<PAGE>
 
                          REVOLVING CREDIT AGREEMENT
                          --------------------------

THIS AGREEMENT, made this 28th day of February, 1996, by and between IDS/JONES
GROWTH PARTNERS 87-A, LTD., a Colorado limited partnership, with offices at 9697
East Mineral Avenue, Englewood, Colorado 80112 (the "Borrower"), and COLORADO
NATIONAL BANK, a national banking association with offices at 918 17th Street,
Denver, Colorado 80202 (the "Bank").


                                  WITNESSETH

WHEREAS, Borrower owns certain cable television franchises, related contract
rights and operating cable television properties and systems in Placer County,
California, and the City of Roseville, California, as defined below, the
"System");

WHEREAS, Borrower desires to borrow $10,000,000.00 for the purpose of
refinancing existing debt and obtaining working capital; and

WHEREAS, Bank is willing to lend $10,000,000.00 to Borrower subject to the terms
and conditions hereof;

NOW, THEREFORE, in consideration of the premises and the agreements hereinafter
set forth, and intending to be legally bound hereby, the parties hereby agree as
follows:

1.      DEFINITIONS.  When used in this Agreement, the following terms shall 
        -----------
have the meaning set forth below;  financial and accounting terms used in the
following definitions or elsewhere in this Agreement, except as otherwise
provided herein, shall be defined in accordance with generally accepted
accounting principles consistently applied.

1.1     "Advance Request Form" shall mean the certificate to be delivered by
         --------------------
        Borrower to Bank as a condition of each advance of the Loan pursuant to
        Section 2.6 hereof and in the form of Exhibit A attached hereto.
                                              ---------

1.2     "Agreement" shall mean this Agreement and all the exhibits hereto, as
         ---------
        amended from time to time.

1.3     "Annualized Operating Cash Flow" shall mean at any time four (4) times
         ------------------------------
        Borrower's Operating Cash Flow for the most recent fiscal quarter.

1.4     "Bank" shall mean Colorado National Bank, a national banking association
         ----
        and its successors and assigns.

1.5     "Basic Rate" shall mean the minimum standard monthly fees and charges
         ----------
        for "basic service" (as such term is commonly understood in the cable
        television industry) charged to Basic Subscribers.

<PAGE>
 
1.6     "Basic Subscribers" shall mean the subscribers in the System who are (a)
         -----------------
        currently receiving cable television signals supplied by Borrower; (b)
        have commenced payment for such signals at the Basic Rate or the
        Expanded Basic Rate, directly or indirectly, under subscriptions with
        Borrower; and (c) are not sixty (60) or more days delinquent in payments
        as determined on a contractual basis. In the case of commercial
        buildings, such as hotels or motels, or in the case of multiple
        residential dwellings, such as apartment houses and multifamily homes,
        which do not obtain reduced bulk service rates, each separate guest unit
        or dwelling unit receiving services shall be counted as one subscriber.
        The number of subscribers in a commercial building or in a multiple
        residential dwelling which does obtain a reduced bulk service rate shall
        be obtained by dividing (a) the aggregate dollar amount of monthly
        subscribers' fees paid on account of such commercial building or
        multiple residential dwelling for basic service by (b) the applicable
        Basic Rate for the System in which such building or dwelling is located.
        Except for discounts to senior citizens less than 20% of the otherwise
        applicable rate, residential households (other than a multiple
        residential dwelling) paying for services on a discounted basis or under
        any form of deferred payment arrangement shall not be included.

1.7     "Borrower" shall mean IDS/Jones Growth Partners 87-A, Ltd., a Colorado
         --------
        limited partnership.

1.8     "Capital Lease" shall mean capital leases and subleases as defined in
         -------------
        the Financial Accounting Standards Board Statement of Financial
        Accounting Standards No.13, dated November, 1976.

1.9     "Collateral Assignment" shall mean that certain Collateral Assignment of
         ---------------------
        Management Agreement and Consent of even date herewith executed by Jones
        and consented to by Jones Intercable.

1.10    "Commitment" shall mean the maximum aggregate principal amount which
         ----------
        Bank has agreed to advance at any one time under Section 2.1 hereof.

1.11    "Communications Act" shall mean the Federal Communications Act of 1934,
         ------------------
        as amended, and the rules and regulations promulgated thereunder, as
        from time to time in effect.

1.12    "Copyright Act" shall mean Title 17 of the United States Code, as
         -------------
        amended, and the rules and regulations promulgated thereunder, as from
        time to time in effect.

                                      -2-
<PAGE>
 
1.13    "Debt Service" shall mean, for each twelve-month period ending on the
         ------------
        last day of a fiscal quarter, the sum of all principal and interest
        payments due on Funded Debt during such period.

1.14    "Depreciation" shall mean for any fiscal quarter of Borrower, the sum of
         ------------
        all Borrower's depreciation and amortization expenses for such quarter,
        as determined in accordance with GAAP.

1.15    "ERISA" shall mean the Employee Retirement Income Security Act of 1974,
         -----
        as amended, and the rules and regulations promulgated thereunder, or
        from time to time in effect.

1.16    "ERISA Affiliate" shall mean any employer, whether or not incorporated,
         ---------------
        which is considered a single employer with Borrower under Titles I, II,
        or IV of ERISA.

1.17    "Event of Default" shall have the meaning set forth in Section 7.1
         ----------------
        below.

1.18    "Expanded Basic Rate" shall mean the minimum standard monthly fees and
         -------------------
        charges for "expanded basic service" (as such term is commonly
        understood in the cable television industry) charged to Basic
        Subscribers.

