Exhibit 10.1


EXECUTION COPY




 





AMENDED AND RESTATED CREDIT AGREEMENT


dated as of


June 1, 2007


among


HAWAIIAN TELCOM HOLDCO, INC.,


HAWAIIAN TELCOM COMMUNICATIONS, INC.,

as Borrower,


The Lenders Party Hereto


and


LEHMAN COMMERCIAL PAPER INC.,

as Administrative Agent and Collateral Agent






LEHMAN BROTHERS INC., and

J.P. MORGAN SECURITIES INC.

as Joint Lead Arrangers and Joint Bookrunners






JPMORGAN CHASE
BANK, N.A.,


as Syndication Agent






COBANK, ACB, and

WACHOVIA BANK, N.A.,


as
Co-Documentation Agents




 



















TABLE OF CONTENTS


	
  ARTICLE I

  
	
  Definitions

  
	
   

  
	
  SECTION 1.01.

  	
   

  	
  Defined Terms

  	
   

  	
  2

  
	
  SECTION 1.02.

  	
   

  	
  Classification of Loans and Borrowings

  	
   

  	
  32

  
	
  SECTION 1.03.

  	
   

  	
  Terms Generally

  	
   

  	
  32

  
	
  SECTION 1.04.

  	
   

  	
  Accounting Terms; GAAP

  	
   

  	
  33

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II

  
	
  The Credits

  
	
   

  
	
  SECTION 2.01.

  	
   

  	
  Commitments

  	
   

  	
  33

  
	
  SECTION 2.02.

  	
   

  	
  Loans and Borrowings

  	
   

  	
  33

  
	
  SECTION 2.03.

  	
   

  	
  Requests for Borrowings

  	
   

  	
  34

  
	
  SECTION 2.04.

  	
   

  	
  Swingline Loans

  	
   

  	
  35

  
	
  SECTION 2.05.

  	
   

  	
  Letters of Credit

  	
   

  	
  36

  
	
  SECTION 2.06.

  	
   

  	
  Funding of Borrowings

  	
   

  	
  40

  
	
  SECTION 2.07.

  	
   

  	
  Interest Elections

  	
   

  	
  41

  
	
  SECTION 2.08.

  	
   

  	
  Termination and Reduction of Commitments

  	
   

  	
  42

  
	
  SECTION 2.09.

  	
   

  	
  Repayment of Loans; Evidence of Debt

  	
   

  	
  42

  
	
  SECTION 2.10.

  	
   

  	
  Amortization of Term Loans

  	
   

  	
  43

  
	
  SECTION 2.11.

  	
   

  	
  Prepayment of Loans

  	
   

  	
  44

  
	
  SECTION 2.12.

  	
   

  	
  Fees

  	
   

  	
  46

  
	
  SECTION 2.13.

  	
   

  	
  Interest

  	
   

  	
  48

  
	
  SECTION 2.14.

  	
   

  	
  Alternate Rate of Interest

  	
   

  	
  48

  
	
  SECTION 2.15.

  	
   

  	
  Increased Costs

  	
   

  	
  49

  
	
  SECTION 2.16.

  	
   

  	
  Break Funding Payments

  	
   

  	
  50

  
	
  SECTION 2.17.

  	
   

  	
  Taxes

  	
   

  	
  50

  
	
  SECTION 2.18.

  	
   

  	
  Payments Generally; Pro Rata Treatment; Sharing of
  Setoffs

  	
   

  	
  51

  
	
  SECTION 2.19.

  	
   

  	
  Mitigation Obligations; Replacement of Lenders

  	
   

  	
  53

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III

  
	
  Representations
  and Warranties

  
	
   

  
	
  SECTION 3.01.

  	
   

  	
  Organization; Powers

  	
   

  	
  54

  
	
  SECTION 3.02.

  	
   

  	
  Authorization; Enforceability

  	
   

  	
  54

  
	
  SECTION 3.03.

  	
   

  	
  Governmental Approvals; No Conflicts

  	
   

  	
  54

  
	
  SECTION 3.04.

  	
   

  	
  Financial Condition; No Material Adverse Change

  	
   

  	
  54

  
	
  SECTION 3.05.

  	
   

  	
  Properties

  	
   

  	
  55

  
	
  SECTION 3.06.

  	
   

  	
  Litigation and Environmental Matters

  	
   

  	
  55

  
	
  SECTION 3.07.

  	
   

  	
  Compliance with Laws

  	
   

  	
  56

  
	
  SECTION 3.08.

  	
   

  	
  Licenses; Tariffs

  	
   

  	
  56

  
	
  SECTION 3.09.

  	
   

  	
  Investment Company Status

  	
   

  	
  57

  
	
  SECTION 3.10.

  	
   

  	
  Taxes

  	
   

  	
  57

  
	
  SECTION 3.11.

  	
   

  	
  ERISA; Margin Regulations

  	
   

  	
  57

  
	
  SECTION 3.12.

  	
   

  	
  Disclosure

  	
   

  	
  57

  
	
  SECTION 3.13.

  	
   

  	
  Subsidiaries

  	
   

  	
  57

  
	
  SECTION 3.14.

  	
   

  	
  Insurance

  	
   

  	
  58

  
	
  SECTION 3.15.

  	
   

  	
  Labor Matters

  	
   

  	
  58

  
	
  SECTION 3.16.

  	
   

  	
  Solvency

  	
   

  	
  58

  
	
  SECTION 3.17.

  	
   

  	
  Senior Indebtedness

  	
   

  	
  58

  



 



 i
 









 


	
  SECTION 3.18.

  	
   

  	
  [Reserved]

  	
   

  	
  58

  
	
  SECTION 3.19.

  	
   

  	
  Security Documents

  	
   

  	
  58

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV

  
	
  Conditions

  
	
   

  
	
  SECTION 4.01.

  	
   

  	
  Effective Date

  	
   

  	
  59

  
	
  SECTION 4.02.

  	
   

  	
  Each Credit Event

  	
   

  	
  61

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V

  
	
  Affirmative
  Covenants

  
	
   

  
	
  SECTION 5.01.

  	
   

  	
  Financial Statements and Other Information

  	
   

  	
  62

  
	
  SECTION 5.02.

  	
   

  	
  Notices of Material Events

  	
   

  	
  64

  
	
  SECTION 5.03.

  	
   

  	
  Information Regarding Collateral

  	
   

  	
  64

  
	
  SECTION 5.04.

  	
   

  	
  Existence; Conduct of Business

  	
   

  	
  64

  
	
  SECTION 5.05.

  	
   

  	
  Payment of Taxes

  	
   

  	
  65

  
	
  SECTION 5.06.

  	
   

  	
  Maintenance of Properties

  	
   

  	
  65

  
	
  SECTION 5.07.

  	
   

  	
  Insurance

  	
   

  	
  65

  
	
  SECTION 5.08.

  	
   

  	
  Books and Records; Inspection and Audit Rights

  	
   

  	
  65

  
	
  SECTION 5.09.

  	
   

  	
  Compliance with Laws

  	
   

  	
  65

  
	
  SECTION 5.10.

  	
   

  	
  Use of Proceeds and Letters of Credit

  	
   

  	
  65

  
	
  SECTION 5.11.

  	
   

  	
  Additional Subsidiaries

  	
   

  	
  66

  
	
  SECTION 5.12.

  	
   

  	
  Further Assurances

  	
   

  	
  66

  
	
  SECTION 5.13.

  	
   

  	
  Designation of Unrestricted Subsidiaries

  	
   

  	
  67

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI

  
	
  Negative
  Covenants

  
	
   

  
	
  SECTION 6.01.

  	
   

  	
  Indebtedness; Certain Equity Securities

  	
   

  	
  68

  
	
  SECTION 6.02.

  	
   

  	
  Liens

  	
   

  	
  70

  
	
  SECTION 6.03.

  	
   

  	
  Fundamental Changes

  	
   

  	
  72

  
	
  SECTION 6.04.

  	
   

  	
  Investments, Loans, Advances, Guarantees and
  Acquisitions

  	
   

  	
  73

  
	
  SECTION 6.05.

  	
   

  	
  Asset Sales

  	
   

  	
  75

  
	
  SECTION 6.06.

  	
   

  	
  Sale and Leaseback Transactions

  	
   

  	
  76

  
	
  SECTION 6.07.

  	
   

  	
  Swap Agreements

  	
   

  	
  77

  
	
  SECTION 6.08.

  	
   

  	
  Restricted Payments; Certain Payments of
  Indebtedness

  	
   

  	
  77

  
	
  SECTION 6.09.

  	
   

  	
  Transactions with Affiliates

  	
   

  	
  79

  
	
  SECTION 6.10.

  	
   

  	
  Restrictive Agreements

  	
   

  	
  81

  
	
  SECTION 6.11.

  	
   

  	
  Change in Business

  	
   

  	
  81

  
	
  SECTION 6.12.

  	
   

  	
  Fiscal Year

  	
   

  	
  81

  
	
  SECTION 6.13.

  	
   

  	
  Amendment of Material Documents

  	
   

  	
  81

  
	
  SECTION 6.14.

  	
   

  	
  [Reserved]

  	
   

  	
  82

  
	
  SECTION 6.15.

  	
   

  	
  [Reserved]

  	
   

  	
  82

  
	
  SECTION 6.16.

  	
   

  	
  Net Secured Leverage Ratio

  	
   

  	
  82

  
	
  SECTION 6.17.

  	
   

  	
  [Reserved]

  	
   

  	
  82

  
	
  SECTION 6.18.

  	
   

  	
  Commingling of Accounts

  	
   

  	
  82

  
	
  SECTION 6.19.

  	
   

  	
  Capital Expenditures

  	
   

  	
  82

  



 



 ii
 









 


	
  ARTICLE VII

  
	
  Events of
  Default

  
	
   

  
	
  SECTION 7.01.

  	
   

  	
  Events of Default

  	
   

  	
  83

  
	
  SECTION 7.02.

  	
   

  	
  Equity Cure

  	
   

  	
  85

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VIII

  
	
  The Agents

  
	
   

  
	
  ARTICLE IX

  
	
  Miscellaneous

  
	
   

  
	
  SECTION 9.01.

  	
   

  	
  Notices

  	
   

  	
  88

  
	
  SECTION 9.02.

  	
   

  	
  Waivers; Amendments

  	
   

  	
  88

  
	
  SECTION 9.03.

  	
   

  	
  Expenses; Indemnity; Damage Waiver

  	
   

  	
  91

  
	
  SECTION 9.04.

  	
   

  	
  Successors and Assigns

  	
   

  	
  92

  
	
  SECTION 9.05.

  	
   

  	
  Survival

  	
   

  	
  96

  
	
  SECTION 9.06.

  	
   

  	
  Counterparts; Integration; Effectiveness

  	
   

  	
  96

  
	
  SECTION 9.07.

  	
   

  	
  Severability

  	
   

  	
  96

  
	
  SECTION 9.08.

  	
   

  	
  Right of Setoff

  	
   

  	
  96

  
	
  SECTION 9.09.

  	
   

  	
  Governing Law; Jurisdiction; Consent to Service of
  Process

  	
   

  	
  97

  
	
  SECTION 9.10.

  	
   

  	
  WAIVER OF JURY TRIAL

  	
   

  	
  97

  
	
  SECTION 9.11.

  	
   

  	
  Headings

  	
   

  	
  97

  
	
  SECTION 9.12.

  	
   

  	
  Confidentiality

  	
   

  	
  97

  
	
  SECTION 9.13.

  	
   

  	
  Interest Rate Limitation

  	
   

  	
  98

  
	
  SECTION 9.14.

  	
   

  	
  Termination or Release

  	
   

  	
  98

  
	
  SECTION 9.15.

  	
   

  	
  USA Patriot Act

  	
   

  	
  99

  
	
  SECTION 9.16.

  	
   

  	
  Delivery of Lender Addenda

  	
   

  	
  99

  
	
  SECTION 9.17.

  	
   

  	
  Amendment and Restatement

  	
   

  	
  99

  



 



 iii
 









 


	
  SCHEDULES:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Schedule 2.01

  	
  —

  	
  Commitments

  
	
  Schedule 3.03

  	
  —

  	
  Governmental Approvals, No Conflicts

  
	
  Schedule 3.05(a)

  	
  —

  	
  Third Party Interests in Real Estate

  
	
  Schedule 3.05(b)

  	
  —

  	
  Third Party Intellectual Property

  
	
  Schedule 3.05(c)

  	
  —

  	
  Real Property

  
	
  Schedule 3.06

  	
  —

  	
  Disclosed Matters

  
	
  Schedule 3.07

  	
  —

  	
  Compliance with Laws and Agreements

  
	
  Schedule 3.08(d)

  	
  —

  	
  Tariffs; FCC Licenses

  
	
  Schedule 3.13

  	
  —

  	
  Subsidiaries

  
	
  Schedule 3.14

  	
  —

  	
  Insurance

  
	
  Schedule 5.13

  	
  —

  	
  Unrestricted Subsidiaries

  
	
  Schedule 6.01

  	
  —

  	
  Existing Indebtedness

  
	
  Schedule 6.02

  	
  —

  	
  Existing Liens

  
	
  Schedule 6.04

  	
  —

  	
  Existing Investments

  
	
  Schedule 6.09

  	
  —

  	
  Transactions With Affiliates

  
	
  Schedule 6.10

  	
  —

  	
  Existing Restrictions

  
	
   

  	
   

  	
   

  
	
  EXHIBITS:

  	
   

  	
   

  



 


	
  Exhibit A

  	
  —

  	
  Form of Assignment and Assumption

  
	
  Exhibit B-1

  	
  —

  	
  Form of Opinion of Latham & Watkins LLP

  
	
  Exhibit B-2

  	
  —

  	
  Form of Opinion of Latham & Watkins LLP

  
	
  Exhibit B-3

  	
  —

  	
  Form of Opinion of Morihara Lau & Fong LLP

  
	
  Exhibit B-4

  	
  —

  	
  Form of Opinion of Morihara Lau & Fong LLP

  
	
  Exhibit C

  	
  —

  	
  Form of Amended and Restated Guarantee and
  Collateral Agreement

  
	
  Exhibit D

  	
  —

  	
  Form of Perfection Certificate

  
	
  Exhibit E

  	
  —

  	
  Form of Amended and Restated Affiliate Subordination
  Agreement

  



 



 iv















AMENDED AND
RESTATED CREDIT AGREEMENT dated as of June 1, 2007 (this “Agreement”),
among HAWAIIAN TELCOM COMMUNICATIONS, INC., a Delaware corporation (the “Borrower”),
HAWAIIAN TELCOM HOLDCO, INC., a Delaware corporation (“Holdings”), the
Lenders (as defined below) from time to time party hereto, LEHMAN COMMERCIAL
PAPER INC. (“LCPI”), as administrative agent (in such capacity, the “Administrative
Agent”) and collateral agent (in such capacity, the “Collateral Agent”)
for such lenders, JPMORGAN CHASE BANK, N.A., as syndication agent (in such
capacity, the “Syndication Agent”) for such lenders and COBANK, ACB and
WACHOVIA BANK, N.A., as co-documentation agents (in such capacity, the “Co-Documentation
Agents”) for such lenders.


W i t n e s s e t h:


Whereas, Holdings and the Borrower have
entered into that certain Credit Agreement, dated as of May 2, 2005 (as
amended, modified or supplemented as of the date hereof, the “Existing
Credit Agreement”) with the lenders from time to party thereto, JPMorgan
Chase Bank, N.A., as administrative agent and collateral agent for such
lenders, and the other agents party thereto; and


Whereas, the Borrower intends to amend
and restate the terms of the Existing Credit Agreement to (i) modify certain
covenants and other provisions of the Existing Credit Agreement (the “Amendment”),
including to permit the sale of the Borrower’s directory publishing business
(the proceeds of which will be used to repay Indebtedness), (ii) replace all of
the Tranche A Term Loans and Tranche B Term Loans outstanding under the
Existing Credit Agreement with the proceeds of the Tranche C Term Loans (as
defined below) (the “Replacement”), and (iii) pay certain fees,
commissions and expenses incurred in connection therewith (together with the
Amendment and the Replacement, the “Transactions”); and


Whereas, the Lenders and the Issuing
Banks have agreed to continue to provide for the revolving credit facility
under the Existing Credit Agreement, to provide for the Tranche C Term Loans to
effect the Transactions and to otherwise amend and restate the terms of the
Existing Credit Agreement, in each case upon the terms and subject to the
conditions set forth herein; and


Whereas, Holdings and the other
Guarantors are willing to continue to guaranty all of the Obligations (as
defined below) of the Borrower, and the Borrower and the other Loan Parties are
willing to continue to secure all of their respective obligations by reaffirming
their grant to the Collateral Agent, for its benefit and the benefit of the Secured
Parties (as defined below), of a security interest in and lien upon
substantially all of the Collateral (as defined below); and


Whereas, (a) this Agreement, on the
terms and subject to the conditions set forth herein, shall amend and restate
the Existing Credit Agreement in its entirety as of the Effective Date, (b)
this Agreement shall not constitute a novation of the obligations and
liabilities existing under the Existing Credit Agreement or evidence payment of
all or any of such obligations and liabilities and (c) from and after the
Effective Date, the Existing Credit Agreement shall be of no further force or
effect, except to evidence the Obligations (as defined therein) incurred, the
representations and warranties made and the actions or omissions performed or
required to be performed thereunder prior to the Effective Date;


Now, Therefore, in consideration of the
premises and the covenants and agreements contained herein, the parties hereto
hereby agree as follows:













ARTICLE I


Definitions


SECTION  1.01.  Defined
Terms.  As used in this Agreement,
the following terms have the meanings specified below:


“ABR”, when used in reference to any Loan or Borrowing, refers
to whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the Alternate Base Rate.


“Adjusted LIBO Rate” means, with respect to any Eurodollar
Borrowing for any Interest Period, an interest rate per annum
(rounded upwards, if necessary, to the next 1/100 of 1%) equal to (a) the LIBO
Rate for such Interest Period multiplied by (b) the Statutory Reserve Rate.


“Administrative Agent” has the meaning assigned to such term in
the preamble to this Agreement.


“Administrative Questionnaire” means an Administrative
Questionnaire in a form supplied by the Administrative Agent.


“Affiliate” means, with respect to a specified Person, another
Person that directly, or indirectly through one or more intermediaries,
Controls or is Controlled by or is under common Control with the Person
specified.


“Affiliate Subordination Agreement” means an Amended and
Restated Affiliate Subordination Agreement substantially in the form of Exhibit
E pursuant to which intercompany obligations and advances owed by any Loan
Party are subordinated to the Obligations.


“Agent” means each of the Administrative Agent, the Collateral
Agent, the Syndication Agent and/or the Co-Documentation Agents, and each of their
Affiliates and successors acting in any such capacity.  The Administrative Agent may act on behalf of
or in place of any Person included in the “Agent”.


“Alternate Base Rate” means, for any day, a rate per annum equal to the greater of (a) the Prime Rate in
effect on such day and (b) the Federal Funds Effective Rate in effect on such
day plus 1⁄2 of 1%. Any change in the Alternate Base Rate due to a change in the
Prime Rate or the Federal Funds Effective Rate shall be effective from and
including the effective date of such change in the Prime Rate or the Federal
Funds Effective Rate, as the case may be.


“Applicable Percentage” means, with respect to any Revolving
Lender, the percentage of the total Revolving Commitments represented by such
Lender’s Revolving Commitment.  If the
Revolving Commitments have terminated or expired, the Applicable Percentages
shall be determined based upon the relative amounts of the Revolving Exposures
of the Revolving Lenders.


“Applicable Premium”:  in
connection with any voluntary prepayment of the Tranche C Term Loans with the
substantially concurrent issuance or incurrence of new term loans pursuant to this
Agreement or any Repricing during any period set forth below (in each case,
other than a refinancing of all of the Term Loans in connection with a
transaction not permitted by this Agreement), the amount determined by
multiplying the principal amount of such Lender’s Tranche C Term Loans being 



 2
 









refinanced or purchased or, in the case of a
Repricing, the aggregate outstanding amount of the Tranche C Term Loans that
are repriced, as the case may be, by the applicable percentage set forth below
under the caption “Prepayment Percentage”
opposite such period:


	
  PERIOD

  	
   

  	
  PREPAYMENT PERCENTAGE

  	
   

  
	
  After June 1, 2007 but on or before June 1, 2008

  	
   

  	
  1.0

  	
  %

  
	
  June 1, 2008 and
  thereafter

  	
   

  	
  0.0

  	
  %

  



 


“Applicable Rate” means, for any day:


(a) with respect to any ABR Loan or Eurodollar Loan that is a Tranche C
Term Loan, the applicable rate per annum set
forth in the table below (the “Term Loan Pricing Grid”) under the
caption “ABR Spread” or “Eurodollar Spread”, as the case may be, based upon the
Total Leverage Ratio as of the most recent determination date; provided
that until the Borrower shall have delivered the financial statements and
certificate required by Section 5.01(b) and Section 5.01(d) for the quarterly
period ended on December 31, 2007, the “Applicable Rate” for purposes of this
clause (a) shall be the applicable rate per annum set forth
below in Category 2: 


	
  Total Leverage Ratio:

  	
   

  	
  ABR Spread

  	
   

  	
  Eurodollar 

  Spread

  	
   

  
	
  Category 1
  

  greater than or equal to 6.00 to 1.00

  	
   

  	
  1.50

  	
  %

  	
  2.50

  	
  %

  
	
  Category 2
  

  greater than or equal to 4.75 to 1.00

  but less than 6.00 to 1.00

  	
   

  	
  1.25

  	
  %

  	
  2.25

  	
  %

  
	
  Category 3
  

  less than 4.75 to 1.00

  	
   

  	
  1.00

  	
  %

  	
  2.00

  	
  %

  



 


(b) with respect to any ABR Loan or Eurodollar Loan that is a Revolving
Loan, or with respect to the commitment fees payable hereunder, as the case may
be, the applicable rate per annum set
forth in the table below (the “Revolving Loan Pricing Grid”) under the
caption “ABR Spread”, “Eurodollar Spread” or “Commitment Fee Rate”, as the case
may be, based upon the Total Leverage Ratio as of the most recent determination
date; provided that until the Borrower shall have delivered the
financial statements and certificate required by Section 5.01(b) and Section
5.01(d) for the first full quarterly period ended after the Effective Date, the
“Applicable Rate” for purposes of clause (b) shall be the applicable rate per annum set forth below in Category 1: 



 3
 









 


	
  Total Leverage Ratio:

  	
   

  	
  ABR Spread

  	
   

  	
  Eurodollar 

  Spread

  	
   

  	
  Commitment

  Fee Rate

  	
   

  
	
  Category 1
  

  greater than or equal to 5.00 to 1.00

  	
   

  	
  1.25

  	
  %

  	
  2.25

  	
  %

  	
  0.50

  	
  %

  
	
  Category 2
  

  greater than or equal to 4.50 to 1.00

  but less than 5.00 to 1.00

  	
   

  	
  1.00

  	
  %

  	
  2.00

  	
  %

  	
  0.50

  	
  %

  
	
  Category 3
  

  greater than or equal to 4.00 to 1.00

  but less than 4.50 to 1.00

  	
   

  	
  0.75

  	
  %

  	
  1.75

  	
  %

  	
  0.375

  	
  %

  
	
  Category 4
  

  less than 4.00 to 1.00

  	
   

  	
  0.50

  	
  %

  	
  1.50

  	
  %

  	
  0.375

  	
  %

  



 


For purposes of the foregoing clauses (a) and (b),
(i) the Total Leverage Ratio shall be determined as of the end of each fiscal
quarter of the Borrower’s fiscal year based upon the consolidated financial
statements delivered pursuant to Section 5.01(a) or (b) and (ii) each change in
the Applicable Rate resulting from a change in the Total Leverage Ratio shall
be effective during the period commencing on and including the date of delivery
to the Administrative Agent of such consolidated financial statements
indicating such change and ending on the date immediately preceding the
effective date of the next such change; provided that the Total Leverage
Ratio shall be deemed to be in Category 1 of each of the Term Loan Pricing Grid
and the Revolving Loan Pricing Grid (A) at any time that an Event of Default
has occurred and is continuing or (B) if the Borrower fails to deliver the
consolidated financial statements required to be delivered by it pursuant to
Section 5.01(a) or (b), during the period from the expiration of the time for
delivery thereof until such consolidated financial statements are delivered.  In addition, all calculations of the Total
Leverage Ratio for purposes of determining the Applicable Rate shall give pro forma effect to the Directories Sale if the Directories
Sale has closed on or prior to the relevant date required for delivery of financial
statements pursuant to Section 5.01(a) or (b) (and regardless of whether the
Directories Sale closed during or after the most recent fiscal period for which
financial statements are available).


“Approved Fund” has the meaning assigned to such term in Section
9.04(c).


“Arrangers” means Lehman Brothers Inc. and J.P. Morgan Securities
Inc.


“Asset Disposition” means (a) any sale, transfer or other
disposition (including pursuant to a sale and leaseback transaction but
excluding any sale of Securitization Assets pursuant to a Securitization) of
any property or asset of Holdings, the Borrower or any Subsidiary, other than
(i) dispositions described in clauses (a), (b), (c), (d), (e) and (h) of
Section 6.05, (ii) any disposition resulting in Net Proceeds, whether through a
single transaction or a series of related transactions, not exceeding
$1,500,000 and (iii) other dispositions and dividends or distributions
resulting in aggregate Net Proceeds not exceeding $10,000,000 during any fiscal
year of the Borrower, (b) any casualty or other insured damage to, or any
taking under power of eminent domain or by condemnation or similar proceeding
of, any property or asset of Holdings, the Borrower or any Subsidiary, but only
in the case of this clause (b) to the extent that (i) the Net Proceeds
therefrom, on an aggregate basis, exceed $10,000,000 in any fiscal year and
(ii) the application of the Net Proceeds of such event to the prepayment of
Term Borrowings hereunder would not violate any applicable laws and
(c) any transfer of Securitization Assets in a Securitization (and any
subsequent transfer of Securitization Assets that results in any increase in
the aggregate funded amount of any Securitization over the greatest aggregate
funded amount previously outstanding thereunder), provided that a Prepayment
Event shall only exist with respect to a Securitization to the extent the
aggregate funded amount of all such Securitizations outstanding at the 



 4
 









time of determination exceeds the aggregate amount
of prepayments of Tranche C Term Loans previously made hereunder in respect of
Securitizations.


“Assignment and Assumption” means an assignment and assumption
entered into by a Lender and an assignee (with the consent of any party whose
consent is required by Section 9.04), and accepted by the Administrative Agent,
in the form of Exhibit A or any other form approved by the Administrative
Agent.


“Assignor” has the meaning assigned to such term in Section
9.04(c).


“Attributable Debt” means, on any date, in respect of any lease
of the Borrower or any Subsidiary entered into as part of a sale and leaseback
transaction subject to Section 6.06, (a) if such lease is a Capital Lease
Obligation, the capitalized amount thereof that would appear on a balance sheet
of such Person prepared as of such date in accordance with GAAP and (b) if such
lease is not a Capital Lease Obligation, the capitalized amount of the
remaining lease payments under such lease that would appear on a balance sheet
of such Person prepared as of such date in accordance with GAAP if such lease
were accounted for as a Capital Lease Obligation.


“Available Additional Amount” means at any time (the “Reference
Time”), an amount equal to (a) the sum, without duplication, of:


(i)            Available Cash;


(ii)           an amount equal to
the sum of (x) any Below Threshold Asset Disposition Proceeds and (y) any
Retained Asset Disposition Proceeds, in each case received by the Borrower or
any Subsidiary from and including the Business Day immediately following the
Effective Date through and including the Reference Time; provided that
the Net Proceeds of the Directories Sale shall be excluded from this clause
(ii); and


(iii)          the amount of any Eligible
Equity Proceeds received by the Borrower from and including the Business Day
immediately following the Effective Date through and including the Reference
Time,


minus (b) the sum, without duplication, of:


(i)            the aggregate
amount of Investments made pursuant to Section 6.04(d)(ii) and 6.04(l)(ii)
following the Effective Date and prior to the Reference Time;


(ii)           the aggregate
amount of Restricted Payments pursuant to Section 6.08(a)(v)(A)(ii) and
6.08(a)(v)(B)(ii) following the Effective Date and prior to the Reference Time;


(iii)          the aggregate
amount of payments of Indebtedness pursuant to Section 6.08(b)(vi)(A)(ii) or
6.08(b)(vi)(B)(ii)  following the Effective Date and
prior to the Reference Time; and


(iv)          the aggregate amount
of Capital Expenditures made pursuant to clause (iv) of the second proviso to
Section 6.19 following the Effective Date and prior to the Reference Time.



 5
 









“Available Cash” means, on any date of determination, an amount
(without duplication) equal to (a) Consolidated Net Income for the most
recently completed Reference Period, adjusted to exclude any gains or losses
attributable to Prepayment Events; plus (b) to the extent deducted in
determining such Consolidated Net Income for such Reference Period (i)
depreciation, amortization and other non-cash charges or losses and non-cash
and/or stock-based compensation expense; plus (c) cash received upon the
redemption, sale or other disposition of (A) any equity interests or patronage
certificates of the Rural Utilities Service, CoBank, ACB, or RTFC, or (B) any
subordinated capital certificates of RTFC or any CoBank Equity Interests; minus
(d) any non-cash gains included in determining such Consolidated Net Income for
such Reference Period minus (e) the sum of (i) Capital Expenditures for
such Reference Period (except to the extent (A) attributable to the incurrence
of Capital Lease Obligations or otherwise financed by incurring Long-Term
Indebtedness, (B) made with Net Proceeds in respect of Prepayment Events or (C)
made with Eligible Equity Proceeds) and (ii) cash consideration paid during
such Reference Period to make acquisitions or other capital investments (other
than Permitted Investments and except to the extent financed by incurring
Long-Term Indebtedness or made with Eligible Equity Proceeds); minus (f)
Taxes for which reserves have been established and funded, to the extent not
reflected in the computation of Consolidated Net Income for such Reference
Period; minus (g) cash expenditures made in respect of Swap Agreements
during such Reference Period, to the extent not reflected in the computation of
Consolidated Net Income; plus (h) cash payments received in respect of
Swap Agreements during such Reference Period to the extent not included in the
computation of Consolidated Net Income; minus (i) the aggregate
principal amount of Long-Term Indebtedness repaid or prepaid by the Borrower
and its Subsidiaries during such Reference Period excluding (i) Indebtedness in
respect of Revolving Loans and Letters of Credit (but only to the extent
Revolving Commitments were not simultaneously permanently reduced), (ii) Term
Loans prepaid pursuant to Section 2.11(c) or (d), (iii) repayments or
prepayments of Long-Term Indebtedness made with Eligible Equity Proceeds or
financed by incurring other Long-Term Indebtedness, (iv) prepayments of the
Senior Notes, the Subordinated Notes or other subordinated Debt, to the extent
such prepayments are made with Available Cash; minus (j) permitted
dividends and distributions or repurchases of its Equity Interests paid in cash
by the Borrower during such Reference Period and permitted dividends paid in
cash by any Subsidiary during such Reference Period to any person other than
Holdings, the Borrower or any of the Subsidiaries, in each case pursuant to and
in accordance with Section 6.08 (other than any such payments made with Available
Cash); minus (k) to the extent not deducted in the computation of Net
Proceeds in respect of any asset disposition, casualty or condemnation giving
rise thereto, the amount of any mandatory prepayment of Indebtedness (other
than Indebtedness created hereunder or under any other Loan Document), together
with any interest, premium or penalties required to be paid (and actually paid)
in connection therewith; minus (l) cash paid for pension and other
post-employment benefit liabilities; minus (m) all other non-cash income
(including the accrual of the non-cash portion of any Rural Utilities Service,
CoBank, ACB or RTFC patronage capital allocation); minus (n) any amounts
of Excess Cash Flow applied to prepay the Term Loan Facility pursuant to
Section 2.11(d).


“Below Threshold Asset Disposition Proceeds” means the aggregate
cumulative amount of Net Proceeds received after the Effective Date that would
have constituted Net Proceeds of an Asset Disposition pursuant to clause (a) or
(b) of the definition thereof except for the operation of clause (a)(iii) or
clause (b)(i) thereof.


“Board” means the Board of Governors of the Federal Reserve
System of the United States of America.


“Borrower” has the meaning assigned to such term in the preamble
to this Agreement.



 6
 









“Borrowing” means (a) Loans of the same Class and Type, made,
converted or continued on the same date and, in the case of Eurodollar Loans,
as to which a single Interest Period is in effect or (b) a Swingline Loan.


“Borrowing Request” means a request by the Borrower for a
Borrowing in accordance with Section 2.03.


“Business Day” means any day that is not a Saturday, Sunday or
other day on which commercial banks in New York City are authorized or required
by law to remain closed; provided that, when used in connection with a
Eurodollar Loan, the term “Business Day” shall also exclude any day on
which banks are not open for dealings in dollar deposits in the London
interbank market.


“Capital Expenditures” means, for any period, without
duplication, the additions to property, plant and equipment and other capital
expenditures of the Borrower and its consolidated Subsidiaries for such period,
determined in accordance with GAAP; provided, that in any event the term
“Capital Expenditures” shall exclude: (i) any Permitted Acquisition and any
other Investment permitted hereunder, (ii) any reinvestment expenditures to the
extent financed with Net Proceeds of insurance received by any Loan Party for
its own account and not applied to prepay the Tranche C Term Loans pursuant to
a transaction subject to Section 2.11(c) and (iii) expenditures for leasehold
improvements for which such Person is reimbursed or receives a credit.


“Capital Lease Obligations” of any Person means the obligations
of such Person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a combination
thereof, which obligations are required to be classified and accounted for as
capital leases on a balance sheet of such Person under GAAP, and the amount of
such obligations shall be the capitalized amount thereof determined in
accordance with GAAP.


“Change in Control” means:


(a)           Holdings shall cease to own, directly or indirectly, 100%
of the Equity Interests of the Borrower (other than as a result of a Qualified
IPO by the Borrower);


(b)           prior to a Qualified IPO of Holdings, Parent or the
Borrower, the failure by the Equity Investors to own (and retain the right to
vote), directly or indirectly through wholly owned investment vehicles, Equity
Interests in Holdings representing more than 50% of each of the aggregate
ordinary voting power represented by the issued and outstanding Equity
Interests in Holdings;


(c)           after a Qualified IPO of Holdings, Parent or the Borrower,
the acquisition of ownership, directly or indirectly, beneficially or of
record, by any Person or group (within the meaning of the Securities Exchange
Act of 1934, as amended, and the rules of the Securities and Exchange
Commission thereunder as in effect on the date hereof) other than the Equity
Investors of Equity Interests in Holdings representing more than 30% of the
aggregate voting power represented by the outstanding Equity Interests in
Holdings and representing a greater percentage of such aggregate ordinary
voting power than that represented by Equity Interests in Holdings owned
directly and of record by the Equity Investors;


(d)           occupation of a majority of the seats (other than vacant
seats) on the board of directors of Holdings by Persons who are not Continuing
Directors;



 7
 









(e)           the occurrence of a “Change of Control”, as defined in the
Senior Subordinated Debt Documents; or


(f)            the occurrence of a “Change of Control”, as defined in
the Senior Unsecured Debt Documents.


“Change in Law” means (a) the adoption of any law, rule or
regulation after the date of this Agreement, (b) any change in any law, rule or
regulation or in the interpretation or application thereof by any Governmental
Authority after the date of this Agreement or (c) compliance by any Lender or
Issuing Bank (or, for purposes of Section 2.15(b), by any lending office of
such Lender or by such Lender’s or Issuing Bank’s holding company, if any) with
any request, guideline or directive (whether or not having the force of law) of
any Governmental Authority made or issued after the date of this Agreement.


“Class”, when used in reference to any Loan or Borrowing, refers
to whether such Loan, or the Loans comprising such Borrowing, are Revolving
Loans, Tranche C Term Loans or Swingline Loans and, when used in reference to
any Commitment, refers to whether such Commitment is a Revolving Commitment or
Tranche C Commitment.


“CoBank Equity Interests” shall mean investments in non-voting
participation certificates of Co-Bank, ACB acquired by the Borrower in
connection with its Loans hereunder from CoBank, ACB.


“Code” means the Internal Revenue Code of 1986, as amended from
time to time.


“Co-Documentation
Agents” has the
meaning assigned to such term in the preamble to this Agreement.


“Collateral” means any and all “Collateral”, as defined in any
Security Document.


“Collateral Agent” has the meaning assigned to such term in the
preamble to this Agreement.


“Collateral Agreement” means the Amended and Restated Guarantee
and Collateral Agreement among Holdings, the Borrower, the Subsidiary Loan
Parties party thereto and the Agent, substantially in the form of Exhibit C.


“Collateral and Guarantee Requirement” means the requirement
that:


(a)           the Collateral Agent shall have received from each Loan
Party either (i) in the case of each Loan Party, a counterpart of the
Collateral Agreement duly executed and delivered on behalf of such Loan Party
or (ii) in the case of any Person that becomes a Loan Party after the Effective
Date, a supplement to the Collateral Agreement, in the form specified therein,
duly executed and delivered on behalf of such Loan Party;


(b)           all outstanding Equity Interests of the Borrower and each
Subsidiary owned by or on behalf of any Loan Party shall have been pledged
pursuant to the Collateral Agreement (except that the Loan Parties shall not be
required to pledge more than 65% of the outstanding voting Equity Interests of
any “first-tier” Foreign Subsidiary directly owned by a Loan Party) and the Collateral
Agent shall have received all certificates or other instruments representing
such 



 8
 









Equity Interests, together
with stock powers or other instruments of transfer with respect thereto
endorsed in blank;


(c)           all Indebtedness of Holdings, the Borrower and each
Subsidiary that is owing to any Loan Party shall be evidenced by a promissory
note and, if in an amount in excess of $1,000,000, shall have been pledged
pursuant to the Collateral Agreement (except to the extent any such pledge
would violate applicable law), and the Collateral Agent shall have received all
such promissory notes, together with note powers or other instruments of
transfer with respect thereto endorsed in blank, and all such Indebtedness
shall be subordinated to the Obligations pursuant to the Affiliate
Subordination Agreement;


(d)           except as otherwise specifically contemplated by any
Security Document, all documents and instruments, including Uniform Commercial
Code financing statements, required by law or reasonably requested by the Collateral
Agent to be filed, registered or recorded to create the Liens intended to be
created by the Collateral Agreement (including any supplements thereto) and
perfect such Liens to the extent required by, and with the priority required
by, the Collateral Agreement, shall have been filed, registered or recorded or
delivered to the Collateral Agent for filing, registration or recording;


(e)           the Collateral Agent shall have received (i) counterparts
of a Mortgage with respect to each Mortgaged Property duly executed and
delivered by the record owner of such Mortgaged Property, (ii) a policy or
policies of title insurance issued by a nationally recognized title insurance
company insuring the Lien of each such Mortgage as a valid first Lien on the
Mortgaged Property described therein, free of any other Liens except as
expressly permitted by Section 6.02, together with such endorsements,
coinsurance and reinsurance as the Collateral Agent may reasonably request, and
(iii) such abstracts, appraisals, legal opinions and other documents as the Collateral
Agent may reasonably request with respect to any such Mortgage or Mortgaged
Property; provided, that in respect of any Mortgaged Property owned by a
Loan Party on the Effective Date and identified on Schedule 3.05, the
Collateral Agent shall have received all such documentation required pursuant
to this clause (e) no later than 30 days following the Effective Date (or such
later date as the Collateral Agent may agree); and


(f)            except as otherwise specifically contemplated by any
Security Document, each Loan Party shall have obtained all consents and
approvals required to be obtained by it in connection with the execution and
delivery of all Security Documents (or supplements thereto) to which it is a
party, the performance of its obligations thereunder and the granting by it of
the Liens thereunder.


“Commitment” means a Revolving Commitment or Tranche C
Commitment, or any combination thereof (as the context requires).


“Communications Act” means the Communications Act of 1934 and
any successor Federal statute, and the rules, regulations and published
policies of the FCC thereunder, all as amended and in effect from time to time.


