claims"),  unless on or before  eighteen  (18) months after the
applicable  Closing Date Buyer notifies Seller of a claim specifying the factual
basis of that claim in reasonable detail;  provided,  however, that any Extended
Claims or a claim for indemnification or reimbursement based upon any obligation
to be performed and complied with after a Closing may be made at any time.

         13.2.  Agreement  by  Buyer to  Indemnify.  Buyer  agrees  that it will
indemnify  and  hold  Seller  harmless  in  respect  of  the  aggregate  of  all
Indemnifiable Damages (as herein defined).

                  13.2.1.   "Seller's   Indemnifiable  Damages"  means,  without
duplication,  the  aggregate  of  all  expenses,  losses,  costs,  deficiencies,
liabilities  and  damages  (including  related  counsel and  paralegal  fees and
expenses)  incurred or suffered by Seller,  on a pre-tax  basis,  together  with
interest  thereon from the date of loss until paid at the rate of 10% per annum,
to the extent (i) resulting from any breach of a  representation  or warranty of
Buyer in or pursuant to Article VII or elsewhere herein; (ii) resulting from any
breach of the  covenants  or  agreements  of Buyer in this  Agreement;  or (iii)
resulting  from the  failure of Buyer to pay,  discharge  or perform the Assumed
Liabilities.


                                       36
<PAGE>

                  13.2.2. Without limiting the generality of the foregoing, with
respect to the measurement of Seller's Indemnifiable Damages,  Seller shall have
the right to be put in the same financial  position as it would have been in had
each of the  representations  and  warranties of Buyer been true and correct and
had each of the covenants of Buyer been performed in full.

                  13.2.3.  Within  ten  (10)  business  days  after  Seller  has
received  written notice of or has actual knowledge of any claim by a person not
a party to this Agreement (a "Third  Person") or the  commencement of any action
or proceeding by a Third Person,  Seller shall give Buyer written notice of such
claim or the commencement of such action or proceeding.  Such notice shall state
the nature and the basis of such claim and a  reasonable  estimate of the amount
thereof. Buyer shall have the right to defend and settle, at its own expense and
by its own  counsel,  any such matter so long as Buyer  pursues the same in good
faith and diligently. If Buyer undertakes to defend or settle, it shall promptly
notify Seller of its intention to do so, Seller shall  cooperate  with Buyer and
its  counsel  in  the  defense  thereof  and  in any  settlement  thereof.  Such
cooperation  shall include,  but shall not be limited to,  furnishing Buyer with
any books,  records or  information  reasonably  requested  by Buyer that are in
Seller's possession or control.  Notwithstanding the foregoing, the Seller shall
have the right to participate in any matter through  counsel of its own choosing
at its own expense (unless there is a conflict of interest that prevents counsel
for Buyer from  representing  Seller,  in which case  Buyer will  reimburse  the
Seller for the expenses of its counsel);  provided that Buyer's counsel shall be
lead counsel and shall determine  litigation and settlement steps,  strategy and
the like.  After Buyer has notified the Seller of its  intention to undertake to
defend  or  settle  any  such  asserted  liability,  and for so  long  as  Buyer
diligently  pursues such defense,  Buyer shall not be liable for any  additional
legal expenses  incurred by Seller in connection  with any defense or settlement
of such asserted liability, except to the extent such participation is requested
by Buyer,  in which event Seller  shall be  reimbursed  by Buyer for  reasonable
additional legal expenses and  out-of-pocket  expenses and except as provided in
the immediately  preceding sentence.  If Buyer does not undertake to defend such
matter to which  Seller  is  entitled  to  indemnification  hereunder,  or fails
diligently to pursue such defense, the Seller may undertake such defense through
counsel of its choice,  at the cost and expense of Buyer,  and Seller may settle
such  matter,  and Buyer  shall  reimburse  Seller for the  amount  paid in such
settlement  and  any  other  liabilities  or  expenses  incurred  by  Seller  in
connection therewith.

                  13.2.4 A claim by Seller for indemnification of any matter not
involving a claim by a Third Person, may be asserted by notice to Buyer.

                  13.2.5 Time  Limitations on Claims Against Buyer. If a Closing
occurs,  Buyer will have no liability (for  indemnification  or otherwise)  with
respect to any  representation  or  warranty,  or covenant or  obligation  to be
performed and complied with prior to such Closing,  other than those in Sections
7.2, and claims relating to Buyer's  obligation to pay Assumed  Liabilities (the

                                       37
<PAGE>

"Extended  Claims"),  unless  on  or  before  eighteen  (18)  months  after  the
applicable Closing Date, Seller notifies Buyer of a claim specifying the factual
basis of that claim in reasonable detail;  provided,  however, that any Extended
Claims or a claim for indemnification or reimbursement based upon any obligation
to be performed and complied with after a Closing may be made at any time.

         13.3.   Indemnification   Threshold.   Neither  party  shall  have  any
obligation to indemnify  the other until the  aggregate  damages from all claims
for Buyer  Indemnified  Damages or Seller  Indemnified  Damages  (which  ever is
applicable,  hereinafter  in this  Section  13.3  referred to as the  "Damages")
suffered  by the  party  seeking  indemnity  exceeds  the  sum  of  Two  Hundred
Twenty-five Thousand Dollars ($225,000.00).  Provided,  however, once the sum of
Two Hundred Twenty-Five  Thousand Dollars  ($225,000.00) in aggregate of Damages
from all  claims  as  provided  herein  is  exceeded,  the  total  amount of the
aggregate  Damages  suffered by the party seeking  indemnity  shall be collected
without regard to the Two Hundred Twenty-five Thousand Dollars  ($225,000.00) de
minimis figure provided for herein.

         13.4. Mediation of Disputes. Any controversy, claim, or dispute arising
out of or  relating  to this  contract,  or the breach  thereof,  that cannot be
settled by good faith  negotiation  between the parties  will be  submitted  for
non-binding  mediation  prior to the  exercise  of any legal  remedies by either
party hereto. The mediator will be selected by mutual agreement of the parties.

         13.5.  Enforceability of Modifications to Survival of Remedies.  Seller
and Buyer  each  acknowledge  and agree (i) that the  amounts  involved  in this
Agreement  are in excess of the  amounts  that  permit the  parties to limit the
survival  periods of their  remedies  under  Section  16.070 of the Texas  Civil
Practices and Remedies Code and (ii) that such statute otherwise applies to this
transaction.


                                   ARTICLE XIV
                                  Miscellaneous

         14.1.  Transaction  Expenses.  Each party  shall bear its own  expenses
incurred in connection with the  transactions  contemplated  hereby.  Buyer will
indemnify and hold harmless the Seller from the commission,  fee or claim of any
person or entity  employed or retained or claiming to be employed or retained by
Buyer to bring  about,  or to  represent  it in, the  transactions  contemplated
hereby.  Seller will indemnify and hold harmless Buyer from the commission,  fee
or claim of any person or entity employed or retained or claiming to be employed
or  retained  by Seller to bring  about,  or to  represent  any of them in,  the
transactions contemplated hereby.



                                       38
<PAGE>


         14.2. Amendment and Modification.  The parties hereto may amend, modify
and  supplement  this  Agreement in such manner as may be agreed upon by them in
writing.

         14.3.    Termination.

                  14.3.1. Anything to the contrary herein notwithstanding,  this
Agreement may be terminated and the subsequent transactions  contemplated hereby
may be abandoned:

                           (a)      By the mutual written  consent of all of the
                                    parties  hereto  at any  time  prior  to any
                                    Closing Date;

                           (b)      By  Buyer,   if  Seller  has  not  satisfied
                                    Buyer's  Condition  of Closing  set forth in
                                    Section 10.1 and Buyer's other conditions of
                                    the Initial  Closing on or prior to December
                                    31,  2001  (other  than as a  result  of the
                                    failure of Buyer to satisfy its  obligations
                                    under this Agreement);

                           (c)      By  Seller,   if  Buyer  has  not  satisfied
                                    Seller's  Conditions of the Initial  Closing
                                    set  forth  in  Section  11.1 on or prior to
                                    December 31, 2001 (other than as a result of
                                    the   failure  of  Seller  to  satisfy   its
                                    obligations under this Agreement);

                           (d)      By the  Buyer  at any  time  prior  to  each
                                    Closing  Date if there shall be a pending or
                                    threatened action or proceeding by or before
                                    any court or other  governmental  body which
                                    shall   seek  to   restrain,   prohibit   or
                                    invalidate  the  sale  of  the   Transferred
                                    Assets or any  portion  thereof to the Buyer
                                    or  any   other   transaction   contemplated
                                    hereby,  or which might  affect the right of
                                    the Buyer to own,  operate in their entirety
                                    or control the  Transferred  Assets,  or any
                                    material portion thereof,  and which, in the
                                    reasonable  judgment of the Buyer,  makes it
                                    inadvisable to proceed with the transactions
                                    contemplated by this Agreement; and

                           (e)      By any  party in the  event of the  material
                                    breach by any other  party of any  provision
                                    of  this  Agreement,  which  breach  is  not
                                    remedied by the  breaching  party  within 15
                                    days after  receipt of notice  thereof  from
                                    the non-breaching party.

                           (f)      By   Seller   if   Seller   has   used   its
                                    Commercially   Reasonable  Best  Efforts  to
                                    satisfy  Buyer's  Condition  of Closing  set
                                    forth in Section  11.2,  but such  condition
                                    has  not  been  satisfied  on  or  prior  to
                                    December 31, 2001.