1.19    "FCC" shall mean the Federal Communications Commission.
         ---

1.20    "Funded Debt" shall mean, at any time as of which such sum is being
         -----------
        computed, the sum of all of Borrower's principal indebtedness for 
        (a) borrowed money other than trade indebtedness or accrued liabilities
        incurred in the normal and ordinary course of business for value
        received or indebtedness which has been expressly subordinated to the
        indebtedness owing to Bank, (b) Capital Leases, and (c) installment
        purchases of real or personal property.

1.21    "GAAP" shall mean generally accepted accounting principles as from time
         ----
        to time in effect, consistently applied, which shall include the
        official interpretations thereof by the Financial Accounting Standards
        Board.

1.22    "Gross Operating Revenues" shall mean, for any period for which such sum
         ------------------------
        is being computed, the sum of all revenues of Borrower during such
        period determined in accordance with GAAP.

1.23    "Home Office Allocations" shall mean, for any period for which such sum
         -----------------------
        is being computed, the amount of reimbursement payable by Borrower to
        Jones Intercable for general overhead and administrative expenses
        pursuant to Section 4.2 of the Partnership Agreement during such period.

                                      -3-
<PAGE>
 
1.24    "IDS" shall mean IDS Cable Corporation, a Minnesota corporation, which
         ---
        is the Supervising General Partner of Borrower.

1.25    "Jones" shall mean Jones Cable Corporation, a Colorado corporation,
         -----
        which is the Managing General Partner of Borrower.

1.26    "Jones Intercable" shall mean Jones Intercable, Inc., a Colorado
         ----------------
        corporation, and the owner of 100% of the outstanding stock of Jones.

1.27    "Loan" shall mean the outstanding principal balance of indebtedness
         ----
        advanced under the Commitment.

1.28    "Local Authorities" shall mean individually and collectively the
         -----------------
        California state and local authorities which govern cable television
        systems.

1.29    "Management Fees" shall mean for any period for which such sum is being
         ---------------
        computed the amount of management fees payable by Borrower to Jones
        pursuant to Section 4.1 of the Partnership Agreement.

1.30    "Net Income" shall mean for any fiscal quarter of Borrower, Borrower's
         ----------
        net profit after taxes for such quarter, as determined in accordance
        with GAAP.

1.31    "Note" shall mean Borrower's promissory note evidencing Borrower's
         ----
        indebtedness to Bank under the Loan, in the form attached hereto as
        Exhibit B.
        ---------

1.32    "Operating Cash Flow" shall mean, for any fiscal quarter of Borrower,
         -------------------
        the sum of the following items for such quarter: (a) Net Income, 
        (b) income taxes, (c) Depreciation, (d) interest expense of Borrower,
        (e) Management Fees, and (f) Home Office Allocations, less any non-cash
        gains or income of Borrower determined in accordance with GAAP.

1.33    "Partnership Agreement" shall mean the IDS/Jones Growth Partners Program
         ---------------------
        Limited Partnership Agreement dated as of September 15, 1987, as it may
        be amended from time to time, by and among Jones, as Managing General
        Partner, IDS, as Supervising General Partner, and certain other parties
        identified therein, as limited partners.

1.34    "Restricted Payments" shall mean redemptions, repurchases, dividends and
         -------------------
        distributions of any kind in respect of partnership interests in
        Borrower.

1.35    "Security Agreement" shall mean that certain Security Agreement of even
         ------------------
        date herewith executed by Borrower in favor of Bank.

                                      -4-
<PAGE>
 
1.36    "Subordination Agreements" shall mean the Subordination Agreements of
         ------------------------
        even date herewith executed by Jones and Jones Intercable, in favor of
        Bank.

1.37    "Subsidiary" shall mean any corporation of which the Borrower, directly
         ----------
        or indirectly, owns more than 50% of any class or classes of securities.

1.38    "System" shall mean collectively Borrower's cable television franchises,
         ------
        properties and systems in and around Placer County, California, and the
        City of Roseville, California, as more particularly described in Exhibit
        C hereto.

1.39    "Termination Date" shall mean the earlier of December 31, 2003 or the
         ----------------
        date on which the Commitment is terminated pursuant to Section 2.7
        hereof.

2.      LOAN.
        ----

2.1     The Facility. From time to time prior to the Termination Date and
        ------------
        subject to the terms and conditions herein, Bank will loan funds to
        Borrower and Borrower may repay at the office of Bank specified above
        and reborrow under a revolving loan facility in an aggregate principal
        amount not to exceed at any time outstanding the amount of the
        Commitment. Prior to March 31, 1999, the Commitment shall be Ten Million
        Dollars ($10,000,000.00). The Commitment shall be reduced on the last
        day of each calendar quarter commencing with the calendar quarter ending
        March 31, 1999, and continuing on the last day of each calendar quarter
        thereafter, by the following amounts:

<TABLE> 
<CAPTION> 
                                                  Amount of
        Year                                 Quarterly Reduction
        ----                                 -------------------

        <S>                                        <C>    
        3/31/99 through 12/31/99                   $250,000
        3/31/2000 through 12/31/2000               $375,000
        3/31/2001 through 12/31/2001               $500,000
        3/31/2002 through 12/31/2002               $625,000
        3/31/2003 through 12/31/2003               $750,000
</TABLE>

2.2     Promissory Note. The indebtedness of Borrower to Bank under the Loan
        ---------------
        will be evidenced by a Note executed by Borrower in favor of Bank in the
        form of Exhibit B hereto. The original principal amount of the Note will
        be the amount of the Commitment; provided, however, that notwithstanding
        the face amount of the Note, Borrower's liability under the Note shall
        be limited at all times to its actual indebtedness, principal and
        interest and fees, then outstanding hereunder and thereunder.