“Consolidated EBITDA” means, for any period, Consolidated Net
Income for such period plus (a) without duplication and to the extent deducted
in determining such Consolidated Net Income, the sum of (i) consolidated
interest expense for such period (net of interest income for such period), (ii)
consolidated income tax expense for such period, including state franchise and
similar taxes, (iii) all amounts attributable to depreciation and amortization
for such period, (iv) any extraordinary or 



 9
 









non-cash charges for such period (provided, however,
that any cash payment or expenditure made with respect to any such non-cash
charge shall be subtracted in computing Consolidated EBITDA during the period
in which such cash payment or expenditure is made), including, without limitation,
any non-cash compensation charge arising from any grant of stock, stock options
or other equity-based awards and non-cash pension and post-employment benefit
expenses, (v) customary non-recurring fees and expenses of the Borrower and the
Subsidiaries payable in connection with the incurrence of Long-Term
Indebtedness permitted hereunder or any Permitted Acquisition, (vi) other
non-recurring or unusual charges, expenses or losses, including with respect to
acts of god or force majeure or with respect to severance costs or costs,
expenses or losses relating to securities offerings, investments or
acquisitions (in each case, to the extent that any such charges, expenses or
losses are not reimbursed from the proceeds of insurance that increased
Consolidated Net Income for such period), (vii) fees paid under the Management
Agreement, (viii) any non-cash decrease in consolidated revenues during such
period resulting from purchase accounting adjustments made in accordance with
GAAP in connection with any Permitted Acquisition, (ix) any reduction in
consolidated revenues during such period attributable to out-of-period billing
adjustments to the extent related to periods prior to the Effective Date, (x)
costs and expenses relating to the amendment and restatement of this Agreement,
(xi) costs and expenses related to a Qualified IPO or the preparation therefor,
including related bonuses, (xii) compensation expense arising from deemed
dividends, the payment of dividends or the equivalent issued under any incentive
stock plans related to restricted and/or unvested stock, (xiii) costs and
expenses related to any repurchase, repayment, payment or redemption of all or
any portion of the Senior Subordinated Debt, Senior Unsecured Debt or other
subordinated Indebtedness, and minus (b) without duplication and to the
extent included in determining such Consolidated Net Income, the sum of (i) any
non-cash gains or other non-cash items of income for such period (provided
that any cash received in a subsequent period in respect of any such non-cash
gain shall be included in Consolidated EBITDA for the period in which
received), (ii) any increase in consolidated revenues during such period
resulting from purchase accounting adjustments made in accordance with GAAP in
connection with any Permitted Acquisition and (iii) any increase in
consolidated revenues during such period attributable to out-of-period billing
adjustments to the extent related to periods prior to the Effective Date, all
determined on a consolidated basis in accordance with GAAP.  For purposes of calculating the Total Leverage
Ratio and the Net Secured Leverage Ratio as of any date, if the Borrower or any
consolidated Subsidiary has made any Permitted Acquisition or sale, transfer,
lease or other disposition outside of the ordinary course of business of a
Subsidiary or of assets constituting a business unit, in each case as permitted
by Section 6.05, during the period of four consecutive fiscal quarters (a “Measurement
Period”) most recently ended on or prior to such date, Consolidated EBITDA
for such Measurement Period shall be calculated after giving pro forma effect thereto and taking into account any
operating improvements or synergies and operating expense reductions as a
result of actions implemented or planned to be implemented and reasonably
expected to be realized within 24 months following such Permitted Acquisition,
sale, transfer , lease or other disposition, as if such Permitted Acquisition
or sale, transfer, lease or other disposition (and any related incurrence,
repayment or assumption of Indebtedness with any new Indebtedness being deemed
to be amortized over the applicable testing period in accordance with its
terms) had occurred on the first day of such Measurement Period, to the extent
that the Borrower delivers to the Administrative Agent (i) a certificate signed
by a Financial Officer of the Borrower setting forth such operating expense
reductions and other operating improvements or synergies, each as having been
determined in good faith by the Borrower and (ii) information and calculations
supporting in reasonable detail such estimated operating expense reductions and
other operating improvements or synergies.


“Consolidated Net Income” means, for any period, the net income
or loss of the Borrower and the Subsidiaries for such period determined on a
consolidated basis in accordance with GAAP; provided that:



 10
 









(a)           (A) net income for
such period of any Person that is not a subsidiary of such person, or that is
accounted for by the equity method of accounting, shall be included only to the
extent of the amount of dividends or distributions paid in cash (or to the
extent converted into cash) to the referent Person or a subsidiary thereof in
respect of such period and (B) the net income for such period shall include any
ordinary course dividend distribution or other payment in cash received from
any person in excess of the amounts included in clause (A); and


(b)           there shall be
excluded:  (i) accruals and reserves that
are established within twelve months after the Effective Date and that are so
required to be established in accordance with GAAP; provided that any
such accruals or reserves paid in cash shall be deducted from Consolidated Net
Income for the period in which paid unless excluded pursuant to another clause
of this definition;


(ii)           the income or loss of any Person accrued prior to the date
it becomes a Subsidiary or is merged into or consolidated with the Borrower or
any Subsidiary or the date that such Person’s assets are acquired by the
Borrower or any Subsidiary;


(iii)          the cumulative effect of any change in accounting
principles during such period;


(iv)          any gain or loss realized upon the sale or other
disposition of any assets of the Borrower or its Subsidiaries that is not sold
or otherwise disposed of in the ordinary course of business and any gain or
loss realized upon the sale or other disposition of any Equity Interests of any
Person;


(v)           any non-cash SFAS 133 income (or loss) related to hedging
activities;


(vi)          all deferred financing costs written off, premiums paid and
other net gains or losses in connection with any early extinguishment of
Indebtedness;


(vii)         any non-cash impairment charges resulting from the
application of SFAS Nos. 142 and 144 and the amortization of intangibles
arising pursuant to SFAS No. 141;


(viii)        any non-cash expense or gain related to
recording of the fair market value of Swap Agreements, in each case entered
into in the ordinary course of business and not for speculative purposes; and


(ix)           unrealized gains and losses relating to hedging
transactions and mark-to-market of Indebtedness denominated in foreign
currencies resulting from the applications of FAS 52.


“Consolidated Total Assets” means, as at any date of
determination, the aggregate amount of assets reflected on the consolidated
balance sheet of the Borrower and the Subsidiaries most recently delivered by
the Borrower pursuant to Section 5.01 on or prior to such date of
determination.


“Continuing Directors” means, before a Qualified IPO, the
directors of Holdings on the Effective Date or, after a Qualified IPO, the
directors of Holdings or Parent immediately after such Qualified IPO and, in
either case, each other director of Holdings or Parent if, in each case, such
other director’s nomination for election to the board of directors of Holdings
or Parent is recommended by at least 51% of the then Continuing Directors or
such other director receives the vote of the Sponsor, as applicable, in his or
her election by the shareholders of Holdings or Parent.


“Continuing Lender” has the meaning assigned to such term in
Section 4.01(a).



 11
 









“Control” means the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of a
Person, whether through the ability to exercise voting power, by contract or
otherwise.  “Controlling” and “Controlled”
have meanings correlative thereto.


“Conversion Notice” means, with respect to any applicable
Lender, a conversion notice in form and substance reasonably acceptable to the
Administrative Agent.


“Cure Amount” has the meaning assigned to such term in Section
7.02.


“Cure Right” has the meaning assigned to such term in Section
7.02.


“Debt Issuance” means the incurrence by the Borrower or any
Subsidiary of any Indebtedness, other than Indebtedness permitted by Section
6.01(a).


“Default” means any event or condition that constitutes an Event
of Default or which upon notice, lapse of time or both would, unless cured or
waived, become an Event of Default.


“Defaulting Lender” means any Lender which has defaulted in the
performance of any of its material obligations to the Borrower under this
Agreement for so long as such Lender has not cured or remedied all such
defaults.


“Directories Sale” means the sale by the Borrower and HTSC of the
Directory Publishing Business pursuant to that certain Purchase Agreement,
dated as of April 29, 2007, among the Borrower, HTSC and CBD Investor, Inc., a
Delaware corporation that is a wholly-owned indirect subsidiary of Local
Insight Media, L.P.


“Directories Sale Subsidiary” means a subsidiary of the Borrower
formed to effect the Directories Sale.


“Directory Publishing Business” means the directory publishing
business of HTSC.


“Disclosed Matters” means the actions, suits and proceedings and
the environmental matters disclosed in Schedule 3.06.


“Domestic Subsidiary” means any Subsidiary that is organized
under the laws of the United States of America or any State thereof or the
District of Columbia.


“dollars” or “$” refers to lawful money of the United
States of America.


“Effective Date” means the date on which the conditions
specified in Section 4.01 are satisfied (or waived in accordance with Section
9.02).


“Eligible Assignee”:  (i)
any Lender, any Affiliate of any Lender and any Approved Fund (any two or more Approved
Funds being treated as a single Eligible Assignee for all purposes hereof), and
(ii) any commercial bank, insurance company, investment or mutual fund or other
entity that is an “accredited investor” (as defined in Regulation D under the
Securities Act of 1933) and which extends credit or buys loans in the ordinary
course.


“Eligible Equity Proceeds” means Equity Proceeds received by
Holdings and contributed by Holdings in cash to the common equity of the
Borrower, other than any such Equity Proceeds 



 12
 









(i) constituting Cure Amounts from the issuance of
Permitted Cure Securities, (ii) constituting Non-Cash Pay Preferred Stock or (iii)
received by Holdings from officers, employees, directors or consultants of
Holdings, the Borrower or its Subsidiaries under stock purchase, stock option
or other incentive plans or arrangements.


“Environmental Laws” means all applicable federal, state, and
local laws (including common law), regulations, rules, ordinances, codes,
decrees, judgments, directives, orders (including consent orders), and binding
agreements with any Governmental Authority in each case, relating to protection
of the environment, natural resources, human health and safety from exposure to
Hazardous Materials or the presence, Release of, or exposure to, Hazardous
Materials, or the generation, manufacture, processing, distribution, use,
treatment, storage, transport, recycling or handling of, or the arrangement for
such activities with respect to, Hazardous Materials.


“Environmental Liability” means any liability, claim, action,
suit, judgment or order under or relating to any Environmental Law for any
damages, injunctive relief, losses, fines, penalties, fees, expenses (including
reasonable fees and expenses of attorneys and consultants) or costs, whether contingent
or otherwise, including those arising from or relating to: (a) compliance or
non-compliance with any Environmental Law, (b) the generation, use, handling,
transportation, storage, treatment or disposal of any Hazardous Materials, (c)
exposure to any Hazardous Materials, (d) the Release of any Hazardous Materials
or (e) any contract, agreement or other consensual arrangement pursuant to
which liability is assumed or imposed with respect to any of the foregoing.


“Equity Interests” means shares of capital stock, partnership
interests, membership interests in a limited liability company, beneficial
interests in a trust or other equity ownership interests in a Person of
whatever nature, and any warrants, options or other rights entitling the holder
thereof to purchase or acquire any of the foregoing.


“Equity Investors” means (i) Carlyle Partners III, L.P., (ii)
Carlyle Partners IV, L.P., (iii) CP III Coinvestment, L.P., (iv) Carlyle High
Yield Partners, L.P., (v) Carlyle Hawaii Partners L.P., (vi) any other
investment fund Controlled and managed by (or managed by a Controlled Affiliate
of) the same general partner or investment manager as any of the investment
funds referred to in clause (i) through (v) above, and (vii) the Management
Group if at the time of any determination the Management Group does not own or
control more than 35% of the aggregate ordinary voting power represented by the
issued and outstanding Equity Interests in Holdings or 35% of the aggregate
voting power represented by the issued and outstanding Equity Interest in any
direct or indirect parent company of Holdings.


“Equity Proceeds” means the Net Proceeds received by Holdings
from contributions to its common equity or from the issuance and sale of its
common Equity Interests or Non-Cash Pay Preferred Stock, in each case on or
after the Effective Date.


“ERISA” means the Employee Retirement Income Security Act of
1974, as amended from time to time.


“ERISA Affiliate” means any trade or business (whether or not
incorporated) that, together with the Borrower, is treated as a single employer
under Section 414(b) or (c) of the Code or, solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.


“ERISA Event” means (a) any “reportable event”, as defined in
Section 4043 of ERISA or the regulations issued thereunder with respect to a
Plan (other than an event for which the 30-day 



 13
 









notice period is waived); (b) the existence with
respect to any Plan of an “accumulated funding deficiency” (as defined in
Section 412 of the Code or Section 302 of ERISA), whether or not waived; (c)
the filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of
an application for a waiver of the minimum funding standard with respect to any
Plan; (d) the incurrence by the Borrower or any of its ERISA Affiliates of any
liability under Title IV of ERISA with respect to the termination of any Plan;
(e) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan
administrator of any notice relating to an intention to terminate any Plan or
Plans or to appoint a trustee to administer any Plan; (f) the incurrence by the
Borrower or any of its ERISA Affiliates of any liability with respect to the
withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (g)
the receipt by the Borrower or any ERISA Affiliate of any notice, or the
receipt by any Multiemployer Plan from the Borrower or any ERISA Affiliate of
any notice, concerning the imposition of Withdrawal Liability or a
determination that a Multiemployer Plan is, or is expected to be, insolvent or
in reorganization, within the meaning of Title IV of ERISA.


“Eurodollar”, when used in reference to any Loan or Borrowing,
refers to whether such Loan, or the Loans comprising such Borrowing, are
bearing interest at a rate determined by reference to the Adjusted LIBO Rate.


“Event of Default” has the meaning assigned to such term in Section
7.01.


“Excess Cash Flow” means, for any fiscal year, the sum (without
duplication) of:


(a) Consolidated Net Income for such fiscal year, adjusted to exclude
any gains or losses attributable to Prepayment Events; plus (b) to the
extent deducted in determining such Consolidated Net Income for such fiscal
year (i) depreciation, amortization and other non-cash charges, losses or other
items that reduce Consolidated Net Income and (ii) non-cash and/or stock-based
compensation expense; plus (c) the sum of (i) the amount, if any, by
which Net Working Capital decreased during such fiscal year, (ii) the net
amount, if any, by which the deferred income taxes of Holdings, the Borrower
and its consolidated Subsidiaries increased during such fiscal year and (iii)
cash received upon the redemption, sale or other disposition of (A) any equity
interests or patronage certificates of the Rural Utilities Service, CoBank,
ACB, or RTFC, or (B) any subordinated capital certificates of RTFC or any
CoBank Equity Interests; minus (d) the sum of (i) any non-cash gains
included in determining such Consolidated Net Income for such fiscal year, (ii)
the amount, if any, by which Net Working Capital increased during such fiscal
year and (iii) the net amount, if any, by which the deferred income taxes of
Holdings, the Borrower and its consolidated Subsidiaries decreased during such
fiscal year; minus (e) the sum of (i) Capital Expenditures for such
fiscal year (except to the extent (A) attributable to the incurrence of Capital
Lease Obligations or otherwise financed by incurring Long-Term Indebtedness,
(B) made with Net Proceeds in respect of Prepayment Events, (C) made with Eligible
Equity Proceeds, or (D) deducted in a prior fiscal year pursuant to clause (j)
of this definition) plus (ii) cash consideration paid during such fiscal
year to make acquisitions or other capital investments (other than Permitted
Investments and except to the extent financed by incurring Long-Term
Indebtedness or made with Eligible Equity Proceeds); minus (f) Taxes for
which reserves have been established and funded, to the extent not reflected in
the computation of Consolidated Net Income, provided that any amount so
deducted shall be added to Excess Cash Flow in respect of any subsequent fiscal
year in which such Taxes reduced Consolidated Net Income; minus (g) cash
expenditures made in respect of Swap Agreements during such fiscal year, to the
extent not reflected in the computation of Consolidated Net Income; plus
(h) cash payments received in respect of Swap Agreements during such fiscal
year to the extent not included in the computation of Consolidated Net Income; minus
(i) the aggregate principal amount of Long-Term Indebtedness repaid or prepaid
by the Borrower and its Subsidiaries during such fiscal year (except to the
extent deducted in a prior fiscal year) or in the first fiscal quarter of the
immediately succeeding fiscal year, excluding (i) Indebtedness in 



 14
 









respect of Revolving Loans and Letters of Credit
(but only to the extent Revolving Commitments were not simultaneously
permanently reduced), (ii) Term Loans prepaid pursuant to Section 2.11(c) or
(d) and (iii) repayments or prepayments of Long-Term Indebtedness made with
Eligible Equity Proceeds or financed by incurring other Long-Term Indebtedness;
minus (j) Capital Expenditures that the Borrower or any Subsidiary
shall, during such fiscal year, become obligated to make but that are not made
during such fiscal year, provided that the Borrower shall deliver a
certificate to the Administrative Agent not later than 105 days after the end
of such fiscal year, signed by an officer of the Borrower and certifying that
such Capital Expenditures and the delivery of the related equipment will be
made in the following fiscal year; minus (k) to the extent not deducted
in the computation of Net Proceeds in respect of any asset disposition, casualty
or condemnation giving rise thereto, the amount of any mandatory prepayment of
Indebtedness (other than Indebtedness created hereunder or under any other Loan
Document), together with any interest, premium or penalties required to be paid
(and actually paid) in connection therewith; minus (l) amounts paid in
cash during such fiscal year on account of items that were accounted for as
non-cash reductions in determining Consolidated Net Income in a prior fiscal
year and were added back in determining Excess Cash Flow in respect of such
prior fiscal year; minus (m) cash paid for pension and other
post-employment benefit liabilities; minus (n) all other non-cash income
(including the accrual of the non-cash portion of any Rural Utilities Service,
CoBank, ACB or RTFC patronage capital allocation).


“Excluded Taxes” means, with respect to the Administrative
Agent, any Lender, any Issuing Bank or any other recipient of any payment to be
made by or on account of any obligation of the Borrower hereunder, (a) income or
franchise taxes imposed on (or measured by) its net income by the United States
of America, or by the jurisdiction under the laws of which such recipient is
organized or in which its principal office is located or, in the case of any
Lender, in which its applicable lending office is located, (b) any branch
profits taxes imposed by the United States of America or any similar tax
imposed by any other jurisdiction described in clause (a) above, (c) in the
case of a Foreign Lender (other than an assignee pursuant to a request by the
Borrower under Section 2.19(b)), any withholding tax that is in effect and
would apply to amounts payable to such Foreign Lender at the time such Foreign
Lender becomes a party to this Agreement (or designates a new lending office),
except to the extent that such Foreign Lender (or its assignor, if any) was
entitled, at the time of designation of a new lending office (or assignment),
to receive additional amounts from the Borrower with respect to any withholding
tax pursuant to Section 2.17(a), and (d) any withholding tax that is
attributable to such Foreign Lender’s failure to comply with Section 2.17(e).


“Existing Credit Agreement” has the meaning assigned to such
term in the recitals to this Agreement.


“Existing Loan Documents” has the meaning assigned to such term
in Section 9.17(b).


“FCC” means the Federal Communications Commission and any
successor agency of the Federal government administering the Communications
Act.


“FCC Licenses” means all licenses, certificates, permits or other
authorizations granted by the FCC pursuant to the Communications Act which are
required for the conduct of any business or activity thereunder.


“Federal Funds Effective Rate” means, for any day, the weighted
average (rounded upwards, if necessary, to the next 1/100 of 1%) of the rates
on overnight Federal funds transactions with members of the Federal Reserve
System arranged by Federal funds brokers, as published on the next succeeding
Business Day by the Federal Reserve Bank of New York, or, if such rate is not
so published for any day that is a Business Day, the average (rounded upwards,
if necessary, to the next 1/100 of 1%) 



 15
 









of the quotations for such day for such transactions
received by the Administrative Agent from three Federal funds brokers of
recognized standing selected by it.


“Fee Letter” means that certain fee letter dated as of May 16,
2007, among Holdings, LCPI, Lehman Brothers Commercial Bank, Lehman Brothers
Inc., JPMCB and J.P. Morgan Securities Inc.


“Financial Covenant” means the covenant set forth in Section
6.16.


“Financial Officer” means the chief financial officer, principal
accounting officer, treasurer or controller of the Borrower.


“Foreign Lender” means any Lender that is organized under the
laws of a jurisdiction other than that in which the Borrower is located.  For purposes of this definition, the United
States of America, each State thereof and the District of Columbia shall be
deemed to constitute a single jurisdiction.


“Foreign Subsidiary” means any Subsidiary that is not a Domestic
Subsidiary.


“GAAP” means generally accepted accounting principles in the
United States of America.


“Governmental Authority” means the government of the United
States of America, any other nation or any political subdivision thereof,
whether state or local, and any agency, authority, instrumentality, regulatory
body, court, central bank or other entity exercising executive, legislative,
judicial, taxing, regulatory or administrative powers or functions of or
pertaining to government.


“Granting Lender” has the meaning assigned to such term in
Section 9.04(g).


“Guarantee” of or by any Person (the “guarantor”) means
any obligation, contingent or otherwise, of the guarantor guaranteeing or
having the economic effect of guaranteeing any Indebtedness or other obligation
of any other Person (the “primary obligor”) in any manner, whether
directly or indirectly, and including any obligation of the guarantor, direct
or indirect, (a) to purchase or pay (or advance or supply funds for the
purchase or payment of) such Indebtedness or other obligation or to purchase
(or to advance or supply funds for the purchase of) any security for the
payment thereof, (b) to purchase or lease property, securities or services for
the purpose of assuring the owner of such Indebtedness or other obligation of
the payment thereof, (c) to maintain working capital, equity capital or any
other financial statement condition or liquidity of the primary obligor so as
to enable the primary obligor to pay such Indebtedness or other obligation or
(d) as an account party in respect of any letter of credit or letter of
guaranty issued to support such Indebtedness or obligation; provided,
that the term Guarantee shall not include endorsements for collection or
deposit in the ordinary course of business or customary and reasonable
indemnity obligations in effect on the Effective Date or entered into in
connection with any acquisition or disposition of assets permitted under this
Agreement.


“Guarantors” means Holdings and the Subsidiary Loan Parties.


“Hazardous
Materials” means (i) any petroleum products or byproducts, radon gas,
asbestos, urea formaldehyde foam insulation, polychlorinated biphenyls,
chlorofluorocarbons and all other ozone-depleting substances; or (ii) any
chemical, material, substance or waste that is prohibited,



 16















limited or regulated as a “hazardous” or “toxic”
material, substance or waste by or pursuant to any applicable Environmental
Law.


“Holdings” has the meaning assigned to such term in the preamble
to this Agreement.


“HPUC” means the Hawaii Public Utilities Commission and any
successor agency thereto.


“HTSC” means Hawaiian Telcom Services Company, Inc., a
wholly-owned subsidiary of the Borrower.


“Incremental Loan Availability Fee” shall have the meaning set forth in Section
2.12(b).


“Incremental
Revolving Loan Availability” shall have the meaning set forth in Section 2.01(c).


“Indebtedness” of any Person means, without duplication, (a) all
obligations of such Person for borrowed money, (b) all obligations of such
Person evidenced by bonds, debentures, notes or similar instruments, (c) all
obligations of such Person under conditional sale agreements relating to
property acquired by such Person, (d) all obligations of such Person in respect
of the deferred purchase price of property or services (excluding current accounts
payable incurred in the ordinary course of business) to the extent the same
would be required to be shown as a liability on a balance sheet prepared in
accordance with GAAP, (e) all Indebtedness of others secured by (or for which
the holder of such Indebtedness has an existing right, contingent or otherwise,
to be secured by) any Lien on property owned or acquired by such Person,
whether or not the Indebtedness secured thereby has been assumed; provided,
that, to the extent such Indebtedness has not been assumed, only the lesser of
the amount of such Indebtedness and the value of the property over which such
Lien is granted shall constitute Indebtedness, (f) all Guarantees by such
Person of Indebtedness of others, (g) all Capital Lease Obligations of such
Person, (h) the principal component of all obligations, contingent or
otherwise, of such Person as an account party in respect of letters of credit
and letters of guaranty and (i) the principal component of all obligations,
contingent or otherwise, of such Person in respect of bankers’ acceptances. The
Indebtedness of any Person shall include the Indebtedness of any other entity
(including any partnership in which such Person is a general partner) to the
extent such Person is liable therefor as a result of such Person’s ownership
interest in or other relationship with such entity, except to the extent the
terms of such Indebtedness provide that such Person is not liable therefor.


“Indemnified Taxes” means Taxes other than Excluded Taxes and
Other Taxes.


“Information Memorandum” means the Confidential Information
Memorandum dated May 2007, as modified or supplemented prior to the Effective
Date, relating to Holdings, the Borrower and the Transactions.


“Initial Closing Date” means May 2, 2005.


“Installment Date” has the meaning assigned to such term in
Section 2.10(a).


“Interest Election Request” means a request by the Borrower to
convert or continue a Revolving Borrowing or Tranche C Term Borrowing in
accordance with Section 2.07.



 17
 









“Interest Payment Date” means (a) with respect to any ABR Loan
(other than a Swingline Loan), the last day of each March, June, September and
December, (b) with respect to any Eurodollar Loan, the last day of the Interest
Period applicable to the Borrowing of which such Loan is a part and, in the
case of a Eurodollar Borrowing with an Interest Period of more than three
months’ duration, each day prior to the last day of such Interest Period that
occurs at intervals of three months’ duration after the first day of such
Interest Period and (c) with respect to any Swingline Loan, the day that such
Loan is required to be repaid.


“Interest Period” means, with respect to any Eurodollar
Borrowing, the period commencing on the date of such Borrowing and ending on
the numerically corresponding day in the calendar month that is one, two, three
or six months thereafter (or nine or 12 months thereafter if, at the time of
the relevant Borrowing, all Lenders participating therein agree to make an
interest period of such duration available), as the Borrower may elect; provided,
that (a) if any Interest Period would end on a day other than a Business Day,
such Interest Period shall be extended to the next succeeding Business Day
unless such next succeeding Business Day would fall in the next calendar month,
in which case such Interest Period shall end on the next preceding Business Day
and (b) any Interest Period that commences on the last Business Day of a
calendar month (or on a day for which there is no numerically corresponding day
in the last calendar month of such Interest Period) shall end on the last
Business Day of the last calendar month of such Interest Period. For purposes
hereof, the date of a Borrowing initially shall be the date on which such
Borrowing is made and thereafter shall be the effective date of the most recent
conversion or continuation of such Borrowing.


“Investment” means purchasing, holding or acquiring (including
pursuant to any merger with any Person that was not a wholly-owned Subsidiary
prior to such merger) any Equity Interest, evidences of indebtedness or other
securities (including any option, warrant or other right to acquire any of the
foregoing) of, or making or permitting to exist any loans or advances (other
than commercially reasonable extensions of trade credit) to, guaranteeing any
obligations of, or making or permitting to exist any investment in, any other
Person, or purchasing or otherwise acquiring (in one transaction or a series of
transactions) any assets of any Person constituting a business unit.  The amount, as of any date of determination,
of any Investment shall be the original cost of such Investment (including any
Indebtedness of a Person existing at the time such Person becomes a Subsidiary
in connection with any Investment and any Indebtedness assumed in connection
with any acquisition of assets), plus the cost of all additions, as of
such date, thereto and minus the amount, as of such date, of any portion
of such Investment repaid to the investor in cash or property as a repayment of
principal, reimbursement in respect of a guarantee or a return of capital
(including pursuant to any sale or disposition of such Investment), as the case
may be, but without any other adjustments for increases or decreases in value,
or write-ups, write-downs or write-offs with respect to such Investment.  In determining the amount of any Investment
or repayment involving a transfer of any property other than cash, such
property shall be valued at its fair market value at the time of such transfer.


“Issuing Bank” means each of JPMCB and LCPI or one or more of
their respective Affiliates, in their respective capacities as issuers of
Letters of Credit hereunder, and each other Lender appointed as an Issuing Bank
hereunder pursuant to Section 2.05(k) and, in each case, its successors in such
capacity as provided in Section 2.05(i). An Issuing Bank may, in its
discretion, arrange for one or more Letters of Credit to be issued by
Affiliates of such Issuing Bank, in which case the term “Issuing Bank” shall
include any such Affiliate with respect to Letters of Credit issued by such
Affiliate.


“JPMCB” means JPMorgan Chase Bank, N.A.



 18
 









“LC Disbursement” means a payment made by any Issuing Bank
pursuant to a Letter of Credit.


“LC Exposure” means, at any time, the sum of (a) the aggregate
undrawn amount of all outstanding Letters of Credit at such time plus (b) the
aggregate amount of all LC Disbursements that have not yet been reimbursed by
or on behalf of the Borrower at such time. 
The LC Exposure of any Revolving Lender at any time shall be its
Applicable Percentage of the total LC Exposure at such time.


“LCPI”
means Lehman Commercial Paper Inc.


“Lender Addendum” means, with respect to any applicable Lender,
a lender addendum in form and substance reasonably acceptable to the Administrative
Agent.


“Lenders” means the Persons listed on Schedule 2.01 and any
other Person that shall have become a party hereto pursuant to an Assignment
and Assumption, other than any such Person that ceases to be a party hereto
pursuant to an Assignment and Assumption. 
Unless the context otherwise requires, the term “Lenders” includes the
Swingline Lender.


“Letter of Credit” means any letter of credit issued pursuant to
this Agreement.


“LIBO Rate” means, with respect to any Eurodollar Borrowing for
any Interest Period, the rate appearing on the Reuters Screen LIBOR01 Page or
otherwise on the Reuters Screen (or on any successor or substitute page of such
service, or any successor to or substitute for such service, providing rate
quotations comparable to those currently provided on such page of such service,
as reasonably determined by the Administrative Agent from time to time for
purposes of providing quotations of interest rates applicable to dollar
deposits in the London interbank market) at approximately 11:00 a.m., London
time, two Business Days prior to the commencement of such Interest Period, as
the rate for dollar deposits with a maturity comparable to such Interest
Period.  In the event that such rate is
not available at such time for any reason, then the “LIBO Rate” with
respect to such Eurodollar Borrowing for such Interest Period shall be the rate
at which dollar deposits of $5,000,000 and for a maturity comparable to such
Interest Period are offered by the principal London office of the Administrative
Agent in immediately available funds in the London interbank market at
approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period.


“Lien” means, with respect to any asset, (a) any mortgage, deed
of trust, lien, pledge, hypothecation, encumbrance, charge or security interest
in, on or of such asset, (b) the interest of a vendor or a lessor under any
conditional sale agreement, capital lease or title retention agreement (or any
financing lease having substantially the same economic effect as any of the
foregoing) relating to such asset and (c) in the case of securities, any
purchase option, call or similar right of a third party with respect to such
securities.  For the avoidance of doubt,
it is understood and agreed that Holdings and any Subsidiary may, as part of
its business, grant licenses to third parties to use intellectual property
owned or developed by, or licensed to, such entity.  For purposes of this Agreement and the other
Loan Documents, such licensing activity shall not constitute a “Lien” on such
intellectual property.  Each of the
Administrative Agent and each Lender understands that any such licenses may be
exclusive to the applicable licensees, and such exclusivity provisions may
limit the ability of the Administrative Agent to utilize, sell, lease, license
or transfer the related intellectual property or otherwise realize value from
such intellectual property pursuant hereto.


“Loan Documents” means this Agreement and the Security
Documents.



 19
 









“Loan Parties” means Holdings, the Borrower and the Subsidiary
Loan Parties.


“Loans” means the loans made by the Lenders to the Borrower
pursuant to this Agreement.


“Long-Term Indebtedness” means any Indebtedness that, in
accordance with GAAP, constitutes (or, when incurred, constituted) a long-term
liability.  For purposes of determining
the Long-Term Indebtedness of Holdings, the Borrower and the Subsidiaries,
Indebtedness of Holdings, the Borrower or any Subsidiary owed to Holdings, the
Borrower or a Subsidiary shall be excluded.


“Management Agreement” means the Management Agreement dated as
of the Initial Closing Date among the Borrower, Holdings and the Sponsor, as
provided to the Arrangers and as in effect on the Effective Date, and as
modified from time to time with the consent of the Administrative Agent.


“Management Group” means the group of individuals consisting of
the directors, executive officers and other management personnel of the
Borrower or Holdings on the Effective Date together with (i) each new director
elected to such board of directors by, or with the approval of, Equity Investors
holding, directly or indirectly, more than 50% of the aggregate ordinary voting
power represented by the issued and outstanding Equity Interests in the Borrower
or whose nomination for such election was approved by a vote of a majority of
the directors on such board of directors and (ii) executive officers and other
management personnel of the Borrower or Holdings hired at a time when the
directors that are members of the Management Group constitute a majority of the
directors of the Borrower or Holdings.


“Margin Stock” shall have the meaning assigned to such term in
Regulation U of the Board.


“Material Adverse Effect” means a material adverse effect on the
business, operations or financial condition of Holdings, the Borrower and the
Subsidiaries, taken as a whole.


“Material Indebtedness” means Indebtedness (other than the Loans
and Letters of Credit), or obligations in respect of one or more Swap
Agreements, of any one or more of Holdings, the Borrower and its Subsidiaries
in an aggregate principal amount exceeding $12,500,000.  For purposes of determining Material
Indebtedness, the “principal amount” of the obligations of Holdings, the
Borrower or any Subsidiary in respect of any Swap Agreement at any time shall
be the maximum aggregate amount (giving effect to any netting agreements) that
Holdings, the Borrower or such Subsidiary would be required to pay if such Swap
Agreement were terminated at such time.


“Material Subsidiary” means (i) any Securitization Vehicle and
(ii) any Subsidiary, including its subsidiaries, which meets any of the
following conditions:  (a) Holdings’, the
Borrower’s and the other Subsidiaries’ investments in and advances to such
Subsidiary exceed 5% of the consolidated total assets of Holdings and the
Subsidiaries as of the end of the most recently completed fiscal year, (b) the
consolidated assets of such Subsidiary exceed 5% of the consolidated total
assets of Holdings and the Subsidiaries as of the end of the most recently
completed fiscal year or (c) the consolidated pre-tax income from continuing
operations of such Subsidiary for the most recently ended period of four
consecutive fiscal quarters exceeds 5% of the consolidated pre-tax income from
continuing operations of Holdings and the Subsidiaries for such period.


“Moody’s” means Moody’s Investors Service, Inc.



 20
 









“Mortgage” means any mortgage, deed of trust, assignment of
leases and rents or other security document granting a Lien on any real
property and improvements thereto to secure the Obligations delivered after the
Effective Date pursuant to Section 5.12.  Each Mortgage shall be reasonably satisfactory
in form and substance to the Collateral Agent.


“Mortgaged Property” means, each parcel of real property and the
improvements thereto owned by a Loan Party and identified as a Mortgaged
Property on Schedule 3.05, and each other parcel of real property and
improvements thereto acquired by a Loan Party after the Effective Date with respect
to which a Mortgage is required to be granted pursuant to Section 5.12.


“Multiemployer Plan” means a multiemployer plan as defined in
Section 4001(a)(3) of ERISA.


“Net Proceeds” means, with respect to any event (a) the cash
proceeds actually received in respect of such event including (i) any cash
received in respect of any debt instrument or equity security received as
non-cash proceeds, but only as and when received, (ii) in the case of a
casualty, insurance proceeds, and (iii) in the case of a condemnation or
similar event, condemnation awards and similar payments, net of (b) the sum of
(i) all fees and out-of-pocket expenses (including underwriting discounts and
commissions and collection expenses) paid or payable by Holdings, the Borrower
and the Subsidiaries to third parties (including Affiliates, if permitted by
Section 6.09) in connection with such event, (ii) in the case of a sale,
transfer or other disposition of an asset (including pursuant to a sale and
leaseback transaction or a casualty or a condemnation or similar proceeding),
the amount of all payments required to be made by Holdings, the Borrower and
the Subsidiaries as a result of such event to repay Indebtedness (other than
Loans) secured by such asset or otherwise subject to mandatory prepayment as a
result of such event, and (iii) the amount of all taxes paid (or reasonably
estimated to be payable) by Holdings, the Borrower and the Subsidiaries
(provided that such amounts withheld or estimated for the payment of taxes
shall, to the extent not utilized for the payment of taxes, be deemed to be Net
Proceeds received when such nonutilization is determined), and the amount of
any reserves established by Holdings, the Borrower and the Subsidiaries to fund
contingent liabilities reasonably estimated to be payable, in each case that
are directly attributable to such event (provided that any reversal of any such
reserves will be deemed to be Net Proceeds received at the time and in the
amount of such reversal), in each case as determined reasonably and in good
faith by the chief financial officer of the Borrower.


“Net Secured Leverage Ratio” means, on any date, the ratio of
(a) the aggregate principal amount of the Loans outstanding under this
Agreement (net of unrestricted cash and Permitted Investments) as of such date
to (b) Consolidated EBITDA for the period of four consecutive fiscal quarters
of the Borrower most recently ended on or prior to such date; provided,
that for purposes of Section 6.01(a)(xx) only, clause (a) of this definition
shall mean all Indebtedness of the Borrower or any Subsidiary secured by a Lien
on any assets or other property of the Borrower or any Subsidiary.


“Net Working Capital” means, at any date, (a) the consolidated
current assets of Holdings, the Borrower and its consolidated Subsidiaries as
of such date (excluding cash, Permitted Investments and current deferred income
taxes) minus (b) the consolidated current liabilities of Holdings, the
Borrower and its consolidated Subsidiaries as of such date (excluding current
liabilities in respect of Indebtedness and current deferred income taxes).  Net Working Capital at any date may be a
positive or negative number. Net Working Capital increases when it becomes more
positive or less negative and decreases when it becomes less positive or more
negative.


“Non-Cash Pay Preferred Stock” means preferred stock or other
preferred securities or membership interests of Holdings or the Borrower which
(i) are not mandatorily redeemable, in whole or 



 21
 









part, or required to be repurchased or reacquired,
in whole or part, by Holdings, the Borrower or any Subsidiary, and which do not
require any payment of cash dividends or distributions, in each case, prior to
the date that is six months after the Tranche C Maturity Date, (ii) are not
secured by any assets of Holdings, the Borrower or any Subsidiary, (iii) are
not guaranteed by Holdings, the Borrower or any Subsidiary and (iv) are not
exchangeable or convertible into Indebtedness of Holdings, the Borrower or any
Subsidiary, except at the option of the Borrower and subject to compliance with
Section 6.01(a), or any preferred stock or other Equity Interest (other than
common equity of Holdings or other Non-Cash Pay Preferred Stock of Holdings).


“Note” means any promissory note evidencing any Loan.


“Obligations” has the meaning assigned to such term in the
Collateral Agreement.


“Operating Licenses” has the meaning assigned to such term in
Section 3.08.


“Other Taxes” means any and all present or future recording,
stamp, documentary, excise, transfer, sales, property or similar taxes, charges
or levies arising from any payment made under any Loan Document or from the
execution, delivery or enforcement of, or otherwise with respect to, any Loan
Document.


“Parent” means Holdings or, in the event that any newly formed
Person becomes the holder of 100% of the beneficial and record ownership
interests in Holdings in connection with an initial public offering of any
Equity Interests in Holdings, such newly formed Person, or in the event of a
Qualified IPO by the Borrower, the Borrower, and in each case, any successor
permitted by Section 6.03.


“Participant” has the meaning set forth in Section 9.04(b).


“Patriot Act” has the meaning assigned to such term in Section
9.15.


“Patronage Certificates” means patronage certificates and/or
capital allocation of any of (i) the Rural Utilities Service, (ii) CoBank, ACB
or (iii) RTFC.


“Payment Office” means the office specified from time to time by
the Administrative Agent as its payment office by notice to the Borrower and
the Lenders.


“PBGC” means the Pension Benefit Guaranty Corporation referred
to and defined in ERISA and any successor entity performing similar functions.


“Perfection Certificate” means a certificate in the form of
Exhibit D to the Collateral Agreement or any other form approved by the
Collateral Agent.


“Permitted Acquisition” means any acquisition (by merger,
consolidation or otherwise) by the Borrower or a Subsidiary Loan Party of all
or substantially all of the assets (including Equity Interests issued by a
Subsidiary) of, or all the Equity Interests in, a Person or division or line of
business of a Person, if (a) immediately after giving effect thereto, no Event
of Default has occurred and is continuing or would result therefrom on a Pro
Forma Basis, (b) substantially all the business of such acquired Person or
business consists of one or more Permitted Businesses, (c) each Subsidiary (which
survives such Permitted Acquisition) and all assets acquired pursuant to such
Permitted Acquisition shall have been (or within 10 Business Days (or such
longer period as may be acceptable to the Administrative Agent) after such
Permitted Acquisition shall be) pledged as Collateral in the manner provided
for and to 



 22
 









the extent required pursuant to the Collateral and
Guarantee Requirement, (d) the Borrower and the Subsidiaries are in Pro Forma
Compliance, after giving effect to such acquisition, computed as of the last
day of the most recently ended fiscal quarter of the Borrower for which
financial statements are available, as if such acquisition had occurred on the
first day of the relevant period for testing compliance, and (e) the Borrower
has delivered to the Administrative Agent an officer’s certificate to the
effect set forth in clauses (a), (b), (c) and (d) above, together with all
relevant financial information for the Person or assets acquired and reasonably
detailed calculations demonstrating satisfaction of the requirement set forth
in clause (d) above; provided, that any non-United States assets,
including the Equity Interests issued by a Foreign Subsidiary, acquired in
connection with any such acquisition shall only be permitted to be acquired to
the extent provided in Section 6.04(d).


“Permitted Business” means the provision of local and
long-distance telephone services, broadband wireless telecommunications
services, internet access services, video services and directory publishing
services, and, in each case, businesses reasonably related, incidental or
ancillary thereto and in the case of any Securitization Vehicle,
Securitizations.


“Permitted Cure Security” shall mean common stock of Holdings or
Non-Cash Pay Preferred Stock.