                                       39
<PAGE>

         If this Agreement is terminated  pursuant to clause (a) of this Section
14.3.1,  no party  shall have any  liability  for any costs,  expenses,  loss of
anticipated profit or any further obligation for breach of warranty or otherwise
to any other party to this Agreement. Any termination of this Agreement pursuant
to clause (b),  (c), (d), (e) or (f) of this  paragraph  14.3.1 shall be without
prejudice to any other rights or remedies of the respective parties. Except with
respect to partial  terminations  of the  obligation to acquire ROEs as to which
consents  are not  obtained  (as set  forth  in  Section  5.1.5),  any  rightful
termination  by Buyer  pursuant to the  provisions of this Section  14.3.1 shall
relieve Buyer of any  obligation to pay Seller any portion of the Purchase Price
as to the Transferred Assets not yet acquired.

                  14.3.2.  The risk of any loss to the  properties to be sold by
the  Seller  hereunder  and all  liability  with  respect  to injury  and damage
occurring in connection therewith shall be the sole responsibility of the Seller
until the  completion of each Closing.  If any material part of said  properties
subject to the Closing shall be damaged by fire or other  casualty  prior to the
completion  of the Closing  hereunder,  the Seller shall so notify the Buyer and
the Buyer shall have the right and option:

                           (a)      To   terminate   this   Agreement,   without
                                    liability  to any party hereto as to any MDU
                                    Property  and  related   Transferred  Assets
                                    damaged by fire or other casualty; or

                           (b)      To proceed with any given Closing hereunder,
                                    in  which  event  such  casualty  shall  not
                                    constitute  a breach  by the  Seller  of any
                                    representation, warranty or covenant in this
                                    Agreement,  and the Buyer  shall be entitled
                                    to  receive   and   retain   the   insurance
                                    proceeds,   if  any,   arising   from   such
                                    casualty.

         In the event that Buyer elects to terminate  this Agreement as to a MDU
Property and related  Transferred  Assets  damaged by fire or  casualty,  Seller
shall have the right  within nine (9) months  thereafter  to rebuild and restore
the Transferred Assets related to the MDU Property to a condition and quality at
least equal to the condition and quality of  Transferred  Assets before the fire
or casualty.  If such Transferred  Assets are so rebuilt and restored and Seller
provides  Buyer with one hundred  twenty (120) days prior written  notice of its
intent to sell the rebuilt and restored  Transferred Assets to Buyer, Buyer will
purchase the Transferred Assets in accordance with the terms of the Agreement at
a time  designated by Buyer which is within one hundred  twenty (120) days after
Buyer's  receipt  of the  notice  of  Seller's  intent to sell the  rebuilt  and
restored  Transferred  Assets.  In the  alternative,  rather than rebuilding and
restoring  the  damaged  Transferred  Assets,  Buyer  shall  have  the  right to
substitute  comparable  Transferred Assets and sell such substitute  Transferred
Assets to Buyer in  accordance  with the terms of this  Agreement  by giving one
hundred twenty (120) days prior written notice of intent to sell such substitute

                                       40
<PAGE>

Transferred  Assets to Buyer;  provided  that the Buyer  shall  have  reasonable
discretion to (i) determine whether the proposed  substitute  Transferred Assets
are comparable to the damaged  Transferred  Assets, and (ii) the right to reject
such substitute  Transferred Asset if Buyer reasonably  determines that they are
not comparable.

         14.4.  Remedies.  Seller and Buyer  acknowledge  that,  if either is in
material  breach  or  default  of  its  covenants,   agreements  or  obligations
hereunder,  the other would be irreparably damaged by such breach or default and
that,  in  addition to the other  remedies  that may be  available  at law or in
equity,  the other  party shall be  entitled  to  specific  performance  of this
Agreement and  injunctive  relief.  All rights and remedies under this Agreement
are  cumulative  of, and not  exclusive  of, any  rights or  remedies  otherwise
available,  and the exercise of any of such rights or remedies shall not bar the
exercise of any other rights or remedies.

         14.5.  Entire  Agreement.  This  Agreement,  including the exhibits and
schedules,  and other documents  executed and delivered  contemporaneously  with
this Agreement,  contain the entire agreement of the parties hereto with respect
to  the  purchase  of  the   Transferred   Assets,   and  supersedes  all  prior
understandings  and agreements  (oral or written) of the parties with respect to
the  subject  matter  hereof,   including  without  limitation  superseding  and
replacing the following  documents:  (i) that one certain  nonbinding  letter of
intent dated July 10, 2001 (as amended  August 8, 2001 and as amended August 17,
2001 and  August  29,  2001),  by and  among  Seller  and  Buyer.  The  separate
Confidentiality  Agreement  dated April 4, 2001  between  Seller and Buyer shall
continue to be binding on the parties  and  survive  all  Closings.  The parties
expressly  represent and warrant that in entering into this  Agreement  they are
not relying on any prior  representations made by any other party concerning the
terms,  conditions  or effects of this  Agreement  which  terms,  conditions  or
effects  are not  expressly  set  forth  herein.  Any  reference  herein to this
Agreement shall be deemed to include the schedules and exhibits.

         14.6  Interpretation.  The  Recitals are  incorporated  as part of this
Agreement.  When a reference is made in this  Agreement to an article,  section,
paragraph,  clause,  schedule or exhibit, such reference shall be to an article,
section,  paragraph,  clause,  schedule  or  exhibit  of this  Agreement  unless
otherwise indicated.  The headings contained herein and on the schedules are for
reference  purposes  only  and  shall  not  affect  in any  way the  meaning  or
interpretation of this Agreement or the schedules. Whenever the words "include",
"includes" or "including" are used in this Agreement, they shall be deemed to be
followed by the words "without limitation". Time shall be of the essence in this
Agreement.

         14.7.  Execution in Counterpart.  This Agreement may be executed in any
number of  counterparts,  each of which shall be deemed an original,  but all of
which taken together shall constitute one and the same instrument.

                                       41
<PAGE>

         14.8. Notices. Any notice, consent, approval, request,  acknowledgment,
other  communications or information to be given or made hereunder to any of the
parties by any other party shall be in writing and (a) delivered personally, (b)
sent by certified mail, postage prepaid,  or (c) sent by facsimile (notices sent
by  facsimile  must be sent and received on a Business Day prior to 5:00 p.m. at
recipients  location to be  effective on such day and if sent after 5:00 pm on a
Business Day the notice will be effective on the next Business Day) as follows:

         If to the Seller, addressed to:

                  USOL, Inc.
                  10300 Metric Blvd.
                  Austin, Texas  78758
                  Attention:  Seth Davis
                  Fax number:  (512) 651-3768

         With copy to:

                  Stahl, Martens & Bernal, L.L.P.
                  7320 N. MoPac, Suite 211
                  Austin, Texas  78731
                  Attn:  Brent Stahl
                  Fax number:  (512) 346-2712

         If to the Buyer, addressed to:

                  Grande Communications, Inc.
                  401 Carlson Circle
                  San Marcos, Texas   78666
                  Attention: J Findley
                  Fax number: (512) 878-4287

         With a copy to:

                  Grande Communications, Inc.
                  401 Carlson Circle
                  San Marcos, Texas   78666
                  Attention: General Counsel
                  Fax number: (512) 878-4287



                                       42
<PAGE>

                  Bickerstaff, Heath, Smiley, Pollan, Kever & McDaniel, L.L.P.
                  816 Congress, Suite 1700
                  Austin, Texas  78701-2443
                  Attn:  John E. Gangstad, Esq.
                  Fax number:  (512) 320-5638

Any party may change the address to which  notices  hereunder  are to be sent to
him or it by giving  written  notice of such  change of  address  in the  manner
herein  provided for giving notice.  Any notice  delivered  personally  shall be
deemed to have been given on the date it is so delivered,  any notice  delivered
by registered  or certified  mail shall be deemed to have been given on the date
it is received,  and any notice sent by  facsimile  shall be deemed to have been
given on the date it was sent (so long as the sender  receives  confirmation  of
transmission and a hard copy of such notice is sent by U.S. mail).

         14.9.  Governing Law. This Agreement shall be governed by and construed
in accordance  with the laws of the State of Texas  applicable to contracts made
and to be performed therein by residents thereof.

         14.10. Confidentiality;  Publicity. Except as may be required by law or
as  otherwise  permitted or expressly  contemplated  hereby,  no party hereto or
their  respective  Affiliates,   employees,  agents  and  representatives  shall
disclose  to any third  party  the  subject  matter  or terms of this  Agreement
without the prior consent of the other parties hereto. No press release or other
public announcement  related to this Agreement or the transactions  contemplated
hereby  will be issued by any party  hereto  without  the prior  approval of the
other  parties  hereto,  except  that any  party  hereto  may make  such  public
disclosure  which it believes in good faith to be required by law (in which case
such party will  consult  with the other  parties  hereto  prior to making  such
disclosure).

         14.11.  Severability.  If any term or other provision of this Agreement
is invalid,  illegal or incapable of being enforced by any rule of law or public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the  economic or legal  substance  of
the  transactions  contemplated  hereby is not affected in any manner adverse to
any party. Upon such  determination that any term or other provision is invalid,
illegal or incapable of being  enforced,  the parties hereto shall  negotiate in
good faith to modify this  Agreement so as to effect the original  intent of the
parties as  closely  as  possible  in an  acceptable  manner to the end that the
transactions contemplated hereby are fulfilled to the greatest extent possible.