                                      -5-
<PAGE>
 
2.3     Use of Proceeds. Funds advanced under the Loan may be used for any
        ---------------
        purposes not prohibited by this Agreement.

2.4     Repayment.
        ---------

        (a)  Commencing with the calendar quarter ending March 31, 1999, and on
             the last day of each calendar quarter thereafter, there shall be
             due and payable such amounts of principal, if any, as are necessary
             to reduce the outstanding principal balance of the Note to an
             amount equal to the reduced Commitment taking effect on such date
             pursuant to Section 2.1 of this Agreement.

        (b)  Notwithstanding the preceding portion of this Section 2.4, in the
             event that Bank shall have terminated the Commitment upon the
             occurrence of any Event of Default hereunder, the aggregate
             outstanding balance of the Note shall be due and payable on the
             date of Bank's declaration of the Event of Default and termination
             of the Commitment.

2.5     Interest. The Loan shall bear interest on the outstanding principal
        --------
        amount thereof in accordance with the following provisions:

        (a)  Definitions. As used herein, the following words and terms shall
             -----------
             have the meanings specified below:

               (i)   "Adjusted Libor Rate" shall mean the Libor Rate plus one
                      -------------------
                     and one-quarter percent (1-1/4%) per annum.

              (ii)   "Business Day" shall mean any day not a Saturday, Sunday or
                      ------------
                     public holiday under the laws of the State of Colorado on
                     which banks are open for the transaction of business.

             (iii)   "Business Day in London" shall mean a day on which banks in
                      ----------------------
                     London are open for the transaction of business.

              (iv)   "Interest Period" shall mean, with respect to the Adjusted
                      ---------------
                     Libor Rate, a period of one (1), two (2), three (3) or six
                     (6) months duration as Borrower may elect; provided,
                     however, that (a) if any Interest Period would otherwise
                     end on a day which shall not be a Business Day in London,
                     such Interest succeeding Business Day in London, subject to
                     clauses (c) and (d) below; (b) interest shall accrue from
                     and including the first day of

                                      -6-
<PAGE>
 
                     each Interest Period to, but excluding, the day on which
                     any Interest Period expires; (c) any Interest Period which
                     would otherwise end on a day which is not a Business Day in
                     London shall extend to the next succeeding Business Day in
                     London unless such Business Day falls in another calendar
                     month, in which case such Interest Period shall end on the
                     next preceding Business Day in London; and (d) any Interest
                     Period which begins on the last Business Day of a calendar
                     month (or on a day for which there is no corresponding day
                     to the calendar month at the end of the Interest Period)
                     shall end on the last Business Day of a calendar month.

               (v)   "Libor Rate" shall mean the rate per annum (rounded
                      ----------
                     upwards, if necessary, to the next 1/16 of 1%) determined
                     pursuant to the following formula:

                                            LIBOR Rate
                                     ------------------------   
                     Libor Rate =     1 - Reserve Percentage

                     For purposes hereof, "LIBOR Rate" shall mean, for any
                                           ----------
                     Interest Period, as applied to a Portion, the arithmetic
                     average of the rates of interest per annum (rounded
                     upwards, if necessary to the next 1/16 of 1%) at which Bank
                     is offered deposits of United States dollars in the London
                     Interbank Market on or about 9:00 a.m. Denver time two (2)
                     Business Days prior to the commencement of such Interest
                     Period in amounts substantially)ally equal to such Portion
                     of the outstanding principal amount of the Loan as to which
                     Borrower may elect the Adjusted Libor Rate to be applicable
                     and with a maturity of comparable duration to the Interest
                     Period selected by Borrower.

              (vi)   "Portion" shall mean a portion of a Loan as to which a
                      -------
                     specific interest rate and, except in the case of a Portion
                     bearing interest at the Reference Rate, Interest Period,
                     has been elected by Borrower.

             (vii)   "Reference Rate" shall mean the rate of interest which has
                      --------------
                     been publicly announced by First Bank National Association
                     in Minneapolis, Minnesota ("FNBA"), from time to time, as
                     its "Reference Rate", which may be a

                                      -7-
<PAGE>
 
                     rate at, above or below the rate or rates at which Bank or
                     FNBA lends to other parties.

            (viii)   "Reserve" shall mean for any day that reserve (expressed as
                      -------
                     a decimal) which may be applicable to Bank on such day, as
                     prescribed by the Board of Governors of the Federal Reserve
                     System (or any successor or any other banking authority to
                     which Bank is subject including any board or governmental
                     or administrative agency of the United States or any other
                     jurisdiction to which Bank is subject), for determining the
                     maximum reserve requirement (including without limitation
                     any basic, supplemental, marginal or emergency reserves)
                     for (i) Bank's negotiable nonpersonal time deposits in
                     United States dollars of $100,000 or more with maturities
                     of comparable duration to the Interest Period elected by
                     Borrower, (ii) deposits of United States dollars in a non-
                     United States office or an international banking facility
                     of Bank used to fund a Portion of the Loan subject to the
                     Adjusted Libor Rate, (iii) any loan made with the proceeds
                     of the deposits described in (ii) above, (iv) the principal
                     amount of or interest on the Loan subject to the Adjusted
                     Libor Rate, or (v) funds transferred from a non-United
                     States office or an international banking facility of Bank
                     to its United States office.