“Permitted Encumbrances” means:


(a)           Liens imposed by law or any Governmental Authority for
taxes, assessments or other governmental charges or levies that are not yet due
or are being contested in compliance with Section 5.05;


(b)           carriers’, warehousemen’s, mechanics’, materialmen’s,
landlord’s, repairmen’s, construction and other like Liens, arising in the
ordinary course of business and securing obligations that are not overdue by
more than 60 days or are being contested in good faith by appropriate
proceedings;


(c)           pledges and deposits made in the ordinary course of
business in compliance with workers’ compensation, unemployment insurance and
other social security laws or regulations;


(d)           deposits to secure the performance of bids, trade
contracts, leases, statutory obligations, surety and appeal bonds, performance
bonds and other obligations of a like nature, in each case in the ordinary
course of business;


(e)           judgment liens in respect of judgments or attachments that
do not constitute an Event of Default under clause (j) of Article VII; and


(f)            easements, zoning restrictions, rights-of-way and similar
encumbrances on real property imposed by law or arising in the ordinary course
of business that do not materially interfere with the ordinary conduct of
business of the Borrower or any Subsidiary;


provided that
the term “Permitted Encumbrances” shall not include any Lien securing Indebtedness.


“Permitted Holdings Debt” means Indebtedness of Holdings which
(i) does not mature, and is not subject to mandatory repurchase, redemption or
amortization (other than pursuant to customary asset sale or change in control
provisions requiring redemption or repurchase only if and to the extent then
permitted by this Agreement), in each case, prior to the date that is six
months after the Tranche C 



 23
 









Maturity Date, (ii) is not secured by any assets of
Holdings, the Borrower or any Subsidiary, (iii) is not Guaranteed by the
Borrower or any Subsidiary, (iv) is not exchangeable or convertible into
Indebtedness of Holdings (except other Permitted Holdings Debt), the Borrower
or any Subsidiary or any preferred stock or other Equity Interest (other than common
equity or Non-Cash Pay Preferred Stock of Holdings, provided that any such
exchange or conversion, if effected, would not result in a Change in Control)
and (v) if subordinated, is subordinated to the Obligations pursuant to a
written instrument delivered, and reasonably satisfactory, to the
Administrative Agent or on terms no less favorable in any significant respect
to the Lenders than the subordination terms applicable to the Senior
Subordinated Debt.


“Permitted Investments” means:


(a)           direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States of
America (or by any agency thereof to the extent such obligations are backed by
the full faith and credit of the United States of America), in each case
maturing or allowing for liquidation at the original par value at the option of
the holder within two years from the date of acquisition thereof;


(b)           investments in commercial paper (other than commercial
paper issued by Holdings, the Borrower, the Equity Investors or any of their
Affiliates) maturing within one year from the date of acquisition thereof and
having, at such date of acquisition, the highest credit rating obtainable from
S&P or from Moody’s;


(c)           investments in certificates of deposit, banker’s
acceptances, time deposits or overnight bank deposits maturing within 180 days
from the date of acquisition thereof issued or guaranteed by or placed with,
and money market deposit accounts issued or offered by, any domestic office of
any commercial bank organized under the laws of the United States of America or
any State thereof which has a combined capital and surplus and undivided
profits of not less than $250,000,000;


(d)           fully collateralized repurchase agreements with a term of
not more than 180 days for securities described in clause (a) above and entered
into with a financial institution satisfying the criteria described in clause
(c) above;


(e)           money market funds that (i) comply with the criteria set
forth in Securities and Exchange Commission Rule 2a-7 under the Investment
Company Act of 1940, (ii) are rated AAA by S&P and Aaa by Moody’s and (iii)
have portfolio assets of at least $5,000,000,000;


(f)            securities with maturities of two years or less from the
date of acquisition issued or fully guaranteed by any State, commonwealth or
territory of the United States of America, or by any political subdivision or
taxing authority thereof, and rated at least A by S&P or A by Moody’s; and


(g)           shares of restricted mutual funds whose investment
guidelines restrict 95% of such funds’ investments to those satisfying the
provisions of clauses (a) through (f) above (other than with respect to the
parenthetical in clause (b) above).


“Permitted Subordinated Indebtedness” means Indebtedness of the
Borrower which (i) does not mature, and is not subject to mandatory repurchase,
redemption or amortization (other than pursuant to customary asset sale or
change in control provisions requiring redemption or repurchase only if and to
the extent then permitted by this Agreement), in each case, prior to the date
that is six months 



 24
 









after the Tranche C Maturity Date, (ii) is not
secured by any assets of Holdings, the Borrower or any Subsidiary, (iii) is not
exchangeable or convertible into Indebtedness of Holdings, the Borrower or any
Subsidiary or any preferred stock or other Equity Interest (other than common
equity or Non-Cash Pay Preferred Stock of Holdings, provided that any such
exchange or conversion, if effected, would not result in a Change in Control) and
(iv) is, together with any Guarantee thereof by any Subsidiary (a “Permitted
Subordinated Guarantee”), subordinated to the Obligations pursuant to a
written instrument delivered, and reasonably satisfactory, to the
Administrative Agent or on terms no less favorable in any significant respect
to the Lenders than the subordination terms applicable to the Senior
Subordinated Debt.


“Person” means any natural person, corporation, limited
liability company, trust, joint venture, association, company, partnership,
Governmental Authority or other entity.


“Plan” means any employee pension benefit plan (other than a
Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section
412 of the Code or Section 302 of ERISA, and in respect of which the Borrower
or any ERISA Affiliate is (or, if such plan were terminated, would under
Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5)
of ERISA.


“Prepayment Event” means any (a) Asset Disposition or (b) Debt
Issuance.


“Prime Rate” means the prime lending rate as set forth on the
British Banking Association Telerate Page 5 (or such other comparable page as
may, in the reasonable opinion of the Administrative Agent, replace such page
for the purpose of displaying such rate), as in effect from time to time.  The Prime Rate is a reference rate and does
not necessarily represent the lowest or best rate actually available.


“Pro Forma Compliance” means, with respect to any event, that
the Borrower is in pro forma
compliance with the Financial Covenant, calculated on a Pro Forma Basis with
respect to the event being tested.


“Pro Forma Basis” means, as to any Person, for any events as
described in clauses (i) and (ii) below that occur subsequent to the
commencement of a period for which the financial effect of such events is being
calculated, and giving effect to the events for which such calculation is being
made, such calculation as will give pro forma
effect to such events as if such events occurred on the first day of the four
consecutive fiscal quarter period ended on or before the occurrence of such
event (the “Test Period”):


(i)            in making any determination of Consolidated EBITDA, pro forma effect shall be given to any Asset Disposition and
to any Permitted Acquisition (or to any similar transaction or transactions
that require a waiver or consent of the Required Lenders pursuant to Section
6.04 or 6.05), in each case that occurred during the Test Period (or, in the
case of determinations made pursuant to the definition of “Permitted Acquisition”
occurring during the Test Period or thereafter and through and including the
date upon which the respective Permitted Acquisition is consummated); and


(ii)           in making any determination on a Pro Forma Basis, (x) all
Indebtedness (including Indebtedness incurred or assumed and for which the
financial effect is being calculated, whether incurred under this Agreement or
otherwise, but excluding normal fluctuations in revolving Indebtedness incurred
for working capital purposes, in each case, not to finance any acquisition)
incurred or permanently repaid during the Test Period (or, in the case of
determinations made pursuant to the definition of “Permitted Acquisition”,
occurring during the Test Period and through and including the date upon which
the respective Permitted Acquisition 



 25
 









is consummated) shall be deemed to have been
incurred or repaid at the beginning of such period and (y) interest expense of
such Person attributable to interest on any Indebtedness, for which pro forma effect is being given as provided in preceding
clause (x), bearing floating interest rates shall be computed on a pro forma basis as if the rates that would have been in
effect during the period for which pro forma
effect is being given had been actually in effect during such periods.


Pro forma
calculations made pursuant to the definition of “Pro Forma Basis” shall be
determined in good faith by a Financial Officer of the Borrower and, for any
fiscal period ending on or prior to the first anniversary of a Permitted
Acquisition or Asset Disposition (or any similar transaction or transactions
that require a waiver or consent of the Required Lenders pursuant to Section
6.04 or 6.05), may include adjustments to reflect operating expense reductions
and other operating improvements or synergies implemented or planned to be
implemented and reasonably expected to result from such Permitted Acquisition,
Asset Disposition or other similar transaction, to the extent that the Borrower
delivers to the Administrative Agent (i) a certificate of the Borrower signed
by a Financial Officer setting forth such operating expense reductions and
other operating improvements or synergies and (ii) information and calculations
supporting in reasonable detail such estimated operating expense reductions and
other operating improvements or synergies.


“Qualified IPO” means an initial public offering by Holdings,
Parent or the Borrower of its common Equity Interests as a result of which,
after giving effect to the application of the proceeds therefrom, the Total Leverage
Ratio is not more than 4.30 to 1.00.


“Reference Period” means, at any date, the period commencing on
the first day of the first full fiscal quarter that starts after the date
hereof and ending on the last day of the last fiscal quarter for which a quarterly
compliance report has been delivered by the Borrower prior to such date.


“Refinancing Indebtedness” means Indebtedness issued or incurred
(including by means of the extension or renewal of existing Indebtedness) to
extend, renew, replace or refinance existing Indebtedness (“Refinanced Debt”);
provided that (i) such extending, renewing, replacing or
refinancing Indebtedness is in an original aggregate principal amount not
greater than the aggregate principal amount of, and unpaid interest on, the Refinanced
Debt plus the amount of any premiums paid thereon and fees and expenses
associated therewith, (ii) such Indebtedness has a maturity and a weighted
average life equal to or greater than that of the Refinanced Debt, (iii) if the
Refinanced Debt or any Guarantees thereof are subordinated to the Obligations,
such Indebtedness and Guarantees thereof are subordinated to the Obligations on
terms no less favorable in any significant respect to the holders of the
Obligations than the subordination terms of such Refinanced Debt or Guarantees
thereof (and no Loan Party that has not guaranteed or is not obligated to
guarantee such Refinanced Debt Guarantees such Indebtedness), (iv) such
Indebtedness contains covenants and events of default and is benefited by Guarantees
(if any) which, taken as a whole, are determined in good faith by the board of
directors of the Borrower not to be materially less favorable to the Lenders
than the covenants and events of default of or Guarantees (if any) in respect
of such Refinanced Debt, (v) if such Refinanced Debt or any Guarantees thereof
are secured, such Indebtedness and any Guarantees thereof are either unsecured
or secured only by such assets as secured or were required to secure the
Refinanced Debt and Guarantees thereof, (vi) if such Refinanced Debt and any
Guarantees thereof are unsecured, such Indebtedness and Guarantees thereof are
also unsecured, (vii) such Indebtedness is issued only by the issuer of such
Refinanced Debt and (viii) the proceeds of such Indebtedness are applied
promptly (and in any event within 45 days) after receipt thereof to the
repayment of such Refinanced Debt.


“Register” has the meaning assigned to such term in Section 9.04(d).



 26
 









“Reimbursement Obligation” means the obligation of the Borrower
to reimburse each Issuing Bank pursuant to Section 2.05 for amounts drawn under
Letters of Credit issued by such Issuing Bank.


“Related Parties” means, with respect to any specified Person,
such Person’s Affiliates and the directors, officers, employees, agents,
trustees, Controlling Persons and advisors of such Person and of each of such
Person’s Affiliates.


“Release” means any actual or threatened release, spill,
emission, leaking, dumping, injection, pouring, deposit, disposal, discharge,
dispersal, leaching or migration into or through the environment or within or
upon any building, structure, facility or fixture.


“Replacement” has the meaning assigned to such term in the
recitals to this Agreement.


“Repricing” has the meaning assigned to such term in Section
2.11(a).


“Required Lenders” means, at any time, Lenders having Revolving
Exposures, Term Loans and unused Commitments representing more than 50% of the
sum of the total Revolving Exposures, outstanding Term Loans and unused
Commitments at such time.


“Required Percentage” has the meaning assigned to such term in
Section 2.11(c).


“Required Revolving Lenders” means, at any time, Lenders having
Revolving Exposures and unused Commitments representing more than 50% of the
sum of the total Revolving Exposures and unused Commitments at such time.


“Restricted Payment” means any dividend or other distribution
(whether in cash, securities or other property) with respect to any Equity
Interests (other than dividends and distributions on Equity Interests payable
solely by the issuance or vesting of additional shares of Equity Interests of
the Person paying such dividends or distributions) in Holdings, the Borrower or
any Subsidiary, or any payment (whether in cash, securities or other property),
including any sinking fund or similar deposit, on account of the purchase,
redemption, retirement, acquisition, cancellation, termination or amendment of
any Equity Interests in Holdings, the Borrower or any Subsidiary or of any
option, warrant or other right to acquire any such Equity Interests in
Holdings, the Borrower or any Subsidiary.


“Retained Asset Disposition Proceeds” has the meaning assigned
to such term in Section 2.11(c).


“Revolving Availability Period” means the period from the
Effective Date to but excluding the earlier of (i) the Business Day immediately
preceding the Revolving Maturity Date and (ii) the date of termination of the
Revolving Commitments.


“Revolving Commitment” means, with respect to each Lender, the
commitment, if any, of such Lender to make Revolving Loans and to acquire
participations in Letters of Credit and Swingline Loans hereunder, expressed as
an amount representing the maximum aggregate amount of such Lender’s Revolving
Exposure hereunder, as such commitment may be (a) reduced from time to time
pursuant to Section 2.08 and (b) reduced or increased from time to time
pursuant to assignments by or to such Lender pursuant to Section 9.04.  The initial amount of each Lender’s Revolving
Commitment is set forth on Schedule 2.01, or in the Assignment and Assumption
pursuant to which such Lender shall have assumed its Revolving Commitment, as
applicable.  The initial aggregate amount
of the Lenders’ Revolving 



 27
 









Commitments as of the Effective Date is $200,000,000;
provided that not more than $90,000,000 of Revolving Loans shall be
available to the Borrower until such time as the Borrower makes an election
pursuant to Section 2.01(c).


“Revolving Exposure” means, with respect to any Lender at any
time, the sum of the outstanding principal amount of such Lender’s Revolving
Loans and its LC Exposure and Swingline Exposure at such time.


“Revolving Lender” means a Lender with a Revolving Commitment
or, if the Revolving Commitments have terminated or expired, a Lender with
Revolving Exposure.


“Revolving Loan” means a Loan made pursuant to clause (b) of
Section 2.01.


“Revolving Maturity Date” means April 30, 2012, or, if such day
is not a Business Day, the next preceding Business Day.


“RTFC” means Rural Telephone Finance Cooperative, a District of
Columbia cooperative association.


“Rural Utilities Service” means the Rural Utilities Service
Agency of the U.S. Department of Agriculture.


“S&P” means Standard & Poor’s Ratings Group, Inc.


“Secured Parties” has the meaning assigned to such term in the
Collateral Agreement.


“Securitization” means any transaction or series of transactions
entered into by the Borrower or any Subsidiary pursuant to which the Borrower
or such Subsidiary, as the case may be, sells, conveys or otherwise transfers
to a Securitization Vehicle Securitization Assets of the Borrower or such
Subsidiary (or grants a security interest in such Securitization Assets
transferred or purported to be transferred to such Securitization Vehicle), and
which Securitization Vehicle finances the acquisition of such Securitization
Assets (i) with proceeds from the issuance of Third Party Interests, (ii) with
Sellers’ Retained Interests or (iii) with proceeds from the sale or collection
of Securitization Assets previously purchased by such Securitization Vehicle.


“Securitization Assets” means any accounts receivable owed to or
owned by the Borrower or any Subsidiary (whether now existing or arising or
acquired in the future) arising in the ordinary course of business from the
sale of goods or services, all collateral securing such accounts receivable,
all contracts and contract rights and all guarantees or other obligations in
respect of such accounts receivable, all proceeds of such accounts receivable
and other assets (including contract rights) which are of the type customarily
transferred in connection with securitizations of accounts receivable and which
are sold, transferred or otherwise conveyed by the Borrower or a Subsidiary to
a Securitization Vehicle in connection with a Securitization permitted by
Section 6.05.


“Securitization Vehicle” means a Person that is a direct wholly
owned Subsidiary of the Borrower or a Subsidiary formed for the purpose of
effecting one or more Securitizations to which the Borrower or its Subsidiaries
transfer Securitization Assets and which, in connection therewith, issues Third
Party Interests or Sellers’ Retained Interests; provided that such
Securitization Vehicle shall engage in no business other than the purchase of
Securitization Assets pursuant to Securitizations permitted by 



 28
 









Section 6.05, the issuance of Third Party Interests
or other funding of such Securitizations and any activities reasonably related
thereto, and provided further that


(x)            no portion of the
Indebtedness or any other obligations (contingent or otherwise) of such
Securitization Vehicle (i) is guaranteed by the Borrower or any Subsidiary
(excluding guarantees of obligations (other than the principal of and interest
on Indebtedness) pursuant to standard Securitization Undertakings), (ii) is
recourse to or obligates the Borrower or any other Subsidiary of the Borrower
in any way other than pursuant to Standard Securitization Undertakings, or
(iii) subjects any property or asset of the Borrower or any other Subsidiary of
the Borrower, directly or indirectly, contingently or otherwise, to the
satisfaction thereof, other than pursuant to Standard Securitization
Undertakings;


(y)           neither the Borrower
nor any Subsidiary has any material contract, agreement, arrangement or
understanding with such Securitization Vehicle other than on terms which the
Borrower reasonably believes to be no less favorable to the Borrower or such
Subsidiary than those that might be obtained at the time from Persons that are
not Affiliates of the Borrower; and


(z)            neither the
Borrower nor any Subsidiary has any obligation to maintain or preserve such
Securitization Vehicle’s financial condition or cause such Securitization
Vehicle to achieve certain levels of operating results.


“Security Documents” means the Collateral Agreement, the
Mortgages and each other security agreement or other instrument or document
executed and delivered pursuant to Section 5.11 or 5.12 or pursuant to the
Collateral Agreement to secure any of the Obligations.


“Sellers’ Retained Interests” means the debt or equity interests
held by the Borrower or any Subsidiary in a Securitization Vehicle to which
Securitization Assets have been transferred in a Securitization permitted by
Section 6.05, including any such debt or equity received in consideration for
the Securitization Assets transferred.


“Senior Subordinated Debt” means the Indebtedness represented by
the Senior Subordinated Notes (including the Note Guarantees, Exchange Notes
(each as defined in the Senior Subordinated Debt Documents), Guarantees of
Exchange Notes and any replacement Exchange Notes).


“Senior Subordinated Debt Documents” means the indenture under
which the Senior Subordinated Debt was issued, the Senior Subordinated Notes,
and the Guarantees of the Senior Subordinated Notes.


“Senior Subordinated Notes” means the Borrower’s Senior
Subordinated Notes due 2015 to be issued on or prior to the Effective Date in
the aggregate principal amount of $150,000,000.


“Senior Unsecured Debt” means the Indebtedness represented by
the Senior Unsecured Notes (including the Note Guarantees, Exchange Notes (each
as defined in the Senior Unsecured Debt Documents), Guarantees of Exchange
Notes and any replacement Exchange Notes).


“Senior Unsecured Debt Documents” means the indenture under
which the Senior Unsecured Debt was issued, the Senior Unsecured Notes and the
Guarantees of the Senior Unsecured Notes.



 29
 









“Senior Unsecured Notes” means the Borrower’s Senior Floating
Rate Notes due 2013 and Senior Fixed Rate Notes due 2013 to be issued on or
prior to the Effective Date in the aggregate principal amount of $350,000,000.


“SPC” has the meaning assigned to such term in Section 9.04(g).


“Sponsor” means, collectively, Carlyle Partners III, L.P. and
Carlyle Partners IV, L.P.


“Standard Securitization Undertakings” means representations,
warranties, covenants, indemnities and guarantees of performance entered into
by the Borrower or any Subsidiary which the Borrower has determined in good
faith to be customary in a Securitization, including, without limitation, those
relating to the servicing of the assets of a Securitization Vehicle.


“Statutory Reserve Rate” means a fraction (expressed as a
decimal), the numerator of which is the number one and the denominator of which
is the number one minus the aggregate of the maximum reserve percentages (including
any marginal, special, emergency or supplemental reserves) expressed as a
decimal established by the Board to which the Administrative Agent is subject
with respect to eurocurrency funding (currently referred to as “Eurocurrency
Liabilities” in Regulation D of the Board). 
Such reserve percentages shall include those imposed pursuant to such
Regulation D.  Eurodollar Loans shall be
deemed to constitute eurocurrency funding and to be subject to such reserve
requirements without benefit of or credit for proration, exemptions or offsets
that may be available from time to time to any Lender under such Regulation D
or any comparable regulation.  The
Statutory Reserve Rate shall be adjusted automatically on and as of the
effective date of any change in any reserve percentage.


“subsidiary” means, with respect to any Person (the “parent”)
at any date, any corporation, limited liability company, partnership,
association or other entity the accounts of which would be consolidated with
those of the parent in the parent’s consolidated financial statements if such
financial statements were prepared in accordance with GAAP as of such date, as
well as any other corporation, limited liability company, partnership,
association or other entity of which securities or other ownership interests
representing more than 50% of the equity or more than 50% of the ordinary
voting power or, in the case of a partnership, more than 50% of the general
partnership interests are, as of such date, owned, Controlled or held by the
parent or one or more subsidiaries of the parent or by the parent and one or
more subsidiaries of the parent.


“Subsidiary” means (a) any subsidiary of the Borrower on the
Effective Date and (b) each subsidiary of the Borrower organized or acquired
after the Effective Date. 
Notwithstanding the foregoing (except for the definition of Unrestricted
Subsidiary contained herein), an Unrestricted Subsidiary shall be deemed not to
be a Subsidiary of the Borrower or any of its Subsidiaries for purposes of this
Agreement.


“Subsidiary Loan Party” means any Subsidiary other than (a)
Hawaiian Telcom Insurance Company Incorporated, (b) any Foreign Subsidiary and
(c) any Securitization Vehicle.


“Subsidiary Redesignation” shall have the meaning set forth in
Section 5.13.


“Swap Agreement” means any agreement with respect to any swap,
forward, future or derivative transaction or option or similar agreement
involving, or settled by reference to, one or more rates, currencies,
commodities, equity or debt instruments or securities, or economic, financial
or pricing indices or measures of economic, financial or pricing risk or value
or any similar transaction or any combination of these transactions; provided
that no phantom stock or similar plan providing for payments 



 30
 









only on account of services provided by current or
former directors, officers, employees or consultants of the Borrower or the
Subsidiaries shall be a Swap Agreement.


“Swingline Exposure” means, at any time, the aggregate principal
amount of all Swingline Loans outstanding at such time.  The Swingline Exposure of any Lender at any
time shall be its Applicable Percentage of the total Swingline Exposure at such
time.


“Swingline Lender” means LCPI, in its capacity as lender of
Swingline Loans hereunder.


“Swingline Loan” means a Loan made pursuant to Section 2.04.


“Syndication Agent” has the meaning assigned to such term in the
preamble to this Agreement.


“Taxes” means any and all present or future taxes, levies,
imposts, duties, deductions, charges or withholdings imposed by any
Governmental Authority.


“Third Party Interests” means, with respect to any
Securitization, notes, bonds or other debt instruments, beneficial interests in
a trust, undivided ownership interests in receivables or other securities
issued for cash consideration by the relevant Securitization Vehicle to banks,
financing conduits, investors or other financing sources (other than Holdings
and its subsidiaries) the proceeds of which are used to finance, in whole or in
part, the purchase by such Securitization Vehicle of Securitization Assets in a
Securitization.  The amount of any Third
Party Interests shall be deemed to equal the aggregate principal, stated or
invested amount of such Third Party Interests which are outstanding at such
time.


“Total Indebtedness” means, as of any date, (a) the aggregate
principal amount of Indebtedness of a type described in clauses (a), (b) and
(g) of the definition thereof and, to the extent relating to any Guarantee of
Indebtedness of a type described in such clauses (a), (b) and (g), clause (f)
of the definition thereof, of the Borrower and the Subsidiaries outstanding as
of such date, in the amount that would be reflected on a balance sheet prepared
as of such date on a consolidated basis in accordance with GAAP minus (b) the
aggregate amount of unrestricted cash and Permitted Investments that would be
reflected on a balance sheet prepared as of such date on a consolidated basis
in accordance with GAAP.


“Total Leverage Ratio” means, on any date, the ratio of (a)
Total Indebtedness as of such date to (b) Consolidated EBITDA for the period of
four consecutive fiscal quarters of the Borrower most recently ended on or
prior to such date.


“Tranche A Term Loan” has the meaning assigned to such term in
the Existing Credit Agreement.


“Tranche B Term Loan” has the meaning assigned to such term in
the Existing Credit Agreement.


“Tranche C Commitment” means, with respect to each Lender, the
commitment, if any, of such Lender to make a Tranche C Term Loan hereunder on
the Effective Date, expressed as an amount representing the maximum principal
amount of the Tranche C Term Loan to be made by such Lender hereunder, as such
commitment may be (a) reduced from time to time pursuant to Section 2.08 and
(b) reduced or increased from time to time pursuant to assignments by or to
such Lender pursuant to Section 9.04. The initial amount of each Lender’s
Tranche C Commitment is set forth on Schedule 2.01, or in the 



 31
 









Assignment and Assumption pursuant to which such
Lender shall have assumed its Tranche C Commitment, as applicable. The initial
aggregate amount of the Lenders’ Tranche C Commitments is $860,000,000.


“Tranche C Lender” means a Lender with a Tranche C Commitment or
an outstanding Tranche C Term Loan.


“Tranche C Maturity Date” means June 1, 2014, or, if such day is
not a Business Day, the next preceding Business Day; provided, that if
on or prior to April 30, 2012, the Borrower does not provide to the
Administrative Agent (i) evidence of approval by the HPUC of the extension of
the period of the guaranty, pledge, encumbrance and security provided for
pursuant to the Loan Documents until at least June 1, 2014 (or evidence
reasonably satisfactory to the Administrative Agent that such approval by the
HPUC is not required) and (ii) any other authorizations or approvals from the
HPUC or any equivalent Governmental Authority necessary to extend the maturity
of the Term Loans until at least June 1, 2014, the Tranche C Maturity Date
shall be April 30, 2012.


“Tranche C Term Loan” or “Term Loan” means a Loan made
pursuant to clause (a) of Section 2.01.


“Transactions” has the meaning assigned to such term in the
recitals to this Agreement.


“Type”, when used in reference to any Loan or Borrowing, refers
to whether the rate of interest on such Loan, or on the Loans comprising such
Borrowing, is determined by reference to the Adjusted LIBO Rate or the
Alternate Base Rate.


“Unrestricted Subsidiary” shall mean any Subsidiary of the
Borrower designated as an Unrestricted Subsidiary pursuant to Section 5.13.


“Withdrawal Liability” means liability to a Multiemployer Plan
as a result of a complete or partial withdrawal from such Multiemployer Plan,
as such terms are defined in Part I of Subtitle E of Title IV of ERISA.


SECTION  1.02.  Classification
of Loans and Borrowings.  For
purposes of this Agreement, Loans may be classified and referred to by Class (e.g.,
a “Revolving Loan”) or by Type (e.g., a “Eurodollar Loan”) or by Class
and Type (e.g., a “Eurodollar Revolving Loan”).  Borrowings also may be classified and referred
to by Class (e.g., a “Revolving Borrowing”) or by Type (e.g., a “Eurodollar
Borrowing”) or by Class and Type (e.g., a “Eurodollar Revolving
Borrowing”).


SECTION  1.03.  Terms Generally.  The definitions of terms herein shall apply
equally to the singular and plural forms of the terms defined.  Whenever the context may require, any pronoun
shall include the corresponding masculine, feminine and neuter forms.  The words “include”, “includes” and “including”
shall be deemed to be followed by the phrase “without limitation”.  The word “will” shall be construed to have
the same meaning and effect as the word “shall”.  Unless the context requires otherwise (a) any
definition of or reference to any agreement, instrument or other document
herein shall be construed as referring to such agreement, instrument or other
document as from time to time amended, supplemented or otherwise modified
(subject to any restrictions on such amendments, supplements or modifications
set forth herein), (b) any reference herein to any Person shall be construed to
include such Person’s successors and assigns, (c) the words “herein”, “hereof”
and “hereunder”, and words of similar import, shall be construed to refer to
this Agreement in its entirety and not to any particular provision hereof, (d)
all references herein to Articles, Sections, Exhibits and Schedules shall be
construed to refer to



 32















Articles and Sections of, and Exhibits and Schedules to, this Agreement
and (e) the words “asset” and “property” shall be construed to have the same
meaning and effect and to refer to any and all tangible and intangible assets
and properties, including cash, securities, accounts and contract rights.


SECTION  1.04.  Accounting Terms; GAAP.  Except as otherwise expressly provided herein,
all terms of an accounting or financial nature shall be construed in accordance
with GAAP, as in effect from time to time; provided that, if the
Borrower notifies the Administrative Agent that the Borrower requests an
amendment to any provision hereof to eliminate the effect of any change
occurring after the date hereof in GAAP or in the application thereof on the
operation of such provision (or if the Administrative Agent notifies the
Borrower that the Required Lenders request an amendment to any provision hereof
for such purpose), regardless of whether any such notice is given before or
after such change in GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until  such notice shall have been withdrawn or such
provision  amended in accordance herewith.


ARTICLE II



The Credits


SECTION  2.01.  Commitments.  Subject to the terms and conditions set forth
herein, each Lender agrees:


(a)           to make a Tranche C Term Loan to the
Borrower on the Effective Date in a principal amount equal to its Tranche C
Commitment;


(b)           to make Revolving Loans to the
Borrower from time to time during the Revolving Availability Period in an
aggregate principal amount that will not (after giving effect to any concurrent
use of the proceeds thereof to repay Swingline Loans or LC Disbursements)
result in such Lender’s Revolving Exposure exceeding such Lender’s Revolving
Commitment; provided, however, that the Borrower may only have Revolving Loans outstanding
on the Effective Date in an aggregate amount of up to $40,000,000;


(c)           that, on or prior to the first
anniversary of the Effective Date, the Borrower may elect, upon five (5)
Business Days’ prior written notice to the Administrative Agent, irrespective
of whether any Event of Default shall have occurred or be continuing at the time
of such election, to increase the availability under the Revolving Commitments
in an aggregate amount not to exceed $110,000,000 (such amount, the “Incremental
Revolving Loan Availability”); provided, that any Loans incurred
pursuant to the Incremental Revolving Loan Availability shall be on the same
terms as all Revolving Loans hereunder, including the same Applicable Rate,
unless the Borrower and the applicable Lenders shall otherwise agree; and


(d)           Within the foregoing limits and
subject to the terms and conditions set forth herein, the Borrower may borrow,
prepay and reborrow Revolving Loans. 
Amounts repaid or prepaid in respect of Term Loans may not be
reborrowed.


SECTION  2.02.  Loans and Borrowings.  (a)  Each
Loan (other than a Swingline Loan) shall be made as part of a Borrowing
consisting of Loans of the same Class and Type made by the Lenders ratably in
accordance with their Commitments of the applicable Class.  The failure of any Lender to make any Loan required
to be made by it shall not relieve any other Lender of its obligations 



 33
 









hereunder; provided that the Commitments of the Lenders are
several and no Lender shall be responsible for any other Lender’s failure to
make Loans as required.


(b)           Subject
to Section 2.14, each Revolving Borrowing and Tranche C Term Borrowing shall be
comprised entirely of ABR Loans or Eurodollar Loans as the Borrower may request
in accordance herewith.  Each Swingline
Loan shall be an ABR Loan.


(c)           At
the commencement of each Interest Period for any Eurodollar Borrowing, such
Borrowing shall be in an aggregate amount that is an integral multiple of
$1,000,000 and not less than $2,000,000. At the time that each ABR Revolving
Borrowing is made, such Borrowing shall be in an aggregate amount that is an
integral multiple of $1,000,000 and not less than $2,000,000; provided
that an ABR Revolving Borrowing may be in an aggregate amount that is equal to
the entire unused balance of the total Revolving Commitments or that is
required to finance the reimbursement of an LC Disbursement as contemplated by
Section 2.05(e).  Each Swingline Loan
shall be in an amount that is an integral multiple of $1,000,000. Borrowings of
more than one Type and Class may be outstanding at the same time; provided
that there shall not at any time be more than a total of 15 Eurodollar
Borrowings outstanding.


(d)           Notwithstanding
any other provision of this Agreement, the Borrower shall not be entitled to
request, or to elect to convert or continue, any Borrowing if the Interest
Period requested with respect thereto would end after the Revolving Maturity
Date or Tranche C Maturity Date, as applicable.


SECTION  2.03.  Requests for Borrowings.  To request funding of a Revolving Borrowing or
Tranche C Term Borrowing, the Borrower shall notify the Administrative Agent of
such request by telephone (a) in the case of a Eurodollar Borrowing, not later
than 2:00 p.m., New York City time, three Business Days before the date of the
proposed Borrowing or (b) in the case of an ABR Borrowing, not later than 2:00
p.m., New York City time, on the Business Day that is the date of the proposed
Borrowing; provided that any such notice of an ABR Revolving Borrowing
to finance the reimbursement of an LC Disbursement as contemplated by Section
2.05(e) may be given not later than 10:00 a.m., New York City time, on the date
of the proposed Borrowing.  Each such
telephonic Borrowing Request shall be irrevocable and shall be confirmed
promptly by hand delivery or telecopy to the Administrative Agent of a written
Borrowing Request in a form approved by the Administrative Agent and signed by
the Borrower.  Each such telephonic and
written Borrowing Request shall specify the following information in compliance
with Section 2.02:


(i)            whether the requested Borrowing is to be a Revolving
Borrowing or Tranche C Term Borrowing;


(ii)           the aggregate amount of such Borrowing;


(iii)          the date of such Borrowing, which shall be a Business Day;


(iv)          subject to the proviso to the fourth sentence of Section
2.02(c), whether such Borrowing is to be an ABR Borrowing or a Eurodollar
Borrowing;


(v)           in the case of a Eurodollar Borrowing, the initial
Interest Period to be applicable thereto, which shall be a period contemplated
by the definition of the term “Interest Period”; and



 34
 









(vi)          the location and number of the Borrower’s account to which
funds are to be disbursed, which shall comply with the requirements of Section
2.06.


If
no election as to the Type of Borrowing is specified, then the requested
Borrowing shall be an ABR Borrowing. If no Interest Period is specified with
respect to any requested Eurodollar Borrowing, then the Borrower shall be
deemed to have selected an Interest Period of one month’s duration.  Promptly following receipt of a Borrowing
Request in accordance with this Section, the Administrative Agent shall advise
each Lender of the details thereof and of the amount of such Lender’s Loan to
be made as part of the requested Borrowing.


SECTION  2.04.  Swingline Loans.  (a)  Subject
to the terms and conditions set forth herein, the Swingline Lender agrees to
make Swingline Loans to the Borrower from time to time during the Revolving
Availability Period, in an aggregate principal amount at any time outstanding
that will not result in (i) the aggregate principal amount of outstanding
Swingline Loans exceeding $35,000,000 or (ii) the sum of the total Revolving
Exposures exceeding the total Revolving Commitments; provided that the
Swingline Lender shall not be required to make a Swingline Loan to refinance an
outstanding Swingline Loan.  Within the
foregoing limits and subject to the terms and conditions set forth herein, the
Borrower may borrow, prepay and reborrow Swingline Loans.


(b)           To
request a Swingline Loan, the Borrower shall notify the Administrative Agent of
such request by telephone (confirmed by telecopy), not later than 2:00 p.m.,
New York City time, on the day of a proposed Swingline Loan.  Each such notice shall be irrevocable and
shall specify the requested date (which shall be a Business Day) and amount of
the requested Swingline Loan.  The
Administrative Agent will promptly advise the Swingline Lender of any such
notice received from the Borrower. The Swingline Lender shall make each
Swingline Loan available to the Borrower by means of a credit to the general
deposit account of the Borrower with the Swingline Lender (or, in the case of a
Swingline Loan made to finance the reimbursement of an LC Disbursement as
provided in Section 2.05(e), by remittance to the applicable Issuing Bank) by
3:00 p.m., New York City time, on the requested date of such Swingline Loan.


(c)           The
Swingline Lender may by written notice given to the Administrative Agent not
later than 12:00 noon, New York City time, on any Business Day require the
Revolving Lenders to acquire participations on such Business Day in all or a
portion of the Swingline Loans outstanding. 
Such notice shall specify the aggregate amount of Swingline Loans in
which Revolving Lenders will participate. 
Promptly upon receipt of such notice, the Administrative Agent will give
notice thereof to each Revolving Lender, specifying in such notice such Lender’s
Applicable Percentage of such Swingline Loan or Loans. Each Revolving Lender
hereby absolutely and unconditionally agrees, upon receipt of notice as
provided above, to pay to the Administrative Agent, for the account of the
Swingline Lender, such Lender’s Applicable Percentage of such Swingline Loan or
Loans.  Each Revolving Lender
acknowledges and agrees that its obligation to acquire participations in
Swingline Loans pursuant to this paragraph is absolute and unconditional and
shall not be affected by any circumstance whatsoever, including the occurrence
and continuance of a Default or reduction or termination of the Commitments,
and that each such payment shall be made without any offset, abatement,
withholding or reduction whatsoever; provided that no Lender shall be
required to acquire a participation in any Swingline Loan to the extent that
doing so would cause the Revolving Exposure of such Lender to exceed such
Lender’s Revolving Commitment.  Each
Revolving Lender shall comply with its obligation under this paragraph by wire
transfer of immediately available funds, in the same manner as provided in
Section 2.06 with respect to Loans made by such Lender (and Section 2.06 shall
apply, mutatis  mutandis, to the payment obligations of the
Revolving Lenders), and the Administrative Agent shall promptly pay to the
Swingline Lender the amounts so received by it from the Revolving Lenders.  The Administrative Agent shall notify 



 35
 









the Borrower of any participations in any Swingline Loan acquired
pursuant to this paragraph, and thereafter payments in respect of such
Swingline Loan shall be made to the Administrative Agent and not to the
Swingline Lender.  Any amounts received
by the Swingline Lender from the Borrower (or other party on behalf of the
Borrower) in respect of a Swingline Loan after receipt by the Swingline Lender
of the proceeds of a sale of participations therein shall be promptly remitted
to the Administrative Agent; any such amounts received by the Administrative
Agent shall be promptly remitted by the Administrative Agent to the Revolving
Lenders that shall have made their payments pursuant to this paragraph and to
the Swingline Lender, as their interests may appear; provided that any such
payment so remitted shall be repaid to the Swingline Lender or to the
Administrative Agent, as applicable, if and to the extent such payment is
required to be refunded to the Borrower for any reason.  The purchase of participations in a Swingline
Loan pursuant to this paragraph shall not relieve the Borrower of any default
in the payment thereof.


SECTION  2.05.  Letters of Credit.  (a)  General.  Subject to the terms and conditions set forth
herein, the Borrower may request the issuance of Letters of Credit for its own
account or the account of any Subsidiary, in a form reasonably acceptable to
the Administrative Agent and the applicable Issuing Bank, on the Initial
Closing Date and at any time and from time to time during the Revolving
Availability Period.  In the event of any
inconsistency between the terms and conditions of this Agreement and the terms
and conditions of any form of letter of credit application or other agreement
submitted by the Borrower to, or entered into by the Borrower with, an Issuing
Bank relating to any Letter of Credit, the terms and conditions of this
Agreement shall control.


(b)           Notice
of Issuance, Amendment, Renewal, Extension; Certain Conditions.  To request the issuance of a Letter of Credit
(or the amendment, renewal or extension of an outstanding Letter of Credit),
the Borrower shall hand deliver or telecopy (or transmit by electronic
communication, if arrangements for doing so have been approved by the
applicable Issuing Bank) to the applicable Issuing Bank and the Administrative
Agent (reasonably in advance of the requested date of issuance, amendment,
renewal or extension) a notice requesting the issuance of a Letter of Credit,
or identifying the Letter of Credit to be amended, renewed or extended, and
specifying the date of issuance, amendment, renewal or extension (which shall
be a Business Day), the date on which such Letter of Credit is to expire (which
shall comply with paragraph (c) of this Section), the amount of such Letter of
Credit, the name and address of the beneficiary thereof and such other
information as shall be necessary to prepare, amend, renew or extend such
Letter of Credit. If requested by the applicable Issuing Bank, the Borrower
also shall submit a letter of credit application on the Issuing Bank’s standard
form in connection with any request for a Letter of Credit.  A Letter of Credit shall be issued, amended,
renewed or extended only if (and upon issuance, amendment, renewal or extension
of each Letter of Credit the Borrower shall be deemed to represent and warrant
that), after giving effect to such issuance, amendment, renewal or extension
(i) the LC Exposure shall not exceed $15,000,000 and (ii) the total Revolving
Exposures shall not exceed the total Revolving Commitments.


(c)           Expiration
Date.  Each Letter of Credit shall
expire at or prior to the close of business on the earlier of (i) the date one
year after the date of the issuance of such Letter of Credit (or, in the case
of any renewal or extension thereof (including any automatic renewal pursuant
to an evergreen feature), one year after the most recent such renewal or
extension) and (ii) the date that is five days prior to the Revolving Maturity
Date.