         14.12.  Assignment.  Neither  this  Agreement  nor  any of the  rights,
interests  or  obligations  hereunder  shall be  assigned  by any of the parties
hereto without the prior consent of the party hereto.

                                       43
<PAGE>

         14.13.  Binding Effect;  No Third Party  Beneficiaries.  This Agreement
shall inure to the benefit of, be binding upon and be enforceable by and against
Seller and Buyer and their  respective  successors  and permitted  assigns,  and
nothing herein  expressed or implied shall be construed to give any other person
or entity any legal or equitable rights hereunder.

         14.14.   Additional   Representations.   Each  party  hereto  expressly
represents  and warrants to all other parties  hereto that (a) before  executing
this  Agreement,  said party has fully informed  itself or himself of the terms,
contents,  conditions and effects of this  Agreement;  (b) said party has relied
solely and completely  upon its or his own judgment in executing this Agreement;
(c) said party has had the  opportunity  to seek and has  obtained the advice of
counsel before  executing this Agreement;  (d) said party has acted  voluntarily
and of its or his own free will in executing this  Agreement;  (e) said party is
not acting  under  duress,  whether  economic or  physical,  in  executing  this
Agreement;  and (f) this  Agreement is the result of  arm's-length  negotiations
conducted by and among the parties and their counsel.



                  [Remainder of this page intentionally blank.]






                                       44
<PAGE>


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

                                   SELLER:
                                   USOL, INC.
                                   A Delaware Corporation

                                   BY:___________________________
                                   Name:_________________________
                                   Title:___________________________


                                   BUYER:
                                   GRANDE COMMUNICATIONS, INC.
                                   A Delaware Corporation

                                   BY:______________________________
                                   Name:___________________________
                                   Title:_____________________________







U.S.-Austin  Cable  Associates  I,  Ltd.,  does  hereby  join in  this  Purchase
Agreement  for the  limited  purpose  of (i)  agreeing  to  convey  to  Buyer in
accordance  with the  terms  of this  Purchase  Agreement  that  portion  of the
Transferred  Assets which is owned by the undersigned and (ii) agreeing that the
consideration  to be paid by Buyer  for the  assets so  conveyed  may be paid to
USOL,  Inc.  and  that  Buyer  shall  have no  obligation  to see to the  proper
application of such sales proceeds.

                                     U.S.-Austin Cable Associates I, Ltd.


                                     BY: USOL, Inc., General Partner

                                     BY:__________________________,
                                     its ___________________________


<PAGE>


                                   SCHEDULE A
                            *[Intentionally Omitted.]













*Confidential  Treatment Requested.  Confidential portions of this document have
been redacted and filed separately with the Commission.


<PAGE>

                                   SCHEDULE B
                            *[Intentionally Omitted.]










*Confidential  Treatment Requested.  Confidential portions of this document have
been redacted and filed separately with the Commission.



<PAGE>
                                   SCHEDULE C
                 Cities and Towns in Austin/San Antonio Corridor

City

Austin
San Marcos
West Lake Hills
Sunset Valley
Pflugerville
Buda
Round Rock
*Rollingwood
*Cedar Park
*Georgetown
*Kyle
*Leander

New Braunfels
San Antonio
Windcrest
Universal City
Alamo Heights
Schertz
Hollywood Park
Olmos Park
Kirby
Balcones Heights
Selma
Garden Ridge
Cibolo
Converse
Leon Valley
Terrell Hills
Live Oak
Castle Hills Hill Country Village
*Shavano Park

NOTE: Grande shall not be obligated to provide any service to starred properties
until  such  time as they  have  received  an  enforceable  franchise  for  each
respective area.


<PAGE>


                                    EXHIBIT A

                BILL OF SALE, ASSIGNMENT AND ASSUMPTION AGREEMENT

         THIS  BILL  OF  SALE,   ASSIGNMENT  AND  ASSUMPTION   AGREEMENT   (this
"Agreement")  is made as of  ____________,  2001,  by  USOL,  Inc.,  a  Delaware
corporation ("Seller"), and Grande Communications,  Inc., a Delaware corporation
("Buyer"). The sale, assignment and assumption accomplished by this Agreement is
made in connection with a certain Purchase  Agreement dated  ___________,  2001,
between  Seller and Buyer (the  "Purchase  Agreement").  Capitalized  terms used
herein shall have the meanings assigned to them in the Purchase Agreement unless
the context requires otherwise.

         By this Agreement,  Seller assigns, transfers, and conveys to Buyer all
of its rights,  title,  and interest in and to that  portion of the  Transferred
Assets  described  on  Schedule 1 attached  hereto (the  "Scheduled  Transferred
Assets") to have and to hold all and singular the Scheduled  Transferred  Assets
unto Buyer and its successors  and assigns to their own use and behalf  forever,
and Buyer assumes,  accepts,  and undertakes and agrees to perform and discharge
when due that  portion  of the  Assumed  Liabilities  described  on  Schedule  2
attached hereto (the "Scheduled Assumed Liabilities") (as Buyer of the Scheduled
Transferred  Assets and Scheduled Assumed  Liabilities from Seller) arising from
and after the date of this Agreement.

         Except for the Scheduled Assumed Liabilities,  Assignee does not assume
and  shall  not be  obligated  to pay,  perform,  or  discharge  any  liability,
obligation,  debt,  charge,  or expense of Seller of any kind,  description,  or
character, whether accrued, absolute, contingent, or otherwise.

         Seller hereby  warrants to Buyer that Seller is the lawful owner of the
Scheduled  Transferred Assets, that all components of the Scheduled  Transferred
Assets are free from any mortgage, pledge, lien, charge,  encumbrance,  lease or
security  interest,  except with regard to the Permitted  Liens, and that Seller
has good  right as to all  persons  to sell the same as  aforesaid;  and  Seller
hereby  covenants  with  Buyer  that  Seller,  to the  extent  of the  foregoing
warranty,  will warrant and forever defend all such components and the Scheduled
Transferred  Assets against the claims and demands of all persons.  This Bill of
Sale is binding  on Seller  and its  successors  and  assigns  and inures to the
benefit of Buyer and its successors and assigns.

         Buyer agrees to indemnify  and hold Seller  harmless for the  Scheduled
Assumed  Liabilities  in accordance  with the  provisions of Section 13.2 of the
Purchase Agreement.  Seller agrees to indemnify and hold Buyer harmless from all
of  the  Excluded  Liabilities  (as  defined  in  the  Purchase  Agreement),  in
accordance with the provisions of Section 13.1 of the Purchase Agreement.



<PAGE>


         This  Agreement  shall be governed by and  interpreted  and enforced in
accordance  with the  internal  laws of the  State of Texas  without  regard  to
conflicts  of law  principles  (whether  of the  State  of  Texas  or any  other
jurisdiction)  that  would  result  in  the  application  of  the  laws  of  any
jurisdiction other than the State of Texas.

         Signed as of the date first written above.

                                   SELLER:
                                   USOL, INC.
                                   A Delaware Corporation


                                   By:
                                      ---------------------------------------
                                   Name:
                                        -------------------------------------
                                   Title:
                                         ------------------------------------



                                   BUYER:
                                   GRANDE COMMUNICATIONS, INC.
                                   A Delaware Corporation


                                   By:
                                      ----------------------------------------
                                   Name:
                                        --------------------------------------
                                   Title:
                                         -------------------------------------







<PAGE>


                                  2.1.1 CHART


                            *[Intentionally Omitted.]














*Confidential  Treatment Requested.  Confidential portions of this document have
been redacted and filed separately with the Commission.



<PAGE>




                                 SCHEDULE 2.1.1
                                 --------------

                     Equipment included in Transferred Asset
                     ---------------------------------------


The following  categories of Equipment are part of the Transferred Assets to the
extent such  category is marked with an "x" in the chart  immediately  following
this page. All MDU  Properties  listed in the chart  immediately  following this
page have the Transferred Assets described below if such chart has an "x" marked
under such category for such MDU Property.

Cable Plant
-----------
Fixed assets include the medium for transporting  cable signals from the headend
room to the buildings  (outside  plant).  This is comprised of various grades of
buried coaxial cable, CATV pedestals,  building entrance terminals/lockboxes and
active/passive devices.

Phone Plant
-----------
Fixed  assets  include the medium for  transporting  telephone  signals from the
switch room to the  buildings  (outside  plant).  This is  comprised  of various
grades of buried telephone cable,  MPOE,  telephone  pedestals,  50 and 100 pair
protectors  (gas and solid state),  building  entrance  terminals/lockboxes  and
active/passive devices.

Analog Converter Boxes
----------------------
Converter  boxes are  equipment  that allows for the reception of a cable signal
via a set-top box located in the user's apartment.

Traps
-----
Traps include  tap-mounted  subscriber  devices  utilized to remove or add cable
services at the unit level.  This includes positive and negative traps. If Buyer
in its sole  discretion  determines  traps will not be used on the  property  on
which they are located,  they will be transferred  to Seller at no cost.  Seller
will be responsible for removing the traps from the property.

Utility Buildings - Removable
-----------------------------
Removable utility buildings include  non-permanent  rooms for storage of headend
equipment. Buyer will assume any recurring cost associated with the building. If
Buyer in its sole discretion  determines any removable building will not be used
on the property on which it is located,  it will be  transferred to Seller at no
cost. Seller will be responsible for removing the building from the property.