              (ix)   "Reserve Percentage" shall mean, for any day, that
                      ------------------
                     percentage (expressed as a decimal) to which Bank is
                     subject (whether or not actually incurred by Bank) on such
                     day, as prescribed by the Board of Governors of the Federal
                     Reserve System (or any successor or any other banking
                     authority to which Bank is subject, including any board or
                     governmental or administrative agency of the United States
                     or any other jurisdiction to which Bank is subject), for
                     determining the reserve requirement (including without
                     limitation any basic, supplemental, marginal or emergency
                     reserves) for Bank's negotiable, non-personal time deposits
                     in United States dollars of $100,000 or more with
                     maturities of comparable duration to the Interest Period
                     selected by Borrower. The Libor Rate shall be adjusted on
                     and as of the effective day of any change in the Reserve
                     Percentage.

                                      -8-
<PAGE>
 
        (b)  Interest on Loan. At Borrower's election in accordance with the
             ----------------
             provisions of Section 2.5(c) below, the Loan or any Portion
             thereof, shall bear interest at either one of the following rates:
             (i) the Adjusted Libor Rate or (ii) the Reference Rate. Any portion
             of the Loan for which Borrower has not made an election, pursuant
             to Section 2.5(c) below, shall bear interest at the Reference Rate.

        (c)  Procedure for Determining Interest Periods and Rates of Interest.
             ----------------------------------------------------------------

                (i)    If Borrower anticipates that it may elect the Adjusted
                       Libor Rate to be applicable to a new advance of the
                       Commitment or to a Portion which was subject to such rate
                       during an expiring Interest Period or which was subject
                       to the Reference Rate, Borrower must notify Bank at least
                       two (2) Business Days prior to such new advance and/or
                       the commencement of the proposed Interest Period of the
                       rate(s) which Borrower anticipates it may elect to be
                       applicable to such new advance or Portion and the
                       duration of the proposed Interest Period(s). If Borrower
                       anticipates that it may elect the Adjusted Libor Rate to
                       be applicable to such new advance or Portion of the Loan,
                       Borrower must request a quotation of such rate(s) prior
                       to 11:00 a.m. Denver time two (2) Business Days in London
                       as to the Adjusted Libor Rate, prior to such advance
                       and/or the commencement of the proposed Interest Period,
                       and if Borrower desires to elect such rate(s), Borrower
                       must accept such quotation of the Adjusted Libor Rate no
                       later than 1:00 p.m. Denver time on the date such
                       quotation is given by Bank. If Borrower does not provide
                       the applicable notice for the Adjusted Libor Rate, then
                       Borrower shall be deemed to have requested that the
                       Reference Rate shall apply to any Portion which was
                       subject to the rate of interest applicable during an
                       expiring Interest Period and to any new advance of the
                       Commitment until Borrower shall have given proper notice
                       of a change in or determination of the rate of interest
                       in accordance with this Section 2.5(c).

               (ii)    Borrower shall not request, and Bank shall not be
                       required to provide, an indication or quotation with
                       respect to a specified rate of interest for a Portion in
                       an amount less than

                                      -9-
<PAGE>
 
                       $100,000 for an Adjusted Libor Rate. Borrower shall not
                       elect more than four (4) different Portions (other than a
                       Portion bearing interest at the Reference Rate) to be
                       applicable to the Loan.

              (iii)    Upon an election of the Adjusted Libor Rate made by
                       Borrower pursuant to subparagraph (c) (i) above, such
                       rate shall apply to the applicable Portion of the Loan
                       unless Bank is unable to obtain the necessary funding for
                       such rate, in which event Bank will so notify Borrower
                       and interest will accrue at the Reference Rate.

        (d)  Payment and Calculation of Interest. With respect to Portions of
             -----------------------------------
             the Loan which bear interest at the Adjusted Libor Rate, Borrower
             shall pay interest upon the expiration of the Interest Period for
             each Portion; with respect to Portions of the Loan which bear
             interest at the Reference Rate, Borrower shall pay interest with
             respect to each outstanding Portion of the Loan on a quarterly
             basis on the last day of each calendar quarter, commencing with the
             last day of the calendar quarter in which this Agreement is
             executed, and continuing on the last day of each March, June,
             September and December thereafter until maturity and thereafter
             upon demand. If any Event of Default shall occur and be continuing,
             and the Loan is not paid when due, each of the Adjusted Libor Rate
             and the Reference Rate shall be increased by two percent (2%) per
             annum (but not in excess of the maximum rate allowed by applicable
             law) and interest shall be payable at the relevant rate on the Loan
             or each Portion thereof until the Loan has been paid in full.
             Interest shall be calculated in accordance with the provisions of
             Section 2.5(b) on the basis of the actual number of days elapsed
             over a year of, (i) with respect to Portions of the Loan bearing
             interest at the Adjusted Libor Rate, three hundred sixty (360)
             days, and (ii) with respect to Portions of the Loan bearing
             interest at the Reference Rate, three hundred sixty-five (365)
             days, or three hundred sixty-six (366) days, as the case may be.