(d)           Participations.  By the issuance of a Letter of Credit (or an
amendment to a Letter of Credit increasing the amount thereof) and without any
further action on the part of an Issuing Bank or the Lenders, each Issuing Bank
hereby grants to each Revolving Lender, and each Revolving Lender hereby
acquires from such Issuing Bank, a participation in such Letter of Credit equal
to such Lender’s 



 36
 









Applicable Percentage of the aggregate amount available to be drawn
under such Letter of Credit.  In
consideration and in furtherance of the foregoing, each Revolving Lender hereby
absolutely and unconditionally agrees to pay to the Administrative Agent, for
the account of the applicable Issuing Bank, such Lender’s Applicable Percentage
of each LC Disbursement made by such Issuing Bank and not reimbursed by the
Borrower on the date due as provided in paragraph (e) of this Section, or of
any reimbursement payment required to be refunded to the Borrower for any
reason.  Each Revolving Lender
acknowledges and agrees that its obligation to acquire participations pursuant
to this paragraph in respect of Letters of Credit is absolute and unconditional
and shall not be affected by any circumstance whatsoever, including any
amendment, renewal or extension of any Letter of Credit or the occurrence and
continuance of a Default or reduction or termination of the Commitments, and
that each such payment shall be made without any offset, abatement, withholding
or reduction whatsoever; provided that no Lender shall be required to
acquire a participation in any Letter of Credit to the extent that doing so
would cause the Revolving Exposure of such Lender to exceed such Lender’s
Revolving Commitment.


(e)           Reimbursement.  If an Issuing Bank shall make any LC
Disbursement in respect of a Letter of Credit, the Borrower shall reimburse
such LC Disbursement by paying to the Administrative Agent an amount equal to
such LC Disbursement not later than 2:00 p.m., New York City time, on the date
that such LC Disbursement is made, if the Borrower shall have received notice
of such LC Disbursement prior to 10:00 a.m., New York City time, on such date,
or, if such notice has not been received by the Borrower prior to such time on
such date, then not later than 2:00 p.m., New York City time, on (i) the
Business Day that the Borrower receives such notice, if such notice is received
prior to 10:00 a.m., New York City time, on the day of receipt, or (ii) the
Business Day immediately following the day that the Borrower receives such
notice, if such notice is not received prior to such time on the day of
receipt; provided that (whether or not the conditions in Section 4.02
are satisfied or a Default exists) each of the Administrative Agent and the
Borrower shall have the absolute and unconditional right to require that such
payment be financed with an ABR Revolving Borrowing or Swingline Loan in an equivalent
amount and, to the extent so financed, the Borrower’s obligation to make such
payment shall be discharged and replaced by the resulting ABR Revolving
Borrowing or Swingline Loan. If the Borrower fails to make such payment when
due, the Administrative Agent shall notify each Revolving Lender of the
applicable LC Disbursement, the payment then due from the Borrower in respect
thereof and such Lender’s Applicable Percentage thereof.  Promptly following receipt of such notice,
each Revolving Lender shall pay to the Administrative Agent its Applicable
Percentage of the payment then due from the Borrower, in the same manner as
provided in Section 2.06 with respect to Loans made by such Lender (and Section
2.06 shall apply, mutatis  mutandis, to the payment obligations of
the Revolving Lenders), and the Administrative Agent shall promptly pay to the
applicable Issuing Bank the amounts so received by it from the Revolving
Lenders.  Promptly following receipt by
the Administrative Agent of any payment from the Borrower pursuant to this
paragraph, the Administrative Agent shall distribute such payment to the
applicable Issuing Bank or, to the extent that Revolving Lenders have made
payments pursuant to this paragraph to reimburse such Issuing Bank, then to
such Lenders and Issuing Bank as their interests may appear.  Any payment made by a Revolving Lender
pursuant to this paragraph to reimburse an Issuing Bank for any LC Disbursement
(other than the funding of ABR Revolving Loans or a Swingline Loan as
contemplated above) shall not constitute a Loan and shall not relieve the
Borrower of its obligation to reimburse such LC Disbursement.


(f)            Obligations
Absolute.  The Borrower’s obligation
to reimburse LC Disbursements as provided in paragraph (e) of this Section shall
be absolute, unconditional and irrevocable, and shall be performed strictly in
accordance with the terms of this Agreement under any and all circumstances
whatsoever and irrespective of (i) any lack of validity or enforceability of
any Letter of Credit or this Agreement, or any term or provision therein, (ii)
any draft or other document presented 



 37
 









under a Letter of Credit proving to be forged, fraudulent or invalid in
any respect or any statement therein being untrue or inaccurate in any respect,
(iii) payment by any Issuing Bank under a Letter of Credit against presentation
of a draft or other document that does not comply strictly with the terms of
such Letter of Credit, or (iv) any other event or circumstance whatsoever,
whether or not similar to any of the foregoing, that might, but for the
provisions of this Section, constitute a legal or equitable discharge of, or
provide a right of setoff against, the Borrower’s obligations hereunder.  None of the Administrative Agent, the
Lenders, the Issuing Banks or any of their Related Parties shall have any
liability or responsibility by reason of or in connection with the issuance or
transfer of any Letter of Credit or any payment or failure to make any payment
thereunder (irrespective of any of the circumstances referred to in the
preceding sentence), or any error, omission, interruption, loss or delay in
transmission or delivery of any draft, notice or other communication under or
relating to any Letter of Credit (including any document required to make a drawing
thereunder), any error in interpretation of technical terms or any consequence
arising from causes beyond the control of such Issuing Bank; provided that
the provisions of this Section 2.05(f) shall not be construed to excuse an
Issuing Bank from liability to the Borrower to the extent of any direct damages
(as opposed to consequential damages, claims in respect of which are hereby
waived by the Borrower to the extent permitted by applicable law) suffered by
the Borrower that are caused by such Issuing Bank’s failure to exercise care
when determining whether drafts and other documents presented under a Letter of
Credit comply with the terms thereof. 
The parties hereto expressly agree that, in the absence of gross negligence
or willful misconduct on the part of an Issuing Bank (as finally determined by
a court of competent jurisdiction), such Issuing Bank shall be deemed to have
exercised care in each such determination. 
In furtherance of the foregoing and without limiting the generality
thereof, the parties agree that, with respect to documents presented which
appear on their face to be in substantial compliance with the terms of a Letter
of Credit, an Issuing Bank may, in its sole discretion, either accept and make
payment upon such documents without responsibility for further investigation,
regardless of any notice or information to the contrary, or refuse to accept
and make payment upon such documents if such documents are not in strict
compliance with the terms of such Letter of Credit.


(g)           Disbursement
Procedures.  An Issuing Bank shall,
promptly following its receipt thereof, examine all documents purporting to
represent a demand for payment under a Letter of Credit issued by it. The applicable
Issuing Bank shall promptly notify the Administrative Agent and the Borrower by
telephone (confirmed by telecopy) of such demand for payment and whether such
Issuing Bank has made or will make an LC Disbursement thereunder; provided
that any failure to give or delay in giving such notice shall not relieve the Borrower
of its obligation to reimburse such Issuing Bank and the Revolving Lenders with
respect to any such LC Disbursement.


(h)           Interim
Interest.  If an Issuing Bank shall
make any LC Disbursement, then, unless the Borrower shall reimburse such LC
Disbursement in full on the date such LC Disbursement is made, the unpaid
amount thereof shall bear interest, for each day from and including the date
such LC Disbursement is made to but excluding the date that the Borrower
reimburses such LC Disbursement, at the rate per annum
then applicable to ABR Revolving Loans; provided that, if the Borrower
fails to reimburse such LC Disbursement when due pursuant to paragraph (e) of
this Section, then Section 2.13(c) shall apply. Interest accrued pursuant to
this paragraph shall be for the account of the applicable Issuing Bank, except
that interest accrued on and after the date of payment by any Revolving Lender
pursuant to paragraph (e) of this Section to reimburse an Issuing Bank shall be
for the account of such Lender to the extent of such payment.


(i)            Replacement
of an Issuing Bank.  An Issuing Bank
may be replaced at any time by written agreement among the Borrower, the
Administrative Agent, the replaced Issuing Bank and the 



 38
 









successor Issuing Bank.  The
Administrative Agent shall notify the Lenders of any such replacement of an
Issuing Bank.  At the time any such
replacement shall become effective, the Borrower shall pay all unpaid fees
accrued for the account of the replaced Issuing Bank pursuant to Section
2.12(b).  From and after the effective
date of any such replacement, (i) the successor Issuing Bank shall have all the
rights and obligations of an Issuing Bank under this Agreement with respect to
Letters of Credit to be issued by it thereafter and (ii) references herein to
the term “Issuing Bank” shall be deemed to refer to such successor or to any
predecessor Issuing Bank, or to such successor and all predecessor Issuing
Banks, as the context shall require. 
After the replacement of an Issuing Bank hereunder, the replaced Issuing
Bank shall remain a party hereto and shall continue to have all the rights and
obligations of an Issuing Bank under this Agreement with respect to Letters of
Credit issued by it prior to such replacement, but shall not be required to issue
additional Letters of Credit.


(j)            Cash
Collateralization.  If any Event of
Default under clauses (a), (b), (h) or (i) of Article VII shall occur and be
continuing or if the Loans have been accelerated pursuant to Article VII as a
result of any other Event of Default, on or before the third Business Day
(subject to the proviso below) after the Borrower receives notice from the
Administrative Agent or the Required Lenders (or, if the maturity of the Loans
has been accelerated, Revolving Lenders with LC Exposure representing greater
than 50% of the total LC Exposure) demanding the deposit of cash collateral
pursuant to this paragraph, the Borrower shall deposit in an account with the
Administrative Agent, in the name of the Administrative Agent and for the benefit
of the Lenders, an amount in cash equal to the LC Exposure as of such date plus
any accrued and unpaid interest thereon;


provided that the obligation to deposit such cash
collateral shall become effective immediately, and such deposit shall become immediately
due and payable, without demand or other notice of any kind, upon the
occurrence of any Event of Default with respect to the Borrower described in
clause (h) or (i) of Article VII.  The
Borrower also shall deposit cash collateral pursuant to this paragraph as and
to the extent required by Section 2.11(b). Each such deposit under this Section
or Section 2.11(b) shall be held by the Administrative Agent as collateral for
the payment and performance of the obligations of the Borrower under this Agreement,
and the Borrower hereby grants to the Agent, for the benefit of the Secured
Parties, a security interest in all funds and investments from time to time in
such account, and in the proceeds thereof, to secure the Obligations. The
Administrative Agent shall have exclusive dominion and control, including the
exclusive right of withdrawal, over such account.  Other than any interest earned on the
investment of such deposits, which investments shall be made at the option and
sole discretion of (i) for so long as an Event of Default shall be continuing,
the Administrative Agent and (ii) at any other time, the Borrower, in each
case, in Permitted Investments and at the Borrower’s risk and expense, such
deposits shall not bear interest. 
Interest or profits, if any, on such investments shall accumulate in
such account.  Moneys in such account
shall be applied by the Administrative Agent to reimburse any Issuing Bank for
LC Disbursements for which it has not been reimbursed and, to the extent not so
applied, shall be held for the satisfaction of the reimbursement obligations of
the Borrower for the LC Exposure at such time or, if the maturity of the Loans
has been accelerated (but subject to the consent of Revolving Lenders with LC
Exposure  representing greater than 50%
of the total LC Exposure), be applied to satisfy other obligations of the
Borrower under this Agreement. If the Borrower is required to provide an amount
of cash collateral under this Section 2.05(j) as a result of the occurrence of
an Event of Default specified above, such amount (to the extent not applied as
aforesaid) shall be returned to the Borrower within three Business Days after
the applicable Events of Default have been cured or waived. If the Borrower is
required to provide an amount of cash collateral hereunder pursuant to Section
2.11(b), such amount (to the extent not applied as aforesaid) shall be returned
to the Borrower as and to the extent that, after giving effect to such return,
the Borrower would remain in compliance with Section 2.11(b) and no Default
shall have occurred and be continuing.



 39
 









(k)           Additional
Issuing Banks.  From time to time,
the Borrower may by notice to the Administrative Agent designate up to three
Lenders (in addition to JPMCB and LCPI or any of their respective Affiliates)
to act as Issuing Banks; provided (i) each agrees (in its sole discretion) to
act in such capacity pursuant to a written instrument satisfactory to the
Borrower and the Administrative Agent, (ii) each is reasonably satisfactory to
the Administrative Agent as an Issuing Bank and (iii) at the time of
designation and for all periods such Lender acts as an Issuing Bank such Lender
has a Revolving Commitment hereunder.


(l)            Reporting.  Unless otherwise requested by the
Administrative Agent, each Issuing Bank shall (i) provide to the Administrative
Agent copies of any notice received from the Borrower pursuant to Section
2.05(b) no later than the next Business Day after receipt thereof and (ii)
report in writing to the Administrative Agent (A) on or prior to each Business
Day on which such Issuing Bank expects to issue, amend, renew or extend any
Letter of Credit, the date of such issuance, amendment, renewal or extension,
and the aggregate face amount of the Letters of Credit to be issued, amended, renewed
or extended by it and outstanding after giving effect to such issuance,
amendment, renewal or extension occurred (and whether the amount thereof
changed), and the applicable Issuing Bank shall be permitted to issue, amend,
renew or extend such Letter of Credit if the Administrative Agent shall not
have advised such Issuing Bank that such issuance, amendment renewal or
extension would not be in conformity with the requirements of this Agreement,
(B) on each Business Day on which such Issuing Bank makes any LC Disbursement,
the date of such LC Disbursement and the amount of such LC Disbursement and (C)
on any other Business Day, such other information as the Administrative Agent
shall reasonably request, including but not limited to prompt verification of
such information as may be requested by the Administrative Agent.


SECTION  2.06.  Funding of Borrowings.  (a)  Each
Lender shall make each Loan to be made by it hereunder on the proposed date
thereof by wire transfer of immediately available funds by 12:00 noon, New York
City time, to the account of the Administrative Agent most recently designated
by it for such purpose by notice to the Lenders; provided that Swingline
Loans shall be made as provided in Section 2.04.  The Administrative Agent will make such Loans
available to the Borrower by promptly crediting the amounts so received, in
like funds, to an account of the Borrower maintained with the Administrative
Agent in New York City and designated by the Borrower in the applicable
Borrowing Request; provided that ABR Revolving Loans and Swingline Loans
made to finance the reimbursement of an LC Disbursement as provided in Section
2.05(e) shall be remitted by the Administrative Agent to the applicable Issuing
Bank.


(b)           Unless
the Administrative Agent shall have received notice from a Lender prior to the
proposed date of any Borrowing that such Lender will not make available to the
Administrative Agent such Lender’s share of such Borrowing, the Administrative
Agent may assume that such Lender has made such share available on such date in
accordance with paragraph (a) of this Section and may, in reliance upon such
assumption, make available to the Borrower a corresponding amount.  In such event, if a Lender has not in fact
made its share of the applicable Borrowing available to the Administrative
Agent, then the applicable Lender and the Borrower severally agree to pay to
the Administrative Agent forthwith on demand such corresponding amount with
interest thereon, for each day from and including the date such amount is made
available to the Borrower to but excluding the date of payment to the
Administrative Agent, at (i) in the case of such Lender, the greater of the
Federal Funds Effective Rate and a rate determined by the Administrative Agent
in accordance with banking industry rules on interbank compensation or (ii) in
the case of the Borrower, the interest rate applicable to ABR Loans. If such
Lender pays such amount to the Administrative Agent, then such amount shall
constitute such Lender’s Loan included in such Borrowing.



 40
 









SECTION  2.07.  Interest Elections.  (a)  Each
Revolving Borrowing and Tranche C Term Borrowing initially shall be of the Type
specified in the applicable Borrowing Request and, in the case of a Eurodollar
Borrowing, shall have an initial Interest Period as specified in such Borrowing
Request. Thereafter, the Borrower may elect to convert such Borrowing to a
different Type or to continue such Borrowing and, in the case of a Eurodollar
Borrowing, may elect Interest Periods therefor, all as provided in this
Section.  The Borrower may elect
different options with respect to different portions of the affected Borrowing,
in which case each such portion shall be allocated ratably among the Lenders
holding the Loans comprising such Borrowing, and the Loans comprising each such
portion shall be considered a separate Borrowing.  This Section shall not apply to Swingline
Borrowings, which may not be converted or continued.


(b)           To
make an election pursuant to this Section, the Borrower shall notify the
Administrative Agent of such election by telephone by the time that a Borrowing
Request would be required under Section 2.03 if the Borrower were requesting a
Revolving Borrowing of the Type resulting from such election to be made on the
effective date of such election. Each such telephonic Interest Election Request
shall be irrevocable and shall be confirmed promptly by hand delivery or
telecopy to the Administrative Agent of a written Interest Election Request in
a form approved by the Administrative Agent and signed by the Borrower.


(c)           Each
telephonic and written Interest Election Request shall specify the following
information in compliance with Section 2.02:


(i)            the Borrowing to which such Interest Election Request
applies and, if different options are being elected with respect to different
portions thereof, the portions thereof to be allocated to each resulting
Borrowing (in which case the information to be specified pursuant to clauses
(iii) and (iv) below shall be specified for each resulting Borrowing);


(ii)           the effective date of the election made pursuant to such
Interest Election Request, which shall be a Business Day;


(iii)          whether the resulting Borrowing is to be an ABR Borrowing
or a Eurodollar Borrowing; and


(iv)          if the resulting Borrowing is a Eurodollar Borrowing, the
Interest Period to be applicable thereto after giving effect to such election,
which shall be a period contemplated by the definition of the term “Interest
Period”.


If
any such Interest Election Request requests a Eurodollar Borrowing but does not
specify an Interest Period, then the Borrower shall be deemed to have selected
an Interest Period of one month’s duration.


(d)           Promptly
following receipt of an Interest Election Request, the Administrative Agent
shall advise each Lender of the details thereof and of such Lender’s portion of
each resulting Borrowing.


(e)           If
the Borrower fails to deliver a timely Interest Election Request with respect
to a Eurodollar Borrowing prior to the end of the Interest Period applicable
thereto, then, unless such Borrowing is repaid as provided herein, at the end
of such Interest Period such Borrowing shall be converted to an ABR Borrowing.
Notwithstanding any contrary provision hereof, if an Event of Default has
occurred and is continuing then, so long as an Event of Default is continuing
(i) no outstanding 



 41
 









Borrowing may be converted to or continued as a Eurodollar Borrowing
and (ii) unless repaid, each Eurodollar Borrowing shall be converted to an ABR
Borrowing at the end of the Interest Period applicable thereto.


SECTION  2.08.  Termination and Reduction of Commitments.
 (a) Unless previously terminated, (i)
the Tranche C Commitments shall terminate at 5:00 p.m., New York City time, on
the Effective Date and (ii) the Revolving Commitments shall terminate on the
Revolving Maturity Date.


(b)           The
Borrower may at any time, without premium or penalty, terminate, or from time
to time reduce, the Revolving Commitments; provided that (i) each
reduction of the Revolving Commitments shall be in an amount that is an
integral multiple of $1,000,000 and not less than $5,000,000 and (ii) the
Borrower shall not terminate or reduce the Revolving Commitments if, after
giving effect to any concurrent prepayment of the Revolving Loans in accordance
with Section 2.11, the sum of the Revolving Exposures would exceed the total
Revolving Commitments.


(c)           The
Borrower shall notify the Administrative Agent of any election to terminate or
reduce the Revolving Commitments under paragraph (b) of this Section at least
three Business Days prior to the effective date of such termination or
reduction, specifying such election and the effective date thereof. Promptly
following receipt of any notice, the Administrative Agent shall advise the
Lenders of the contents thereof.  Each notice
delivered by the Borrower pursuant to this Section shall be irrevocable; provided
that a notice of termination of the Revolving Commitments delivered by the
Borrower may state that such notice is conditioned upon the effectiveness of
other credit facilities, in which case such notice may be revoked by the
Borrower (by notice to the Administrative Agent on or prior to the specified
effective date) if such condition is not satisfied.


(d)           [Reserved].


(e)           Any
termination or reduction of the Revolving Commitments shall be permanent.  Each reduction of the Revolving Commitments
shall be made ratably among the Revolving Lenders in accordance with their
respective Revolving Commitments.


SECTION  2.09.  Repayment of Loans; Evidence of Debt.  (a)  The
Borrower hereby unconditionally promises to pay (i) to the Administrative Agent
for the account of each Lender the then unpaid principal amount of each
Revolving Loan of such Lender on the Revolving Maturity Date, (ii) to the
Administrative Agent for the account of each Lender the then unpaid principal
amount of each Tranche C Term Loan of such Lender as provided in Section 2.10
and (iii) to the Swingline Lender the then unpaid principal amount of each
Swingline Loan on the earlier of the Revolving Maturity Date and the first date
after such Swingline Loan is made that is the 15th or last day of a calendar
month and is at least five Business Days after such Swingline Loan is made; provided
that on each date that a Revolving Borrowing is made, the Borrower shall repay
all Swingline Loans that were outstanding on the date such Borrowing was
requested.


(b)           Each
Lender shall maintain in accordance with its usual practice an account or
accounts evidencing the indebtedness of the Borrower to such Lender resulting
from each Loan made by such Lender, including the amounts of principal and
interest payable and paid to such Lender from time to time hereunder.


(c)           The
Administrative Agent shall maintain accounts in which it shall record (i) the
amount of each Loan made hereunder, the Class and Type thereof and the Interest
Period applicable thereto, (ii) the amount of any principal or interest due and
payable or to become due and payable from 



 42
 









the Borrower to each Lender hereunder and (iii) the amount of any sum
received by the Administrative Agent hereunder for the account of the Lenders
and each Lender’s share thereof.


(d)           The
entries made in the accounts maintained pursuant to paragraph (b) or (c) of
this Section shall be prima  facie evidence of the existence and
amounts of the obligations recorded therein; provided that the failure
of any Lender or the Administrative Agent to maintain such accounts or any
error therein shall not in any manner affect the obligation of the Borrower to
repay the Loans in accordance with the terms of this Agreement.


(e)           Any
Lender may request that Loans of any Class made by it be evidenced by a
promissory note.  In such event, the
Borrower shall prepare, execute and deliver to such Lender a promissory note
payable to the order of such Lender (or, if requested by such Lender, to such
Lender and its registered assigns) and in a form reasonably satisfactory to the
Administrative Agent.  Such promissory
note shall state that it is subject to the provisions of this Agreement.  Thereafter, the Loans evidenced by such
promissory note and interest thereon shall at all times (including after
assignment pursuant to Section 9.04) be represented by one or more promissory
notes in such form payable to the order of the payee named therein (or, if such
promissory note is a registered note, to such payee and its registered
assigns).


SECTION  2.10.  Amortization of Term Loans.  (a)  Subject
to adjustment pursuant to paragraph (d) of this Section 2.10, the Borrower
shall repay Tranche C Term Borrowings on each date set forth below in the
aggregate principal amount set forth opposite such date (each such date being
called an “Installment Date”): 


	
  Date

  	
   

  	
  Amount

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  September 30,
  2007

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  December 31,
  2007

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  March 31, 2008

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  June 30, 2008

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  September 30,
  2008

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  December 31,
  2008

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  March 31, 2009

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  June 30, 2009

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  September 30,
  2009

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  December 31,
  2009

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  March 31, 2010

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  June 30, 2010

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  September 30,
  2010

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  December 31,
  2010

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  March 31, 2011

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  June 30, 2011

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  September 30,
  2011

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  December 31,
  2011

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  March 31, 2012

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  June 30, 2012

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  September 30,
  2012

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  December 31,
  2012

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  March 31, 2013

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  June 30, 2013

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  September 30,
  2013

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  December 31,
  2013

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  March 31, 2014

  	
   

  	
  $

  	
  2,150,000

  	
   

  
	
  Tranche C
  Maturity Date

  	
   

  	
  $

  	
  801,950,000

  	
   

  



 



 43
 









(b)           [Reserved].


(c)           To
the extent not previously paid, all Tranche C Term Loans shall be due and
payable on the Tranche C Maturity Date.


(d)           Any
mandatory prepayment of a Tranche C Term Borrowing shall be applied to reduce
the subsequent scheduled repayments of the Tranche C Term Borrowings to be made
pursuant to this Section first, in direct order of the first eight scheduled
payments to become due under Section 2.10(a) following the date of such
prepayment, and thereafter, ratably to the remaining scheduled payments under
such section.  Any optional prepayment of
the Tranche C Term Loans shall be applied to the remaining installments thereof
as directed by the Borrower.


(e)           Prior
to any repayment of any Tranche C Term Borrowings hereunder, the Borrower shall
select the Borrowing or Borrowings to be repaid and shall notify the
Administrative Agent by telephone (confirmed by telecopy) of such selection not
later than 11:00 a.m., New York City time, three Business Days before the
scheduled date of such repayment.  Each
repayment of a Borrowing shall be applied ratably to the Loans included in the
repaid Borrowing.  Repayments of Tranche
C Term Borrowings shall be accompanied by accrued interest on the amount
repaid.


SECTION  2.11.  Prepayment of Loans.  (a)  The
Borrower shall have the right at any time and from time to time to prepay any
Borrowing (including accrued and unpaid interest thereon) in whole or in part,
without premium or penalty (other than any Applicable Premium, and in any case,
subject to Section 2.16), in an aggregate principal amount that is an integral
multiple of $1,000,000 and not less than $2,000,000 (or $500,000 or more, in
the case of Swingline Loans) or, if less, the amount outstanding, subject to
the requirements of this Section; provided, that in connection with, and
as a condition to any voluntary prepayment of the Tranche C Term Loans on or
prior to the first anniversary of the Effective Date pursuant to (i) a
refinancing of all or part of the Tranche C Term Loans with the proceeds of a substantially
concurrent issuance or incurrence of new term loans pursuant to this Agreement or
(ii) any amendment to this Agreement or the other Loan Documents (any such
amendment, a “Repricing”) (in each case, other than a refinancing of all
of the Term Loans in connection with a transaction not permitted by this
Agreement), and in each case, the Applicable Rate (or similar interest spread)
for such Type of Loan is, or upon the satisfaction of certain conditions, could
be less than the Applicable Rate (or similar interest spread) for such Type of
Loan on the Effective Date, the Borrower shall pay to the Tranche C Term Lenders,
in addition to the amount of such prepayment and any other amounts then due on
the date of such refinancing or Repricing, the Applicable Premium.


(b)           In
the event and on such occasion that the sum of the Revolving Exposures exceeds
the total Revolving Commitments, the Borrower shall prepay Revolving Borrowings
or Swingline Borrowings (or, if no such Borrowings are outstanding, deposit
cash collateral in an account with the Administrative Agent pursuant to Section
2.05(j)) in an aggregate amount equal to such excess.


(c)           (i)
In the event and on each occasion that any Net Proceeds are received by or on
behalf of Holdings, the Borrower or any Subsidiary in respect of any Prepayment
Event, the Borrower 



 44
 









shall, not later than the Business Day next after the date on which
such Net Proceeds are received, prepay Tranche C Term Borrowings in an aggregate
amount equal to the Required Percentage of such Net Proceeds; provided
that, in the case of any Asset Disposition described in clauses (a) and (b) of
the definition of the term Asset Disposition, if the Borrower shall deliver to
the Administrative Agent a certificate of a Financial Officer to the effect
that the Borrower or a Subsidiary intends to apply the Net Proceeds from such
event (or a portion thereof specified in such certificate), within 15 months
after receipt of such Net Proceeds, to acquire, maintain, develop, construct,
improve, upgrade or repair assets (other than Equity Interests) to be used in
the business of the Borrower or such Subsidiaries or to fund a Permitted
Acquisition in accordance with the terms of Section 6.04, and certifying that
no Event of Default has occurred and is continuing, then no prepayment shall be
required pursuant to this paragraph in respect of the Net Proceeds in respect
of such event (or the portion of such Net Proceeds specified in such
certificate, if applicable) except to the extent of any such Net Proceeds
therefrom that have not been so applied by the end of such 15-month period or
contractually committed by the end of such 15-month period to be so applied
within 21 months after receipt of such Net Proceeds, at which time a prepayment
shall be required in an amount equal to such Net Proceeds that have not been so
applied or committed (and if any portion of Net Proceeds contractually
committed to be applied within such 15-month period are not so applied within
such period, a prepayment shall be required in an amount equal to such portion
on the last day of such period); provided, further, that in the
case of any Asset Disposition, if on a Pro Forma Basis, the Net Secured
Leverage Ratio is less than or equal to 3.00 to 1.00, the Borrower may retain the
Net Proceeds from such Asset Disposition, and no prepayment shall be required
pursuant to this paragraph in respect of such Net Proceeds, to the extent that
the amount of Net Proceeds retained by the Borrower pursuant to this proviso
shall not exceed $50,000,000 in the aggregate during the term of this Agreement
(any such retained amount, the “Retained Asset Disposition Proceeds”).  For purposes hereof, “Required Percentage”
shall mean: (i) in the case of an Asset Disposition, 100%; (ii) in the case of
a Debt Issuance, (A) if on the date of the relevant issuance, the Total
Leverage Ratio, calculated on a Pro Forma Basis, is greater than 4.50 to 1.00,
100% or (B) if on the date of the relevant issuance, Total Leverage Ratio,
calculated on a Pro Forma Basis, is less than or equal to 4.50 to 1.00, but
greater than 3.00 to 1.00, 50% or (C) if on the date of the relevant issuance, Total
Leverage Ratio, calculated on a Pro Forma Basis, is less than or equal to 3.00
to 1.00, 0% (it being understood that a portion of such Net Proceeds from a
Debt Issuance may be applied so as to reduce such Total Leverage Ratio to the next
lower level referred to above, and that the Required Percentage for the
remainder of such Net Proceeds shall be based on such next lower level).


(ii)           If, within 15
months after the receipt of Net Proceeds from the Directories Sale, all or any
portion of such Net Proceeds have not been applied to repay Indebtedness, the
Borrower shall, not later than the Business Day next after the date that is 15
months from the date on which such Net Proceeds were received, prepay Tranche C
Term Borrowings in an aggregate amount equal to 100% of such Net Proceeds not
so previously applied.


(d)           Following
the end of each fiscal year of the Borrower, beginning with the fiscal year
ending December 31, 2008, the Borrower will prepay (without duplication of any amount
prepaid from the Net Proceeds of any Asset Disposition pursuant to clause (c)
above) Tranche C Term Borrowings in an aggregate amount equal to (i) 50% of
Excess Cash Flow for such fiscal year minus (ii) to the extent that such
prepayments are not funded with the proceeds of Indebtedness, the aggregate
amount of voluntary prepayments of Tranche C Term Loans and Revolving Loans
(but only, in the case of payments in respect of Revolving Loans, to the extent
that the Revolving Credit Commitments are permanently reduced by the amount of
such payments) made pursuant to this Section 2.11 during such fiscal year; provided,
that no such prepayment shall be required in respect of any such fiscal year if
the Total Leverage Ratio is less than 5.00 to 1.00.  Each prepayment pursuant to this paragraph
shall be made 



 45
 









on or before the date on which financial statements are delivered pursuant
to Section 5.01 with respect to the fiscal year for which Excess Cash Flow is
being calculated (and in any event within 105 days after the end of such fiscal
year).


(e)           Prior
to any optional or, subject to Sections 2.11(c) and (d), mandatory prepayment
of Borrowings hereunder, the Borrower shall select the Borrowing or Borrowings
to be prepaid and shall specify such selection in the notice of such prepayment
pursuant to paragraph (f) of this Section. In the event of any mandatory
prepayment of Tranche C Term Borrowings, any Tranche C Lender may elect, by
notice to the Administrative Agent by telephone (confirmed by telecopy) at
least one Business Day prior to the prepayment date, to decline all or any
portion of any prepayment of its Tranche C Term Loans pursuant to this Section
2.11 (other than an optional prepayment pursuant to paragraph (a) of this
Section, which may not be declined), in which case the aggregate amount of the
prepayment that would have been applied to prepay Tranche C Term Loans but was
so declined may be retained by the Borrower.


(f)            The
Borrower shall notify the Administrative 
Agent (and, in the case of prepayment of a Swingline Loan, the Swingline
Lender) by telephone (confirmed by telecopy) of any prepayment hereunder (i) in
the case of prepayment of a Eurodollar Borrowing, not later than 2:00 p.m., New
York City time, three Business Days before the date of prepayment, (ii) in the
case of prepayment of an ABR  Borrowing,
not later than 2:00 p.m., New York City time, one Business Day before the date
of prepayment or (iii) in the case of prepayment of a Swingline Loan, not
later than 3:00 p.m., New York City time, on the date of prepayment.  Each such notice shall be irrevocable and
shall specify the prepayment date, the principal amount of each Borrowing or
portion thereof to be prepaid, in the case of a mandatory prepayment, a
reasonably detailed calculation of the amount of such prepayment, and, in the
case of a voluntary prepayment of Tranche C Term Borrowings, the application
thereof to the remaining scheduled repayments of such Borrowings; provided
that, if a notice of optional prepayment is given in connection with a
conditional notice of termination of the Revolving Commitments as contemplated
by Section 2.08, then such notice of prepayment may be revoked if such notice
of termination is revoked in accordance with Section 2.08.  Promptly following receipt of any such notice
(other than a notice relating solely to Swingline Loans), the Administrative
Agent shall advise the Lenders of the contents thereof.  Each partial prepayment of any Borrowing
shall be in an amount that would be permitted in the case of an advance of a
Borrowing of the same Type as provided in Section 2.02, except as necessary to
apply fully the required amount of a mandatory prepayment or to prepay such
Borrowing in full. Each prepayment of a Borrowing shall be applied ratably to
the Loans included in the prepaid Borrowing. 
Prepayments shall be accompanied by accrued interest and other amounts
to the extent required by Sections 2.13 and 2.16.


SECTION  2.12.  Fees.  (a)  The
Borrower agrees to pay to the Administrative Agent for the account of each
Revolving Lender (other than a Defaulting Lender) a commitment fee, which shall
accrue at the Applicable Rate on the daily unused amount of each Revolving
Commitment (including the Incremental Revolving Loan Availability after and to
the extent the Borrower requests the use of such Incremental Revolving Loan
Availability, effective starting on the date such Incremental Loan is available
for borrowing by the Borrower) of such Lender during the period from and
including the Effective Date to but excluding the date on which the Revolving
Commitments terminate.  Accrued
commitment fees shall be payable in arrears on the last day of March, June,
September and December of each year and on the dates on which the Revolving
Commitments terminate, commencing on the first such date to occur after the
date hereof.  All commitment fees shall
be computed on the basis of a year of 360 days and shall be payable for the
actual number of days elapsed (including the first day but excluding the last
day). For purposes of computing commitment fees with respect to Revolving
Commitments, a Revolving Commitment of a Lender shall be deemed to be used to
the extent of the outstanding 



 46
 









Revolving Loans and LC Exposure of such Lender (and the Swingline
Exposure of such Lender shall be disregarded for such purpose).


(b)           The
Borrower agrees to pay to the Administrative Agent for the account of each Revolving
Lender (other than a Defaulting Lender) an incremental loan availability fee
(the “Incremental Loan Availability Fee”), which shall accrue at the
rate of 0.50% per annum on the aggregate amount
of the Incremental Revolving Loan Availability during the period from and
including the Effective Date until the date the Incremental Loan Availability
Fee is paid.  The Incremental Loan Availability
Fee shall be payable on the earlier of (i) the date of the Borrower’s written
notice to the Arrangers of the exercise of its right to incur additional
Revolving Loans pursuant to the Incremental Revolving Loan Availability, (ii)
the date on which the Borrower notifies the Arrangers of its intent to cancel
the Incremental Revolving Loan Availability in full and (iii) the first
anniversary of the Effective Date.  The
Incremental Loan Availability Fee shall be computed on the basis of a year of
365 days and shall be payable for the actual number of days elapsed (including
the first day but excluding the last day). For purposes of computing the
Incremental Loan Availability Fee with respect to each Revolving Lender, the
Administrative Agent shall multiply the total amount of Incremental Loan Availability
Fee actually received by such Lender’s Applicable Percentage.


(c)           The
Borrower agrees to pay (i) to the Administrative Agent for the account of each
Revolving Lender (other than a Defaulting Lender) a participation fee with
respect to its participations in Letters of Credit, which shall accrue at the
same Applicable Rate from time to time in effect for purposes of determining
the interest rate applicable to Eurodollar Revolving Loans on the daily amount
of such Lender’s LC Exposure (excluding any portion thereof attributable to
unreimbursed LC Disbursements) during the period from and including the
Effective Date to but excluding the later of the date on which such Lender’s
Revolving Commitment terminates and the date on which such Lender ceases to
have any LC Exposure; provided, that such participation fee shall be
reduced by the amount of any fronting fee paid to any Issuing Bank pursuant to
clause (ii) below in respect of such Letters of Credit, and (ii) to the
applicable Issuing Bank a fronting fee for each Letter of Credit issued by such
Issuing Bank, which shall accrue at the rate of 0.125% per annum,
on the average daily amount of the LC Exposure (excluding any portion thereof
attributable to unreimbursed LC Disbursements) during the period from and
including the Effective Date to but excluding the later of the date of
termination of the Revolving Commitments and the date on which there ceases to
be any LC Exposure, as well as such Issuing Bank’s customary documentary and
processing fees with respect to the issuance, amendment, renewal or extension
of any Letter of Credit or processing of drawings thereunder.  Participation fees and fronting fees accrued
through and including the last day of March, June, September and December of
each year shall be payable in arrears on the third Business Day following such
last day, commencing on the first such date to occur after the Effective Date; provided
that all such fees shall be payable on the date on which the Revolving
Commitments terminate and any such fees accruing after the date on which the
Revolving Commitments terminate shall be payable on demand.  Any other fees payable to any Issuing Bank
pursuant to this paragraph shall be payable within 10 days after demand.  All participation fees and fronting fees
shall be computed on the basis of a year of 360 days and shall be payable for
the actual number of days elapsed (including the first day but excluding the
last day).


(d)           The
Borrower agrees to pay to the Agents and the Arrangers, for their own respective
accounts, fees payable in the amounts and at the times separately agreed upon
between the Borrower and the Agents and/or the Arrangers, as the case may be,
including but not limited to all fees specified in the Fee Letter.


(e)           All
fees payable hereunder shall be paid on the dates due, in immediately available
funds, to the Administrative Agent (or to the applicable Issuing Bank, in the
case of fees 



 47
 









payable to it) for distribution, in the case of commitment fees and
participation fees, to the Lenders entitled thereto.  Fees paid shall not be refundable under any
circumstances.


SECTION  2.13.  Interest.  (a)  The
Loans comprising each ABR Borrowing (including each Swingline Loan) shall bear
interest at the Alternate Base Rate plus the Applicable Rate.


(b)           The
Loans comprising each Eurodollar Borrowing shall bear interest at the Adjusted
LIBO Rate for the Interest Period in effect for such Borrowing plus the
Applicable Rate.


(c)           Notwithstanding
the foregoing, if any principal of or interest on any Loan or any fee or other
amount payable by the Borrower hereunder is not paid when due, whether at
stated maturity, upon acceleration or otherwise, such overdue amount shall bear
interest, after as well as before judgment, at a rate per annum
equal to (i) in the case of overdue principal of any Loan, 2% plus the rate
otherwise applicable to such Loan as provided in the preceding paragraphs of
this Section or (ii) in the case of any other amount, 2% plus the rate
applicable to ABR Revolving Loans as provided in paragraph (a) of this Section.


(d)           Accrued
interest on each Loan shall be payable in arrears on each Interest Payment Date
for such Loan and, in the case of Revolving Loans, upon termination of the
Revolving Commitments; provided that (i) interest accrued pursuant to
paragraph (c) of this Section shall be payable on demand, (ii) in the event of
any repayment or prepayment of any Loan (other than a prepayment of an ABR
Revolving Loan prior to the end of the Revolving Availability Period), accrued
interest on the principal amount repaid or prepaid shall be payable on the date
of such repayment or prepayment and (iii) in the event of any conversion of any
Eurodollar Loan prior to the end of the current Interest Period therefor,
accrued interest on such Loan shall be payable on the effective date of such
conversion.


(e)           All
interest hereunder shall be computed on the basis of a year of 360 days, except
that interest computed by reference to the Alternate Base Rate at times when
the Alternate Base Rate is based on the Prime Rate shall be computed on the
basis of a year of 365 days (or 366 days in a leap year), and in each case
shall be payable for the actual number of days elapsed (including the first day
but excluding the last day).  The
applicable Alternate Base Rate or Adjusted LIBO Rate shall be determined by the
Administrative Agent, and such determination shall be conclusive absent
manifest error.