Service Equipment - Plant
-------------------------
Service equipment includes  miscellaneous  assets used in the maintenance of the
Cable or Phone outside plant.

Security Equipment
------------------
Security fixed assets includes cameras and equipment that allow for residents to
monitor a "gate" camera channel at the property.

PBX Systems
-----------
Includes  on-premise PBX (key systems) used by leasing  offices to support their
internal office phone system.

Spare Parts
-----------
Spare  materials  located  on the MDU  Property  used in the  outside  plant for
maintenance purposes, including active and passive devices.



<PAGE>

                                 SCHEDULE 2.1.3
                                 --------------

                            *[Intentionally Omitted].













*Confidential  Treatment Requested.  Confidential portions of this document have
been redacted and filed separately with the Commission.



<PAGE>
                                 SCHEDULE 2.1.4
                                 --------------

                                      None
















<PAGE>

                                 SCHEDULE 2.1.6
                                 --------------

                                   Contracts
                                   ---------


None.


<PAGE>


                                   2.2 CHART

                            *[Intentionally Omitted]
















*Confidential  Treatment Requested.  Confidential portions of this document have
been redacted and filed separately with the Commission.

<PAGE>

                                  SCHEDULE 2.2
                                  ------------

                                 Excluded Assets
                                 ---------------

The Excluded  Assets are  everything  not  described as a  Transferred  Asset on
Schedule  2.1.1.  Without  limiting the foregoing,  some of the Excluded  Assets
located on the MDU Properties are described below.

SMATV/Headend Equipment
-----------------------
Headend equipment includes assets that receive,  modulate,  process, amplify and
combine  television  signals for transmission  through television coaxial cable.
Headend  equipment  includes  relay racks,  modulators,  processors,  combiners,
digicyphers, IRD's, multi-switches,  QAM transcoders, encoders, off-air antennae
and satellite dishes.

Microwave Equipment
-------------------
Microwave   equipment   includes   assets   utilized  in18  GHz   point-to-point
transmission and reception.  Such assets include  receivers,  receiving  dishes,
splitting networks, transmitters, transmit dishes and dehydrators.

Phone Switch Equipment
----------------------
Telephone  equipment  includes the primary DXC, LXC and LIM telephone  switching
and routing  equipment.  Phone switch equipment includes  racks/cabinets,  power
supplies, batteries, CSU/DSU and switch cabling.

Towers and Monopoles
--------------------
Towers and  monopoles  include  the support  structures  and  equipment  used to
transmit and/or receive cable television  signals.  Such assets include transmit
towers/monopoles and receive  towers/monopoles.  Tower/monopole  bases/platforms
will remain.

Service Equipment
-----------------
Service equipment includes  miscellaneous assets used in the maintenance of USOL
headends,  microwave and switch  equipment.  Service  equipment  includes  spare
parts, tools and test equipment.

Digital Converter Boxes
-----------------------
Converter  boxes are  equipment  that allows for the reception of a cable signal
via a set-top box located in the users apartment. Any customer receiving digital
cable service requires a converter box to receive this service.

Interdiction Equipment
----------------------
Interdiction  equipment  (addressable  taps) allows for the remote upgrading and
downgrading of cable services at multiple properties via a "controller" which is
kept in a central location.  Seller will remove  interdiction  housings.  Grande
will be responsible for replacing Interdiction taps with their own taps.


Without  limiting the foregoing,  the some of the Excluded Assets are identified
by an "x" marked next to the applicable MDU Property for the applicable category
above on the chart that immediately follows this page. Any item identified by an
"x" on such chart is part of the Excluded Assets.






<PAGE>


                                  SCHEDULE 3.2
                                  ------------

                               Assumed Liabilities
                               -------------------


1. All  obligations  of Seller  under all of the ROEs  listed  or  described  in
Section 2.1.3 of the Agreement or in Schedule 2.1.3 of the Agreement.

2. All obligations of Seller under all of the Subscriber Agreements in effect as
of each  Closing  under the ROEs  listed or  described  in Section  2.1.3 of the
Agreement or in Schedule 2.1.3 of the Agreement;  provided, however, Buyer shall
not assume any obligations to refund prepayments made by Subscribers,  nor shall
Buyer assume any obligations to refund deposits made by Subscribers.



















<PAGE>


                                  SCHEDULE 4.4
                                  ------------

                            *[Intentionally Omitted].












*Confidential  Treatment Requested.  Confidential portions of this document have
been redacted and filed separately with the Commission.


<PAGE>


                                  SCHEDULE 5.1
                                  ------------

                            *[Intentionally Omitted].



















*Confidential  Treatment Requested.  Confidential portions of this document have
been redacted and filed separately with the Commission.

<PAGE>

                                  SCHEDULE 6.1
                                  ------------

                          Ownership Interest of Seller
                          ----------------------------



Ownership  of  50,000,000  outstanding  shares  (99%)  of the  common  stock  of
TheResidentClub, Inc., a Delaware Corporation.

     50% general partnership  interest in U.S.- Austin Cable Associates I, Ltd.,
     a Texas Limited Partnership.

<PAGE>


                                  SCHEDULE 6.3
                                  ------------

                                Required Consents
                                -----------------

1. Consents from owners of the MDU Properties under the ROEs listed or described
in Section 2.1.3 of the Agreement or in Schedule 2.1.3 to the Agreement,  to the
extent such consents are required under the terms of such ROEs.

2. Consent from the Seller's  lenders under its Credit  Agreement dated December
30, 1999, as amended, to permit the transactions  contemplated by this Agreement
and to modify Seller's financial covenants in a manner reasonably  acceptable to
Seller.

<PAGE>




                                  SCHEDULE 6.4
                                  ------------

                 Liens to be Released at each applicable Closing
                 -----------------------------------------------

1. At each  Closing,  all  Liens  held by  Seller's  lenders  under  its  Credit
Agreement  dated December 30, 1999, as amended,  must be released as to the ROEs
that are the subject of each such Closing.

2. Any Liens held by applicable  governmental  authorities  in  connection  with
Travis  County,  et al v U.S.  On-Line  Cable,  L.L.C.  and  a/k/a  U.S.  OnLine
Communications, L.L.C., Cause No. GV-101743, Travis County, Texas.


<PAGE>


                                  SCHEDULE 6.5
                                  ------------


                            *[Intentionally Omitted.]




















*Confidential  Treatment Requested.  Confidential portions of this document have
been redacted and filed separately with the Commission.




<PAGE>

                                  SCHEDULE 6.7
                                  ------------

              Exceptions as to Seller's Empoloyee Representations
              ---------------------------------------------------


None.



<PAGE>


                                  SCHEDULE 6.8
                                  ------------

                            *[Intentionally Omitted].

















*Confidential  Treatment Requested.  Confidential portions of this document have
been redacted and filed separately with the Commission.


<PAGE>


                                  SCHEDULE 6.9
                                  ------------

                            *[Intentionally Omitted].



















*Confidential  Treatment Requested.  Confidential portions of this document have
been redacted and filed separately with the Commission.




<PAGE>


                                 SCHEDULE 6.10
                                 -------------

                            *[Intentionally Omitted]





















*Confidential  Treatment Requested.  Confidential portions of this document have
been redacted and filed separately with the Commission.



<PAGE>



                                SCHEDULE 6.10(f)
                                ----------------

                            *[Intentionally Omitted].
























*Confidential  Treatment Requested.  Confidential portions of this document have
been redacted and filed separately with the Commission.


<PAGE>

                                SCHEDULE 6.11(c)

                                 SYSTEMS STATUS

                            *[Intentionally Omitted]













*Confidential  Treatment Requested.  Confidential portions of this document have
been redacted and filed separately with the Commission.


<PAGE>


                                 SCHEDULE 6.13
                                 -------------

                            *[Intentionally Omitted]



















*Confidential  Treatment Requested.  Confidential portions of this document have
been redacted and filed separately with the Commission.



<PAGE>


                                SCHEDULE 6.18
                                -------------

                            *[Intentionally Omitted].



















*Confidential  Treatment Requested.  Confidential portions of this document have
been redacted and filed separately with the Commission.




<PAGE>


                                 SCHEDULE 12.7
                                 -------------

                            *[Intentionally Omitted]

















*Confidential  Treatment Requested.  Confidential portions of this document have
been redacted and filed separately with the Commission.


<PAGE>
                                    EXHIBIT B


                    FORM OF OPINION OF COUNSEL TO THE SELLER
                    ----------------------------------------

________   ____, 2001

Grande Communications, Inc.
401 Carlson Circle
San Marcos, Texas 78666

Ladies and Gentlemen:

     We have acted as counsel to USOL, Inc.,  ("Seller") a Delaware corporation,
and U.S.-Austin Cable Associates I, Ltd., ("USACA") a Texas limited partnership,
in  connection  with  the  Purchase  Agreement,  dated  August  ___,  2001  (the
"Agreement"),  among  Seller,  and  Grande  Communications,   Inc.,  a  Delaware
corporation  ("Buyer")  and being  joined by USACA.  This is the opinion  letter
contemplated by Section 5.2.1(e) of the Agreement. All capitalized terms used in
this opinion letter  without  definition  have the respective  meanings given to
them in the Agreement.

     Our  opinions  are limited in all  respects to the  substantive  law of the
State of Texas and the General Corporation Law of the State of Delaware, and the
federal  law of the United  States,  and we assume no  responsibility  as to the
applicability  thereto,  or the  effect  thereon,  of  the  laws  of  any  other
jurisdiction.