        (e)  Reserves. If at any time the Loan or any Portion of the Loan
             --------
             outstanding hereunder is subject to the Adjusted Libor Rate, and
             Bank is subject to and incurs a Reserve, Borrower hereby agrees to
             pay within five (5) Business Days of demand thereof from time to
             time, as billed by Bank, such additional amount as is necessary to
             reimburse Bank for its costs in maintaining such Reserve. Such
             amount shall be

                                     -10-
<PAGE>
 
             computed by taking into account the cost incurred by Bank in
             maintaining such Reserve in an amount equal to the Portion on which
             such Reserve is incurred. The determination by Bank of such costs
             incurred shall be prima facie evidence of the correctness of the
             fact and amount of such additional cost.

        (f)  Special Provisions Applicable to Adjusted Libor Rate. The following
             ----------------------------------------------------
             special provisions shall apply to the Adjusted Libor Rate:

               (i)   Change of Libor Rates.  The Adjusted Libor Rate may be
                     ---------------------
                     automatically adjusted by Bank on a prospective basis to
                     take into account the additional or increased cost of
                     maintaining any necessary reserves for Eurodollar deposits
                     or increased costs due to changes in applicable law
                     occurring subsequent to the commencement of the then
                     applicable Interest Period, including but not limited to
                     changes in tax laws (except corporate income tax laws) and
                     changes in the reserve requirements imposed by the Board of
                     Governors of the Federal Reserve System (or any successor),
                     including the Reserve Percentage but excluding the Reserve,
                     that increase the cost to Bank of funding the Loan or a
                     Portion thereof bearing interest at the Adjusted Libor
                     Rate. Bank shall give Borrower notice of such a
                     determination and adjustment and Borrower may, by notice to
                     Bank (a) require Bank to furnish to Borrower a statement
                     setting forth the basis for adjusting such Adjusted Libor
                     Rate and the method for determining the amount of such
                     adjustment; and/or (b) repay the Portion of the Loan with
                     respect to which such adjustment is made pursuant to the
                     requirements of Section 2.8 hereof.

              (ii)   Unavailability of Eurodollar Funds. In the event that
                     ----------------------------------
                     Borrower shall have requested a quotation of the Adjusted
                     Libor Rate in accordance with Section 2.5(c) hereof and
                     Bank shall have reasonably determined that Eurodollar
                     deposits equal to the amount of the principal of the Loan,
                     or a Portion thereof, and for the Interest Period specified
                     are unavailable or that the Adjusted Libor Rate will not
                     adequately and fairly reflect the cost of making or
                     maintaining the principal amount of the Loan specified by
                     Borrower during the Interest

                                     -11-
<PAGE>
 
                     Period specified or that by reason of circumstances
                     affecting Eurodollar markets, adequate and reasonable means
                     do not exist for ascertaining an Adjusted Libor Rate
                     applicable to the specified Interest Period, Bank shall
                     promptly give notice of such determination to Borrower that
                     the Adjusted Libor Rate is not available. A determination
                     by Bank hereunder shall be prima facie evidence of the
                     correctness of the fact.

             (iii)   Illegality. In the event that it becomes unlawful for Bank 
                     ----------
                     to maintain Eurodollar liabilities sufficient to fund any
                     Portion of the Loan subject to the Adjusted Libor Rate,
                     then Bank shall immediately notify Borrower thereof and
                     Bank's obligations hereunder to advance funds or maintain
                     the Loan or a Portion thereof at the Adjusted Libor Rate
                     shall be suspended until such time as Bank may again cause
                     the Adjusted Libor Rate to be applicable to any Portion of
                     the outstanding principal balance of the Loan and any
                     Portion shall then be subject to the Reference Rate.

        (g)  Minimizing Additional Cost.  To the extent reasonably possible,
             --------------------------
             Bank will use its best efforts to minimize any additional costs
             which may arise under either subparagraphs (e) or (f) above.

2.6     Advances. In addition to the notice required under Section 2.5(c) hereof
        --------
        with respect to interest rate elections, Borrower shall give Bank at
        least one (1) Business Day's prior notice, in case of a Reference Rate
        advance, and two (2) Business Days' prior notice, in case of an Adjusted
        Libor Rate advance, of each requested new advance under the Commitment,
        such request to be confirmed in writing and received by Bank within five
        (5) Business Days after the date of the advance by delivering to Bank an
        Advance Request Form certified by the President, Vice President/Finance
        or Treasurer of Jones, in the form attached hereto as Exhibit A,
        containing the following information and representations, which must be
        true and correct as of the date of the requested advance:

        (a)  the aggregate amount of the requested advance, which shall be in
             multiples of $25,000 or, if less, the unborrowed balance of the
             Commitment for a Portion subject to the Reference Rate, and of not
             less than $100,000, for a Portion subject to the Adjusted Libor
             Rate;

                                     -12-
<PAGE>
 
        (b)  confirming the interest rate(s) Borrower has elected to apply to
             the new advance and, if more than one interest rate has been
             elected, the amount of the Portion as to which each interest rate
             shall apply; and

        (c)  representations that (i) the representations and warranties set
             forth in Section 3 hereof are true and correct; (ii) no Event of
             Default hereunder, or event which with the passage of time or the
             giving of notice or both would constitute an Event of Default
             hereunder, has occurred and is then continuing; and (iii) there has
             been no material adverse change in Borrower's financial condition
             or business since the date hereof.