SECTION  2.14.  Alternate Rate of Interest.  If prior to the commencement of any Interest
Period for a Eurodollar Borrowing:


(a)           the Administrative Agent determines (which determination
shall be conclusive absent manifest error) that adequate and reasonable means
do not exist for ascertaining the Adjusted LIBO Rate for such Interest Period;
or


(b)           the Administrative Agent is advised by the Required
Lenders that the Adjusted LIBO Rate for such Interest Period will not
adequately and fairly reflect the cost to such Lenders of making or maintaining
their Loans included in such Borrowing for such Interest Period;


then
the Administrative Agent shall give notice thereof to the Borrower and the
Lenders by telephone or telecopy as promptly as practicable thereafter and,
until the Administrative Agent notifies the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) any Interest
Election Request that requests the conversion of any Borrowing to, or
continuation of any Borrowing as, a Eurodollar Borrowing shall be ineffective
and (ii) if any Borrowing Request requests a Eurodollar



 48















Borrowing,
such Borrowing shall be made as an ABR Borrowing; provided, however,
that, in the case of a notice received pursuant to clause (b) above, if the
Administrative Agent is able prior to the commencement of such Interest Period
to ascertain, after using reasonable efforts to poll the Lenders giving such
notice, that a rate other than the Alternate Base Rate would adequately and
fairly reflect the cost to such Lenders of making or maintaining their Loans
included in such Borrowing for such Interest Period, the Administrative Agent
shall notify the Borrower of such alternate rate and the Borrower may agree by
written notice to the Administrative Agent prior to the commencement of such
Interest Period to increase the Applicable Rate for the Loans included in such
Borrowing for such Interest Period to result in an interest rate equal to such
alternate rate, in which case such increased Applicable Rate shall apply to all
the Eurodollar Loans included in the relevant Borrowing.


SECTION  2.15.  Increased Costs.  (a) If any Change in Law (except with respect
to Taxes, which shall be governed by Section 2.17) shall:


(i)            impose, modify or deem applicable any reserve, special
deposit or similar requirement against assets of, deposits with or for the
account of, or credit extended by, any Lender (except any such reserve
requirement reflected in the Adjusted LIBO Rate) or Issuing Bank; or


(ii)           impose on any Lender or Issuing Bank or the London
interbank market any other condition affecting this Agreement or Eurodollar
Loans made by such Lender or any Letter of Credit or participation therein;


and
the result of any of the foregoing shall be to increase the cost to such Lender
of making or maintaining any Eurodollar Loan (or of maintaining its obligation
to make any such Loan) or to increase the cost to such Lender or Issuing Bank
of participating in, issuing or maintaining any Letter of Credit or to reduce
the amount of any sum received or receivable by such Lender or Issuing Bank
hereunder (whether of principal, interest or otherwise), then the Borrower will
pay to such Lender or Issuing Bank, as the case may be, such additional amount
or amounts as will compensate such Lender or Issuing Bank, as the case may be,
for such additional costs incurred or reduction suffered.


(b)           If
any Lender or Issuing Bank determines that any Change in Law regarding capital
requirements has or would have the effect of reducing the rate of return on
such Lender’s or Issuing Bank’s capital or on the capital of such Lender’s or
Issuing Bank’s holding company, if any, as a consequence of this Agreement or
the Loans made by, or participations in Letters of Credit held by, such Lender,
or the Letters of Credit issued by such Issuing Bank, to a level below that
which such Lender or Issuing Bank or such Lender’s or Issuing Bank’s holding
company could have achieved but for such Change in Law (taking into
consideration such Lender’s or Issuing Bank’s policies and the policies of such
Lender’s or Issuing Bank’s holding company with respect to capital adequacy),
then from time to time after submission by such Lender to the Borrower of a
written request therefor, the Borrower will pay to such Lender or Issuing Bank,
as the case may be, such additional amount or amounts as will compensate such
Lender or Issuing Bank or such Lender’s or Issuing Bank’s holding company for
any such reduction suffered.


(c)           A
certificate of a Lender or Issuing Bank setting forth in reasonable detail the
matters giving rise to a claim under this Section 2.15 and the calculation of
such claim by such Lender or Issuing Bank or its holding company, as the case
may be, shall be delivered to the Borrower and shall be conclusive absent
manifest error.  The Borrower shall pay
such Lender or Issuing Bank, as the case may be, the amount shown as due on any
such certificate within 10 days after receipt thereof.



 49
 









(d)           Failure
or delay on the part of any Lender or Issuing Bank to demand compensation
pursuant to this Section shall not constitute a waiver of such Lender’s or
Issuing Bank’s right to demand such compensation; provided that the
Borrower shall not be required to compensate a Lender or Issuing Bank pursuant
to this Section for any increased costs or reductions incurred more than 180
days prior to the date that such Lender or Issuing Bank, as the case may be,
notifies the Borrower of the Change in Law giving rise to such increased costs
or reductions and of such Lender’s or Issuing Bank’s intention to claim
compensation therefor; provided  further that, if the Change in
Law giving rise to such increased costs or reductions is retroactive, then the
180-day period referred to above shall be extended to include the period of
retroactive effect thereof.


SECTION  2.16.  Break Funding Payments.  In the event of (a) the payment of any
principal of any Eurodollar Loan other than on the last day of an Interest
Period applicable thereto (including as a result of an Event of Default), (b)
the conversion of any Eurodollar Loan other than on the last day of the
Interest Period applicable thereto, (c) the failure to borrow, convert,
continue or prepay any Eurodollar Loan on the date specified in any notice
delivered pursuant hereto (regardless of whether such notice may be revoked
under Section 2.11(f) and is revoked in accordance therewith) or (d) the assignment
of any Eurodollar Loan other than on the last day of the Interest Period
applicable thereto as a result of a request by the Borrower pursuant to Section
2.19 or Section 9.02(c), then, in any such event, the Borrower shall compensate
each Lender for the loss, cost and expense attributable to such event.  Such loss, cost or expense to any Lender
shall consist of an amount determined by such Lender to be the excess, if any,
of (i) the amount of interest that would have accrued on the principal amount of
such Loan had such event not occurred, at the Adjusted LIBO Rate that would
have been applicable to such Loan, for the period from the date of such event
to the last day of the then current Interest Period therefor (or, in the case
of a failure to borrow, convert or continue, for the period that would have
been the Interest Period for such Loan), over (ii) the amount of interest that
would accrue on such principal amount for such period at the interest rate that
such Lender would bid were it to bid, at the commencement of such period, for
dollar deposits of a comparable amount and period from other banks in the
Eurodollar market.  A certificate of any
Lender setting forth any amount or amounts that such Lender is entitled to
receive pursuant to this Section shall be delivered to the Borrower and shall
be conclusive absent manifest error.  The
Borrower shall pay such Lender the amount shown as due on any such certificate
within 10 days after receipt thereof.


SECTION  2.17.  Taxes.  (a)  Any
and all payments by or on account of any obligation of the Borrower hereunder
or under any other Loan Document shall be made free and clear of, and without
deduction for, any Indemnified Taxes or Other Taxes; provided that if
the Borrower shall be required to deduct any Indemnified Taxes or Other Taxes
from such payments, then (i) the sum payable shall be increased as necessary so
that after making all required deductions (including deductions applicable to
additional sums payable under this Section) the Administrative Agent, Lender or
Issuing Bank (as the case may be) receives an amount equal to the sum it would
have received had no such deductions been made, (ii) the Borrower shall make
such deductions and (iii) the Borrower shall pay the full amount deducted to
the relevant Governmental Authority in accordance with applicable law.


(b)           In
addition, the Borrower shall pay any Other Taxes to the relevant Governmental
Authority in accordance with applicable law.


(c)           The
Borrower shall indemnify the Administrative Agent, each Lender and each Issuing
Bank, within 10 days after written demand therefor, for the full amount of any
Indemnified Taxes or Other Taxes paid by the Administrative Agent, such Lender
or Issuing Bank, as the case may be, on or with respect to any payment by or on
account of any obligation of the Borrower hereunder or under any other Loan
Document (including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable 



 50
 









to amounts payable under this Section) and any penalties, interest and
reasonable expenses arising therefrom or with respect thereto.  A certificate as to the amount of such
payment or liability prepared in good faith and delivered to the Borrower by any
Lender or Issuing Bank, or by the Administrative Agent on its own behalf or on
behalf of any Lender or Issuing Bank, shall be presumed correct, provided that
upon reasonable request of the Borrower, a Lender shall provide all relevant
information reasonably accessible to it justifying such amount.


(d)           As
soon as practicable after any payment of Indemnified Taxes or Other Taxes by
the Borrower to a Governmental Authority, the Borrower shall deliver to the
Administrative Agent a copy of a receipt issued by such Governmental Authority
evidencing such payment, a copy of the return reporting such payment or other
evidence of such payment reasonably satisfactory to the Administrative Agent.


(e)           A
Foreign Lender shall deliver to the Borrower and the Administrative Agent a
copy of either U.S. Internal Revenue Service Form W-8BEN or Form W-8ECI, or, in
the case of a Foreign Lender claiming exemption from U.S. federal withholding
tax under Section 871(h) or 881(c) of the Code with respect to payments of “portfolio
interest” a statement to the effect that such Lender is eligible for a complete
exemption from withholding of U.S. taxes under Section 871(h) or 881(c) of the
Code and a Form W-8BEN, or any subsequent versions thereof or successors
thereto properly completed and duly executed by such Foreign Lender claiming
complete exemption from, or a reduced rate of, U.S. federal withholding tax on
all payments by the Borrower under this Agreement and the other Loan
Documents.  Such forms shall be delivered
by each Foreign Lender on or before the date it becomes a party to this
Agreement.


(f)            If
the Administrative Agent, a Lender or Issuing Bank determines, in its
reasonable judgment, that it has received a refund of any Taxes or Other Taxes
as to which it has been indemnified by the Borrower or with respect to which
the Borrower has paid additional amounts pursuant to this Section 2.17, it
shall pay over such refund to the Borrower within a reasonable period of time
(but only to the extent of indemnity payments made, or additional amounts paid,
by the Borrower under this Section 2.17 with respect to the Taxes or Other
Taxes giving rise to such refund), net of all out-of-pocket expenses of the
Administrative Agent, such Lender or Issuing Bank and without interest (other
than any interest paid by the relevant Governmental Authority with respect to
such refund); provided, that the Borrower, upon the request of the
Administrative Agent, such Lender or Issuing Bank, agrees to repay the amount
paid over to the Borrower (plus any penalties, interest or other charges
imposed by the relevant Governmental Authority) to the Administrative Agent,
such Lender or Issuing Bank in the event the Administrative Agent, such Lender
or Issuing Bank is required to repay such refund to such Governmental
Authority.  This Section shall not be construed
to require the Administrative Agent, any Lender or Issuing Bank to make
available its tax returns (or any other information relating to its Taxes that
it deems confidential) to the Borrower or any other Person.


SECTION  2.18.  Payments Generally; Pro Rata Treatment;
Sharing of Setoffs.  (a)  The Borrower shall make each payment required
to be made by it hereunder or under any other Loan Document (whether of
principal, interest, fees or reimbursement of LC Disbursements, or of amounts
payable under Section 2.15, 2.16 or 2.17, or otherwise) prior to the time
expressly required hereunder or under such other Loan Document for such payment
(or, if no such time is expressly required, prior to 2:00 p.m., New York City
time), on the date when due, in immediately available funds, without setoff or
counterclaim.  Any amounts received after
such time on any date may, in the discretion of the Administrative Agent, be
deemed to have been received on the next succeeding Business Day for purposes
of calculating interest thereon.  All
such payments shall be made to the Administrative Agent at the Payment Office,
except payments to be made directly to any Issuing Bank or to the Swingline
Lender 



 51
 









as expressly provided herein and except that payments pursuant to
Sections 2.15, 2.16, 2.17 and 9.03 shall be made directly to the Persons
entitled thereto and payments pursuant to other Loan Documents shall be made to
the Persons specified therein.  The
Administrative Agent shall distribute any such payments received by it for the
account of any other Person to the appropriate recipient promptly following
receipt thereof.  If any payment under
any Loan Document shall be due on a day that is not a Business Day, the date
for payment shall be extended to the next succeeding Business Day, and, in the
case of any payment accruing interest, interest thereon shall be payable for
the period of such extension. All payments under each Loan Document shall be
made in dollars.


(b)           If
at any time insufficient funds are received by and available to the
Administrative Agent to pay fully all amounts of principal, unreimbursed LC
Disbursements, interest and fees then due hereunder, such funds shall be
applied (i) first, towards payment of interest and fees then due hereunder,
ratably among the parties entitled thereto in accordance with the amounts of
interest and fees then due to such parties, and (ii) second, towards payment of
principal and unreimbursed LC Disbursements then due hereunder, ratably among
the parties entitled thereto in accordance with the amounts of principal and unreimbursed
LC Disbursements then due to such parties.


(c)           If
any Lender shall, by exercising any right of setoff or counterclaim or
otherwise, obtain payment in respect of any principal of or interest on any of
its Revolving Loans, Term Loans or participations in LC Disbursements or
Swingline Loans resulting in such Lender receiving payment of a greater
proportion of the aggregate amount of its Revolving Loans, Term Loans and
participations in LC Disbursements and Swingline Loans and accrued interest
thereon than the proportion received by any other Lender, then the Lender
receiving such greater proportion shall purchase (for cash at face value)
participations in the Revolving Loans, Term Loans and participations in LC
Disbursements and Swingline Loans of other Lenders to the extent necessary so
that the benefit of all such payments shall be shared by the Lenders ratably in
accordance with the relative aggregate amounts of principal of and accrued
interest on their Revolving Loans, Term Loans and participations in LC
Disbursements and Swingline Loans; provided that (i) if any such
participations are purchased and all or any portion of the payment giving rise
thereto is recovered, such participations shall be rescinded and the purchase
price restored to the extent of such recovery, without interest, and (ii) the
provisions of this paragraph shall not be construed to apply to any payment
made by the Borrower pursuant to and in accordance with the express terms of
this Agreement or any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Loans or participations
in LC Disbursements to any assignee or participant, other than to the Borrower
or any Subsidiary or Affiliate thereof (as to which the provisions of this
paragraph shall apply). The Borrower consents to the foregoing and agrees, to
the extent it may effectively do so under applicable law, that any Lender
acquiring a participation pursuant to the foregoing arrangements may exercise
against the Borrower rights of setoff and counterclaim with respect to such
participation as fully as if such Lender were a direct creditor of the Borrower
in the amount of such participation.


(d)           Unless
the Administrative Agent shall have received notice from the Borrower prior to
the date on which any payment is due to the Administrative Agent for the
account of the Lenders or any Issuing Bank hereunder that the Borrower will not
make such payment, the Administrative Agent may assume that the Borrower has
made such payment on such date in accordance herewith and may, in reliance upon
such assumption, distribute to the Lenders or such Issuing Bank, as the case
may be, the amount due.  In such event,
if the Borrower has not in fact made such payment, then each of the Lenders or such
Issuing Bank, as the case may be, severally agrees to repay to the
Administrative Agent forthwith on demand the amount so distributed to such
Lender or Issuing Bank with interest thereon, for each day from and including
the date such amount is distributed to it to but excluding the date of payment
to the 



 52
 









Administrative Agent, at the greater of the Federal Funds Effective
Rate and a rate determined by the Administrative Agent in accordance with
banking industry rules on interbank compensation.


(e)           If
any Lender shall fail to make any payment required to be made by it pursuant to
Section 2.04(c), 2.05(d) or (e), 2.06(b), 2.18(d) or 9.03(c), then the
Administrative Agent may, in its discretion (notwithstanding any contrary
provision hereof), apply any amounts thereafter received by the Administrative
Agent for the account of such Lender to satisfy such Lender’s obligations under
such Sections until all such unsatisfied obligations are fully paid.


SECTION  2.19.  Mitigation Obligations; Replacement of
Lenders.  (a)  If any Lender requests compensation under
Section 2.15, or if the Borrower is required to pay any additional amount to
any Lender or any Governmental Authority for the account of any Lender pursuant
to Section 2.17, then such Lender shall use reasonable efforts to designate a
different lending office for funding or booking its Loans hereunder or to
assign its rights and obligations hereunder to another of its offices, branches
or affiliates, if, in the judgment of such Lender, such designation or assignment
(i) would eliminate or reduce amounts payable pursuant to Section 2.15 or 2.17,
as the case may be, in the future and (ii) would not subject such Lender to any
unreimbursed cost or expense and would not otherwise be disadvantageous to such
Lender in any material respect.  The
Borrower hereby agrees to pay all reasonable costs and expenses incurred by any
Lender in connection with any such designation or assignment.


(b)           If
any Lender requests compensation under Section 2.15, or if the Borrower is required
to pay any additional amount to any Lender or any Governmental Authority for
the account of any Lender pursuant to Section 2.17, or if any Lender is a
Defaulting Lender, then the Borrower may, at its sole expense and effort, upon
notice to such Lender and the Administrative Agent, require such Lender to
assign and delegate, without recourse (in accordance with and subject to the
restrictions contained in Section 9.04), all its interests, rights and
obligations under this Agreement to an assignee that shall assume such
obligations (which assignee may be another Lender, if a Lender accepts such
assignment); provided that (i) the Borrower shall have received the
prior written consent of the Administrative Agent (and, if a Revolving
Commitment is being assigned, each Issuing Bank and the Swingline Lender),
which consent shall not unreasonably be withheld and (ii) such Lender shall
have received payment of an amount equal to the outstanding principal of its
Loans and funded participations in LC Disbursements and Swingline Loans,
accrued interest thereon, accrued fees and all other amounts payable to it
hereunder, from the assignee (to the extent of such outstanding principal and
accrued interest and fees) or the Borrower (in the case of all other amounts) and
such Lender shall be released from all obligations hereunder.  A Lender shall not be required to make any
such assignment and delegation if, prior thereto, as a result of a waiver by
such Lender or otherwise, the circumstances entitling the Borrower to require
such assignment and delegation cease to apply. Nothing in this Section 2.19
shall be deemed to prejudice any rights that the Borrower may have against a
Lender that is a Defaulting Lender in respect of actions taken or not taken by
such Lender prior to its replacement hereunder.


ARTICLE III



Representations and Warranties


Each
of Holdings and the Borrower represents and warrants to the Lenders that,
except as disclosed on the disclosure schedules hereto, (the representations
and warranties made on the Effective Date are deemed made concurrently with the
consummation of the Transactions):



 53
 









SECTION  3.01.  Organization; Powers.  Each of Holdings, the Borrower and its
Subsidiaries is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its organization, has all requisite power and
authority to carry on its business as now conducted and, except where the
failure to do so, individually or in the aggregate, would not reasonably be
expected to result in a Material Adverse Effect, is qualified to do business
in, and is in good standing in, every jurisdiction where such qualification is
required.


SECTION  3.02.  Authorization; Enforceability.  The Transactions and each Loan Document entered
into and to be entered into by each Loan Party are within such Loan Party’s
corporate or limited liability company powers, as applicable, and have been
duly authorized by all necessary corporate or limited liability company and, if
required, stockholder action.  This
Agreement has been duly executed and delivered by each of Holdings and the
Borrower and constitutes, and each other Loan Document to which any Loan Party
is to be a party, when executed and delivered by such Loan Party, will
constitute, a legal, valid and binding obligation of Holdings, the Borrower or
such Loan Party (as the case may be), enforceable in accordance with its terms,
subject to applicable bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance or other laws affecting creditors’ rights generally and
subject to general principles of equity, regardless of whether considered in a
proceeding in equity or at law, and implied covenants of good faith and fair
dealing.


SECTION  3.03.  Governmental Approvals; No Conflicts.  The Transactions, the borrowings hereunder
and the execution, delivery, performance, validity or enforceability of this
Agreement and the other Loan Documents will not: (a) require any consent or
approval of, registration or filing with, or any other action by, any
Governmental Authority or any other Person, except such as have been obtained
or made and are in full force and effect and except (i) filings necessary to
perfect Liens created under the Loan Documents and (ii) the recordation of
Mortgages; (b) violate any applicable law or regulation or the charter, by-laws
or other organizational documents of Holdings, the Borrower or any of its
Subsidiaries or any order of any Governmental Authority; (c) violate or result
in a default under any indenture, agreement or other instrument binding upon
Holdings, the Borrower or any of its Subsidiaries or any of their assets, or
give rise to a right thereunder to require any payment to be made by Holdings,
the Borrower or any of its Subsidiaries; or (d) result in the creation or
imposition of any Lien on any asset of Holdings, the Borrower or any of its
Subsidiaries, except Liens permitted under Section 6.02; except, in the case of
clauses (a), (b) and (c), where the failure to obtain such consent or approval
or make such registration, filing or action or any such violation or default
would not reasonably be expected to result, individually or in the aggregate,
in a Material Adverse Effect or have a material adverse effect upon the
validity or enforceability of the Loan Documents or the rights of the Lenders
thereunder.


SECTION  3.04.  Financial Condition; No Material Adverse
Change.  (a)  The Borrower has heretofore furnished to the
Lenders the combined balance sheet and statements of income, and cash flows of Holdings,
the Borrower and its Subsidiaries as of and for the fiscal years ended December
31, 2006, December 31, 2005 and December 31, 2004, reported on by either
Deloitte & Touche LLP or Ernst & Young LLP, independent registered
public accountants, without qualification. 
The Borrower has heretofore furnished to the Lenders the combined
balance sheet and statements of income, and cash flows of Holdings, the
Borrower and its Subsidiaries as of and for the fiscal quarter ended March 31,
2007, subject to normal year-end adjustment and the absence of footnotes.  At the time of presentation, all such
financial statements present fairly, in all material respects, the financial
position and results of operations and cash flows of Holdings, the Borrower and
its Subsidiaries as of such dates and for such periods in accordance with GAAP,
subject to normal year-end adjustment and the absence of footnotes in the case
of quarterly financial statements.



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(b)           The
Borrower has heretofore furnished to the Lenders its pro forma
consolidated balance sheet as of March 31, 2007, prepared giving effect to
the Transactions as if such Transactions had occurred on such date.  Such pro forma
consolidated balance sheet (i) has been prepared in good faith based on the
same assumptions used to prepare the pro forma
financial statements included in the Information Memorandum (which assumptions
are believed by Holdings and the Borrower to have been reasonable at the time
made) and (ii) presents fairly, in all material respects, the pro forma financial position of the Borrower and its
consolidated Subsidiaries as of such date, as if the Transactions had occurred
on such date.


(c)           Except
as disclosed in the financial statements referred to above or the notes thereto
or in the Information Memorandum and except for the Disclosed Matters, after
giving effect to the Transactions, none of Holdings, the Borrower or its
Subsidiaries has, as of the Effective Date, any contingent liabilities or
unusual long-term commitments that, individually or in the aggregate, would
reasonably be expected to result in a Material Adverse Effect.


(d)           Since
December 31, 2006, there has been no material adverse change in the business,
operations or financial condition of Holdings, the Borrower and their
Subsidiaries, taken as a whole.


SECTION  3.05.  Properties.  (a)  Each
of Holdings, the Borrower and its Subsidiaries has good title to, or valid
leasehold interests in, all its real and personal property material to its
business (including its Mortgaged Properties), except for defects in title that
do not interfere with its ability to conduct its business as currently
conducted or to utilize such properties for their intended purposes and except
where the failure to have such title or interests would not reasonably be
expected, individually or in the aggregate, to result in a Material Adverse
Effect.


(b)           Each
of Holdings, the Borrower and its Subsidiaries owns, or is licensed to use, all
trademarks, trade names, copyrights, patents and other intellectual property
material to its business, and the use thereof by Holdings, the Borrower and its
Subsidiaries does not infringe upon the rights of any other Person, except, in
each case, for any matters that, individually or in the aggregate, would not
reasonably be expected to result in a Material Adverse Effect.


(c)           Schedule
3.05 sets forth the address of each real property that is owned by, and each
material property that is leased by, the Borrower or any of its Subsidiaries as
of the Effective Date after giving effect to the Transactions and indicates
each parcel of real property owned in fee that is a Mortgaged Property as of
the Effective Date.


SECTION  3.06.  Litigation and Environmental Matters.  (a)  There
are no actions, suits, proceedings or investigations by or before any
arbitrator or Governmental Authority pending against or, to the knowledge of
Holdings or the Borrower, threatened against or affecting Holdings, the
Borrower or any of their Subsidiaries (i) which would reasonably be expected,
individually or in the aggregate, to result in a Material Adverse Effect (other
than the Disclosed Matters) or (ii) that involve any of the Loan Documents or
the Transactions.


(b)           Except
for either the Disclosed Matters or any other matters that, individually or in
the aggregate, would not reasonably be expected to result in a Material Adverse
Effect, none of Holdings, the Borrower or any of their Subsidiaries (i) has
failed to comply with any Environmental Law or to obtain, maintain or comply
with any permit, license or other approval required under any Environmental
Law, (ii) has become subject to any Environmental Liability, (iii) has received
written 



 55
 









notice of any claim with respect to any Environmental Liability or (iv)
knows of any facts or circumstances which are reasonably likely to form the
basis for any Environmental Liability.


SECTION  3.07.  Compliance with Laws.  Each of Holdings, the Borrower and their
Subsidiaries is in compliance with all laws, regulations and orders of any
Governmental Authority (including the Communications Act, the regulations of
HPUC, and any orders of the FCC or HPUC) applicable to it or its property,
except where the failure to do so, individually or in the aggregate, would not
reasonably be expected to result in a Material Adverse Effect.


SECTION  3.08.  Licenses; Tariffs.  (a)  The
Borrower and its Subsidiaries hold all FCC Licenses that are necessary for the
operation of their businesses as currently conducted, except to the extent that
failures to hold any such FCC Licenses, individually or in the aggregate, would
not reasonably be expected to result in a Material Adverse Effect. Each such
FCC License is in full force and effect and such FCC Licenses are not subject
to any material restriction or material conditions that limit the operation of
the businesses of the Borrower and its Subsidiaries, other than restrictions or
conditions generally applicable to licenses of that type.


(b)           Holdings,
the Borrower and the Subsidiaries hold all permits, licenses, waivers, orders,
approvals, concessions, registrations and other authorizations issued or
provided by any Governmental Authority (other than the FCC), including HPUC,
under all applicable laws, that are material to and necessary for Holdings, the
Borrower and each of the Subsidiaries to own its assets and conduct the
businesses currently conducted by it (“Operating Licenses”), except to
the extent that failures to hold any such Operating Licenses, individually or
in the aggregate, would not reasonably be expected to result in a Material
Adverse Effect.


(c)           HPUC
or such other Governmental Authority having jurisdiction thereof has approved
all material regulatory tariffs required to permit each of the Borrower and the
Subsidiaries to operate its businesses as currently operated, all such
regulatory tariffs are in full force and effect and neither the Borrower nor
any Subsidiary has failed to comply with the terms of any such tariff, except
in each case any lack of approvals or failures which, individually or in the
aggregate, would not reasonably be expected to have a Material Adverse Effect.


(d)           Neither
Holdings nor the Borrower has knowledge of any investigation, notice of
apparent liability, violation, forfeiture or other order or complaint issued by
or before the FCC or HPUC, or of any other proceedings (other than proceedings
relating to the telecommunications industries generally) of or before the FCC
or HPUC, which would reasonably be expected to have a Material Adverse Effect.


(e)           To
the best knowledge of Holdings and the Borrower, no event has occurred which
(i) has resulted in, or after notice or lapse of time or both would result in,
revocation, suspension, adverse modification, non-renewal, impairment,
restriction or termination of, or order of forfeiture with respect to, any FCC
License or Operating License in any respect which could reasonably be expected
to have a Material Adverse Effect or (ii) affects or could reasonably be
expected in the future to affect any of the rights of Holdings, the Borrower or
any Subsidiary under any FCC License or Operating License held by it in any
respect which would reasonably be expected to have a Material Adverse Effect.


(f)            Each
of Holdings, the Borrower and the Subsidiaries has duly filed in a timely
manner all material filings, reports, applications, documents, instruments and
information required to be filed by it under the Communications Act, and all
such filings were when made true, correct and complete in all material
respects.  Holdings and the Borrower have
no reason to believe that any material FCC 



 56
 









License or Operating License held by the Borrower or any Subsidiary
will not be renewed in the ordinary course.


SECTION  3.09.  Investment Company Status.  None of Holdings, the Borrower or any of its
Subsidiaries is an “investment company” as defined in, or subject to regulation
under, the Investment Company Act of 1940.


SECTION  3.10.  Taxes.  Each of Holdings, the Borrower and its
Subsidiaries has timely filed or caused to be filed all material Tax returns
and reports required to have been filed and has paid or caused to be paid all material
Taxes required to have been paid by it, except any Taxes that are being
contested in good faith by appropriate proceedings and for which Holdings, the
Borrower or such Subsidiary, as applicable, has set aside on its books adequate
reserves.


SECTION  3.11.  ERISA; Margin Regulations.  (a)  During
the five year period prior to the date on which this representation is made or
deemed to be made with respect to any Plan or Multiemployer Plan, no ERISA
Event has occurred or is reasonably expected to occur that, when taken together
with all other such ERISA Events for which liability has occurred during such
five year period or for which liability is reasonably expected to occur, could
reasonably be expected to result in a Material Adverse Effect. The present
value of all accumulated benefit obligations under each Plan (based on the
assumptions used for purposes of Statement of Financial Accounting Standards
No. 87) did not, as of the date of the most recent financial statements
reflecting such amounts, exceed the fair market value of the assets of such
Plan by an amount that would reasonably be expected to have a Material Adverse
Effect, and the present value of all accumulated benefit obligations of all
underfunded Plans (based on the assumptions used for purposes of Statement of
Financial Accounting Standards No. 87) did not, as of the date of the most
recent financial statements reflecting such amounts, exceed the fair market
value of the assets of all such underfunded Plans by an amount that would
reasonably be expected to have a Material Adverse Effect.


(b)           None
of Holdings, the Borrower or any of its Subsidiaries is engaged principally, or
as one of its important activities, in the business of extending credit for the
purpose of buying or carrying Margin Stock. No part of the proceeds of any Loan
or any Letter of Credit will be used, whether directly or indirectly, and
whether immediately, incidentally or ultimately, in any manner that would
entail a violation of the regulations of the Board, including Regulation T, U
or X.


SECTION  3.12.  Disclosure.  Neither the Information Memorandum nor any of
the other written reports, financial statements, public filings, certificates
or other written information, taken as a whole, furnished by or on behalf of
any Loan Party to the Administrative Agent or any Lender in connection with the
negotiation of this Agreement or any other Loan Document or delivered hereunder
or thereunder (as of the date thereof and as modified or supplemented by other
information so furnished) contains any material misstatement of fact or omits
to state any material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading; provided
that, with respect to information of a general economic nature, estimates and
projected financial information, Holdings and the Borrower represent only that
such information was prepared in good faith based upon assumptions believed to
be reasonable (i) at the time such projected financial information was prepared,
(ii) on the date of the Information Memorandum and (iii) as of the date hereof
(it being understood that actual results may vary materially from such
projected financial information).


SECTION  3.13.  Subsidiaries.  Schedule 3.13 sets forth (i) the name of, and
the ownership interest of Holdings in, each subsidiary of Holdings and
identifies each subsidiary that is a Subsidiary Loan Party, in each case as of
the Effective Date, and (ii) the name of, and the ownership 



 57
 









interest of the Borrower in, each Subsidiary of the Borrower and
identifies each Subsidiary that is a Subsidiary Loan Party, in each case as of
the Effective Date.


SECTION  3.14.  Insurance.  Schedule 3.14 sets forth a description of all
material insurance maintained by or on behalf of Holdings, the Borrower and its
Subsidiaries as of the Effective Date. 
As of the Effective Date, all premiums due and payable in respect of
such insurance have been paid.  Holdings
and the Borrower believe that the insurance maintained by or on behalf of Holdings,
the Borrower and its Subsidiaries is adequate.


SECTION  3.15.  Labor Matters.  Except as could not, individually or in the
aggregate, reasonably be expected to result in a Material Adverse Effect:  (a) as of the Effective Date, there are no
strikes, lockouts or slowdowns against Holdings, the Borrower or any Subsidiary
pending or, to the knowledge of Holdings or the Borrower, threatened; (b) the
hours worked by and payments made to employees of Holdings, the Borrower and
the Subsidiaries have not been in violation of the Fair Labor Standards Act or
any other applicable Federal, state, local or foreign law dealing with such
matters; (c) all payments due from Holdings, the Borrower or any Subsidiary, or
for which any claim may be made against Holdings, the Borrower or any
Subsidiary, on account of wages and employee health and welfare insurance and
other benefits, have been paid or accrued as a liability on the books of
Holdings, the Borrower or such Subsidiary; and (d) the consummation of the
Transactions will not give rise to any right of termination or right of
renegotiation on the part of any union under any collective bargaining
agreement to which Holdings, the Borrower or any Subsidiary is bound.


SECTION  3.16.  Solvency.  Immediately after the consummation of the
Transactions to occur on the Effective Date (a) the fair value of the assets of
the Borrower (individually) and Holdings, the Borrower and its subsidiaries on
a consolidated basis, at a fair valuation, will exceed the debts and
liabilities, subordinated, contingent or otherwise, respectively, of the
Borrower (individually) and Holdings, the Borrower and its subsidiaries on a
consolidated basis; (b) the present fair saleable value of the property of the
Borrower (individually) and Holdings, the Borrower and its subsidiaries on a
consolidated basis will be greater than the amount that will be required to pay
the probable liability of the debts and other liabilities, subordinated,
contingent or otherwise, of the Borrower (individually) and Holdings, the
Borrower and its subsidiaries on a consolidated basis as such debts and other
liabilities become absolute and matured; (c) the Borrower (individually) and
Holdings, the Borrower and its subsidiaries on a consolidated basis will be
able to pay the debts and liabilities, subordinated, contingent or otherwise,
respectively, of the Borrower (individually) and Holdings, the Borrower and its
subsidiaries on a consolidated basis, as such debts and liabilities become
absolute and matured; and (d) the Borrower (individually) and Holdings, the
Borrower and its subsidiaries on a consolidated basis will not have
unreasonably small capital with which to conduct the businesses in which they
are engaged as such businesses are now conducted and are proposed to be conducted
following the Effective Date.


SECTION  3.17.  Senior Indebtedness.  The Obligations constitute “Senior
Indebtedness” under and as defined in the Senior Subordinated Debt Documents.


SECTION  3.18.  [Reserved].


SECTION  3.19.  Security Documents.  (a)  The
Collateral Agreement is effective to create in favor of the Collateral Agent,
for the benefit of the respective Secured Parties, a legal, valid and
enforceable security interest in the Collateral described therein and proceeds
thereof.  In the case of the Pledged
Stock (as defined in the Collateral Agreement), when stock certificates
representing such Pledged Stock are delivered to the Collateral Agent, and in
the case of the other Collateral described in the Collateral Agreement (other
than the Intellectual Property, as defined in the Collateral Agreement), when



 58
 









financing statements and other filings specified on Schedule 5 of the
Perfection Certificate in appropriate form are filed in the offices specified
on Schedule 6 of the Perfection Certificate (as updated by the Borrower from
time to time in accordance with Section 5.03), the Collateral Agent shall have
a fully perfected Lien on, and security interest in, all right, title and
interest of the Loan Parties in the Collateral and the proceeds thereof, as
security for the Obligations, to the extent perfection can be obtained by
filing Uniform Commercial Code financing statements, in each case prior and
superior in right to any other Person (except, in the case of Collateral other
than the Pledged Stock, Liens permitted by Section 6.02(a) and, in the case of
the Pledged Stock, inchoate Liens arising by operation of law and permitted by
Section 6.02(a)).


(b)           When
the Collateral Agreement or a summary thereof is properly filed in the United
States Patent and Trademark Office and the United States Copyright Office, and,
with respect to Collateral in which a security interest cannot be perfected by
such filings, upon the proper filing of the financing statements referred to in
paragraph (a) above, the Collateral Agreement and such financing statements
shall constitute a fully perfected Lien on, and security interest in, all
right, title and interest of the grantors thereunder in the Intellectual
Property (as defined in the Collateral Agreement), in each case prior and
superior in right to any other Person (it being understood that subsequent
recordings in the United States Patent and Trademark Office and the United
States Copyright Office may be necessary to perfect a lien on registered
trademarks and patents, trademark and patent applications and registered
copyrights acquired by the grantors after the date hereof).


(c)           The
Mortgages entered into on the Effective Date are, and the Mortgages, if any,
entered into after the Effective Date pursuant to Section 5.12 shall be,
effective to create in favor of the Collateral Agent, for the ratable benefit
of the applicable Secured Parties, a legal, valid and enforceable Lien on all
of the Loan Parties’ right, title and interest in and to the Mortgaged Property
thereunder and the proceeds thereof, and when such Mortgages are filed in the
proper real estate filing offices, such Mortgages shall constitute a fully
perfected Lien on, and security interest in, all right, title and interest of
Loan Parties in such Mortgaged Property and the proceeds thereof, in each case
prior and superior in right to any other Person, other than with respect to the
rights of Person pursuant to Liens expressly permitted by Section 6.02(a).


ARTICLE IV



Conditions


SECTION  4.01.  Effective Date.  The effectiveness of this Agreement and the
amendment and restatement of the Existing Credit Agreement, and the obligations
of the Lenders to make the Tranche C Term Loans hereunder shall not become
effective until the date on which each of the following conditions is satisfied
(or waived in accordance with Section 9.02):


(a)           The Administrative Agent (or its counsel) shall have
received (i) from Holdings and the Borrower either (A) a counterpart of this
Agreement signed on behalf of such party or (B) written evidence satisfactory
to the Administrative Agent (which may include telecopy or electronic
transmission of a signed signature page of this Agreement) that such party has
signed a counterpart of this Agreement and (ii) as applicable, (x) fully
executed Lender Addenda from the Required Lenders, (y) a fully executed Lender
Addendum with respect to each such bank or other financial institution
committing to fund the Tranche C Term Loans (and pursuant to which, on the
Effective Date, such bank or other financial institution shall become a Tranche
C Lender, for all purposes under this Agreement) or (z) a fully executed
Conversion Notice with respect to each Lender (each a “Continuing Lender”) of
Tranche A Term Loans or Tranche B Term Loans 



 59
 









electing to convert such Trance A Term Loans or
Tranche B Term Loans into Tranche C Term Loans (and pursuant to which, on the
Effective Date the identified portion of the outstanding principal amount of
such Tranche A Term Loans or Tranche B Term Loans held by such Lender shall
convert into Tranche C Term Loans); it being agreed and understood that
delivery of a fully executed Conversion Notice by a Continuing Lender shall be
deemed to constitue an authorization by such Continuing Lender directing the
Administrative Agent to execute this Agreement. 
Each Continuing Lender, having delivered its Conversion Notice, and each
new Tranche C Lender, having delivered its Lender Addendum, and in each case
having funded a Tranche C Term Loan on the Effective Date (including by means of
conversion), has acknowledged receipt of, and consented to and approved, each
Loan Document and each other document required to be approved by any Agent,
Required Lenders or Lenders, as applicable on the Effective Date.


(b)           The Arrangers shall have received (i) audited consolidated
financial statements of the Borrower and its Subsidiaries for the 2004, 2005 and
2006 fiscal years and (ii) unaudited interim consolidated financial statements
of the Borrower and its Subsidiaries for each fiscal month and quarterly period
ended more than 45 days prior to the Effective Date as to which such financial
statements are available (and for the comparable period of the preceding fiscal
year).


(c)           The Administrative Agent shall have received favorable
written opinions (addressed to the Administrative Agent and the Lenders and
dated the Effective Date) of (i) Latham & Watkins LLP, counsel for the
Borrower, substantially in the form of Exhibit B-1, (ii) Latham & Watkins
LLP, FCC regulatory counsel for the Borrower, substantially in the form of
Exhibit B-2, (iii) Morihara Lau & Fong LLP, Hawaiian regulatory counsel for
the Borrower, substantially in the form of Exhibit B-3 and (iv) Morihara Lau
& Fong LLP, local Hawaiian counsel for the Borrower, substantially in the
form of Exhibit B-4.


(d)           The Administrative Agent shall have received such
documents and certificates as the Administrative Agent or its counsel may
reasonably request relating to the organization, existence and good standing of
each Loan Party, the authorization of the Transactions and any other legal
matters relating to the Loan Parties, the Loan Documents or the Transactions,
all in form and substance reasonably satisfactory to the Administrative Agent.


(e)           The Administrative Agent shall have received a certificate,
dated the Effective Date and signed by an executive officer or a Financial
Officer of the Borrower on behalf of the Borrower, confirming compliance with
the conditions set forth in paragraphs (a) and (b) of Section 4.02.


(f)            The Administrative Agent shall have received all fees and
other amounts due and payable on or prior to the Effective Date, including
without limitation all amounts due and payable pursuant to the Fee Letter, and
also including, to the extent invoiced, reimbursement or payment of all
reasonable documented out-of-pocket expenses (including reasonable fees,
charges and disbursements of counsel) required to be reimbursed or paid by any
Loan Party hereunder or under any other Loan Document.


(g)           The Collateral and Guarantee Requirement shall have been
satisfied (except as specifically provided pursuant to clause (e) of the
definition thereof) and the Administrative Agent shall have received a
completed Perfection Certificate dated the Effective Date and signed by an
executive officer or Financial Officer of the Borrower, together with all
attachments contemplated thereby, including the results of a search of the
Uniform Commercial Code (or 



 60
 









equivalent) filings made with respect to the Loan
Parties in the jurisdictions contemplated by the Perfection Certificate and
copies of the financing statements (or similar documents) disclosed by such
search and evidence reasonably satisfactory to the Administrative Agent that
the Liens indicated by such financing statements (or similar documents) are permitted
by Section 6.02 or have been released.