     1. DOCUMENTS REVIEWED

     (a) Documents  Reviewed  -Transaction  Documents.  As counsel to Seller, we
have  reviewed  the  following  documents  and  instruments  (collectively,  the
"Transaction Documents"):

          (i) the Agreement;

          (ii) the Bill of Sale and Assignment and Assumption Agreement;

          (iii) the Services Agreement (together with the form of Interim System
     Management Agreement attached thereto); and

          (iv) any  additional  documents  and  instruments  to be  delivered by
     Seller or USACA at the Closing.

     (b) Other Documents  Reviewed.  As counsel to Seller,  we have reviewed the
following documents and instruments:



<PAGE>

          (i) copies of resolutions  adopted by the Board of Directors of Seller
     authorizing  the execution,  delivery and  performance  of the  Transaction
     Documents and certified by the Seller's  Secretary (unless such resolutions
     are effected by unanimous  written  consent of the Seller's  directors,  in
     which instance no secretary's certificate is relied upon); and

     2. QUALIFICATIONS

     Whenever  any of the  phrase  "to  the  best  of our  knowledge,"  "to  our
knowledge," "known to us," or words of similar import,  appears in this Opinion,
it  means,  unless  otherwise  expressly  stated  herein,  (a)  we  have  relied
exclusively  on the review of the documents  described in paragraphs (i) through
(iv) above and the Officer's Certificates referred to above, (b) we have made no
examination of public records (including,  without limitation,  the plaintiff or
defendant  indices of state and federal  courts),  whether or not examination or
investigation  might  otherwise be reasonable or prudent and (c) no attorney (1)
who has  participated in  representing  the Seller during the last twelve months
and (2) who is  currently  employed  by or is a  member  of  this  firm  has any
conscious  awareness of facts which indicates that any of the opinions contained
herein which are made to our knowledge are untrue.  Unless  otherwise  expressly
stated herein, we have not undertaken any independent investigation to determine
the existence or absence of any such facts or other information and no inference
as to the  existence  or  absence  of  such  facts  should  be  drawn  from  our
representation of the Seller.

     3. ASSUMPTIONS

     In our examination,  we have assumed, without investigation or inquiry, the
authenticity of all documents  submitted to us as originals,  the genuineness of
all signatures,  the legal capacity of natural persons and the conformity to the
originals  of all  documents  submitted to us as copies.  In addition,  we have,
without  investigation  or inquiry,  assumed (i) that all of the parties to such
documents have all requisite power and authority to execute, deliver and perform
their  respective  obligations  under each of the  documents to which they are a
party  (other than the power and  authority  of the Seller and USACA to execute,
deliver and perform its obligations under the Transaction Documents);  (ii) that
each of the  documents has been duly  authorized by all necessary  action on the
part of such parties (other than due authorization of the Transaction  Documents
by the  Seller  and  USACA)  as are a  party  thereto;  (iii)  that  each of the
documents  has been duly  executed and  delivered by such parties as are a party
thereto (other than due execution and delivery of the  Transaction  Documents by
the Seller and USACA);  and (iv) that each of the documents  are valid,  binding
and  enforceable  obligations  of all  parties  (other  than upon the Seller and
USACA).

     As to the truth and accuracy of all factual  matters  which are relevant to
this Opinion,  we have relied,  without  investigation  or inquiry,  solely upon
certificates or other comparable documents of officers or other  representatives
of the Seller (the "Officer's Certificates"), certificates of governmental


<PAGE>



agencies  and upon the  representations  and  warranties  of each of the parties
contained in the Agreement and upon the relevant  facts stated  therein,  all of
which we have assumed to be true and complete.

     4. OPINIONS

     On the basis of the foregoing and in reliance thereon,  and on the basis of
such  other  matters as we deemed  relevant  under the  circumstances,  and upon
consideration of the applicable Texas and United States federal laws, subject to
the limitations,  qualifications and assumptions set forth herein, we are of the
opinion that as of the date hereof:

     (a)  The  Agreement,  the  Bill  of  Sale  and  Assignment  and  Assumption
Agreement,  the Services Agreement and the other Transaction Documents have been
duly  authorized,  executed  and  delivered by Seller and  constitute  valid and
binding  obligations of Seller,  enforceable  against Seller in accordance  with
their terms.  The Agreement and the Bill of Sale and  Assignment  and Assumption
Agreement,  have been duly  executed and delivered by USACA and  constitute  the
valid and binding obligation of USACA,  enforceable  against USACA in accordance
with  its  terms.  This  opinion  is  subject  to  bankruptcy,   reorganization,
insolvency and other similar laws affecting the enforcement of creditors' rights
in general and to general principles of equity (regardless of whether considered
in a proceeding in equity or an action of law).

     (b) Seller is a corporation duly incorporated, validly existing and in good
standing  under  the laws of the State of  Delaware,  with  corporate  power and
authority to execute and deliver the Agreement and consummate  the  transactions
contemplated by the Agreement and the other Transaction  Documents,  and is duly
qualified and in good standing as a foreign  corporation  in the State of Texas.
USACA is a limited partnership,  validly existing and in good standing under the
laws of the  State of  Texas  and  USOL,  Inc.,  its  general  partner,  has the
requisite  power and authority to execute and deliver the Agreement and the Bill
of Sale and Assignment and Assumption Agreement.

     (c)  Neither  the   execution   and  delivery  of  the  Agreement  nor  the
consummation of any or all of the transactions contemplated in the Agreement and
the other Transaction Documents (a) violates any provision of the certificate of
incorporation  or bylaws (or other governing  instrument) of Seller;  (b) to our
knowledge,  breaches or constitutes a default (or an event that,  with notice or
lapse of time or both,  would  constitute  a default)  under,  or results in the
termination  of,  or  accelerates  the  performance   required  by,  or  excuses
performance  by any  Person  of any of its  obligations  under,  or  causes  the
acceleration  of the maturity or any debt or obligation  pursuant to, or results
in the creation or imposition of any Lien upon any property or assets of Seller;
or (c) to our knowledge,  violates any statute,  law, regulation or rule, or any
judgment,  decree  or  order  known to us of any  court  or  other  Governmental
Authority  applicable to Seller.  For purposes of this  opinion,  we have relied
upon a  certificate  of an officer of Seller as to the existence and identity of
judgments, decrees or orders of court covered by this paragraph.

<PAGE>




     (d)  To  our  knowledge  no  consent,  approval  or  authorization  of,  or
declaration, filing or registration with, any Governmental Authority is required
by Seller in connection  with the execution and delivery of the Agreement or the
consummation  of the  transactions  contemplated  by the  Agreement or the other
Transaction Documents.


     We hereby confirm to you that to our knowledge there is no proceeding by or
before any court or Governmental Authority pending or overtly threatened against
or involving  Seller or USACA that  questions or challenges  the validity of the
Agreement or any action taken or to be taken by Seller or USACA  pursuant to the
Agreement or in connection with the  transactions  contemplated by the Agreement
and the other Transaction Documents.


     Our  opinion  set forth in  Paragraph  (b) above that the Seller is validly
existing and in good  standing  under the laws of the State of Delaware is given
as of the dates set forth below and it is based solely upon:

          (i) copies of the Certificate of Incorporation of Seller, certified by
     the Secretary of State of Delaware as of _______;

          (ii) a letter of good  standing  with  respect to the Seller  from the
     Secretary of State of the State of Delaware, dated ______ ___, 200__.

          (iii) copies of the Bylaws of Seller, certified to be true and correct
     by the Secretary of Seller;

          (iv) copies of the  Certificate  of Authority of Seller to do business
     in the State of Texas dated ________;

          (v) copies of certificates  from the Comptroller of Public Accounts of
     Texas and from the Secretary of State of dated  ________  Texas  indicating
     that Seller is good standing in the State of Texas;


     Our  opinion  set forth in  Paragraph  (b) above  that the USACA is validly
existing and in good  standing  under the laws of the State of Texas is given as
of the dates set forth below and it is based solely upon:

          (i) the Certificate of Limited Partnership; and

          (ii) a  letter  of good  standing  with  respect  to  USACA  from  the
     Secretary of State of the State of Texas, dated ______ ___, 200__.


<PAGE>

          (iii) copies of  certificates  from the Comptroller of Public Accounts
     of Texas and from the Secretary of State of dated ________ Texas indicating
     that USACA is in good standing in the State of Texas;


     With  respect to our opinion  set forth in  Paragraph  (b) above,  that the
Seller has the  "corporate  power and  authority"  to take  certain  action,  we
interpret  that  phrase to mean that the  action  would not be ultra  vires with
respect  to the  Seller.  The  opinions  with  respect to  "corporate  power and
authority" of the Seller do not, however,  extend to any other federal, state or
local  authorizations  or  approvals;  however,  we are not  aware  of any  such
required authorization or approvals which have not been obtained.


     With  respect to our opinion set forth in Paragraph  (b) above,  that USACA
has the  "requisite  power and authority" to take certain  action,  we interpret
that  phrase to mean that the action  would not be ultra  vires with  respect to
USACA.  The opinions with respect to "requisite power and authority" of USACA do
not,  however,  extend to any other federal,  state or local  authorizations  or
approvals;  however,  we are not  aware of any such  required  authorization  or
approvals which have not been obtained.