2.7     Reduction and Termination of Commitment. Borrower shall have the right
        ---------------------------------------
        at any time and from time to time, upon three (3) Business Days' prior
        written notice to Bank, to reduce the amount of the Commitment in whole
        or in part without penalty or premium, provided that on the effective
        date of such reduction, Borrower shall make a prepayment of the Loan in
        an amount, if any, by which the aggregate outstanding principal balance
        of the Loan exceeds the amount of the Commitment as then so reduced,
        together with accrued interest on the amount so prepaid; provided that
        in the event of such a prepayment of a Portion of the Loan upon which
        interest is determined by reference to the Adjusted Libor Rate prior to
        the end of the applicable Interest Period, Borrower shall reimburse Bank
        for any costs and expenses incurred by Bank on account of such
        prepayment, including but not limited to funding costs. Bank shall have
        the right to terminate the Commitment at any time, in its discretion and
        upon notice to Borrower, upon the occurrence of any Event of Default
        hereunder. Any termination or reduction of the Commitment shall be
        permanent, and the Commitment cannot thereafter be restored or increased
        without the written consent of Bank.

2.8     Prepayments.
        -----------

        (a)  Subject to the provision of subsection (b) below, Borrower may pay
             or prepay the outstanding principal balance under the Loan at any
             time without premium or penalty, and such payments or prepayments
             shall not reduce the Commitment (other than as it may have been
             reduced pursuant to Section 2.1 above) and may be reborrowed.  All
             principal payments or repayments shall be applied first to any
             Portion bearing interest at the Reference Rate, with any remaining
             amounts of the payment or prepayment to then be applied to any
             Portion(s) bearing interest at the Adjusted Libor Rate.  Except for
             a prepayment required to be made by

                                     -13-
<PAGE>
 
             Borrower pursuant to paragraph 2.8 (b) hereof, payments or
             prepayments shall be in multiples of $25,000, but not less than
             $100,000 if subject to the Adjusted Libor Rate. Borrower shall
             notify Bank at least one (1) Business Day in advance of such
             payment.

        (b)  If a Portion of the Loan upon which interest is determined by
             reference to the Adjusted Libor Rate is repaid or prepaid other
             than at the end of the applicable Interest Period (including
             repayment or prepayment by reason of acceleration or otherwise),
             Borrower shall reimburse Bank for any costs and expenses incurred
             by Bank on account of such repayment or prepayment, including but
             not limited to funding costs.

2.9     Payments in Available Funds.  All payments and prepayments shall be made
        ---------------------------
        by Borrower at the offices of Bank specified above no later than 2:00
        p.m. Denver time and in immediately available funds.

2.10    Fees.  Borrower shall pay Bank a fee of $50,000 upon execution of this
        ----
        Agreement.  In addition, from the date hereof until the Loan is paid in
        full, Borrower shall pay Bank a commitment fee at the rate of three-
        eighths of one percent (3/8%) per annum on the unborrowed portion of the
        Commitment, which shall be payable at the offices of the Bank specified
        above, quarterly, in arrears as billed by the Bank.  The commitment fee
        shall be calculated on the basis of the actual number of days elapsed
        over a year of three hundred sixty-five (365) days or three hundred
        sixty-six (366) days, if applicable, and shall be payable on the last
        day of each March, June, September and December, commencing the last day
        of the calendar quarter in which this Agreement is executed.

2.11    Collateral.  The repayment of all of Borrower's indebtedness to Bank
        ----------
        shall be secured by first priority security interests (the "Security
        Interests") in all real estate, fixtures, accounts, equipment, inventory
        and general intangibles (such terms having the meanings given them in
        the Colorado Uniform Commercial Code) including all of the cable
        television franchises relating to the System, now owned or hereafter
        acquired by Borrower, and in all proceeds thereof (the "Collateral").
        The Security Interests shall be created and perfected by mortgages,
        deeds of trust, collateral assignments, security agreements, UCC
        financing statements, and any other collateral documents deemed
        necessary or advisable by Bank in its sole discretion, each in form
        satisfactory to Bank, duly executed by Borrower (the "Collateral
        Documents"). Hereafter, Borrower shall from time to time execute and
        deliver to Bank such other documents in form and substance

                                     -14-
<PAGE>
 
        satisfactory to Bank, and perform such other acts, as Bank may
        reasonably request, to perfect and maintain valid Security Interests in
        the Collateral.

3.      REPRESENTATIONS AND WARRANTIES.  Borrower represents and warrants as
        ------------------------------
        follows:

3.1     Organization and Good Standing.  Borrower is a limited partnership duly
        ------------------------------
        formed and validly existing under the laws of the State of Colorado; and
        Borrower has the partnership power and authority to carry on its
        business as now conducted and is qualified to do business in California
        and in all other states in which the nature of its activities or the
        character of its properties requires such qualification, except those
        jurisdictions where the failure to so qualify would not have a material
        adverse effect on Borrower or its assets.

3.2     Power and Authority; Validity of Agreement.  Borrower has the 
        ------------------------------------------
        partnership power and authority under Colorado law and under its
        Partnership Agreement to enter into and perform this Agreement, the Note
        and all other agreements, documents and actions required hereunder; and
        all actions (partnership, corporate or otherwise) necessary or
        appropriate for the execution and performance by Borrower of this
        Agreement, the Note and all other agreements, documents and actions
        required hereunder have been taken, and, upon their execution, the same
        will constitute the valid and binding obligations of Borrower to the
        extent it is a party thereto, enforceable in accordance with their
        terms, and the Collateral Documents will create first priority security
        interests in the Collateral contemplated in Section 2.11 hereof in favor
        of Bank.