(h)           The Administrative Agent shall have received evidence that
the insurance required by Section 5.07 and the Security Documents is in effect.


(i)            [Reserved].


(j)            [Reserved]


(k)           [Reserved]


(l)            The Transactions shall have been consummated or shall be
consummated simultaneously with the initial funding of the Tranche C Term Loans
on the Effective Date.


(m)          The Administrative Agent shall have received a certificate
from an executive officer or a Financial Officer of the Borrower on behalf of
the Borrower, in form and substance reasonably satisfactory to the
Administrative Agent, with respect to the solvency of the Loan Parties on a
consolidated basis on the Effective Date after giving effect to the
Transactions.


(n)           [Reserved].


(o)           All consents and approvals required to be obtained from
any Governmental Authority (including but not limited to state public utility
commissions) in connection with the Transactions shall have been obtained to
the extent such consents or approvals are required under applicable laws or
agreements or otherwise, and all applicable regulatory appeal periods shall
have expired. The Administrative Agent shall have received a certificate of an
executive officer or a Financial Officer of the Borrower on behalf of the
Borrower, certifying on behalf of the Borrower that there is no claim, action
or proceeding pending or, to the knowledge of the Borrower, threatened, by any
Governmental Authority to enjoin, restrain, prohibit or impose materially burdensome
conditions on the Transactions.


(p)           The Lenders shall have received such documentation and
other information as required by regulatory authorities under applicable “know
your customer” and anti-money-laundering rules and regulations, including, without
limitation, the Patriot Act.


The
Administrative Agent shall notify the Borrower and the Lenders of the Effective
Date, and such notice shall be conclusive and binding.


SECTION  4.02.  Each Credit Event.  The obligation of each Lender to make a Loan on
any date, and of each Issuing Bank to issue, increase, renew or extend any
Letter of Credit on any date, is subject to receipt of the request therefor in
accordance herewith and to the satisfaction of the following conditions:


(a)           The representations and warranties of each Loan Party set
forth in the Loan Documents shall be true and correct in all material respects
on and as of the date such Loan is made or the date of issuance, increase,
renewal or extension of such Letter of Credit, as 



 61
 









applicable, except to the extent such
representations and warranties expressly relate to an earlier date (in which
case such representations and warranties shall be true and correct in all
material respects on and as of such earlier date).


(b)           At the time of and immediately after giving effect to such
Borrowing or the issuance, increase, renewal or extension of such Letter of
Credit, as applicable, no Default shall have occurred and be continuing.


Each
funding of Loans and each issuance, increase, renewal or extension of a Letter
of Credit shall be deemed to constitute a representation and warranty by
Holdings and the Borrower on the date thereof as to the matters specified in
paragraphs (a) and (b) of this Section.


ARTICLE V


Affirmative Covenants


Until
the Commitments have expired or been terminated and the principal of and
interest on each Loan and all fees payable hereunder shall have been paid in
full and all Letters of Credit shall have expired or terminated, or been cash
collateralized or backstopped in a manner reasonably acceptable to the
Administrative Agent, and all LC Disbursements shall have been reimbursed, each
of Holdings and the Borrower covenants and agrees with the Lenders that:


SECTION  5.01.  Financial Statements and Other Information.
 The Borrower will furnish to the
Administrative Agent:


(a)           no later than the earlier of (i) 10 days after the date
that the Borrower is or would be required to file a report on Form 10-K with
the Securities and Exchange Commission in compliance with the reporting
requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as
amended (whether or not the Borrower is subject to such reporting
requirements), and (ii) 100 days after the end of each fiscal year of the
Borrower, the Borrower’s audited consolidated balance sheet and related
statements of operations, stockholders’ equity and cash flows as of the end of
and for such year, setting forth in each case in comparative form the figures
for the previous fiscal year, all reported on by Deloitte & Touche LLP or
another independent registered public accounting firm of recognized national
standing (without a “going concern” or like qualification or exception and
without any qualification or exception as to the scope of such audit) to the
effect that such consolidated financial statements present fairly in all
material respects the financial condition and results of operations of the
Borrower and its consolidated Subsidiaries on a consolidated basis in
accordance with GAAP consistently applied;


(b)           no later than the earlier of (i) 10 days after the date
that the Borrower is or would be required to file a report on Form 10-Q with
the Securities and Exchange Commission in compliance with the reporting
requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as
amended (whether or not the Borrower is subject to such reporting
requirements), and (ii) 55 days after the end of each of the first three fiscal
quarters of each fiscal year of the Borrower, the Borrower’s unaudited
consolidated balance sheet and related statements of operations, stockholders’
equity and cash flows as of the end of and for such fiscal quarter and the then
elapsed portion of the fiscal year, setting forth in each case in comparative
form the figures for the corresponding period or periods of (or, in the case of
the balance sheet, as of the end of) the previous fiscal year, all certified by
a Financial Officer as presenting fairly in all material respects the financial
condition and results of operations of the Borrower and its Subsidiaries on a 



 62
 









consolidated basis in accordance with GAAP
consistently applied, subject to normal year-end audit adjustments and the
absence of footnotes;


(c)           promptly upon request by any Lender, a statement,
certified by a Financial Officer, setting forth the number of residential and
business access lines of the Borrower and its Subsidiaries as of the end of
such fiscal quarter;


(d)           concurrently with any delivery of financial statements
under clause (a) or (b) above, a certificate of the Borrower signed by a
Financial Officer of the Borrower (i) certifying as to whether a Default has
occurred and, if a Default has occurred, specifying the details thereof and any
action taken or proposed to be taken with respect thereto, (ii) setting forth
reasonably detailed calculations demonstrating compliance with the Financial
Covenant, (iii) stating whether any change in GAAP or in the application
thereof that is applicable to the Borrower’s financial statements has occurred
since the date of the audited financial statements referred to in Section 3.04
and, if any such change has occurred, specifying the effect of such change on
the financial statements accompanying such certificate, (iv) identifying any
Subsidiary formed or acquired since the end of the previous fiscal quarter, (v)
identifying any parcels of owned real property or improvements thereto with a
value exceeding $2,000,000 that have been acquired by any Loan Party since the
end of the previous fiscal quarter, (vi) identifying any changes of the type
described in Section 5.03(a) that have not been previously reported by the
Borrower, (vii) identifying any Permitted Acquisition or other acquisitions of
going concerns that have been consummated since the end of the previous fiscal
quarter, including the date on which each such acquisition was consummated and
the consideration therefor and (viii) identifying any material Intellectual
Property (as defined in the Collateral Agreement) with respect to which a
notice is required to be delivered under the Collateral Agreement and has not
been previously delivered;


(e)           concurrently with any delivery of financial statements
under clause (a) above, a certificate of the accounting firm that reported on
such financial statements stating whether they obtained knowledge during the
course of their examination of such financial statements of any Default (which
certificate may be limited to the extent required by accounting rules,
guidelines or practice) provided that the Borrower shall not be required
to deliver such a certificate if, after using commercially reasonable efforts,
the Borrower is unable to obtain such a certificate;


(f)            within 90 days after the commencement of each fiscal year
of the Borrower, a detailed consolidated budget for such fiscal year (broken
down by quarter and including (i) a projected consolidated balance sheet and
related statements of projected operations and cash flow as of the end of and
for such fiscal year and setting forth the assumptions used for purposes of
preparing such budget and (ii) other information reasonably requested by the
Administrative Agent and reasonably available to the Borrower) and, promptly
when available, any material revisions of such budget;


(g)           promptly after the same become publicly available, copies
of all periodic and current reports, proxy statements and registration
statements filed by Holdings, the Borrower or any Subsidiary with the
Securities and Exchange Commission, or any Governmental Authority succeeding to
any or all of the functions of said Commission, or with any national securities
exchange, or in the event Holdings becomes a publicly traded company,
distributed by Holdings to its shareholders generally; and


(h)           promptly following any request therefor, such other
information regarding the operations, business affairs and financial condition
of Holdings, the Borrower or any Subsidiary, 



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or compliance with the terms of any Loan Document,
as the Administrative Agent (including on behalf of any Lender) may reasonably
request.


Notwithstanding the
requirements of Sections 5.01(a) and 5.01(b), if Parent, Holdings or the
Borrower is a public reporting company under the Securities Exchange Act of
1934, as amended, the Borrower may, in lieu of the financial reports required
pursuant to Sections 5.01(a) and 5.01(b), furnish only the quarterly and annual
reports filed with the SEC and referenced in 
Section 5.01(g).


SECTION  5.02.  Notices of Material Events.  The Borrower will furnish to the
Administrative Agent written notice of the following promptly after any
Financial Officer or executive officer of the Borrower obtains actual knowledge
thereof:


(a)           the occurrence of any Default;


(b)           the filing or commencement of any action, suit or
proceeding by or before any arbitrator or Governmental Authority (including the
FCC or HPUC) against or affecting Holdings, the Borrower or any Subsidiary
thereof that involves a reasonable possibility of an adverse determination and
which, if adversely determined, would reasonably be expected to result in a
Material Adverse Effect;


(c)           the occurrence of any ERISA Event that, alone or together
with any other ERISA Events that have occurred, would reasonably be expected to
result in a Material Adverse Effect; and


(d)           any other development that results in, or would reasonably
be expected to result in, a Material Adverse Effect.


Each
notice delivered under this Section shall be accompanied by a statement of a
Financial Officer or other executive officer of the Borrower setting forth the
details of the event or development requiring such notice and any action taken
or proposed to be taken with respect thereto.


SECTION  5.03.  Information Regarding Collateral.  (a)  The
Borrower will furnish to the Administrative Agent prompt written notice of any
change (i) in any Loan Party’s legal name, as reflected in its organization
documents, (ii) in any Loan Party’s jurisdiction of organization or corporate
structure and (iii) in any Loan Party’s identity, Federal Taxpayer
Identification Number or organization number, if any, assigned by the
jurisdiction of its organization.  The
Borrower agrees not to effect or permit any change referred to in clauses (i)
through (iii) of the preceding sentence unless all filings have been made, or
will have been made within any statutory period, under the Uniform Commercial Code
or otherwise that are required in order for the Agent to continue at all times
following such change to have a valid, legal and perfected security interest in
all the Collateral for the benefit of the Secured Parties.  The Borrower also agrees promptly to notify
the Administrative Agent if any damage to or destruction of Collateral that is
uninsured and has a fair market value exceeding $1,000,000 occurs.


(b)           Upon
the request of the Administrative Agent, the Borrower shall promptly deliver to
the Administrative Agent an updated Perfection Certificate certified by a
Financial Officer of the Borrower reflecting all changes since the date of the
Perfection Certificate delivered on the Effective Date or the date of the most
recent certificate delivered pursuant to this Section.


SECTION  5.04.  Existence;
Conduct of Business.  Each of
Holdings and the Borrower will, and the Borrower will cause each of its
Subsidiaries to, do or cause to be done all things necessary to



 64














preserve, renew and keep in full force and effect its legal existence
and the rights, contracts, FCC Licenses, Operating Licenses, other licenses,
permits, privileges, franchises, patents, copyrights, trademarks and trade
names, except to the extent that the failure to do so (other than in the case
of maintaining the Borrower’s existence) would not reasonably be expected to
result in a Material Adverse Effect; provided that the foregoing shall
not prohibit any merger, consolidation, liquidation or dissolution permitted
under Section 6.03 or any sale of assets permitted under Section 6.05; and provided,
further, that Holdings or the Borrower may consummate any entity
reorganization necessary for the purposes of effecting a Qualified IPO.


SECTION  5.05.  Payment of Taxes.  The Borrower will, and will cause each of its
Subsidiaries to, pay its material Tax liabilities, before the same shall become
delinquent or in default, except where (a) the validity or amount thereof is
being contested in good faith by appropriate proceedings and (b) the Borrower
or such Subsidiary has set aside on its books adequate reserves with respect
thereto in accordance with GAAP.


SECTION  5.06.  Maintenance of Properties.  Except as would not reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect, the
Borrower will, and will cause each of its Subsidiaries to, keep and maintain
all property in good working order and condition, ordinary wear and tear
excepted.


SECTION  5.07.  Insurance.  The Borrower will, and will cause each of its
Subsidiaries to, maintain, with financially sound and reputable insurance
companies (a) insurance in such amounts and against such risks as are
customarily maintained by companies of established repute engaged in the same or
similar businesses operating in the same or similar locations and (b) all
insurance required to be maintained pursuant to the Security Documents.  The Borrower will furnish to the Lenders,
upon the reasonable request of the Administrative Agent, information in
reasonable detail as to the insurance so maintained.


SECTION  5.08.  Books and Records; Inspection and Audit
Rights.  The Borrower will, and will
cause each of its Subsidiaries to, keep books of record and account in
accordance with GAAP. The Borrower will, and will cause each of its
Subsidiaries to, permit any representatives designated by the Administrative
Agent or any Lender, upon reasonable prior notice, to visit and inspect its
properties, to examine and make extracts from its books and records, and to
discuss its affairs, finances and condition with its officers and independent
accountants, all at such reasonable times and as often as reasonably requested
(subject to confidentiality requirements imposed by law or agreements); provided
that unless an Event of Default shall have occurred and be continuing, visits
by Lenders will be made jointly and not more often than once each fiscal year.


SECTION  5.09.  Compliance with Laws.  The Borrower will, and will cause each of its
Subsidiaries to, comply with all laws, rules, regulations, including the
Communications Act, HPUC regulations, other communications laws and
Environmental Laws, and orders of any Governmental Authority applicable to it,
its operations or its property, except where the failure to do so, individually
or in the aggregate, would not reasonably be expected to result in a Material
Adverse Effect.


SECTION  5.10.  Use of Proceeds and Letters of Credit.
 The proceeds of the Tranche C Term Loans
borrowed on the Effective Date will be used only for (a) the completion of the Replacement
and (b) the payment of fees, commissions and expenses payable in connection
with the Transactions.  The proceeds of
the Revolving Loans and Swingline Loans borrowed on or after the Effective Date
will be used only for working capital and other general corporate purposes of
the Borrower and its Subsidiaries, including but not limited to Permitted
Acquisitions and Investments.  No part of
the proceeds of any Loan 



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will be used, whether directly or indirectly, for any purpose that
entails a violation of any of the Regulations of the Board, including
Regulations U and X.  Letters of Credit
will be issued only to support obligations of the Borrower and its Subsidiaries
incurred for general corporate purposes.


SECTION  5.11.  Additional Subsidiaries.  If any additional Subsidiary is formed or
acquired after the Effective Date (if it is a Subsidiary Loan Party), the
Borrower will, within five Business Days after such Subsidiary is formed or
acquired, notify the Administrative Agent thereof and, within 20 Business Days
after such Subsidiary is formed or acquired or such longer period as the
Administrative Agent shall agree, cause the Collateral and Guarantee
Requirement to be satisfied with respect to such Subsidiary and with respect to
any Equity Interest in or Indebtedness of such Subsidiary owned by or on behalf
of any Loan Party.


SECTION  5.12.  Further Assurances.  (a)  Each
of Holdings and the Borrower will, and the Borrower will cause each Subsidiary
Loan Party to, execute any and all further documents, financing statements,
agreements and instruments, and take all such further actions (including the
filing and recording of financing statements, fixture filings, Mortgages and
other documents), that may be required under any applicable law, or that the
Administrative Agent or the Required Lenders may reasonably request, to cause
the Collateral and Guarantee Requirement to be and remain satisfied, all at the
expense of the Loan Parties.  Holdings
and the Borrower also agree to provide to the Administrative Agent, from time
to time upon reasonable request, evidence reasonably satisfactory to the
Administrative Agent as to the perfection and priority of the Liens created or
intended to be created by the Security Documents.


(b)           If
any material asset (including any real property or improvements thereto or any
interest therein) that has an individual fair market value of more than
$2,000,000 is acquired by the Borrower or any Subsidiary Loan Party after the
Effective Date or owned by an entity at the time it becomes a Subsidiary Loan
Party (in each case other than assets constituting Collateral under the
Collateral Agreement that become subject to the Lien of the Collateral
Agreement upon acquisition thereof), the Borrower will notify the
Administrative Agent thereof, and, if requested by the Administrative Agent or
the Required Lenders, the Borrower will cause such asset to be subjected to a
Lien securing the Obligations and will take, and cause the Subsidiary Loan
Parties to take, such actions as shall be necessary or reasonably requested by
the Administrative Agent to grant and perfect such Liens, including actions
described in paragraph (a) of this Section, all at the expense of the Loan
Parties.


(c)           The
Collateral and Guarantee Requirement and the other provisions of this Section
5.12 need not be satisfied with respect to (i) real properties owned by the
Borrower or any Subsidiary with an individual fair market value (including
fixtures and improvements) that is less than $1,000,000 in the case of such
properties owned on the Effective Date and $2,000,000 in the case of properties
acquired after the Effective Date, (ii) any real property held by the Borrower
or any Subsidiary as a lessee under a lease, (iii) any Equity Interests
acquired after the Effective Date in accordance with this Agreement if, and to
the extent that, and for so long as (A) doing so would violate applicable law
or a contractual obligation binding on such Equity Interests and (B) such law
or obligation existed at the time of the acquisition thereof and was not
created or made binding on such Equity Interests in contemplation of or in
connection with the acquisition of such Subsidiary, (iv) any assets acquired
after the Effective Date, to the extent that, and for so long as, taking such
actions would violate a contractual obligation (it being understood that a
Uniform Commercial Code filing does not in and of itself constitute a
contractual obligation) binding on such assets that existed at the time of the
acquisition thereof and was not created or made binding on such assets in
contemplation or in connection with the acquisition of such assets (except in
the case of assets acquired with Indebtedness permitted pursuant to Section
6.01(a)(vii) that is secured by a Lien permitted pursuant to Section
6.02(a)(v)); provided that, upon the reasonable request of the
Administrative Agent, the Borrower shall, and shall cause any applicable
Subsidiary to, use commercially 



 66
 








reasonable efforts to have waived or eliminated any contractual
obligation of the types described in clauses (iii) and (iv) above and (v) other
assets with respect to which the Administrative Agent reasonably determines
after request by the Borrower that the cost or impracticability of including
such assets as Collateral would be excessive in relation to the benefits to the
Secured Parties.


SECTION  5.13.  Designation of Unrestricted Subsidiaries.
 The Borrower’s board of directors may,
at any time, designate (A) the Directories Sale Subsidiary or (B) any other
Subsidiary that is acquired or created after the Effective Date as an
Unrestricted Subsidiary by written notice to the Administrative Agent; provided
that, in addition to those Subsidiaries previously designated as “Unrestricted
Subsidiaries” by the Borrower pursuant to the Existing Credit Agreement and set
forth on Schedule 5.13, the Borrower shall only be permitted to so designate a
new Unrestricted Subsidiary after the Effective Date and so long as (a) no
Default or Event of Default exists or would result therefrom, (b) such
Subsidiary does not own any capital stock or Indebtedness of, or own or hold a
Lien on any property of, the Borrower or any other Subsidiary that is not a
subsidiary of the Subsidiary to be so designated and (c) such Unrestricted
Subsidiary shall be capitalized (to the extent capitalized by the Borrower or
any of its Subsidiaries) through Investments permitted by, and in compliance
with, Section 6.04(l) or (v), with any assets owned by such Unrestricted
Subsidiary at the time of the initial designation thereof to be treated as
Investments pursuant to Section 6.04(l) or (v); provided that at the time of
the initial Investment by the Borrower or any of its Subsidiaries in such
Subsidiary, the Borrower shall designate such entity as an Unrestricted
Subsidiary in a written notice to the Administrative Agent. The Borrower may
designate any Unrestricted Subsidiary to be a Subsidiary for purposes of this
Agreement (each, a “Subsidiary Redesignation”); provided that (i) such
Unrestricted Subsidiary, both before and after giving effect to such
designation, shall be a wholly owned Subsidiary of the Borrower, (ii) no
Default or Event of Default then exists or would occur as a consequence of any
such Subsidiary Redesignation, (iii) calculations are made by the Borrower of
Pro Forma Compliance with the Financial Covenant, if applicable at such time,
for the relevant period, as if the respective Subsidiary Redesignation (as well
as all other Subsidiary Redesignations theretofore consummated after the first
day of such period) had occurred on the first day of such period, and such
calculations shall show that such Financial Covenant would have been complied
with if the Subsidiary Redesignation had occurred on the first day of such
period (for this purpose, if the first day of the respective period occurs
prior to the Effective Date, calculated as if the Financial Covenant had been
applicable from the first day of such period), (iv) based on good faith
projections prepared by the Borrower for the period from the date of the
respective Subsidiary Redesignation to the date that is one year thereafter,
the level of financial performance measured by the Financial Covenant shall be
better than or equal to such level as would be required to provide that no
Default or Event of Default would exist under the Financial Covenant through
the date that is one year from the date of the respective Subsidiary
Redesignation, (v) all representations and warranties contained herein and in
the other Loan Documents shall be true and correct in all material respects
with the same effect as though such representations and warranties had been
made on and as of the date of such Subsidiary Redesignation (both before and
after giving effect thereto), unless stated to relate to a specific earlier
date, in which case such representations and warranties shall be true and
correct in all material respects as of such earlier date, (vi) the Borrower
shall have delivered to the Administrative Agent an officer’s certificate
executed by a Financial Officer, certifying to the best of such officer’s
knowledge, compliance with the requirements of preceding clauses (i) through
(v), inclusive, and containing the calculations required by the preceding
clauses (iii) and (iv), and (vii) any Unrestricted Subsidiary subject to a
Subsidiary Redesignation may not thereafter be designated as an Unrestricted
Subsidiary.



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ARTICLE VI


Negative Covenants


Until
the Commitments have expired or terminated and the principal of and interest on
each Loan and all fees payable hereunder have been paid in full and all Letters
of Credit have expired or terminated, or been cash collateralized or
backstopped in a manner reasonably acceptable to the Administrative Agent, and
all LC Disbursements shall have been reimbursed, each of Holdings and the
Borrower covenants and agrees with the Lenders that:


SECTION  6.01.  Indebtedness; Certain Equity Securities.
 (a)  The Borrower will not, and will not permit any
Subsidiary to, create, incur, assume or permit to exist any Indebtedness or any
Attributable Debt, except:


(i)            Indebtedness created under the Loan Documents;


(ii)           the Senior Subordinated Debt, the Senior Unsecured Debt
and, in each case, Refinancing Indebtedness in respect thereof;


(iii)          [Reserved];


(iv)          Indebtedness existing on the date hereof and set forth in
Schedule 6.01 and Refinancing Indebtedness in respect thereof;


(v)           Indebtedness of the Borrower to any Subsidiary and of any
Subsidiary to the Borrower or any other Subsidiary; provided that (i)
any such Indebtedness owed by a Loan Party is subordinated to the Obligations
pursuant to the Affiliate Subordination Agreement and (ii) Indebtedness of any
Subsidiary that is not a Loan Party to the Borrower or any Subsidiary Loan
Party shall be subject to Section 6.04;


(vi)          Guarantees by the Borrower of Indebtedness of any
Subsidiary and by any Subsidiary of Indebtedness of any other Subsidiary; provided
that Guarantees by the Borrower or any Subsidiary Loan Party of Indebtedness of
any Subsidiary that is not a Loan Party shall be subject to Section 6.04;


(vii)         Indebtedness and Attributable Debt of the Borrower or any
Subsidiary incurred to finance the acquisition, construction or improvement of
any fixed or capital assets, including Capital Lease Obligations and any
Indebtedness assumed in connection with the acquisition of any such assets or
secured by a Lien on any such assets prior to the acquisition thereof, and
extensions, renewals, refinancings and replacements of any such Indebtedness
that do not increase the outstanding principal amount thereof (other than by an
amount not greater than fees and expenses, including premium and defeasance
costs, associated therewith) or result in a decreased average weighted life
thereof; provided that (1) such Indebtedness (but not Attributable Debt)
is incurred prior to or within 180 days after such acquisition or the
completion of such construction or improvement and (2) the aggregate principal
amount of Indebtedness and Attributable Debt permitted by this clause (vii)
shall not at any time exceed (x) the greater of $75,000,000 and 4% of
Consolidated Total Assets minus (y) the aggregate principal amount of
Indebtedness outstanding pursuant to Section 6.01(a)(viii);



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(viii)        Indebtedness of any Person that becomes
a Subsidiary after the date hereof; provided that (A) such acquired
Indebtedness exists at the time such Person becomes a Subsidiary and is not
created in contemplation of or in connection with such Person becoming a
Subsidiary (except to the extent such acquired Indebtedness refinanced other
Indebtedness to facilitate such entity becoming a Subsidiary) and (B) the
aggregate principal amount of Indebtedness permitted by this clause (viii)
shall not at any time exceed (x) the greater of $75,000,000 and 4% of
Consolidated Total Assets minus (y) the aggregate principal amount of
Indebtedness outstanding pursuant to Section 6.01(a)(vii);


(ix)           Indebtedness owed to (including obligations in respect of
letters of credit or bank guarantees or similar instruments for the benefit of)
any person providing workers’ compensation, health, disability or other
employee benefits or property, casualty or liability insurance to the Borrower
or any Subsidiary, pursuant to reimbursement or indemnification obligations to
such person, provided that upon the incurrence of Indebtedness with respect to
reimbursement obligations regarding workers’ compensation claims, such
obligations are reimbursed not later than 30 days following such incurrence;


(x)            Indebtedness arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument drawn against
insufficient funds in the ordinary course of business or other cash management
services in the ordinary course of business, provided that (i) such
Indebtedness (other than credit or purchase cards) is extinguished within ten
Business Days of its incurrence and (ii) such Indebtedness in respect of credit
or purchase cards is extinguished within 60 days from its incurrence;


(xi)           Indebtedness arising from agreements of the Borrower or any
Subsidiary providing for indemnification, adjustment of purchase or acquisition
price or similar obligations, in each case, incurred or assumed in connection
with the disposition of any business, assets or a Subsidiary permitted
hereunder, other than Guarantees of Indebtedness incurred by any person
acquiring all or any portion of such business, assets or a Subsidiary for the
purpose of financing such acquisition;


(xii)          Indebtedness of Foreign Subsidiaries in an aggregate amount
outstanding at any time not to exceed 2.0% of Consolidated Total Assets at such
time;


(xiii)         Third Party Interests issued by
Securitization Vehicles in Securitizations permitted by Section 6.05, and
Indebtedness represented by such Third Party Interests and Indebtedness
consisting of Standard Securitization Undertakings, provided that the aggregate
amount of such Third Party Interests shall not exceed $100,000,000 at any time
outstanding;


(xiv)        Indebtedness in respect of performance bonds, bid bonds,
appeal bonds, surety bonds, financial assurances and completion guarantees and
similar obligations, in each case provided in the ordinary course of business,
including those incurred to secure health, safety and environmental obligations
in the ordinary course of business;


(xv)         all premium (if any), interest (including post-petition
interest), fees, expenses, charges and additional or contingent interest on
obligations described in paragraphs (i) through (xiv) above and paragraph (xvi)
below;



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(xvi)        cash management obligations and other Indebtedness in respect
of netting services, overdraft protection and similar arrangements, in each
case, in connection with cash management and deposit accounts;


(xvii)       [Reserved];


(xviii)      [Reserved];


(xix)         unsecured Indebtedness of the Borrower or any of its
Subsidiaries so long as, on a Pro Forma Basis, the Total Leverage Ratio does
not exceed 6.00 to 1.00; and


(xx)          Indebtedness of the Borrower or any of its Subsidiaries so
long as, on a Pro Forma Basis, (i) the Net Secured Leverage Ratio does not
exceed 4.50 to 1.00 and (ii) the Total Leverage Ratio does not exceed 6.00 to
1.00.


(b)           The
Borrower will not, nor will it permit any Subsidiary to, issue any preferred
stock or other preferred Equity Interests, other than (i) Non-Cash Pay
Preferred Stock of the Borrower, issued to Holdings and pledged pursuant to the
Collateral Agreement, (ii) preferred stock or other preferred Equity Interests
of a Subsidiary, issued to a Loan Party and pledged pursuant to the Collateral
Agreement and (iii) Third Party Interests issued by Securitization Vehicles.


SECTION  6.02.  Liens.  (a)  The
Borrower will not, and will not permit any Subsidiary to, create, incur, assume
or permit to exist any Lien on any property or asset now owned or hereafter
acquired by it, or assign or sell any income or revenues (including accounts
receivable) or rights in respect of any thereof, except:


(i)            Liens created under the Loan Documents;


(ii)           Permitted Encumbrances;


(iii)          any Lien existing on the date hereof and set forth in
Schedule 6.02 on any property or asset of the Borrower or any Subsidiary or, to
the extent not listed in such Schedule, where such property or assets have a
fair market value that does not exceed $10,000,000 in the aggregate; provided
that (A) such Lien shall not apply to any other property or asset of the
Borrower or any Subsidiary (other than proceeds) and (B) such Lien shall secure
only those obligations which it secures on the date hereof and extensions,
renewals, refinancings and replacements thereof that do not increase the
outstanding principal amount thereof or result in an earlier maturity date or
decreased weighted average life thereof;


(iv)          any Lien existing on any property or asset prior to the
acquisition thereof by the Borrower or any Subsidiary or existing on any
property or asset of any Person that becomes a Subsidiary after the date hereof
prior to the time such Person becomes a Subsidiary; provided that (A)
such Lien is not created in contemplation of or in connection with such
acquisition or such Person becoming a Subsidiary, as the case may be, (B) such
Lien shall not apply to any other property or assets of the Borrower or any
Subsidiary (other than proceeds and after acquired property of any acquired
Subsidiary to the extent required by the terms of any Indebtedness assumed in
such acquisition and permitted pursuant to Section 6.01(a)) and (C) such Lien
shall secure only those 



 70
 








obligations which it secures on the date of such
acquisition or the date such Person becomes a Subsidiary, as the case may be,
and extensions, renewals, refinancings and replacements thereof that do not
increase the outstanding principal amount thereof (other than by an amount not
in excess of fees and expenses, including premium and defeasance costs,
associated therewith) or result in a decreased average weighted life thereof;


(v)           Liens on fixed or capital assets acquired, constructed or
improved by the Borrower or any Subsidiary; provided that (A) such Liens
secure Indebtedness permitted by clause (vii) of Section 6.01(a) or by Section
6.06, (B) such Liens and the Indebtedness secured thereby are incurred prior to
or within 180 days after such acquisition or the completion of such
construction or improvement, (C) the Indebtedness secured thereby does not
exceed the cost of acquiring, constructing or improving such fixed or capital
assets, including transaction costs incurred in connection therewith, and (D)
such Liens shall not apply to any other property or assets of the Borrower or
any Subsidiary (other than proceeds); provided that individual
financings of equipment provided by a single lender may be cross-collateralized
to other financings of equipment provided solely by such lender;


(vi)          Cash deposits securing any Swap Agreement entered into in
connection with the Loans hereunder;


(vii)         Liens securing Indebtedness permitted by Section 6.01(a)(xx);


(viii)        (a) deposits securing liability to
insurance carriers under insurance or self-insurance arrangements in respect of
such obligations and (b) pledges and deposits securing liability for
reimbursement or indemnification obligations of (including obligations in
respect of letters of credit or bank guarantees for the benefit of) insurance
carriers providing property, casualty or liability insurance to the Borrower or
any Subsidiary;


(ix)           Liens disclosed by the title insurance policies delivered
on or prior to the Effective Date and any replacement, extension or renewal of
any such Lien; provided that such replacement, extension or renewal Lien shall
not cover any property other than the property that was subject to such Lien
prior to such replacement, extension or renewal; provided, further,
that the Indebtedness and other obligations secured by such replacement,
extension or renewal Lien are permitted by this Agreement;


(x)            any interest or title of a lessor under any leases or
subleases entered into by the Borrower or any Subsidiary in the ordinary course
of business;


(xi)           Liens that are contractual rights of set-off (a) relating
to the establishment of depository relations with banks not given in connection
with the issuance of Indebtedness, (b) relating to pooled deposit or sweep
accounts to permit satisfaction of overdraft or similar obligations incurred in
the ordinary course of business or (c) relating to purchase orders and other agreements
entered into with customers of the Borrower or any Subsidiary in the ordinary
course of business;


(xii)          Liens arising solely by virtue of any statutory or common
law provision relating to banker’s liens, rights of set-off or similar rights,
and Liens in favor of CoBank ACB on the Borrower’s CoBank Equity Interests or
Patronage Certificates;



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(xiii)         licenses of intellectual property
granted in the ordinary course of business and in a manner consistent with past
practice;


(xiv)        Liens solely on any cash earnest money deposits made by the
Borrower or any of the Subsidiaries in connection with any letter of intent or
purchase agreement permitted hereunder;


(xv)         Liens with respect to property or assets of any Foreign
Subsidiary securing Indebtedness of a Foreign Subsidiary permitted under
Section 6.01;


(xvi)        Liens arising from precautionary UCC financing statements in
connection with operating leases;


(xvii)       Liens in favor of co-venturors in Equity
Interests in joint ventures securing obligations of such joint venture;


(xviii)      Liens on securities that are the subject
of repurchase agreements constituting Permitted Investments under clause (d) of
the definition thereof;


(xix)         Liens in favor of any Securitization Vehicle or any
collateral agent on Securitization Assets transferred or purported to be
transferred to such Securitization Vehicle in connection with Securitizations
permitted by Section 6.05;


(xx)          Liens in favor of customs and revenue authorities arising
as a matter of law to secure payment of customs duties in connection with the
importation of goods;


(xxi)         the prior rights of consignees and their lenders under
consignment arrangements entered into in the ordinary course of business;


(xxii)        agreements to subordinate any interest
of the Borrower or any Subsidiary in any accounts receivable or other proceeds
arising from inventory consigned by the Borrower or any of its Subsidiaries
pursuant to an agreement entered into in the ordinary course of business; and


(xxiii)       other Liens with respect to property or
assets of the Borrower or any Subsidiary securing Indebtedness or other
obligations not at any time in excess of $10,000,000 at any time outstanding;


SECTION  6.03.  Fundamental Changes.  (a)  The
Borrower will not, and will not permit any Subsidiary to, merge into or
consolidate with any other Person, or permit any other Person to merge into or
consolidate with it, or liquidate or dissolve, except that, if at the time
thereof and immediately after giving effect thereto no Event of Default shall
have occurred and be continuing, (i) any Subsidiary may merge into the Borrower
in a transaction in which the Borrower is the surviving corporation, (ii) any
Subsidiary may merge into any Subsidiary in a transaction in which the
surviving entity is a wholly-owned Subsidiary and, if any party to such merger
is a Subsidiary Loan Party, a Subsidiary Loan Party, (iii) any Subsidiary may
merge or consolidate with any other Person in order to effect a Permitted
Acquisition, (iv) any Subsidiary may liquidate or dissolve if the Borrower
determines in good faith that such liquidation or dissolution is in the best
interests of the Borrower and is not materially disadvantageous to the Lenders;
provided that any such merger involving a Person that is not a
wholly-owned Subsidiary immediately prior to such merger shall not be permitted
unless also permitted by 



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Section 6.04, (v) the Parent (if other than Holdings), Holdings and the
Borrower may consummate any entity reorganization necessary for the purposes of
effecting a Qualified IPO; provided, that (A) the interests of the
lenders shall not be materially adversely affected thereby, (B) each surviving
or continuing entity shall be organized under the jurisdiction of one of the
fifty United States of America and (C) if any of the Parent (if other than
Holdings), Holdings or the Borrower, as applicable, shall be assumed by a
surviving or continuing entity pursuant to an instrument in form and substance
reasonably satisfactory to the Administrative Agent and, in any case, in connection
with such entity reorganization, each such surviving or continuing entity shall
comply with the Collateral and Guarantee Requirement, on terms consistent with
the other existing Loan Documents, and take such other actions relating to the
Guarantee, the Collateral Agreement and the other Loan Documents, the
perfection and protection of the security interests of the Secured Parties
granted pursuant thereto and the assumption by such surviving or continuing
entity of obligations under the applicable Loan Documents, in each case as may
be reasonably required by the Administrative Agent, including, without
limitation, providing legal opinions with respect to any new documents entered
into in connection with such reorganization as shall be reasonably satisfactory
to the Administrative Agent and as are in form consistent with opinions
delivered to the Administrative Agent on the Effective Date; and (vi) Holdings
may liquidate or dissolve as part of any entity reorganization necessary for
the purposes of effecting a Qualified IPO.


(b)           Holdings
will not engage at any time in any business or business activity other than (i)
ownership and acquisition of Equity Interests in the Borrower, together with
activities directly related thereto, (ii) performance of its obligations under
and in connection with the Loan Documents, the Senior Subordinated Debt
Documents and the Senior Unsecured Debt Documents (and Refinancing Indebtedness
in respect thereof) and the other agreements contemplated hereby and thereby,
(iii) actions incidental to the consummation of the Transactions, (iv) actions
required by law to maintain its existence, (v) the payment of dividends and
taxes, (vi) the issuance of and the performance of obligations in respect of
its Equity Interests and Indebtedness, (vii) activities incidental to its
maintenance and continuance and to the foregoing activities and (viii) the
incurrence of Permitted Holdings Debt. 
Notwithstanding anything to the contrary contained in herein, (i)
Holdings or Parent shall at all times own directly 100% of the Equity Interests
of the Borrower and (ii) Holdings or Parent shall not sell, dispose of, grant a
Lien on or otherwise transfer such Equity Interests in the Borrower (other than
pursuant to the Loan Documents).


SECTION  6.04.  Investments, Loans, Advances, Guarantees
and Acquisitions.  The Borrower will
not, and will not permit any of its Subsidiaries to, make, purchase, hold or
acquire (including pursuant to any merger with any Person that was not a wholly
owned Subsidiary prior to such merger) any Investment, except:


(a)           [Reserved];


(b)           Permitted Investments and Investments that were Permitted
Investments when made;


(c)           Investments existing on, or contractually committed as of,
the date hereof and set forth on Schedule 6.04;


(d)           Investments by the Borrower and its Subsidiaries in Equity
Interests in (x) Subsidiaries that are Subsidiary Loan Parties immediately
prior to the time of such Investments and (y) Foreign Subsidiaries; provided
that the aggregate amount of investments by Loan Parties in, loans and
advances by Loan Parties to, and Guarantees by Loan Parties of Indebtedness of,
Subsidiaries that are not Loan Parties (including all such investments, loans,
advances and 



 73
 








Guarantees existing on the Effective Date) shall not
at any time exceed the sum of (i) $40,000,000 plus (ii) the Available
Additional Amount;


(e)           loans or advances made by the Borrower to any Subsidiary
and made by any Subsidiary to the Borrower or any other Subsidiary; provided
that (A) any such loans and advances made to a Loan Party shall be
subordinated to the Obligations pursuant to the Affiliate Subordination
Agreement and shall be evidenced by a promissory note pledged pursuant to the
Collateral Agreement and (B) the amount of such loans and advances made by Loan
Parties to Subsidiaries that are not Loan Parties shall be subject to the
limitation set forth in clause (d) above;


(f)            Guarantees constituting Indebtedness permitted by Section
6.01; provided that (i) a Subsidiary shall not Guarantee either the
Senior Subordinated Debt or the Senior Unsecured Debt unless (A) such
Subsidiary also has Guaranteed the Obligations pursuant to the Collateral
Agreement, as the case may be, (B) such Guarantee of the Senior Subordinated
Debt is subordinated to such Guarantee of the Obligations on terms no less
favorable to the Lenders than the subordination provisions of the Senior
Subordinated Debt and (C) such Guarantee of the Senior Subordinated Debt and
Senior Unsecured Debt provides for the release and termination thereof, without
action by any party, upon any release and termination of such Guarantee of the
Obligations, and (ii) the aggregate principal amount of Indebtedness of
Subsidiaries that are not Loan Parties that is Guaranteed by any Loan Party
shall be subject to the limitation set forth in clause (d) above;


(g)           Permitted Acquisitions;


(h)           Investments (including debt obligations and equity
securities) received in connection with the bankruptcy or reorganization of, or
settlement of delinquent accounts and disputes with, customers and suppliers,
in each case in the ordinary course of business;


(i)            accounts receivable, security deposits and prepayments
arising and extensions of trade credit in the ordinary course of business and
any assets and securities received in satisfaction or partial satisfaction
thereof from financially troubled account debtors to the extent reasonably
necessary to prevent or limit loss and any prepayments and other credits to
suppliers in the ordinary course of business;


(j)            Investments consisting of non-cash consideration received
in respect of sales, transfers or other dispositions of assets to the extent
permitted by Section 6.05;


(k)           Swap Agreements entered into in compliance with Section
6.07;


(l)            other Investments by the Borrower or any Subsidiary,
including investments in Unrestricted Subsidiaries, in an aggregate amount not
to exceed at any time after the Effective Date the sum of (i) the greater of
$40,000,000 and 2.5% of Consolidated Total Assets plus (ii) the Available
Additional Amount;


(m)          Investments of a Subsidiary acquired after the Effective
Date or of a corporation merged into the Borrower or merged into or
consolidated with a Subsidiary in accordance with Section 6.03 after the
Effective Date to the extent that such Investments were not made in
contemplation of or in connection with such acquisition, merger or
consolidation and were in existence on the date of such acquisition, merger or
consolidation;



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(n)           acquisitions by the Borrower of obligations of one or more
officers or other employees of Holdings, the Borrower or its Subsidiaries in
connection with such officer’s or employee’s acquisition of Equity Interests of
Holdings, so long as no cash is actually advanced by the Borrower or any of the
Subsidiaries to such officers or employees in connection with the acquisition
of any such obligations;


(o)           Guarantees by the Borrower or any Subsidiary of operating
leases (other than Capital Lease Obligations) or of other obligations that do
not constitute Indebtedness, in each case entered into by the Borrower or any
Subsidiary in the ordinary course of business;


(p)           [Reserved];


(q)           loans and advances by the Borrower and any of its
Subsidiaries to their employees in the ordinary course of business and for bona
fide business purposes in an aggregate amount at any time outstanding not in
excess of $10,000,000 and advances of payroll payments and expenses to
employees in the ordinary course of business;


(r)            Investments resulting from pledges and deposits referred
to in Section 6.02(a)(ii) and 6.02(a)(viii);


(s)           Investments consisting of Sellers’ Retained Interests in
Securitizations permitted by Section 6.05;


(t)            [Reserved];


(u)           the Borrower’s Investments in CoBank Equity Interests and
Patronage Certificates; and


(v)           Investments as a result of the designation of the Directories
Sale Subsidiary as an Unrestricted Subsidiary or the transfer or capital
contribution of the Directory Publishing Business to the Directories Sale
Subsidiary in connection with the consummation of the Directories Sale; provided,
that (i) any such Investment shall be made substantially contemporaneously with
the consummation of the Directories Sale and (ii) the Net Proceeds of the
Directories Sale are owned by the Borrower or a Guarantor immediately after the
Directories Sale.