     The  opinion  in  Paragraph  (a)  above is also  subject  to the  following
qualifications:

          (1)  enforceability  may  be  subject  to or  limited  by  bankruptcy,
          insolvency,  reorganization,  moratorium,  fraudulent  conveyance,  or
          other  similar  laws  relating  to  or  affecting   creditors'  rights
          generally, or the appointment of a receiver or conservator pursuant to
          state or federal laws;

          (2) the availability of equitable remedies,  specific  performance and
          injunctive  relief is subject to the  discretion  of the court  before
          which any proceeding therefor is brought;

          (3) the  enforceability  of  certain  covenants  may be limited to the
          extent that the court before which any proceeding for the  enforcement
          thereof  is  brought   concludes  that  such   enforcement   would  be
          unreasonable,  unconscionable or unnecessary for the protection of the
          parties to such agreement under existing circumstances;

          (4)  enforcement  of certain  rights may be  unavailable if any of the
          parties seek to enforce their rights other than in good faith or other
          than in a manner in which it is commercially reasonable to do so;

          (5) rights to indemnity may be limited by applicable state and federal
          securities laws or the public policy underlying such laws;

<PAGE>


          (6) waivers of  statutes  of  limitations,  notice,  jury  trial,  due
          process  and  choice of venue,  forum or law  clauses  may  contravene
          public  policy  and  statutory  and case  law,  and  therefore  may be
          unenforceable;

          (7) contractual provisions waiving broadly or vaguely stated rights or
          unknown future rights,  and/or  provisions that rights or remedies are
          not  exclusive,  that every right and remedy is cumulative  and may be
          exercised in addition to or together with any other right or remedy or
          that the  election  of some  particular  remedy or  remedies  does not
          preclude recourse to one or more others, may be unenforceable; and

          (8)  enforceability  may be  subject  to or  limited  by the effect of
          general principles of equity, including without limitation concepts of
          materiality,  reasonableness,  good faith and fair dealing, regardless
          of whether considered in a proceeding in equity or at law.


     We  expresses  no  opinion  with  respect  to  (i)  the  enforceability  of
provisions  in the  Transaction  Documents  relating  to  delay or  omission  of
enforcement  of rights or  remedies,  or  waivers of  defenses,  waivers of jury
trials,  or waivers of benefits of  appraisement,  valuation,  stay,  extension,
moratorium,  redemption,  statutes of limitation,  or other nonwaivable benefits
bestowed  by  operation  of  law;  (ii)  the  lawfulness  of  enforceability  of
exculpation  clauses,  confession  of  judgment  clauses,  clauses  relating  to
releases of unmatured  claims,  clauses  purporting to waive  unmatured  rights,
severability  clauses,  and  clauses  similar  in  substance  or  nature  to the
foregoing  clauses  insofar  as  any  of  the  foregoing  are  contained  in the
Transaction   Documents;   (iii)  the  enforceability  of  the   indemnification
provisions  to the extent they purport to  indemnify a person for such  person's
own negligence or any violation of federal or state securities or blue sky laws;
(iv) the right of any person or entity to  institute  or maintain  any action in
any court or upon matters  respecting  the  jurisdiction  of any court;  (v) the
enforceability  of  non-competition  provisions;  (vi) any  matters  relating to
title;  (vii) any matters relating to the priority or perfection of any liens or
other encumbrances; (viii) any matters related to telecommunications, telephone,
cable,  or Internet laws; (ix) any matters related to the laws or regulations of
the Texas Public Utility  Commission or any matter related  thereto;  or (x) any
matters related to the laws of the Federal  Communications  Commission,  Federal
Aviation Administration, or the U.S. Trademark Office.


     As to our opinions set forth above,  we do not opine as to, and we have not
reviewed or examined:  (i) any local,  municipal,  county,  district or regional
law,  statute,   order,  decree,   administrative  record,  policy,   procedure,
guideline,  rule,  requirement,  regulation  or  notice;  or  (ii)  any  policy,
procedure,  guideline,  rule,  requirement  or  regulation  that is  privileged,
confidential,   internal,  unpublished,  or  not  of  public  record  or  widely
disseminated at the date of this opinion.


<PAGE>

     Our opinions are limited in all respects to the laws of the State of Texas,
the General  Corporation  Law of the State of Delaware where expressly noted and
to federal  law as applied in the State of Texas.  You should be aware that this
firm is not  admitted to the  practice  of law in the State of Delaware  and the
opinion  herein as to the  General  Corporation  Law of the State of Delaware is
based  solely  upon the  unofficial  compilation  thereof  contained  in the CSC
Annotated [ 200___ ] Edition of Delaware Laws Affecting Business  Entities,  and
we assume no  responsibility  as to the  applicability  thereto,  or the  effect
thereon, of the laws of any other jurisdiction.

     The opinions expressed herein are subject to statutory, regulatory and case
law developments after the date hereof. With your consent and concurrence,  this
Opinion is  limited  to facts and  applicable  law in  existence  as of the date
hereof and we do not undertake  and expressly  disavow any duty or obligation to
advise  you of any  change in facts or  applicable  law  after the date  hereof,
whether or not relating to the specific  issues  addressed in this Opinion,  and
you may not  rely  upon us in any  respect  with  regard  to  continuing  advice
concerning changes in applicable law or facts after the date of this Opinion.


     This Opinion (a) has been furnished to you at your request, and we consider
it to be a confidential communication,  which may not be furnished,  reproduced,
distributed  or disclosed to anyone  without our prior written  consent;  (b) is
rendered solely for your information and assistance in connection with the above
transaction  and may not be  relied  upon by any  other  person or for any other
purpose  without  our prior  written  consent;  (c) is  rendered  as of the date
hereof,  and we undertake no, and hereby disclaim any,  obligation to advise you
of any  changes  (including  any changes in law) or any new  developments  which
might affect any matters or opinions set forth herein; and (d) is limited to the
matters  stated  herein and no opinions  may be  inferred or implied  beyond the
matters expressly stated herein.

     You are hereby notified that (i) we do not consider you to be our client in
the matters to which this opinion letter relates, (ii) neither the Texas Code of
Professional  Responsibility  nor  current  case  law  clearly  articulates  the
circumstances under which an attorney may give a legal opinion to a person other
than  the  attorney's  own  client,  (iii) a court  might  determine  that it is
improper for us to issue, and for you to rely upon, a legal opinion issued by us
when we have acted as counsel  to the  Seller and USACA in  connection  with the
Transaction Documents, and (iv) you may wish to obtain a legal opinion from your
own legal counsel as to the matters addressed in this opinion letter.

Very truly yours,

STAHL, MARTENS & BERNAL, L.L.P.



By: _____________________________



<PAGE>


                                    EXHIBIT C
                                    ---------

                          OPINION OF COUNSEL FOR BUYER

USOL, Inc.
10300 Metric Blvd.
Austin, Texas    78758


Gentlemen:

     We have  acted as  counsel  to  Grande  Communications,  Inc.,  a  Delaware
corporation  ("Buyer"),  in connection with the Purchase  Agreement dated August
_____,  2001 (the  "Agreement"),  between USOL,  Inc. and Buyer and joined in by
U.S. - Austin Cable Associates I, Ltd., a Texas limited partnership. This is the
opinion (the "Opinion Letter") of Buyer's legal counsel  contemplated by Section
5.2.2(g) of the  Agreement.  All  capitalized  terms used in this Opinion Letter
without definition have the respective meanings given to them in the Agreement.

1.   DOCUMENTS REVIEWED

     (a) Documents  Reviewed - Transaction  Documents.  As counsel to Buyer,  we
     have reviewed the following  documents and instruments  (collectively,  the
     "Transaction Documents"):

          (i)       the Agreement;
          (ii)      the Services Agreement;
          (iii)     the Bill of Sale and Assignment and Assumption;
          (iv)      the Interim Systems Management Agreement; and
          (v)       [List any other  documents  to be  delivered by Buyer at the
                    Closing]

     (b)  Documents  Reviewed - Other  Documents  Examined.  In  addition to the
     Transaction  Documents,  other documents we have examined in rendering this
     Opinion Letter and upon which we have relied, are as follows:

          (i)       the Certificate of Incorporation  of Buyer,  certified to be
                    true and correct by the Secretary of State of Delaware;
          (ii)      the Bylaws of Buyer, certified to be true and correct by the
                    Secretary of Buyer;
          (iii)     a copy of the  Certificate of Authority of Buyer to transact
                    business in the State of Texas,  certified by the  Secretary
                    of State of Texas;
          (iv)      Certificates  from the  Secretary  of State of Delaware  and
                    Texas  and  the  Texas   Comptroller   of  Public   Accounts
                    indicating  that Buyer is in good  standing in the States of
                    Delaware and Texas;


<PAGE>


          (v)       Certificate  from  the  Secretary  of  Buyer  verifying  the
                    authority of the  appropriate  officers of Buyer to execute,
                    deliver, and perform the Transaction Documents; and
          (vi)      Certificate  of [title of officer] of Buyer,  dated the date
                    hereof  certifying as to certain factual matters (the "Buyer
                    Certificate").

2.   QUALIFICATIONS TO FACTUAL EXAMINATION

     We have been furnished with and examined  original or copies,  certified or
otherwise  identified  to  our  satisfaction,  of all  such  records  of  Buyer,
agreements and other instruments,  certificates of officers and  representatives
of Buyer,  certificates of public officials and other documents, and we have had
such discussions with appropriate  officers of Buyer as we have deemed necessary
or desirable as a basis for the opinions hereinafter expressed.  As to questions
of fact  material  to such  opinions,  we have,  where  relevant  facts were not
independently  verified or established,  relied upon certificates of officers of
Buyer.