3.3     No Violation of Laws or Agreements.  The making and performance of this
        ----------------------------------
        Agreement, the Note and the other documents, agreements and actions
        required of Borrower hereunder will not violate any provisions of any
        law or regulation, federal, state or local, or the Partnership Agreement
        or result in any breach or violation of, or constitute a default under,
        any material agreement by which Borrower or its property may be bound,
        other than those agreements shown on Exhibit C as requiring consent for
        the granting of a security interest for which consent has not yet been
        obtained.

3.4     System.  Borrower owns the System described in Exhibit C attached 
        ------
        hereto, which sets forth a description of the franchises, locations and
        Basic Subscriber counts of the System on the date set forth therein and
        as supplemented by reports delivered to Bank pursuant to Section 5.4
        hereof, a general description of the property and assets comprising

                                     -15-
<PAGE>
 
        the System, including any property leased from others and including the
        locations of all such property and assets, including, without
        limitation, headend and office facilities, and the record owners of such
        locations and descriptions of any leases covering Borrower's lease of
        any of such property, assets or locations from others.

3.5     Material Contracts.  Borrower is neither a party to nor in any manner
        ------------------
        obligated under any contracts material to its business except the
        franchises and other agreements identified on Exhibit C hereto, and
        there exists no material default under any of such contracts.

3.6     Compliance.  Borrower is in compliance in all material respects with all
        ----------
        applicable laws and regulations, federal, state and local (including
        without limitation those administered by the Local Authorities and the
        FCC), material to the conduct of its business and operations; Borrower
        possesses all the franchises, permits, licenses, certificates of
        compliance and approval and grants of authority described on Exhibit C
        hereto, necessary or required in the conduct of its business, and the
        same are valid, binding, enforceable and subsisting without any material
        defaults thereunder and are not subject to any proceedings or claims
        opposing the issuance, development or use thereof or contesting the
        validity thereof; and no governmental (federal, state or local) or
        nongovernmental approvals, waivers or consents material to the conduct
        of its business and operations, other than the consents set forth on
        Exhibit C, under the terms of contracts or otherwise, are required by
        reason of or in connection with its execution and performance of this
        Agreement, the Note and all other agreements, documents and actions
        required hereunder.

3.7     Litigation.  Except as disclosed on Exhibit C hereto, there are no
        ----------                          ---------
        actions, suits, proceedings or claims which are pending or, to the best
        of its knowledge or information, threatened against Borrower which, if
        adversely resolved, would materially adversely affect either its
        financial condition or its business.

3.8     Title to Assets.  Borrower has good and marketable title to all of its
        ---------------
        properties and assets free and clear of any liens and encumbrances
        except as described on Exhibit C hereto, and all such assets are in good
        order and repair, ordinary wear and tear excepted, and fully covered by
        the insurance required under Section 5.6.

3.9     Partnership Interests.  The percentages of general partnership interest 
        ---------------------
        in Borrower are accurately set forth on Exhibit C attached hereto; all
        partnership interests in Borrower are validly existing and the creation
        and sale

                                     -16-
<PAGE>
 
        thereof by Borrower were effected in compliance with all applicable
        federal and state securities and other applicable laws; and Jones and
        IDS are the sole general partners of Borrower.

3.10    Financial Information.  Borrower's annual financial statement for the
        ---------------------
        period ended December 31, 1994, and Borrower's unaudited statement for
        the period ended September 30, 1995, copies of which have been furnished
        to Bank, have been prepared in accordance with GAAP and fairly present
        the financial condition of Borrower as of the dates and for the period
        covered and include all liabilities of any kind of Borrower required to
        be disclosed in such financial statements, and there have been no
        material adverse changes in the financial condition or business of
        Borrower from the date of such statements to the date hereof.

3.11    Taxes and Assessments.  Borrower has filed all required tax returns or
        ---------------------
        has filed for extensions of time for the filing thereof, and has paid
        all applicable federal, state and local taxes, other than taxes not yet
        due or which may be paid hereafter  without penalty or which are
        contested in good faith, and has no knowledge of any deficiency or
        additional assessment in connection therewith not provided for in the
        financial statements required hereunder.

3.12    Indebtedness.  Other than trade indebtedness and accrued liabilities
        ------------
        incurred in the normal and ordinary course of business for value
        received, Borrower has no presently outstanding indebtedness or
        obligations including contingent obligations and obligations under
        leases of property from others, except the indebtedness and obligations
        described in Exhibit C hereto and in Borrower's financial statements
        which have been furnished to Bank and indebtedness pursuant to Capital
        Leases permitted pursuant to Section 6.2 of this Agreement.

3.13    Management Agreements.  Borrower is a party to no management or 
        ---------------------
        consulting agreements for the provision of services to Borrower, other
        than the Partnership Agreement.

3.14    Investments.  Borrower has no Subsidiaries or investments in or loans to
        -----------
        any other individuals or business entities.


3.15    ERISA.  Except as disclosed on Exhibit C hereto, neither Borrower nor 
        -----                          ---------
        any ERISA Affiliate has established or maintained, or has ever made or
        been obligated to make contributions to, any pension or employee benefit
        plan (a "Plan") covered by ERISA or any multi-employer plan as defined
        in Section 4001 of ERISA.

                                      -17-
<PAGE>
 
3.16    Fees and Commissions.  Borrower owes no fees or commissions of any kind,
        --------------------
        and knows of no claim for any fees or commissions, in connection with
        Borrower's obtaining the Commitment or the Loan from Bank, excepting
        those provided herein.

3.17    No Extension of Credit for Securities.  Neither Borrower nor Jones is
        -------------------------------------
        now, nor at any time has it been engaged principally, or as one of its
        important activities, in the business of extending credit for the
        purpose of purchasing or carrying any securities.