SECTION  6.05.  Asset Sales.  The Borrower will not, and will not permit
any of its Subsidiaries to, sell, transfer, lease or otherwise dispose of any
asset, including any Equity Interest owned by it and any sale of Securitization
Assets in connection with a Securitization, nor will the Borrower permit any of
it Subsidiaries to issue any additional Equity Interest in such Subsidiary,
except:


(a)           sales of (x) inventory, (y) used, surplus, obsolete or
worn-out equipment or other worn-out property and Permitted Investments in the
ordinary course of business and (z) sales, leases or other dispositions of
inventory of the Borrower and its Subsidiaries determined by the management of
the Borrower to be no longer useful or necessary in the operation of the business
of the Borrower or any of the Subsidiaries;


(b)           sales, transfers and dispositions to the Borrower or a
Subsidiary; provided that any such sales, transfers or dispositions
involving a Subsidiary that is not a Loan Party shall be made in compliance with
Section 6.09;



 75
 








(c)           sale and leaseback transactions permitted by Section 6.06;


(d)           the sale of defaulted receivables in the ordinary course
of business and not as part of an accounts receivables financing transaction;


(e)           licensing and cross-licensing arrangements involving any
technology or other intellectual property of the Borrower or any Subsidiary in
the ordinary course of business;


(f)            sales, transfers and other dispositions of assets that
are not permitted by any other clause of this Section; provided that the
aggregate cumulative fair market value of all assets sold, transferred or
otherwise disposed of after the Effective Date in reliance upon this clause (f)
shall not exceed the greater of $80,000,000 and 6.0% of Consolidated Total
Assets;


(g)           sales of Securitization Assets to one or more
Securitization Vehicles in Securitizations; provided that (i) each such
Securitization is effected on market terms as reasonably determined by the
board of directors of the Borrower, (ii) the aggregate amount of Third Party
Interests in respect of all such Securitizations does not exceed $100,000,000
at any time outstanding, (iii) the proceeds to each such Securitization Vehicle
from the issuance of Third Party Interests are applied substantially
simultaneously with receipt thereof to the purchase from the Borrower or
Subsidiaries of Securitization Assets and an amount equal to 100% of the Net
Proceeds from each such Securitization is applied to the mandatory repayment of
Term Loans in accordance with Section 2.11(c) and (iv) the Equity Interests and
Sellers’ Retained Interests in respect of each such Securitization Vehicle
shall be pledged to the Collateral Agent under the Collateral Agreement; and


(h)           the Directories Sale.


provided that (x) all sales, transfers, leases and
other dispositions permitted hereby (other than pursuant to clauses (a)(y),
(a)(z), (b), (e) and (g) above) shall be made for at least 75% cash
consideration (provided that for purposes of this clause (x) and the
immediately following clause (y), the amount of any secured Indebtedness or
other Indebtedness of a Subsidiary that is not a Loan Party (as shown on the
Borrower’s or such Subsidiary’s most recent balance sheet or in the notes
thereto) of the Borrower or any Subsidiary of the Borrower that is assumed by
the transferee of any such assets shall be deemed to be cash) or, in the case
of Permitted Investments and sale and leaseback transactions, 100% cash
consideration, (y) all sales, transfers, leases and other dispositions
permitted by clause (d) above and all sales of Permitted Investments shall be
made for fair value and (z) all sales, transfers, leases and other dispositions
in excess of $3,500,000 permitted by clauses (a) (other than Permitted
Investments), (e) and (f) above shall be made for fair value; and provided,
further, that under no circumstances shall any sale or issuance of
Equity Interests in any Subsidiary of the Parent be permitted other than in
connection with a sale of all of the Equity Interests in such Subsidiary
otherwise permitted hereunder or in connection with a Qualified IPO.


SECTION  6.06.  Sale and Leaseback Transactions.  The Borrower will not, and will not permit
any of its Subsidiaries (other than Foreign Subsidiaries) to, enter into any
arrangement, directly or indirectly, whereby it shall sell or transfer any
property, real or personal, used or useful in its business, whether now owned
or hereinafter acquired, and thereafter rent or lease such property or other
property that it intends to use for substantially the same purpose or purposes
as the property sold or transferred, except for the sale of any fixed or
capital assets that is made for cash consideration in an amount not less than
the cost of such fixed or capital asset; provided, however, that
all Capital Lease Obligations, Attributable Debt and Liens associated with such
sale and leaseback transaction are permitted by Sections 6.01(a)(vii) and
6.02(a)(v) (treating the property subject thereto as being subject to a Lien
securing the 



 76
 








related Attributable Debt, in the case of a sale and leaseback not
accounted for as a Capital Lease Obligation). 
In addition, the Borrower and the Subsidiaries may engage in other sale
and leaseback transactions after the Effective Date in a cumulative aggregate
amount not exceeding $25,000,000, provided that the Net Proceeds of any such
sale and leaseback transaction are used simultaneously with the consummation of
such sale and leaseback transaction to prepay outstanding Term Loans to the extent
required by Section 2.11(c).


SECTION  6.07.  Swap Agreements.  The Borrower will not, and will not permit
any of its Subsidiaries to, enter into any Swap Agreement, except (a) Swap
Agreements entered into in the ordinary course of business to hedge or mitigate
risks to which the Borrower or any Subsidiary has actual exposure (other than
those in respect of Equity Interests of the Borrower or any of its
Subsidiaries) in the conduct of its business or the management of its
liabilities, (b) Swap Agreements required by any Securitization and (c) Swap
Agreements entered into in order to effectively cap, collar or exchange
interest rates (from fixed to floating rates, from one floating rate to another
floating rate or otherwise) with respect to any interest-bearing liability or
investment of the Borrower or any Subsidiary.


SECTION  6.08.  Restricted Payments; Certain Payments of
Indebtedness.  (a)  The Borrower will not, and will not permit any
Subsidiary to, declare or make, or agree to pay or make, directly or
indirectly, any Restricted Payment, except (subject to clause (d) of this
Section):


(i)            Subsidiaries of the Borrower may declare and pay
dividends ratably (or in a manner more favorable to the Borrower or
Subsidiaries) with respect to their capital stock;


(ii)           the Borrower may make Restricted Payments pursuant to and
in accordance with stock option plans or other benefit plans for management,
employees (including former employees) of the Borrower and its Subsidiaries; provided
that the amount thereof does not exceed $10,000,000 in any fiscal year (plus
the amount of Equity Proceeds transferred to the Borrower during such fiscal
year from sales of Equity Interests of Holdings to directors, consultants,
officers or employees in connection with permitted incentive arrangements, and
the proceeds of any key-man life insurance policies received by the Borrower
during such fiscal year (which amounts, if not used in any fiscal year, may be
carried forward to any subsequent fiscal year));


(iii)          the Borrower may pay dividends to Holdings at any time in
such amounts as may be necessary to permit Holdings to pay its expenses and
liabilities incurred in the ordinary course (other than payments in respect of
Indebtedness or Restricted Payments) which are attributable or allocable to the
operations of the Borrower and the Subsidiaries;


(iv)          [Reserved];


(v)           the Borrower may make Restricted Payments after the
Effective Date in a cumulative aggregate amount not to exceed (A) prior to a
Qualified IPO, the sum of (i) $15,000,000 plus (ii) the Available Additional Amount
and (B) following a Qualified IPO, the sum of (i) $50,000,000 plus any unused
portion of the amount provided prior to a Qualified IPO pursuant to clause
(A)(i) above and (ii) the Available Additional Amount; provided, that at
the time of any such Restricted Payment, (x) no Event of Default is continuing
or would result therefrom and (y) on a Pro Forma Basis, the Total Leverage
Ratio does not exceed 5.25 to 1.00; and provided, further, that
no Restricted 



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Payments may be made under this clause (v) during
any fiscal quarter if the Cure Right has been (or is anticipated to be)
exercised in respect of either of the two immediately preceding fiscal
quarters;


(vi)          [Reserved];


(vii)         noncash repurchases of Equity Interests deemed to occur upon
exercise of stock options if such Equity Interests represent a portion of the
exercise price of such options;


(viii)        the Borrower or any Subsidiary may make
Restricted Payments to Holdings to make payments of fees and expenses required
by the Management Agreement; and


(ix)           the Borrower or any Subsidiary may make Restricted
Payments to Holdings in amounts required for Holdings to pay federal, state and
local income Taxes imposed directly on Holdings to the extent such Taxes are
attributable to the income of the Borrower and its Subsidiaries (including,
without limitation, by virtue of Holdings being the common parent of a
consolidated or combined Tax group of which the Borrower and/or its
Subsidiaries are members); provided, however, that the amount of
any such dividends or distributions (plus any taxes payable directly by the
Borrower and its Subsidiaries) shall not exceed the amount of such taxes that
would have been payable directly by the Borrower and/or its Subsidiaries had
the Borrower been the common parent of a separate tax group that included only
the Borrower and its Subsidiaries and (ii) in amounts equal to the amounts
required for Parent to pay franchise taxes and other fees required to maintain
its corporate existence.


(b)           The
Borrower will not, and will not permit any Subsidiary to, make or agree to pay
or make, directly or indirectly, any payment or other distribution (whether in
cash, securities or other property) of or in respect of principal of or
interest on any Indebtedness, or any payment or other distribution (whether in
cash, securities or other property), including any sinking fund or similar
deposit, on account of the purchase, redemption, retirement, acquisition, cancellation
or termination of the Senior Subordinated Notes, the Senior Unsecured Notes and
other subordinated Indebtedness, except (subject to clause (d) of this Section):


(i)            payment of Indebtedness created under the Loan Documents;


(ii)           payment of fees and expenses and regularly scheduled
interest and principal payments as and when due in respect of any Indebtedness,
other than payments in respect of the Senior Subordinated Debt, Permitted
Subordinated Indebtedness or other subordinated Indebtedness prohibited by the
subordination provisions thereof;


(iii)          refinancings of Indebtedness to the extent permitted by
Section 6.01;


(iv)          [Reserved];


(v)           [Reserved];


(vi)          repurchases or repayments of the Senior Subordinated Notes,
the Senior Unsecured Notes and other subordinated Indebtedness after the
Effective Date in a 



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cumulative aggregate amount not to exceed (A) prior
to a Qualified IPO, the sum of (i) $15,000,000 plus (ii) the Available
Additional Amount and (B) following a Qualified IPO, the sum of (i) $50,000,000
plus any unused portion of the amount provided prior to a Qualified IPO
pursuant to clause (A)(i) above and (ii) the Available Additional Amount; provided,
that at the time of any such repurchase or repayment, (x) no Event of Default
is continuing or would result therefrom and (y) on a Pro Forma Basis, the Total
Leverage Ratio does not exceed 5.25 to 1.00; and


(vii)         any agreement to pay or make any such payment or other
distribution in connection with a transaction that will result in the repayment
in full of the Obligations.


(c)           The
Borrower will not, and will not permit any Subsidiary to, furnish any funds to,
make any Investment in, or provide other consideration to any other Person
(including any Unrestricted Subsidiary) for purposes of enabling such Person
to, or otherwise permit any such Person to, make any Restricted Payment or other
payment, repurchase, repayment or distribution restricted by this Section that
could not be made directly by the Borrower in accordance with the provisions of
this Section.


(d)           Notwithstanding
any of the provisions of this Section 6.08, the Borrower may not at any time
use any Net Proceeds received from the consummation of the Directories Sale for
the making of any Restricted Payment or any repurchase or repayment of
Indebtedness, except that the Borrower may use the Net Proceeds of the
Directories Sale to prepay (i) the Senior Subordinated Notes and/or the Senior
Unsecured Notes so long as, at the time of any such prepayment, the Net Secured
Leverage Ratio, calculated on a Pro Forma Basis, does not exceed 4.00 to 1.00
or (ii) the Obligations.


SECTION  6.09.  Transactions with Affiliates.  The Borrower will not, and will not permit any
Subsidiary to, sell, lease or otherwise transfer any property or assets to, or
purchase, lease or otherwise acquire any property or assets from, or otherwise
engage in any other transactions with, any of its Affiliates, except:


(a)           transactions that do not involve Holdings and are at
prices and on terms and conditions not less favorable to the Borrower or such
Subsidiary than could be obtained on an arm’s-length basis from a Person who is
not such an Affiliate;


(b)           transactions that (i) have been approved by a majority of
the members of the board of directors of the Borrower having no personal stake
in such transactions and certified by a Financial Officer or executive officer
of the Borrower as being on terms and conditions not less favorable to the
Borrower or its Subsidiaries than could be obtained on an arm’s-length basis
from a Person who is not such an Affiliate or (ii) have been determined by a
nationally recognized appraisal or investment banking firm to be fair, from a
financial standpoint, to the Borrower and its Subsidiaries or are on terms and
conditions not less favorable to the Borrower and its Subsidiaries than could
be obtained on an arm’s-length basis from a Person who is not such an
Affiliate;


(c)           transactions between or among the Borrower and the
Subsidiary Loan Parties not involving any other Affiliate;


(d)           any Restricted Payment permitted by Section 6.08 or
Investments permitted by Section 6.04;



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(e)           any payments to the Sponsor or any of its Controlled
Affiliates consisting of management fees payable pursuant to the Management
Agreement, including (i) payments made for financial advisory, financing,
underwriting or placement services or in respect of other investment banking
services made pursuant to the Management Agreement or otherwise approved by a
majority of the board of directors of the Borrower, and (ii) in each case, all
reasonable out-of-pocket expenses incurred by, and indemnification payments
owed to, the Sponsor or its Controlled Affiliates in connection with its
performance of management, consulting, monitoring, financial advisory or other
services with respect to the Borrower and its Subsidiaries;


(f)            any employment agreements entered into by the Borrower or
any of its Subsidiaries in the ordinary course of business and any issuance of
securities, or other payments, awards or grants in cash, securities or
otherwise pursuant to, or the funding of, employment arrangements, stock
options and stock ownership plans or similar employee benefit plans approved in
good faith by the board of directors of the Borrower or of a Subsidiary, as
appropriate, provided that any Restricted Payments contemplated thereby will be
subject to Section 6.08(a);


(g)           the grant of stock options or similar rights to employees
and directors of the Borrower pursuant to plans approved by the board of
directors of the Borrower;


(h)           loans or advances to employees in the ordinary course of
business which are approved by a majority of the board of directors of the
Borrower in good faith, to the extent permitted by Section 6.04(q);


(i)            the payment of compensation and reasonable fees to, and
indemnity provided on behalf of, directors, officers, consultants and employees
of Holdings, of the Borrower and of the Subsidiaries;


(j)            transactions pursuant to agreements in existence on the
Effective Date and set forth on Schedule 6.09 or, in each case, pursuant to any
amendment thereto to the extent such amendment is not, when taken as a whole,
adverse to the Lenders in any material respect;


(k)           any purchase by Holdings of Equity Interests of the
Borrower or contributions by Holdings to the equity capital of the Borrower;
provided that any Equity Interests of the Borrower purchased by Holdings shall
be pledged to the Collateral Agent pursuant to the Collateral Agreement;


(l)            transactions with wholly owned Subsidiaries for the
purchase or sale of goods, products, parts and services entered into in the
ordinary course of business in a manner consistent with past practice;


(m)          sales of Securitization Assets to Securitization Vehicles
and other transactions effected as part of Securitizations permitted by Section
6.05;


(n)           the entry into and performance of any tax sharing
agreement permitted by Section 6.08(a)(viii); and


(o)           payments permitted by Section 6.08(b)(ix).



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SECTION  6.10.  Restrictive Agreements.  The Borrower will not, and will not permit
any Subsidiary to, directly or indirectly, enter into, incur or permit to exist
any agreement or other arrangement that prohibits, restricts or imposes any
condition upon (a) the ability of the Borrower or any Subsidiary to create,
incur or permit to exist any Lien upon any of its property or assets securing
the Obligations, or (b) the ability of any Subsidiary to pay dividends or other
distributions with respect to any shares of its capital stock or to make or
repay loans or advances to the Borrower or any other Subsidiary or to Guarantee
any Indebtedness of the Borrower or any other Subsidiary; provided that
(i) the foregoing shall not apply to restrictions and conditions imposed by law
or by any Loan Document, Senior Subordinated Debt Document or Senior Unsecured
Debt Document, (ii) the foregoing shall not apply to restrictions and
conditions existing on the date hereof identified on Schedule 6.10 (and shall
not apply to any extension or renewal of, or any amendment or modification
expanding the scope of, any such restriction or condition), (iii) the foregoing
shall not apply to customary restrictions and conditions contained in
agreements relating to the sale of a Subsidiary or any asset pending such sale,
provided such restrictions and conditions apply only to the Subsidiary or asset
that is to be sold and such sale is permitted hereunder, (iv) the foregoing
shall not apply to restrictions or conditions imposed by any agreement relating
to secured Indebtedness permitted by this Agreement if such restrictions or
conditions apply only to the property or assets securing such Indebtedness and
the proceeds thereof, (v) clause (a) of the foregoing shall not apply to
customary provisions in leases or other agreements restricting the assignment
thereof, (vi) the foregoing shall not apply to restrictions or conditions
imposed by any agreement related to any Indebtedness incurred by a Subsidiary
prior to the date on which such Subsidiary was acquired by the Borrower (but
shall apply to any extension or renewal of, or any amendment or modification
expanding the scope of, any such restriction or condition), (vii) the foregoing
shall not apply to restrictions or conditions imposed by any agreement related
to the refinancing of Indebtedness, provided that the terms of any such
restrictions or conditions are not materially less favorable to the Lenders
than the restrictions or conditions contained in the predecessor agreements,
(viii) the foregoing shall not apply to customary net worth provisions
contained in real property leases or licenses of intellectual property and
other similar agreements entered into in the ordinary course of business, so
long as the Borrower has determined in good faith that such net worth
provisions could not reasonably be expected to impair the ability of the
Borrower and its Subsidiaries to meet their ongoing obligations, (ix) the
foregoing shall not apply to customary restrictions and conditions contained in
the document relating to any Lien, so long as (1) such Lien is permitted under
Section 6.02 and such restrictions or conditions relate only to the specific
asset subject to such Lien, and (2) such restrictions and conditions are not
created for the purpose of avoiding the restrictions imposed by this Section
6.10, (x) the foregoing shall not apply to restrictions that are contained in
any documents documenting Indebtedness of any Foreign Subsidiary permitted
hereunder, provided that such restrictions only apply to such Subsidiary
and its assets, (xi) the foregoing shall not apply to customary provisions in
joint venture agreements and (xii) the foregoing shall not apply to customary
restrictions contained in any documents relating to any Securitizations, provided
that such restrictions only apply to the applicable Securitization Vehicle and
its assets. 


SECTION  6.11.  Change in Business.  The Borrower will not, and will not permit
any Subsidiary to, engage to any material extent at any time in any business or
business activity other than a Permitted Business.   


SECTION  6.12.  Fiscal Year.  Neither Holdings nor the Borrower shall change
its fiscal year for accounting and financial reporting purposes to end on any
date other than December 31. 


SECTION  6.13.  Amendment of Material Documents.  The Borrower will not, and will not permit any
Subsidiary to, amend, modify or waive any of its rights under (i) any Senior
Subordinated



 81
 









Debt Document, (ii) any Senior Unsecured Debt Document, or (iii) its
certificate of incorporation, by-laws or other organizational documents if, in
each case referred to above, such amendment, modification or waiver, taken as a
whole, is adverse in any material respect to the interests of the Lenders. 


SECTION  6.14.  [Reserved]. 



SECTION  6.15.  [Reserved]. 


SECTION  6.16.  Net Secured Leverage Ratio.  The Borrower will not permit, at any time when
any Revolving Exposure of any Revolving Lender is outstanding, the Net Secured
Leverage Ratio (calculated on a on a Pro Forma Basis) to exceed (i) beginning
with the first four fiscal quarter period ending after the Effective Date, and on
or prior to the third anniversary of the Effective Date, 5.25 to 1.00 or (ii)
after the third anniversary of the Effective Date, 5.00 to 1.00: 


SECTION  6.17.  [Reserved]. 


SECTION  6.18.  Commingling of Accounts.  The Borrower will not, nor will it cause or
permit any Subsidiary to, commingle amounts relating to Securitization Assets
sold pursuant to a Securitization with cash or any other amounts of the
Borrower and its Subsidiaries other than the temporary commingling of
collections on and proceeds of any accounts receivable or related assets of the
Borrower and its Subsidiaries, in each case as may be necessary to identify and
sort such collections and proceeds.


SECTION  6.19.  Capital Expenditures.  The Borrower will not, nor will it cause or
permit any Subsidiary to make any cash Capital Expenditures exceeding in the
aggregate, in any fiscal year set forth below, the maximum amount set forth
below for such period; 




	
  FISCAL YEAR

  	
   

  	
  MAXIMUM CAPITAL EXPENDITURES

  	
   

  
	
  2007

  	
   

  	
  $

  	
  125,000,000

  	
   

  
	
  2008

  	
   

  	
  $

  	
  110,000,000

  	
   

  
	
  2009

  	
   

  	
  $

  	
  100,000,000

  	
   

  
	
  2010

  	
   

  	
  $

  	
  100,000,000

  	
   

  
	
  2011

  	
   

  	
  $

  	
  100,000,000

  	
   

  
	
  2012

  	
   

  	
  $

  	
  100,000,000

  	
   

  
	
  2013

  	
   

  	
  $

  	
  100,000,000

  	
   

  
	
  2014

  	
   

  	
  $

  	
  100,000,000

  	
   

  






 


provided, that (i) any
portion of such amount that is not so expended in any fiscal year in which such
expenditure is permitted may be carried over to the next succeeding fiscal year
and (ii) Capital Expenditures made pursuant to this proviso during any fiscal year
shall be deemed made, first, in respect of amounts permitted for such
fiscal year as provided above and second, in respect of amounts carried
over from the prior fiscal year pursuant to subclause (i) above; provided,
further, that for the purposes of this Section 6.19, the following shall
be excluded from the above limitations: 
(i) Capital Expenditures related to the integration of Permitted
Acquisitions, (ii) Capital Expenditures mandated by Governmental Authorities,
(iii) Capital Expenditures related to the Borrower’s investment in its
television business in an amount not to exceed either (x) $40,000,000 per  annum (provided,
that any portion of such amount that is not so expended in any fiscal year in
which such expenditure is permitted may be carried over to the next



 82
 









succeeding
fiscal year) or (y) $100,000,000 in the aggregate during the term of this
Agreement and (iv) Capital Expenditures made with the Available Additional
Amount.


ARTICLE VII


Events of Default


SECTION  7.01.  Events
of Default.  If any of the following
events (“Events of Default”) shall occur: 


(a)           the Borrower shall fail to
pay any principal of any Loan or any reimbursement obligation in respect of any
LC Disbursement when and as the same shall become due and payable, whether at
the due date thereof or at a date fixed for prepayment thereof or otherwise; 


(b)           the Borrower shall fail to
pay any interest on any Loan or any fee or any other amount (other than an
amount referred to in clause (a) of this Article) payable under this Agreement
or any other Loan Document, when and as the same shall become due and payable,
and such failure shall continue unremedied for a period of three Business Days;



(c)           any representation or
warranty made or deemed made by Holdings, the Borrower or any Subsidiary in or
in connection with any Loan Document or any amendment or modification thereof
or waiver thereunder, or in any certificate furnished pursuant to or in
connection with any Loan Document or any amendment or modification thereof or
waiver thereunder, shall prove to have been incorrect in any material respect
when made or deemed made; provided, that if any representation or
warranty shall have been proven to be incorrect solely as a result of a
restatement of any financial statement of the Borrower that is non-cash in
nature and does not result in non-compliance with the Financial Covenant or with
any ratio contained in any covenant contained in Article VI hereunder, such
restatement shall not result in an Event of Default; and provided, further,
that during the period of any such restatement, it shall be assumed that the
Financial Covenant shall be in effect regardless of whether any Revolving
Exposure is outstanding during such period; 


(d)           Holdings or the Borrower
shall fail to observe or perform any covenant, condition or agreement contained
in Section 5.02(a), 5.04 (with respect to the existence of Holdings or the
Borrower), 5.10, 5.11 or in Article VI; 


(e)           any Loan Party shall fail to
observe or perform any covenant, condition or agreement contained in any Loan
Document (other than those specified in clause (a), (b) or (d) of this
Article), and such failure shall continue unremedied for a period of 30 days
after notice thereof from the Administrative Agent to the Borrower (which
notice will promptly be given at the request of any Lender); 


(f)            Holdings, the Borrower or
any Subsidiary shall fail to make any payment (whether of principal or interest
and regardless of amount) in respect of any Material Indebtedness, when and as
the same shall become due and payable (after giving effect to any applicable
grace period specified in the agreement or instrument governing such
Indebtedness); 


(g)           any event or condition
occurs that results in any Material Indebtedness becoming due prior to its
scheduled maturity or that enables or permits (with or without the giving of
notice, but after giving effect to all applicable grace periods contained in
the applicable instrument) the



 83
 









holder or holders of any Material Indebtedness or
any trustee or agent on its or their behalf to cause any Material Indebtedness
to become due, or to require the prepayment, repurchase, redemption or
defeasance thereof, prior to its scheduled maturity; provided that this
clause (g) shall not apply to secured Indebtedness that becomes due as a result
of the voluntary sale or transfer of the property or assets securing such
Indebtedness; 


(h)           an involuntary proceeding
shall be commenced or an involuntary petition shall be filed in a court of
competent jurisdiction seeking (i) liquidation, reorganization or other relief
in respect of Holdings, the Borrower or any Material Subsidiary (except, in the
case of any Material Subsidiary, in a transaction permitted by Section 6.03),
or of a substantial part of its assets, under any Federal, state or foreign
bankruptcy, insolvency, receivership or similar law now or hereafter in effect
or (ii) the appointment of a receiver, trustee, custodian, sequestrator,
conservator or similar official for Holdings, the Borrower or any Material
Subsidiary or for a substantial part of its assets, and, in any such case, such
proceeding or petition shall continue undismissed for 60 days or an order or
decree approving or ordering any of the foregoing shall be entered; 


(i)            Holdings, the Borrower or
any Material Subsidiary shall (i) voluntarily commence any proceeding or file
any petition seeking relief under any Federal, state or foreign bankruptcy,
insolvency, receivership or similar law now or hereafter in effect, (ii)
consent to the institution of any proceeding or petition described in clause
(h) of this Article, (iii) apply for or consent to the appointment of a
receiver, trustee, custodian, sequestrator, conservator or similar official for
Holdings, the Borrower or any Material Subsidiary or for a substantial part of
its assets, (iv) file an answer admitting the material allegations of a
petition filed against it in any such proceeding that would entitle the other
party or parties to an order for relief or (v) make a general assignment for
the benefit of creditors; 


(j)            one or more judgments for
the payment of money in an aggregate amount in excess of $12,500,000 (net of
amounts covered by insurance) shall be rendered against Holdings, the Borrower,
any Subsidiary and the same shall remain undischarged for a period of 45
consecutive days during which execution shall not be effectively stayed, or any
action shall be legally taken by a judgment creditor to attach or levy upon any
assets of Holdings, the Borrower or any Subsidiary to enforce any such
judgment; 


(k)           an ERISA Event shall have
occurred that, when taken together with all other ERISA Events that have
occurred, would reasonably be expected to result in a Material Adverse Effect; 


(l)            any Lien purported to be
created under any Security Document shall cease to be, or shall be asserted by
any Loan Party not to be, a valid and perfected Lien (perfected as, or having
the priority, required by this Agreement or the relevant Security Document and
subject to such limitations and restrictions as set forth herein and therein)
on any Collateral having, in the aggregate, a value in excess of $12,500,000,
except (i) as a result of the sale or other disposition of the applicable
Collateral in a transaction permitted under the Loan Documents or (ii) as a
result of the Agent’s failure to maintain possession of any stock certificates,
promissory notes or other instruments delivered to it under the Collateral
Agreement or to file Uniform Commercial Code continuation statements and except
to the extent that such loss is covered by a Lender’s title insurance policy
and the Administrative Agent shall be reasonably satisfied with the credit of
such insurer; 


(m)          a Change in Control shall
occur; or 



 84
 









(n)           any Guarantee under the
Collateral Agreement for any reason shall cease to be in full force and effect
(other than in accordance with its terms), or any Guarantor shall assert in
writing that the Collateral Agreement or any Guarantee thereunder has ceased to
be or is not enforceable; 


then,
and in every such event (other than an event with respect to the Borrower
described in clause (h) or (i) of this Article), and at any time thereafter
during the continuance of such event, the Administrative Agent may with the
consent of the Required Lenders, and at the request of the Required Lenders shall,
by notice to the Borrower, take either or both of the following actions, at the
same or different times:  (i) terminate
the Commitments, and thereupon the Commitments shall terminate immediately, and
(ii) declare the Loans then outstanding to be due and payable in whole or in
part, and thereupon the principal of the Loans so declared to be due and
payable, together with accrued interest thereon and all fees and other
obligations of the Borrower accrued hereunder, shall become due and payable
immediately, without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Borrower; and in case of any event with
respect to the Borrower described in clause (h) or (i) of this Article, the
Commitments shall automatically terminate and the principal of the Loans then
outstanding, together with accrued interest thereon and all fees and other
obligations of the Borrower accrued hereunder, shall automatically become due
and payable, without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Borrower. 


To the extent Borrower
restates any financial statements for any period as contemplated by Section
7.01(c), such restatement shall cause an Event of Default only if such
restatement causes a default or an event of default under the Senior
Subordinated Notes or the Senior Unsecured Notes, or a violation of any
covenant (without regard to any waiver of any such covenant) contained in any
Senior Subordinated Debt Document or any Senior Unsecured Debt Document,
regardless of, and without application of, any cure period provided under such Senior
Subordinated Debt Document or such Senior Unsecured Debt Document; provided,
however, the Borrower shall not lose the benefit of any cure period specifically
provided for in this Agreement in respect of the covenants contained in the
Loan Documents.


SECTION  7.02.  Equity
Cure.  Notwithstanding anything to
the contrary contained in Article VII, in the event that the Borrower fails to
comply with the requirements of the Financial Covenant, until the expiration of
the 15th day subsequent to the date the certificate calculating compliance (or
non-compliance) with the Financial Covenant is required to be delivered
pursuant to Section 5.01, Holdings shall have the right to issue Permitted Cure
Securities for cash or otherwise receive cash contributions to the capital of
Holdings, and, in each case, to contribute any such cash to the capital of the
Borrower (collectively, the “Cure Right”), and upon the receipt by the Borrower
of such cash (the “Cure Amount”) pursuant to the exercise by Holdings of such
Cure Right, the Financial Covenant shall be recalculated giving effect to the
following pro forma adjustments: 


(a)           Consolidated EBITDA shall be
increased, solely for the purpose of measuring compliance with such Financial
Covenant and not for any other purpose under this Agreement, including in
connection with determining whether, after giving effect to an event, the
requirements of the Financial Covenant have been met or Pro Forma Compliance
exists, by an amount equal to the Cure Amount; and 


(b)           If, after giving effect to
the foregoing recalculations, the Borrower shall then be in compliance with the
requirements of the Financial Covenant, the Borrower shall be deemed to have
satisfied the requirements of the Financial Covenant as of the relevant date of
determination with the same effect as though there had been no failure to
comply therewith at such date, and the



 85
 









applicable breach or default of the Financial Covenant
that had occurred shall be deemed cured for this purposes of the Agreement. 


Notwithstanding
anything herein to the contrary, (i) in each four fiscal quarter period there
shall be a period of at least two fiscal quarters in which the Cure Right is not
exercised, (ii) the Cure Amount shall be no greater than the amount required
for purposes of complying with the Financial Covenant and (iii) any Equity
Issuance consisting of Permitted Cure Securities shall be disregarded for the
purposes of determining compliance with any limitation contained in any of the
covenants in Article VI hereof (other than the Financial Covenant). 


ARTICLE VIII


The Agents


Each
of the Lenders and Issuing Banks hereby irrevocably appoints each of the Administrative
Agent, the Collateral Agent and the Syndication Agent as its agent and
authorizes each Agent to take such actions on its behalf and to exercise such
powers as are delegated to such Agent by the terms of the Loan Documents,
together with such actions and powers as are reasonably incidental thereto.  


Each
bank serving as an Agent hereunder shall have the same rights and powers in its
capacity as a Lender as any other Lender and may exercise the same as though it
were not an Agent, and such bank and its Affiliates may accept deposits from,
lend money to and generally engage in any kind of business with Holdings, the
Borrower or any Subsidiary or other Affiliate thereof as if it were not an
Agent hereunder. 


The
Agents shall not have any duties or obligations except those expressly set
forth in the Loan Documents.  Without
limiting the generality of the foregoing, (a) no Agent shall be subject to any
fiduciary or other implied duties, regardless of whether a Default has occurred
and is continuing, (b) no Agent shall have any duty to take any discretionary
action or exercise any discretionary powers, except discretionary rights and
powers expressly contemplated by the Loan Documents that such Agent is required
to exercise in writing as directed by the Required Lenders (or such other
number or percentage of the Lenders as shall be necessary under the
circumstances as provided in Section 9.02), and (c) except as expressly set
forth in the Loan Documents, no Agent shall have any duty to disclose, and no
Agent shall be liable for the failure to disclose, any information relating to
Holdings, the Borrower or any of its Subsidiaries that is communicated to or
obtained by any bank serving as an Agent or any of their Affiliates in any
capacity (other than as an Agent).  No
Agent shall be liable for any action taken or not taken by it with the consent
or at the request of the Required Lenders (or such other number or percentage
of the Lenders as shall be necessary under the circumstances as provided in
Section 9.02) or in the absence of its own gross negligence or willful
misconduct.  No Agent shall be deemed to
have knowledge of any Default unless and until written notice thereof is given
to such Agent by Holdings, the Borrower or a Lender, and no Agent shall be
responsible for or have any duty to ascertain or inquire into (i) any
statement, warranty or representation made in or in connection with any Loan
Document, (ii) the contents of any certificate, report or other document
delivered thereunder or in connection therewith, (iii) the performance or
observance of any of the covenants, agreements or other terms or conditions set
forth in any Loan Document, (iv) the validity, enforceability, effectiveness or
genuineness of any Loan Document or any other agreement, instrument or
document, or (v) the satisfaction of any condition set forth in Article IV or
elsewhere in any Loan Document, other than to confirm receipt of items
expressly required to be delivered to such Agent.  



 86
 









The
Arrangers, in their capacity as such, shall have no duties or responsibilities,
and shall incur no liability, under this Agreement and the other Loan Documents.


Each
Agent shall be entitled to rely upon, and shall not incur any liability for
relying upon, any notice, request, certificate, consent, statement, instrument,
document or other writing believed by it to be genuine and to have been signed
or sent by the proper Person. Each Agent also may rely upon any statement made
to it orally or by telephone and believed by it to be made by the proper
Person, and shall not incur any liability for relying thereon. Each Agent may
consult with legal counsel (who may be counsel for the Borrower), independent
accountants and other experts selected by it, and shall not be liable for any
action taken or not taken by it in accordance with the advice of any such
counsel, accountants or experts. 


Each
Agent may perform any and all of its duties and exercise its rights and powers
by or through any one or more sub-agents appointed by such Agent.  Each Agent and any such sub-agent may perform
any and all of its duties and exercise its rights and powers through their
respective Related Parties.  The
exculpatory provisions of the preceding paragraphs shall apply to any such
sub-agent and to the Related Parties of each Agent and any such sub-agent, and
shall apply to their respective activities in connection with the syndication
of the credit facilities provided for herein as well as activities as Agent. 


Effective
upon the appointment and acceptance of a successor to such Agent as provided in
this paragraph, any Agent may resign upon 30 days notice to the Lenders, the
Issuing Banks and the Borrower.  Upon
receipt of any such notice of resignation, the Required Lenders shall have the
right, with the consent of the Borrower (such consent not to be unreasonably
withheld or delayed and such consent not to be required if an Event of Default
under clause (a), (b), (h) or (i) of Section 7.01 has occurred and is
continuing), to appoint a successor.  If
no successor shall have been so appointed by the Required Lenders and shall
have accepted such appointment within 30 days after the retiring Agent gives
notice of its resignation, then the retiring Agent may, on behalf of the
Lenders and the Issuing Banks, and with the consent of the Borrower (such
consent not to be unreasonably withheld or delayed) appoint a successor Agent
which shall be a bank with an office in New York, New York, or an Affiliate of
any such bank.  Upon the acceptance of
its appointment as an Agent hereunder by a successor, such successor shall
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Agent, and the retiring Agent shall be discharged from its
duties and obligations hereunder. The fees payable by the Borrower to a
successor Agent shall be the same as those payable to its predecessor unless
otherwise agreed between the Borrower and such successor. After any Agent’s
resignation hereunder, the provisions of this Article and Section 9.03 shall
continue in effect for the benefit of such retiring Agent, its sub-agents and
their respective Related Parties in respect of any actions taken or omitted to
be taken by any of them while it was acting as Agent. 


Each
Lender acknowledges that it has, independently and without reliance upon any
Agent or any other Lender and based on such documents and information as it has
deemed appropriate, made its own credit analysis and decision to enter into
this Agreement.  Each Lender also
acknowledges that it will, independently and without reliance upon any Agent or
any other Lender and based on such documents and information as it shall from
time to time deem appropriate, continue to make its own decisions in taking or
not taking action under or based upon this Agreement, any other Loan Document
or related agreement or any document furnished hereunder or thereunder. 



 87
 









ARTICLE IX


Miscellaneous


SECTION  9.01.  Notices.  (a)  Except
in the case of notices and other communications expressly permitted to be given
by telephone, all notices and other communications provided for herein shall be
in writing and shall be delivered by hand or overnight courier service, mailed
by certified or registered mail or sent by telecopy, as follows:


(i)            if to Holdings or the
Borrower, to it at 1177 Bishop Street, Honolulu, Hawaii 96813, Attention of Paul
Sunu, Chief Financial Officer and Alan Oshima, General Counsel (Telecopy No.
808­546-7621);


(ii)           if to the Administrative Agent,
Collateral Agent, Issuing Bank or Swingline Lender, to Lehman Commercial Paper
Inc., 745 Seventh Avenue, New York, New York 10019, Attention: for credit
notices, Michael Masters (michael.masters@lehman.com, Telecopy No. 646-834-4997);
for borrowing notices, Maritza Ospina (LoanIQAgency@lehman.com, Telecopy No.
646-758-4648) ;


(iii)          if to the Syndication Agent,
to JPMorgan Chase Bank, N.A., Loan and Agency Services Group, 1111 Fannin, 10th
Floor, Houston, Texas 77002, Attention of Maria Giannavola (Telecopy No.
713-750-2878), with a copy to JPMorgan Chase Bank, N.A., 270 Park Avenue, New
York, New York 10017, Attention of John Kowalczuk (Telecopy No. 212-270-4584);
and


(iv)          if to any other Lender, to
it at its address (or telecopy number) set forth in its Administrative
Questionnaire.


(b)           Notices and other communications to the Lenders
hereunder may be delivered or furnished by electronic communications pursuant
to procedures approved by the Administrative Agent; provided that the
foregoing shall not apply to notices pursuant to Article II unless otherwise
agreed by the Administrative Agent and the applicable Lender. The
Administrative Agent or the Borrower may, in its discretion, agree to accept
notices and other communications to it hereunder by electronic communications
pursuant to procedures approved by it; provided that approval of such
procedures may be limited to particular notices or communications.