3.   ASSUMPTIONS

     For purposes of this Opinion Letter,  we have assumed:  (a) the genuineness
of all signatures on all documents (other than those of Buyer on the Transaction
Documents);  (b) the authenticity of all documents submitted to us as originals;
(c) the conformity to the originals of all documents  submitted to us as copies;
(d) the correctness and accuracy of all facts set forth in all  certificates and
reports;  and (e) the  due  authorization,  execution  and  delivery  of and the
validity  and binding  effect of the  Transaction  Documents  with regard to the
parties to the Transaction Documents other than Buyer.

4.   OPINIONS

     Based upon and subject to the  foregoing and the other  qualifications  and
limitations stated in this Opinion Letter, we are of the opinion that:

     (a) Buyer is a Delaware corporation duly organized, validly existing and in
good  standing  under  the laws of the State of  Delaware  and is  qualified  to
transact  business in, and is in good standing  under,  the laws of the State of
Texas.

     (b) Buyer has the power to engage in the  transactions  contemplated by the
Transaction  Documents  and all  requisite  power,  authority and legal right to
execute  and deliver the  Transaction  Documents  and to perform and observe the
terms and conditions of the Transaction Documents.

<PAGE>


     (c) The  Transaction  Documents  have been duly  authorized,  executed  and
delivered  by Buyer and  constitute  valid  and  binding  obligations  of Buyer,
enforceable against Buyer in accordance with their terms.

     (d) Neither the execution and delivery of the Transaction Documents nor the
consummation of the transactions  contemplated by the Transaction Documents: (a)
violates any provision of the Certificate of  Incorporation  or Bylaws of Buyer;
(b) to our knowledge,  breaches or constitutes a default (or an event that, with
notice or lapse of time or both, would constitute a default) under any agreement
or  commitment  to which Buyer is party;  or (c) to our  knowledge  violates any
statute, law, regulation or rule, or any judgment,  decree or order of any court
or Governmental Body applicable to Buyer.

     (e)  To  our  knowledge  no  consent,  approval  or  authorization  of,  or
declaration, filing or registration with, any Governmental Authority is required
by Buyer in  connection  with the execution and delivery of the Agreement or the
consummation  of the  transactions  contemplated  by the  Agreement or the other
Transaction Documents.

     The  qualification  of any  opinion or  statement  herein by the use of the
words "to our  knowledge"  or "known to us" means  that,  during  the  course of
representation  as described in this Opinion Letter,  no information has come to
the attention of the lawyers in this firm involved in the transactions described
or the  lawyers  in our  firm who has  principal  legal  responsibility  for our
representation of Buyer that would give such lawyers current actual knowledge of
the existence of the facts so qualified. Except as set forth herein, we have not
undertaken any  investigation  to determine the existence of such facts,  and no
inference  as to our  knowledge  thereof  shall  be  drawn  from the fact of our
representation of any party or otherwise.

     The  opinion  in  Paragraph  4(c) above is also  subject  to the  following
qualifications:

          (1)  enforceability  may  be  subject  to or  limited  by  bankruptcy,
          insolvency,  reorganization,  moratorium,  fraudulent  conveyance,  or
          other  similar  laws  relating  to  or  affecting   creditors'  rights
          generally, or the appointment of a receiver or conservator pursuant to
          state or federal laws;

          (2) the availability of equitable remedies,  specific  performance and
          injunctive  relief is subject to the  discretion  of the court  before
          which any proceeding therefor is brought;

          (3) the  enforceability  of  certain  covenants  may be limited to the
          extent that the court before which any proceeding for the  enforcement


<PAGE>


          thereof  is  brought   concludes  that  such   enforcement   would  be
          unreasonable,  unconscionable or unnecessary for the protection of the
          parties to such agreement under existing circumstances;

          (4)  enforcement  of certain  rights may be  unavailable if any of the
          parties seek to enforce their rights other than in good faith or other
          than in a manner in which it is commercially reasonable to do so;

          (5) rights to indemnity may be limited by applicable state and federal
          securities laws or the public policy underlying such laws;

          (6) waivers of  statutes  of  limitations,  notice,  jury  trial,  due
          process  and  choice of venue,  forum or law  clauses  may  contravene
          public  policy  and  statutory  and case  law,  and  therefore  may be
          unenforceable;

          (7) contractual provisions waiving broadly or vaguely stated rights or
          unknown future rights,  and/or  provisions that rights or remedies are
          not  exclusive,  that every right and remedy is cumulative  and may be
          exercised in addition to or together with any other right or remedy or
          that the  election  of some  particular  remedy or  remedies  does not
          preclude recourse to one or more others, may be unenforceable; and

          (8)  enforceability  may be  subject  to or  limited  by the effect of
          general principles of equity, including without limitation concepts of
          materiality,  reasonableness,  good faith and fair dealing, regardless
          of whether considered in a proceeding in equity or at law.

     We  expresses  no opinion  with  respect to (i) the  enforceability  of any
provisions  in the  Transaction  Documents  relating  to  delay or  omission  of
enforcement  of rights or  remedies,  or  waivers of  defenses,  waivers of jury
trials,  or waivers of benefits of  appraisement,  valuation,  stay,  extension,
moratorium,  redemption,  statutes of limitation,  or other nonwaivable benefits
bestowed  by  operation  of  law;  (ii)  the  lawfulness  of  enforceability  of
exculpation  clauses,  confession  of  judgment  clauses,  clauses  relating  to
releases of any unmatured claims,  clauses purporting to waive unmatured rights,
severability  clauses,  and  clauses  similar  in  substance  or  nature  to the
foregoing  clauses  insofar  as  any  of  the  foregoing  are  contained  in the
Transaction   Documents;   (iii)  the  enforceability  of  the   indemnification
provisions  to the extent they purport to  indemnify a person for such  person's
own negligence or any violation of federal or state securities or blue sky laws;
(iv) the right of any person or entity to  institute  or maintain  any action in
any court or upon matters  respecting  the  jurisdiction  of any court;  (v) the
enforceability  of  non-competition  provisions;  (vi) any  matters  relating to
title; (vii) any matters relating to the priority or perfection of any liens or


<PAGE>




other encumbrances; (viii) any matters related to telecommunications, telephone,
cable,  or internet laws; (ix) any matters related to the laws or regulations of
the Texas Public Utility  Commission or any matter related  thereto;  or (x) any
matters related to the laws of the Federal  Communications  Commission,  Federal
Aviation Administration, or the U.S. Trademark Office.

     As to our opinions set forth above,  we do not opine as to, and we have not
reviewed or examined:  (i) any local,  municipal,  county,  district or regional
law,  statute,   order,  decree,   administrative  record,  policy,   procedure,
guideline,  rule,  requirement,  regulation  or  notice;  or  (ii)  any  policy,
procedure,  guideline,  rule,  requirement  or  regulation  that is  privileged,
confidential,  internal,  unpublished,  or not of public  record  or not  widely
disseminated at the date of this opinion.

     Our opinions are limited in all respects to the laws of the State of Texas,
the  General  Corporation  Law of the State of  Delaware  and to federal  law as
applied  in the  State of  Texas.  You  should  be aware  that  this firm is not
admitted to the practice of law in the State of Delaware and the opinion  herein
as to the General  Corporation Law of the State of Delaware is based solely upon
the unofficial compilation thereof contained in The Delaware Law of Corporations
&  Business  Organization  (Aspen  Law &  Business)  (200___),  and we assume no
responsibility as to the applicability  thereto,  or the effect thereon,  of the
laws of any other jurisdiction.

     The opinions expressed herein are subject to statutory, regulatory and case
law developments after the date hereof. With your consent and concurrence,  this
Opinion  Letter is limited to facts and  applicable  law in  existence as of the
date hereof and we do not undertake and expressly disavow any duty or obligation
to advise you of any change in facts or  applicable  law after the date  hereof,
whether or not relating to the specific issues addressed in this Opinion Letter,
and you may not rely upon us in any  respect  with regard to  continuing  advice
concerning  changes in  applicable  law or facts after the date of this  Opinion
Letter.

     This Opinion Letter (a) has been  furnished to you at your request,  and we
consider  it to be a  confidential  communication,  which may not be  furnished,
reproduced,  distributed  or  disclosed  to anyone  without  our  prior  written
consent;  (b)  is  rendered  solely  for  your  information  and  assistance  in
connection  with the above  transaction  and may not be relied upon by any other
person or for any  other  purpose  without  our prior  written  consent;  (c) is
rendered as of the date hereof,  and we undertake  no, and hereby  disclaim any,
obligation  to advise you of any changes  (including  any changes in law) or any
new  developments  which might affect any matters or opinions set forth  herein;
and (d) is limited to the matters  stated herein and no opinions may be inferred
or implied beyond the matters expressly stated herein.


<PAGE>



     You are hereby notified that (i) we do not consider you to be our client in
the matters to which this Opinion Letter relates, (ii) neither the Texas Code of
Professional  Responsibility  nor  current  case  law  clearly  articulates  the
circumstances under which an attorney may give a legal opinion to a person other
than  the  attorney's  own  client,  (iii) a court  might  determine  that it is
improper for us to issue, and for you to rely upon, a legal opinion issued by us
when we have acted as counsel to the Buyer in  connection  with the  Transaction
Documents,  and (iv) you may wish to obtain a legal  opinion from your own legal
counsel as to the matters addressed in this Opinion Letter.