(c)           Any party hereto may change its address or telecopy
number for notices and other communications hereunder by notice to the other
parties hereto.  All notices and other
communications given to any party hereto in accordance with the provisions of
this Agreement shall be deemed to have been given on the date of receipt.


SECTION  9.02.  Waivers; Amendments.  (a)  No
failure or delay by any Agent, Issuing Bank or Lender in exercising any right
or power hereunder or under any other Loan Document shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right or power,
or any abandonment or discontinuance of steps to enforce such a right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power.  The rights and remedies
of the Agents, the Issuing Banks and the Lenders hereunder and under the other
Loan Documents are cumulative and are not exclusive of any rights or remedies
that they would otherwise have. No waiver of any provision of any Loan Document
or consent to any departure by any Loan Party therefrom shall in any event be
effective unless the same shall be permitted by paragraph (b) of this Section,
and then such waiver or consent shall



 88
 









be effective only in the specific instance and for the purpose for
which given.  Without limiting the
generality of the foregoing, the making of a Loan or issuance of a Letter of
Credit shall not be construed as a waiver of any Default, regardless of whether
any Agent, Lender or Issuing Bank may have had notice or knowledge of such
Default at the time.


(b)           Neither this Agreement nor any other Loan Document
nor any provision hereof or thereof may be waived, amended or modified except,
in the case of this Agreement, pursuant to an agreement or agreements in
writing entered into by Holdings, the Borrower and the Required Lenders or, in
the case of any other Loan Document, pursuant to an agreement or agreements in
writing entered into by the Administrative Agent and the Loan Party or Loan
Parties that are parties thereto, in each case with the consent of the Required
Lenders; provided that no such agreement shall (i) increase the
Commitment of any Lender without the written consent of such Lender, (ii)
reduce the principal amount of any Loan or LC Disbursement held by any Lender
or reduce the rate of interest thereon, reduce or limit the application of the
Applicable Premium or reduce any fees payable hereunder, without the written
consent of such Lender, (iii) postpone the final maturity of any Lender’s Loan,
or any scheduled date of payment of the principal amount of any Lender’s Tranche
C Term Loan under Section 2.10, or the required date of reimbursement of any LC
Disbursement held by any Lender, or any date for the payment of any interest or
fees payable to any Lender hereunder, or reduce the amount of, waive or excuse
any such payment, or postpone the scheduled date of expiration of any
Commitment, without the written consent of such Lender, (iv) change Section 2.18(b)
or (c) in a manner that would alter the pro rata
sharing of payments required thereby or change the last sentence of Section
2.08(e) in a manner which would alter the pro rata
reduction of Commitments thereby, without the written consent of each Lender,
(v) change any of the provisions of this Section or the definition of “Required
Lenders” or any other provision of any Loan Document specifying the number or
percentage of Lenders (or Lenders of any Class) required to waive, amend or
modify any rights thereunder or make any determination or grant any consent
thereunder, without the written consent of each Lender (or each Lender of such
Class, as the case may be), (vi) release Holdings from its Guarantee under the
Collateral Agreement or release a substantial portion of the Guarantees of the
Subsidiary Loan Parties under the Collateral Agreement (except as expressly
provided therein), or limit its liability in respect of such Guarantee, without
the written consent of each Lender, (vii) release all or substantially all of
the Collateral from the Liens of the Security Documents, without the written
consent of each Lender or (viii) change any provisions of any Loan Document in
a manner that by its terms adversely affects the rights in respect of payments
due to Lenders holding Loans of any Class differently than those holding Loans
of any other Class, without the written consent of Lenders holding a majority
in interest of the outstanding Loans and unused Commitments of each affected
Class; provided, further, that any amendment or modification of
the Financial Covenant, or any waiver or consent in respect thereof, shall
require only the consent of the Required Revolving Lenders; and provided,
further that (A) no such agreement shall amend, modify or otherwise affect
the rights or duties of any Agent, any Issuing Bank or the Swingline Lender
without the prior written consent of such Agent, such Issuing Bank or the
Swingline Lender, as the case may be, and (B) any waiver, amendment or
modification of this Agreement that by its terms affects the rights or duties
under this Agreement of the Revolving Lenders (but not the Tranche C Lenders)
or the Tranche C Lenders (but not the Revolving Lenders) may be effected by an
agreement or agreements in writing entered into by Holdings, the Borrower and
requisite percentage in interest of the affected Class of Lenders that would be
required to consent thereto under this Section if such Class of Lenders were
the only Class of Lenders hereunder at the time.  Notwithstanding the foregoing, any provision
of this Agreement may be amended by an agreement in writing entered into by
Holdings, the Borrower, the Required Lenders and the Administrative Agent (and,
if their rights or obligations are affected thereby, each other Agent, each
Issuing Bank and the Swingline Lender) if (i) by the terms of such agreement
the Commitment of each Lender not consenting to the amendment provided for
therein shall terminate upon the effectiveness of such amendment and (ii) at
the time such amendment



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becomes effective, each Lender not consenting thereto receives payment
in full of the principal of and interest accrued on each Loan made by it and
all other amounts owing to it or accrued for its account under this Agreement.


(c)           If, in connection with any proposed change, waiver,
discharge or termination of or to any of the provisions of this Agreement as
contemplated by clauses (i) through (ix), inclusive, of the first proviso to
Section 9.02(b), the consent of Lenders having Revolving Exposures, Tranche C Term
Loans and unused Commitments representing more than 50% of the sum of the total
Revolving Exposures, outstanding Tranche C Term Loans and unused Commitments at
such time is obtained but the consent of one or more of such other Lenders
whose consent is required is not obtained, then the Borrower shall have the
right, so long as all non-consenting Lenders whose individual consent is
required are treated as described in either clause (i) or (ii) below, to either
(i) replace each such non-consenting Lender or Lenders (or, at the option of
the Borrower if any such Lender’s consent is required with respect to less
than all Classes of Loans (or related Commitments), to replace only the
Commitments and/or Loans of such non-consenting Lender that gave rise to the
need to obtain such Lender’s individual consent) with one or more assignees
pursuant to, and with the effect of an assignment under, Section 9.04 so long
as at the time of such replacement, each such assignee consents to the proposed
change, waiver, discharge or termination or (ii) terminate such non-consenting
Lender’s Commitment (if such Lender’s consent is required as a result of its
Commitment) and/or repay each Class of outstanding Loans of such Lender that
gave rise to the need to obtain such Lender’s consent and/or cash collateralize
its LC Exposure, in accordance with Section 2.05(j); provided (A) that,
unless the Commitments that are terminated and Loans that are repaid pursuant
to the preceding clause (ii) are immediately replaced in full at such time
through the addition of new Lenders or the increase of the Commitments and/or
outstanding Loans of existing Lenders (who in each case must specifically
consent thereto), then in the case of any action pursuant to the preceding
clause (ii), Lenders having Revolving Exposures, Tranche C Term Loans and
unused Commitments representing more than 50% of the sum of the total Revolving
Exposures, outstanding Tranche C Term Loans and unused Commitments at such time
(determined after giving effect to the proposed action) shall specifically
consent thereto (B) any such assignee shall be reasonably acceptable to the
Administrative Agent to the extent that such assignment would require the
consent of the Administrative Agent pursuant to Section 9.04 and (C) any such
replacement or termination transaction described above shall be effective on
the date notice is given of the relevant transaction and shall have a
settlement date no earlier than five Business Days and no later than 90 days
after the relevant transaction; provided  further that the
Borrower shall not have the right to replace a Lender, terminate its Commitment
or repay its Loans solely as a result of the exercise of such Lender’s rights
(and the withholding of any required consent by such Lender) pursuant to the
second proviso to Section 9.02(b).


(d)           Without the consent of the Lenders or Issuing Banks,
the Loan Parties and the Administrative Agent may (in their sole discretion, or
shall, to the extent required by any Loan Document) enter into any amendment,
modification or waiver of any Loan Document, or enter into any new agreement or
instrument, to effect the granting, perfection, protection, expansion or
enhancement of any security interest in any Collateral or additional property
to become Collateral for the benefit of the Secured Parties, or as required by
local law to give effect to, or protect, any security interest for the benefit
of the Secured Parties in any Collateral, or so that the security interests
therein comply with applicable law.


(e)           Notwithstanding the foregoing, this Agreement may be
amended (or amended and restated) with the written consent of the Required
Lenders, the Administrative Agent, Holdings and the Borrower (i) to add one or
more additional credit facilities to this Agreement and to permit the
extensions of credit from time to time outstanding thereunder and the accrued
interest and fees in respect



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thereof to share ratably in the benefits of this Agreement and the
other Loan Documents with the Term Loans and the Revolving Loans and the
accrued interest and fees in respect thereof and (ii) to include appropriately
the Lenders holding such credit facilities in any determination of the Required
Lenders.


SECTION  9.03.  Expenses; Indemnity; Damage Waiver.  (a)  The
Borrower shall pay (i) all reasonable out-of-pocket expenses incurred by the
Agents, the Arrangers and their Affiliates, including the reasonable fees,
charges and disbursements of transaction and documentation counsel for the
Agents and the Arrangers and such other local counsel and special counsel as
may be required in the reasonable judgment of the Agents and the Arrangers, in
connection with the syndication of the credit facilities provided for herein,
the preparation and administration of the Loan Documents or any amendments,
modifications or waivers of the provisions thereof (whether or not the
transactions contemplated hereby or thereby shall be consummated), (ii) all
reasonable out-of-pocket expenses incurred by any Issuing Bank in connection
with the issuance, amendment, renewal or extension of any Letter of Credit or
any demand for payment thereunder and (iii) all reasonable out-of-pocket
expenses incurred by the Agents, the Arrangers, the Issuing Banks or any
Lender, (including the reasonable fees, charges and disbursements of
transaction and documentation counsel for the Agents, the Arrangers, the
Issuing Banks and any Lender and such other local counsel and special counsel
as may be required in the reasonable judgment of the Agents and the Arrangers)
in connection with documentary Taxes or the enforcement or protection of its
rights in connection with the Loan Documents, including its rights under this
Section, or in connection with the Loans made or Letters of Credit issued
hereunder, including all such out-of-pocket expenses incurred during any
workout, restructuring or negotiations in respect of such Loans or Letters of
Credit.


(b)           The Borrower shall indemnify the Agents, the
Arrangers, the Issuing Banks and each Lender, and each Related Party of any of
the foregoing Persons (each such Person being called an “Indemnitee”)
against, and hold each Indemnitee harmless from, any and all losses, claims,
damages, liabilities and related expenses, including the reasonable fees,
charges and disbursements of counsel (including such other local counsel and
special counsel as may be required in the reasonable judgment of the Agents and
the Arrangers), incurred by or asserted against any Indemnitee arising out of,
in connection with, or as a result of any actions, judgments, suits, litigations
or investigations of any kind or nature whatsoever, arising out of or in
connection with (i) the execution or delivery of any Loan Document or any other
agreement or instrument contemplated hereby, the performance by the parties to
the Loan Documents of their obligations thereunder or the consummation of the
Transactions or any other transactions contemplated hereby, (ii) any Loan or
Letter of Credit or the use of the proceeds therefrom (including any refusal by
any Issuing Bank to honor a demand for payment under a Letter of Credit if the
documents presented in connection with such demand do not strictly comply with
the terms of such Letter of Credit), (iii) any actual or alleged presence or
Release of Hazardous Materials on or from any Mortgaged Property or any other
property currently or formerly owned or operated by the Borrower or any of its
Subsidiaries, or any Environmental Liability related in any way to the Borrower
or any of its Subsidiaries, or (iv) any actual or prospective claim,
litigation, investigation or proceeding relating to any of the foregoing,
whether based on contract, tort or any other theory and regardless of whether
instituted by any Loan Party or whether any Indemnitee is a party thereto; provided
that such indemnity shall not, as to any Indemnitee, be available to the extent
that such losses, claims, damages, liabilities or related expenses are
determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from such Indemnitee’s (or such Indemnitee’s Related
Parties) breach of its Obligations under the Loan Documents or from the gross
negligence or willful misconduct of such Indemnitee (or such Indemnitee’s
Related Party).



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(c)           To the extent that the Borrower fails to pay any
amount required to be paid by it to any Agent, any Issuing Bank or the
Swingline Lender under paragraph (a) or (b) of this Section, each Lender
severally agrees to pay to such Agent, and each Revolving Lender agrees to pay
to such Issuing Bank or the Swingline Lender, as the case may be, such Lender’s
pro rata share (determined as of the
time that the applicable unreimbursed expense or indemnity payment is sought)
of such unpaid amount; provided that the unreimbursed expense or
indemnified loss, claim, damage, liability or related expense, as the case may
be, was incurred by or asserted against such Agent, such Issuing Bank or the
Swingline Lender in its capacity as such. 
For purposes hereof, a Lender’s “pro rata share”
with respect to payments to any Agent shall be determined based upon its share
of the sum of the total Revolving Exposures, outstanding Term Loans and unused
Commitments at the time, and a Revolving Lender’s “pro rata
share” with respect to payments to any Issuing Bank or the Swingline Lender shall
be determined based upon its share of the sum of the total Revolving Exposures
and unused Commitments at the time.


(d)           To the extent permitted by applicable law, neither
Holdings nor the Borrower shall assert, and each hereby waives, any claim
against any Indemnitee, on any theory of liability, for special, indirect,
consequential or punitive damages (as opposed to direct or actual damages)
arising out of, in connection with, or as a result of, this Agreement or any
agreement or instrument contemplated hereby, the Transactions, any Loan or
Letter of Credit or the use of the proceeds thereof.


(e)           All amounts due under this Section shall be payable
not later than 10 days after written demand therefor accompanied by reasonable
documentation with respect to any reimbursement, indemnification or other
amount requested.


SECTION  9.04.  Successors and Assigns.  (a)  This
Agreement shall be binding upon and inure to the benefit of Holdings, the
Borrower, the Lenders, the Issuing Banks, the Arrangers, the Agents, all future
holders of the Loans and Commitments and their respective successors and permitted
assigns, except that the Borrower may not assign or transfer any of its rights
or obligations under this Agreement without the prior written consent of the
Arrangers, the Agents and each Lender.


(b)           Any Lender may, without the consent of the Borrower
or any other Person, in accordance with applicable law, at any time sell to one
or more banks, financial institutions or other entities (each, a “Participant”)
participating interests in any Loan owing to such Lender, any Commitment of
such Lender or any other interest of such Lender hereunder and under the other
Loan Documents.  In the event of any such
sale by a Lender of a participating interest to a Participant, such Lender’s
obligations under this Agreement to the other parties to this Agreement shall
remain unchanged, such Lender shall remain solely responsible for the
performance thereof, such Lender shall remain the holder of any such Loan for
all purposes under this Agreement and the other Loan Documents, and the
Borrower, the Arrangers and the Administrative Agent shall continue to deal
solely and directly with such Lender in connection with such Lender’s rights
and obligations under this Agreement and the other Loan Documents.  In no event shall any Participant under any
such participation have any right to approve any amendment or waiver of any
provision of any Loan Document, or any consent to any departure by any Loan Party
therefrom, except to the extent that such amendment, waiver or consent would
require the consent of all Lenders pursuant to Section 9.02.  The Borrower agrees that if amounts
outstanding under this Agreement and the Loans are due or unpaid, or shall have
been declared or shall have become due and payable upon the occurrence of an
Event of Default, each Participant shall, to the maximum extent permitted by
applicable law, be deemed to have the right of setoff in respect of its
participating interest in amounts owing under this Agreement to the same extent
as if the amount of its participating interest were owing directly to it as a
Lender under this Agreement, provided, however, that, in
purchasing such participating interest, such Participant shall be deemed to
have agreed to share with the Lenders the proceeds thereof as provided in
Section 2.19(c) as fully as if such Participant were a Lender hereunder.



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The Borrower also agrees that each Participant shall be entitled to the
benefits of Sections 2.15, 2.16 and 2.17 with respect to its participation in
the Commitments and the Loans outstanding from time to time as if such
Participant were a Lender; provided, however, that, in the case
of Section 2.17, such Participant shall have complied with the requirements of
said Section, and provided, further, that no Participant shall be
entitled to receive any greater amount pursuant to any such Section than the
transferor Lender would have been entitled to receive in respect of the amount
of the participation transferred by such transferor Lender to such Participant
had no such transfer occurred.  In
addition, each transferor Lender selling a participation to a Participant under
this Section 9.04(b):  (i) shall keep a
register, meeting the requirements of Treasury Regulation section 5f.103-1(c),
of each such Participant, specifying such Participant’s entitlement to payments
of principal and interest with respect to such participation, and (ii) shall
collect from each such Participant the appropriate forms, certificates and
statements described in Section 2.17 (and updated as required by Section 2.17)
as if such Participant were a Lender under Section 2.17.


(c)           Any Lender (an “Assignor”) may, in accordance
with applicable law, at any time and from time to time assign to any Lender or
any Affiliate, Approved Fund or Controlled Affiliate thereof or, with the
consent of the Borrower and the Administrative Agent and, in the case of any
assignment of Revolving Credit Commitments, the written consent of each Issuing
Bank and the Swingline Lender (which, in each case, shall not be unreasonably
withheld or delayed), to an additional Eligible Assignee all or any part of its
rights and obligations under this Agreement pursuant to an Assignment and Assumption,
executed by such Eligible Assignee and such Assignor (and, where the consent of
the Borrower, the Administrative Agent, the Issuing Banks or the Swingline
Lender is required pursuant to the foregoing provisions, by the Borrower and
such other Persons) and delivered to the Administrative Agent for its
acceptance and recording in the Register; provided, however, that
(A) no such assignment to an Eligible Assignee (other than, in each case, any
Lender, any affiliate of a Lender or any Approved Fund) shall be in an
aggregate principal amount of less than $1,000,000 (in the case of the Tranche
C Term Loans) or $5,000,000 (in the case of the Revolving Commitments), unless
(1) otherwise agreed by the Borrower and the Administrative Agent or (2) such
assignment represents an assignment of all of a Lender’s interests under this
Agreement; provided, that such amount shall be aggregated in respect of
each Lender and its Affiliates or Approved Funds, if any, and (B) if the
Assignor shall retain any Loans or Commitments after giving effect to such
assignment such Loans and Commitments shall, unless otherwise agreed by the
Borrower and the Administrative Agent, be in an aggregate principal amount of
not less than $1,000,000 (in the case of the Tranche C Term Loans) or
$5,000,000 (in the case of the Revolving Commitments).  Upon such execution, delivery, acceptance and
recording in the Register, from and after the effective date determined
pursuant to such Assignment and Assumption, (x) the Eligible Assignee
thereunder shall be a party hereto and, to the extent provided in such Assignment
and Assumption, have the rights and obligations of a Lender hereunder with  Commitments and/or Loans as set forth
therein, and (y) the Assignor thereunder shall, to the extent provided in such
Assignment and Acceptance, be released from its obligations under this
Agreement (and, in the case of an Assignment and Acceptance covering all of an
Assignor’s rights and obligations under this Agreement, such Assignor shall
cease to be a party hereto, except as to Section 2.15, 2.16, 2.17 and 9.03 in
respect of the period prior to such effective date).  Notwithstanding any provision of this
Section, the consent of the Borrower shall not be required for any assignment
that occurs at any time when any Event of Default pursuant to clauses (a), (b),
(h) or (i) of Section 7.01 shall have occurred and be continuing.  For purposes of the minimum assignment
amounts set forth in this paragraph, multiple assignments to or by two or more Approved
Funds shall be aggregated.


For the purposes of this
Section 9.04(c), the term “Approved Fund” has the following meaning:



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“Approved
Fund” means any Person (other than a natural person) that is engaged in
making, purchasing, holding or investing in bank loans and similar extensions
of credit in the ordinary course and that is administered or managed by (a) a
Lender, (b) an Affiliate of a Lender or (c) any entity or an Affiliate of an
entity that administers or manages a Lender.


(d)           The Administrative Agent shall, on behalf of the
Borrower, maintain at its address referred to in Section 9.01 a copy of each
Assignment and Assumption delivered to it and a register (the “Register”)
for the recordation of the name and address of each Lender and each Issuing Bank,
each Lender’s Commitment, each Lender’s and each Issuing Bank’s interest in
each Loan, each Letter of Credit and each Reimbursement Obligation, and in the
right to receive any payments hereunder and any assignment of any such interest
or rights.  The entries in the Register
shall be presumptively correct, in the absence of manifest error, and the
Borrower, the Administrative Agent, the Lenders and the Issuing Banks shall
treat each Person whose name is recorded in the Register as the owner of the
Loans, any Notes evidencing such Loans and any Reimbursement Obligation recorded
therein for all purposes of this Agreement. 
Any assignment of any Loan, whether or not evidenced by a Note, shall be
effective only upon appropriate entries with respect thereto being made in the
Register (and each Note shall expressly so provide).  Any assignment or transfer of all or part of
a Loan evidenced by a Note shall be registered on the Register only upon
surrender for registration of assignment or transfer of the Note evidencing
such Loan, accompanied by a duly executed Assignment and Assumption; thereupon
one or more new Notes in the same aggregate principal amount shall be issued to
the designated Eligible Assignee, and the old Notes shall be returned by the
Administrative Agent to the Borrower marked “canceled”.  The Register shall be available for inspection
by the Borrower, any Lender (with respect to any entry relating to such Lender’s
Loans) or any Issuing Bank (with respect to any entry relating to the Borrower’s
Reimbursement Obligations owed to such Issuing Bank) at any reasonable time and
from time to time upon reasonable prior notice.


(e)           Upon its receipt of an Assignment and Assumption
executed by an Assignor and an Eligible Assignee (and, in any case where the
consent of any other Person is required by Section 9.04(c), by each such other
Person) together with payment to the Administrative Agent of a registration and
processing fee of $3,500 (if required by the Administrative Agent and, in any
case treating multiple, simultaneous assignments by or to two or more Approved
Funds as a single assignment), the Administrative Agent shall (i) promptly
accept such Assignment and Assumption and (ii) on the effective date determined
pursuant thereto record the information contained therein in the Register and
give notice of such acceptance and recordation to the Borrower.  On or prior to such effective date, the
Borrower, at its own expense, upon request, shall execute and deliver to the
Administrative Agent (in exchange for the Note or Notes of the assigning
Lender) a new Note or Notes, to the order of such Eligible Assignee and its
registered assigns in an amount equal to the Revolving Commitment and/or Tranche
C Term Loans, as the case may be, assumed or acquired by it pursuant to such
Assignment and Assumption and, if the Assignor has retained a Revolving
Commitment and/or Tranche C Term Loans, as the case may be, upon request, a new
Note or Notes, as the case may be, to the order of the Assignor and its
registered assigns in an amount equal to the Revolving Commitment and/or Tranche
C Term Loans, as the case may be, retained by it hereunder.  Such new Note or Notes shall be dated the
Closing Date and shall otherwise be in the form of the Note or Notes replaced
thereby.


(f)            For the avoidance of doubt, the parties to this
Agreement acknowledge that the provisions of this Section concerning
assignments of Loans and Notes relate only to absolute assignments and that
such provisions do not prohibit assignments creating security interests in
Loans and Notes, including any pledge or assignment by a Lender of any Loan or
Note to (i) any Federal Reserve Bank in



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accordance with applicable law, (ii) any holder of, or trustee for the
benefit of, the holders of such Lender’s securities or (iii) any SPC to which
such Lender granted an option pursuant to clause (g) below.


(g)           Notwithstanding anything to the
contrary contained herein, any Lender (a “Granting Lender”) may grant to
a special purpose funding vehicle (an “SPC”), identified as such in
writing from time to time by the Granting Lender to the Administrative Agent and
the Borrower, the option to provide to the Borrower all or any part of any Loan
that such Granting Lender would otherwise be obligated to make to the Borrower
pursuant to this Agreement; provided, however, that (i) nothing herein shall constitute a commitment
by any SPC to make any Loan and (ii) if an SPC elects not to exercise such
option or otherwise fails to provide all or any part of such Loan, the Granting
Lender shall be obligated to make such Loan pursuant to the terms hereof.  The making of a Loan by an SPC hereunder
shall utilize the Commitment of the Granting Lender to the same extent, and as
if, such Loan were made by such Granting Lender.  Each party hereto hereby agrees that no SPC
shall be liable for any indemnity or similar payment obligation under this
Agreement (all liability for which shall remain with the Granting Lender).  In furtherance of the foregoing, each party
hereto hereby agrees (which agreement shall survive the termination of this
Agreement) that, prior to the date that is one year and one day after the
payment in full of all outstanding commercial paper or other indebtedness of
any SPC, it will not institute against, or join any other person in instituting
against, such SPC any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings under the laws of the United States or any state
thereof.  In addition, notwithstanding
anything to the contrary in this Section 9.04(g), any SPC may (A) with notice
to, but without the prior written consent of, the Borrower and the
Administrative Agent and without paying any processing fee therefor, assign all
or a portion of its interests in any Loans to the Granting Lender, or with the
prior written consent of the Borrower and the Administrative Agent (which
consent shall not be unreasonably withheld) to any financial institutions
providing liquidity and/or credit support to or for the account of such SPC to
support the funding or maintenance of Loans, and (B) disclose on a confidential
basis any non-public information relating to its Loans to any rating agency,
commercial paper dealer or provider of any surety, guarantee or credit or
liquidity enhancement to such SPC; provided, however, that non-public information with respect to the
Borrower may be disclosed only with the Borrower’s consent which will not be
unreasonably withheld.  This paragraph
(g) may not be amended without the written consent of any SPC with Loans
outstanding at the time of such proposed amendment.  In addition, each Granting Lender
granting an SPC the option to provide to the Borrower all or any part of any
Loan that such Granting Lender would otherwise be obligated to make to the
Borrower pursuant to this Agreement, (i) shall keep a register, meeting the
requirements of Treasury Regulation section 5f.103-1(c), of each SPC which has
funded all or any part of any Loan that such Lender would have otherwise been
obligated to make to the Borrower pursuant to this Agreement, specifying such
SPC’s entitlement to payments of principal and interest with respect to such
Loan and (ii) shall collect, prior to the time such SPC receives payments with
respect to such funded Loan, from each SPC the appropriate forms, certificates
and statements described in Section 2.17 (and updated as required by Section 2.17)
as if such SPC were a Lender under Section 2.17, and each SPC that assigns all
or a portion of its interests in any Loan to any financial institution pursuant
to this Section 9.04(g), (i) shall keep a register, meeting the requirements of
Treasury Regulation section 5f.103-1(c), of each such financial institution,
specifying such financial institution’s entitlement to payments of principal
and interest with respect to such Loan and (ii) shall collect, prior to the
time such financial institution receives payments with respect to such funded
Loan, from each such financial institution the appropriate forms, certificates
and statements described in Section 2.17 (and updated as required by Section 2.17)
as if such financial institution were a Lender under Section 2.17.


(h)           For purposes of this Section 9.04, if an Issuing Bank
transfers its rights with respect to the Borrower’s Reimbursement Obligation
with respect to a Letter of Credit, (i) such Issuing



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Bank shall give the Borrower and the Administrative Agent notice of
such transfer for notation in the Register, (ii) each such transfer may only be
made upon notation of such transfer in the Register, and (iii) no such transfer
will be effective for purposes of this Agreement unless it has been recorded in
the Register.


SECTION  9.05.  Survival.  All covenants, agreements, representations
and warranties made by the Loan Parties in the Loan Documents and in the certificates
or other instruments delivered in connection with or pursuant to this Agreement
or any other Loan Document shall be considered to have been relied upon by the
other parties hereto and shall survive the execution and delivery of the Loan
Documents and the making of any Loans and issuance of any Letters of Credit,
regardless of any investigation made by any such other party or on its behalf
and notwithstanding that any Agent, any Issuing Bank or any Lender may have had
notice or knowledge of any Default or incorrect representation or warranty at
the time any credit is extended hereunder, and shall continue in full force and
effect as long as the principal of or any accrued interest on any Loan or any
fee or any other amount payable under this Agreement is outstanding and unpaid
or any Letter of Credit is outstanding and so long as the Commitments have not
expired or terminated.  The provisions of
Sections 2.15, 2.16, 2.17 and 9.03 and Article VIII shall survive and remain in
full force and effect regardless of the consummation of the transactions
contemplated hereby, the repayment of the Loans, the expiration or termination
of the Letters of Credit and the Commitments or the termination of this
Agreement or any provision hereof.


SECTION  9.06.  Counterparts; Integration; Effectiveness.
 This Agreement may be executed in
counterparts (and by different parties hereto on different counterparts), each
of which shall constitute an original, but all of which when taken together
shall constitute a single contract.  This
Agreement, the other Loan Documents and any separate letter agreements with
respect to fees payable to the Administrative Agent constitute the entire
contract among the parties relating to the subject matter hereof and supersede
any and all previous agreements and understandings, oral or written, relating
to the subject matter hereof.  Except as
provided in Section 4.01, this Agreement shall become effective when it shall
have been executed by the Administrative Agent and when the Administrative
Agent shall have received counterparts hereof which, when taken together, bear
the signatures of each of the other parties hereto, and thereafter shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns. Delivery of an executed counterpart of a
signature page of this Agreement by telecopy or electronic transmission shall
be effective as delivery of a manually executed counterpart of this Agreement.


SECTION  9.07.  Severability.  Any provision of this Agreement held to be
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof; and the invalidity of a particular provision
in a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.


SECTION  9.08.  Right of Setoff.  If an Event of Default shall have occurred and
be continuing, each Lender is hereby authorized at any time and from time to
time, to the fullest extent permitted by law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held and other obligations at any time owing by such Lender to or for the
credit or the account of the Borrower against any of and all the obligations of
the Borrower now or hereafter existing under this Agreement held by such
Lender, irrespective of whether or not such Lender shall have made any demand
under this Agreement and although such obligations may be unmatured.  The rights of each Lender under this Section
are in addition to other rights and remedies (including other rights of setoff)
which such Lender may have.



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SECTION  9.09.  Governing Law; Jurisdiction; Consent to
Service of Process.  (a)  This Agreement shall be construed in accordance
with and governed by the law of the State of New York.


(b)           Each of Holdings and the Borrower hereby irrevocably
and unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of the Supreme Court of the State of New York sitting in New York
County and of the United States District Court of the Southern District of New
York, and any appellate court from any thereof, in any action or proceeding
arising out of or relating to any Loan Document, or for recognition or
enforcement of any judgment, and each of the parties hereto hereby irrevocably
and unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such New York State or, to the extent
permitted by law, in such Federal court. 
Each of the parties hereto agrees that a final judgment in any such
action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by
law.  Nothing in this Agreement or any
other Loan Document shall affect any right that any Agent, any Issuing Bank or
any Lender may otherwise have to bring any action or proceeding relating to
this Agreement or any other Loan Document against Holdings, the Borrower or its
properties in the courts of any jurisdiction.


(c)           Each of Holdings and the Borrower hereby irrevocably
and unconditionally waives, to the fullest extent it may legally and
effectively do so, any objection which it may now or hereafter have to the
laying of venue of any suit, action or proceeding arising out of or relating to
this Agreement or any other Loan Document in any court referred to in paragraph
(b) of this Section.  Each of the parties
hereto hereby irrevocably waives, to the fullest extent permitted by law, the
defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.


(d)           Each party to this Agreement irrevocably consents to
service of process in the manner provided for notices in Section 9.01.  Nothing in this Agreement or any other Loan
Document will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.


SECTION  9.10.  WAIVER OF JURY TRIAL.  EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN  ANY LEGAL PROCEEDING DIRECTLY OR
INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN
DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT,
TORT OR ANY OTHER THEORY).  EACH PARTY
HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER
PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT,
IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B)
ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.


SECTION  9.11.  Headings.  Article and Section headings and the Table of
Contents used herein are for convenience of reference only, are not part of
this Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.


SECTION  9.12.  Confidentiality.  Each Agent, Issuing Bank and Lender agrees to
maintain the confidentiality of the Information (as defined below), except that
Information may be disclosed (a) to its and its Affiliates’ directors,
officers, trustees, employees and agents, including accountants, legal counsel
and other advisors (it being understood that the Persons to whom such
disclosure is made will be informed of the confidential nature of such
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such Information confidential), (b) to the extent requested by any
regulatory authority, (c) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process, (d) to any other party
to this Agreement, (e) in connection with the exercise of any remedies
hereunder or any suit, action or proceeding relating to this Agreement or any other
Loan Document or the enforcement of rights hereunder or thereunder, (f) subject
to an agreement containing provisions substantially the same as those of this
Section, to (i) to any pledgee under Section 9.04(f) or any assignee of or
Participant in, or any prospective assignee of or Participant in, any of its
rights or obligations under this Agreement or (ii) any actual or prospective
counterparty (or its advisors) to any swap or derivative transaction relating
to the Borrower and its obligations, (g) with the consent of the Borrower or
(h) to the extent such Information (i) becomes publicly available other than as
a result of a breach of this Section or (ii) becomes available to any Agent, any
Issuing Bank or any Lender on a nonconfidential basis from a source other than
Holdings or the Borrower. For the purposes of this Section, “Information”
means all information received from Holdings or the Borrower relating to
Holdings or the Borrower or its business, other than any such information that
is available to the Agent, any Issuing Bank or any Lender on a nonconfidential
basis prior to disclosure by Holdings or the Borrower; provided that, in
the case of information received from Holdings or the Borrower after the date
hereof, such information is clearly identified at the time of delivery as
confidential. Any Person required to maintain the confidentiality of
Information as provided in this Section shall be considered to have complied
with its obligation to do so if such Person has exercised the same degree of
care to maintain the confidentiality of such Information as such Person would
accord to its own confidential information.


SECTION  9.13.  Interest Rate Limitation.  Notwithstanding anything herein to the
contrary, if at any time the interest rate applicable to any Loan, together
with all fees, charges and other amounts which are treated as interest on such
Loan under applicable law (collectively the “Charges”), shall exceed the
maximum lawful rate (the “Maximum Rate”) which may be contracted for,
charged, taken, received or reserved by the Lender holding such Loan in
accordance with applicable law, the rate of interest payable in respect of such
Loan hereunder, together with all Charges payable in respect thereof, shall be
limited to the Maximum Rate and, to the extent lawful, the interest and Charges
that would have been payable in respect of such Loan but were not payable as a
result of the operation of this Section shall be cumulated and the interest and
Charges payable to such Lender in respect of other Loans or periods shall be
increased (but not above the Maximum Rate therefor) until such cumulated
amount, together with interest thereon at the Federal Funds Effective Rate to
the date of repayment, shall have been received by such Lender.


SECTION  9.14.  Termination or Release.  (a)  At
such time as the Loans, the Borrower’s obligations to reimburse any Issuing
Bank pursuant to Section 2.05(e) for LC Disbursements, all accrued interest and
fees under this Agreement, and all other obligations under the Loan Documents
(other than (i) obligations under Sections 2.15, 2.17 and 9.03 that are not
then due and payable and (ii) obligations in respect of outstanding Letters of
Credit) shall have been paid in full in cash, the Commitments have been
terminated and all Letters of Credit shall have been discharged or cash
collateralized to the reasonable satisfaction of the Agents and Issuing Banks
(each of which shall have confirmed such satisfaction by written notice to the
Borrower), the Collateral shall be released from the Liens created by the
Security Documents, and the obligations (other than those expressly stated to
survive termination) of the Collateral Agent and each Loan Party under the
Security Documents shall terminate, all without delivery of any instrument or
performance of any act by any Person.


(b)           A Subsidiary Loan Party shall automatically be
released from its obligations under the Collateral Agreement and the security
interests in the Collateral of such Subsidiary Loan Party shall be
automatically released upon the consummation of any transaction permitted by
this Agreement as



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a result of which such Subsidiary Loan Party ceases to be a Subsidiary
of the Borrower or is designated an Unrestricted Subsidiary.


(c)           Upon any sale or other transfer by any Loan Party of
any Collateral that is permitted under this Agreement to any Person that is not
a Loan Party, or upon the effectiveness of any written consent to the release
of the security interest granted by the Collateral Agreement in any Collateral
pursuant to Section 9.02 of this Agreement, the security interest in such
Collateral shall be automatically released.


(d)           In connection with any termination or release
pursuant to paragraph (a), (b) or (c) of this Section 9.14, the Collateral
Agent shall execute and deliver to any Loan Party at such Loan Party’s expense
all documents that such Loan Party shall reasonably request to evidence such
termination or release.  Any execution
and delivery of documents pursuant to this Section 9.14 shall be without recourse
to or warranty by the Collateral Agent or any Lender.


SECTION  9.15.  USA Patriot Act.  Each Lender that is subject to the
requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into
law October 26, 2001)) (the “Patriot Act”) hereby notifies Borrower that
pursuant to the requirements of the Patriot Act, it is required to obtain,
verify and record information that identifies the Borrower, which information
includes the name and address of the Borrower and other information that will allow
such Lender to identify the Borrower in accordance with the Patriot Act.


SECTION  9.16.  Delivery of Lender Addenda.  Each Lender as of the Effective Date which is
not a Continuing Lender shall become a party to this Agreement by delivery to
the Administrative Agent a Lender Addendum duly executed by such Lender, the
Borrower and the Administrative Agent.


SECTION  9.17.  Amendment and Restatement.


(a)           On the Effective Date, the
Existing Credit Agreement shall be amended and restated in its entirety by this
Agreement, and the Existing Credit Agreement shall thereafter be of no further
force and effect, except to evidence (i) the incurrence by the Loan Parties of
the “Obligations” under and as defined in the Existing Credit Agreement
(whether or not such “Obligations” are contingent as of the Effective Date),
(ii) the representations and warranties made by the Loan Parties prior to the
Effective Date and (iii) any action or omission performed or required to be
performed pursuant to such Existing Credit Agreement prior to the Effective
Date (including any failure, prior to the Effective Date, to comply with the
covenants contained in such Existing Credit Agreement).  The amendments and restatements set forth
herein shall not cure any breach thereof or any “Default” or “Event of Default”
under and as defined in the Existing Credit Agreement existing prior to the
Effective Date.  This Agreement is not in
any way intended to constitute a novation of the obligations and liabilities
existing under the Existing Credit Agreement or evidence payment of all or any
portion of such obligations and liabilities.


(b)           The terms and conditions of
this Agreement and the Agents’ and the Lenders’ rights and remedies under this
Agreement and the other Loan Documents shall apply to (i) all of the
Obligations incurred hereunder and all obligations incurred under the Loan
Documents and (ii) all of the “Obligations” incurred under and as defined in
the Existing Credit Agreement and all obligations of the Loan Parties incurred
under the Loan Documents (as defined in the Existing Credit Agreement) (the “Existing
Loan Documents”).



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(c)           Each Grantor (as defined in
the Collateral Agreement) and each Guarantor hereby reaffirms the Liens granted
pursuant to the Existing Loan Documents to the Collateral Agent for the benefit
of the Secured Parties (as defined in the Existing Credit Agreement), which
Liens shall continue in full force and effect during the term of this Agreement
and any renewals thereof and shall continue to secure the Obligations.  Each of the Grantors and the Guarantors
hereby consents to the execution, delivery and performance of this Agreement
and all of the other Loan Documents executed in connection therewith.


(d)           On and after the Effective
Date, (i) all references to the Existing Credit Agreement in the Loan Documents
(other than this Agreement) shall be deemed to refer to the Existing Credit
Agreement, as amended and restated hereby, (ii) all references to any Article,
Section or sub-clause of the Existing Credit Agreement in any Loan Document
(other than this Agreement) shall be deemed to be references to the
corresponding provisions of this Agreement and (iii) except as the context
otherwise provides, on or after the Effective Date, all references to this
Agreement herein (including for purposes of indemnification and reimbursement
of fees) shall be deemed to be references to the Existing Credit Agreement, as
amended and restated hereby.


(e)           This amendment and
restatement is limited as written and is not a consent to any other amendment,
restatement or waiver, whether or not similar and, except as expressly provided
herein or in any other Loan Document, all terms and conditions of the Loan
Documents remain in full force and effect unless otherwise specifically amended
hereby or amended by any other Loan Document.



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IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective authorized officers as of the day and year first
above written.


	
  

  	
  HAWAIIAN TELCOM COMMUNICATIONS, INC.,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  	
  /s/ Michael S. Ruley

  	
   

  
	
   

  	
   

  	
   

  	
  Name: Michael S. Ruley

  
	
   

  	
   

  	
   

  	
  Title: Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HAWAIIAN TELCOM HOLDCO, INC.,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  	
  /s/ Michael S. Ruley

  	
   

  
	
   

  	
   

  	
   

  	
  Name: Michael S. Ruley

  
	
   

  	
   

  	
   

  	
  Title: Chief Executive Officer

  



 











 


	
  

  	
  LEHMAN COMMERCIAL PAPER INC., individually

  and as Administrative Agent and Collateral Agent,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  by

  	
  /s/ Laurie Perper

  	
   

  
	
   

  	
   

  	
  Name: Laurie Perper

  
	
   

  	
   

  	
  Title: Senior Vice President