                                             Very truly yours,

                                             BICKERSTAFF, HEATH, SMILEY, POLLAN,
                                             KEVER & MCDANIEL, LLP



                                             By: ____________________________


                                   EXHIBIT D

                                 INTERIM SYSTEMS
                              MANAGEMENT AGREEMENT

                            *[Intentionally Omitted]


*Confidential  Treatment Requested.  Confidential portions of this document have
been redacted and filed separately with the Commission.


<PAGE>


                                 FIRST AMENDMENT
                                       TO
                               PURCHASE AGREEMENT
                               ------------------

     THIS FIRST AMENDMENT (THE "FIRST  AMENDMENT") TO PURCHASE AGREEMENT is made
and  entered  into  this  28th  day of  September,  2001,  by and  among  GRANDE
COMMUNICATIONS,  INC.,  a  Delaware  corporation,  (hereinafter  referred  to as
"Buyer") and USOL,  INC., a Delaware  corporation,  (hereinafter  referred to as
"Seller") and U.S.-Austin Cable Associates I, Ltd. ("US-Austin Cable, Ltd.").

                                    RECITALS:
                                    --------

     A. Buyer,  Seller and  US-Austin  Cable,  Ltd. have entered into a Purchase
Agreement dated August 31, 2001, (the "Original Purchase Agreement") pursuant to
which Buyer has agreed to  purchase  certain  assets  from Seller and  US-Austin
Cable,  Ltd.  Capitalized  terms not defined  herein shall have the meanings set
forth in the Original Purchase Agreement.

     B. The Original  Purchase  Agreement  contemplates  that an Initial Closing
will take  place in the  fourth  quarter  of 2001.  However,  the  parties  have
determined  that it would be mutually  beneficial to have a Closing in the third
quarter  of 2001 in  accordance  with the  terms of the  Original  Agreement  as
amended by this First Amendment.

                                        1

<PAGE>


                                   AGREEMENTS:
                                   ----------

     In  consideration of the mutual  representations,  warranties and covenants
and subject to the conditions herein contained, the parties hereto, intending to
be legally bound hereby, agree as follows:

     1. Definitions. Article I is amended to add the following definitions after
definition of "Door Fee" on page 3 of the Original Agreement:

          "Early Closing" has the meaning given in Section 5.1.1-A."

          "Early Closing Date" has the meaning given in Section 5.1.1-A."

     2. Closing Dates.  Section 5.1 of the Original  Agreement is hereby amended
to change the word "four" in the second line to "five."

     3. Early, Initial, Interim and Final Closings. Sections 5.1.2 through 5.1.4
of the Original  Purchase  Agreement  are hereby  deleted and the  following are
substituted  in lieu thereof:


          "5.1.1-A.  Early Closing.  An early closing (the "Early Closing") will
          take  place on a date  (the  "Early  Closing  Date")  not  later  than
          September  30,  2001.  At the Early  Closing,  Seller  and Buyer  will
          execute and deliver to each other the (i) assignment  and  assumptions
          of the  ROEs and  Subscriber  Agreements  with  respect  to those  MDU
          Properties  described in Schedule 5.1.1-A  attached  hereto,  (ii) the
          documents  contemplated by Sections 5.2.1 and 5.2.2 and Articles X and
          XI, and (iii) a First Amendment to the Services Agreement.


                                        2

<PAGE>


          5.1.2 Initial Closing. An initial closing (the "Initial Closing") will
          take  place on a date (the  "Initial  Closing  Date")  not later  than
          December  31,  2001.  At the  Initial  Closing,  Seller and Buyer will
          execute and deliver to each other the (i)  assignments and assumptions
          of the  ROEs  for all  contracted  MDU  Properties  and the  ROEs  and
          Subscriber  Agreements with respect to those MDU Properties  described
          in the  Take-Down  Schedule as being  completed  prior to December 31,
          2001 to the extent not  previously  transferred  to Buyer at the Early
          Closing,  and (ii) the documents  contemplated  by Sections  5.2.1 and
          5.2.2 and by Articles X and XI.

          5.1.3 Interim Closings.  An interim closing ("Interim  Closing") shall
          occur (i) on or prior to March  31,  2002 and (ii) on or prior to June
          30, 2002  (collectively the "Interim Closing Dates").  At each Interim
          Closing,  the parties  will  execute and deliver (i)  assignments  and
          assumptions of the ROEs and Subscriber  Agreements with respect to the
          MDU Properties  described in the Take-Down Schedule as being completed
          prior to such  Closing  to the extent not  previously  transferred  to
          Buyer at the Early  Closing,  and (ii) the documents  contemplated  by
          Sections 5.2.1 and 5.2.2 and by Articles X and XI.

          5.1.4  Final   Closing.   The  Final   Closing  of  the   transactions
          contemplated  by  this  Agreement  will  take  place  on or  prior  to


                                        3

<PAGE>



          September 30, 2002 (the "Final Closing Date") at which time Seller and
          Buyer will execute and deliver (i)  assignments and assumptions of all
          remaining   ROEs  and  Subscriber   Agreements   related  to  the  MDU
          Properties,  and (ii) the documents contemplated by Sections 5.2.1 and
          5.2.2 and by Articles X and XI."

     4.  Interim  Systems  Management  Agreement.  Section  5.3 of the  Original
Purchase  Agreement is hereby  amended to add the following  clause prior to the
period at the end of Section 5.3.

          "; provided, however that with respect to a Deferred Property acquired
          at the Early Closing,  the Deferred Property may be operated for up to
          two-hundred  and seventy  (270) days  pursuant to the Interim  Systems
          Management Agreement and the provision of Section II(A) of the Interim
          Systems Management  Agreement  requiring thirty (30) days prior notice
          shall not be applicable,

     5. Efforts Regarding Amendments and Estoppel Certificates.  Notwithstanding
occurrence  of  the  Early  Closing,   Buyer  agrees  to  continue  to  use  its
commercially  Reasonable  Best  Efforts  after the Early  Closing to satisfy the
requirements of Section 8.3(b) with respect to the ROEs acquired by Buyer at the
Early Closing.

     6.  Conditions  to  Obligations  of  Buyer.  Section  10.1 of the  Original
Purchase  Agreement is hereby  deleted and the following is  substituted in lieu
thereof:

                                        4


<PAGE>

          10.1.  Conditions of Early,  Initial and Other  Closings.  Buyer shall
          have obtained,  and shall hold at the time of the Early  Closing,  the
          Initial  Closing and each other  Closing,  consents from owners of the
          MDU Properties  which  (together  with those MDU  Properties  where no
          consent is required)  represent  ROEs covering at least 80% (or 9,870)
          of the total 12,337  Subscriber Doors in the MDU Properties.  Further,
          Buyer shall have obtained, and shall hold (i) at the time of the Early
          Closing,  consents from owners of the MDU Properties  which  represent
          all of the  ROEs to be  acquired  at the  Early  Closing  pursuant  to
          Section 5.1.1-A and (ii) at the time of the Initial Closing,  consents
          from owners of the MDU Properties  which  represent all the ROEs to be
          acquired by Buyer at the Initial Closing as provided in Section 5.1.2.

     7. Table of Contents;  Schedule 5.1.1-A.  Page (i) of the Table of Contents
for the  Original  Purchase  Agreement  is  hereby  revised  to refer to the new
Section 5.1.1-A and page (iv) of such Table of Contents is hereby revised to add
Schedule  5.1.1-A to the list of Schedules.  Schedule 5.1.1-A attached hereto is
added to the Schedules to the Original Purchase Agreement as herein amended.

     8.  Mistaken  Reference to Park West Property  Telecommunications  Services
Agreement is Deleted. All references in the Purchase Agreement (including in any
schedules or exhibits  thereto) to the following ROE are hereby deleted in their
entirety:  Park  West  Property  -  Telecommunications  Services


                                        5

<PAGE>

Agreement (as  assigned)  between Park West  Apartments  Ltd.,  and U.S.  OnLine
Communications,  L.L.C.,  a Washington  limited  liability  company,  d/b/a U.S.
OnLine, dated May 7, 1997.

     9.  Continued  Effectiveness  of  Original  Purchase  Agreement.  Except as
amended hereby and as previously amended or supplemented by written agreement of
the parties, the Original Purchase Agreement remains in full force and effect.


                  [Remainder of this page intentionally blank]












                                        6
<PAGE>


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


                                            SELLER:
                                            USOL, INC.
                                            A Delaware Corporation


                                            BY:_________________________________
                                            Name:_______________________________
                                            Title:______________________________


                                            BUYER:
                                            GRANDE COMMUNICATIONS, INC.
                                            A Delaware Corporation


                                            BY:_________________________________
                                            Name:_______________________________
                                            Title:______________________________


                                            U.S.-AUSTIN CABLE ASSOCIATES I, LTD.

                                            BY: USOL, Inc., General Partner

                                            By: ________________________________
                                            Name: ______________________________
                                            Title: _____________________________



                                        7
<PAGE>

                                SCHEDULE 5.1.1-A
                                       To
                               PURCHASE AGREEMENT

                            *[Intentionally Omitted.]





















*Confidential  Treatment Requested.  Confidential portions of this document have
been redacted and filed separately with the Commission.