3.18    Hazardous Wastes, Substances and Petroleum Products.
        ---------------------------------------------------

        (a)  Borrower (i) has received all permits and filed all notifications
             necessary to carry on its businesses under, and (ii) is otherwise
             in compliance in all material respects with, all federal, state or
             local laws and regulations governing the control, removal, spill,
             release or discharge of hazardous or toxic wastes, substances and
             petroleum products, including without limitation as provided in the
             provisions of the regulations under the Comprehensive Environmental
             Response, Compensation and Liability Act of 1980, the Resource
             Conservation and Recovery Act of 1976, and the Federal Water
             Pollution Control Act Amendments of 1972 (all of the foregoing
             enumerated and nonenumerated statutes, including without limitation
             any applicable state or local statutes, collectively the
             "Environmental Control Statutes")

        (b)  Borrower has not given any written or oral notice to the
             Environmental Protection Agency ("EPA") or any state or local
             agency with regard to any actual or imminently threatened removal,
             spill, release or discharge of hazardous or toxic wastes,
             substances or petroleum products on properties owned or leased by
             Borrower or in connection with the conduct of its business and
             operations (an "Event").

        (c)  Borrower has not received notice that it is potentially responsible
             for costs of clean-up of any actual or imminently threatened spill,
             release or discharge of hazardous or toxic wastes or substances or
             petroleum products pursuant to any Environmental Control Statute.


4.      CONDITIONS.  The obligation of Bank to make the advances of the Loan
        ----------
        shall be subject to Bank's receipt of the following documents, each in
        form and substance satisfactory to Bank:

                                      -18-
<PAGE>
 
4.1     Promissory Note and Collateral Documents.  The Note and such Collateral
        ----------------------------------------
        Documents as may be specified by Bank under Section 2.11, each duly
        executed by Borrower.

4.2     Authorization Documents.  (a) A certified copy of the resolution of the
        -----------------------
        Board of Directors of Jones authorizing Borrower's execution and full
        performance of this Agreement, the Note and all other documents and
        actions required hereunder; (b) a certified copy of the resolution of
        the Board of Directors of Jones Intercable authorizing the execution and
        full performance by Jones Intercable of the Collateral Assignment and
        its Subordination Agreement; and (c) incumbency certificates setting
        forth the officers of each of Jones Intercable and Jones.

4.3     Opinion of Counsel.  An opinion letter from counsel for Borrower and
        ------------------
        Jones substantially in the form of Exhibit D hereto.
                                           ---------

4.4     Insurance.  Certificates of insurance and evidence showing Bank as an
        ---------
        additional insured with respect to all of Borrower's fire, casualty,
        liability and other insurance covering its respective property and
        business.

4.5     Franchises and Approvals.  Copies of all Borrower's franchises,
        ------------------------
        certificates of compliance and approvals and material related contracts,
        licenses and permits necessary or required in connection with the
        System.

4.6     Subordination Agreements.  Subordination Agreements executed by Jones 
        ------------------------
        and Jones Intercable substantially in the form of Exhibit E hereto,
                                                          ---------
        together with appropriate certified board resolutions and a legal
        opinion substantially in the form of Exhibit F hereto.
                                             ---------
        
4.7     Advance Request.  As a condition to the first advance and each
        ---------------
        subsequent advance of any of the Loan, the Advance Request Form required
        under Section 2.6 hereof, and any other documents or information
        reasonably required by Bank in connection therewith.

4.8     Partnership Agreement.  A copy of the Partnership Agreement, as amended 
        ---------------------
        to the date hereof.

4.9     Consent.  A Consent executed by Jones Intercable, consenting to Bank's
        -------
        security interest in that certain Management Agreement between Borrower
        and Jones Intercable dated as of July 20, 1987, in form satisfactory to
        Bank.

4.10    Other Documents.  Such additional documents as Bank may reasonably
        ---------------
        request.

                                     - 19 -
<PAGE>
 
5.      AFFIRMATIVE COVENANTS.  Borrower covenants and agrees that so long as
        ---------------------
        the Commitment of Bank to Borrower or any indebtedness of Borrower to
        Bank is outstanding:

5.1     Existence and Good Standing.  Borrower will preserve and maintain its
        ---------------------------
        existence as a Colorado limited partnership and its good standing in
        Colorado, California and all other states in which the nature of its
        activities and the character of its properties requires such
        qualifications; provided, however, that Borrower shall not be required
        to qualify in those jurisdictions where the failure to so qualify would
        not have a material adverse effect on Borrower or its assets. Borrower
        will preserve the validity of all its franchises, licenses, permits,
        certificates of compliance or grants of authority material to the
        conduct of its business.

5.2     Quarterly Financial Statements and Subscriber Reports.  Borrower will
        -----------------------------------------------------
        furnish Bank within seventy-five (75) days of the end of each quarterly
        fiscal period hereafter (a) unaudited quarterly financial statements,
        including a balance sheet, an income statement, a statement of cash
        flow, and the information required to apply the criteria prescribed in
        Sections 5.13, 5.14 and 5.15 hereof, prepared in accordance with GAAP,
        together with a certificate executed by the President, Vice
        President/Finance or Treasurer of Jones stating that the financial
        statements fairly present the financial condition of Borrower as of the
        date and for the periods covered and that as of the date of such
        certificate there has not occurred any Event of Default or any event
        which with the giving of notice or the passage of time, or both, would
        constitute an Event of Default hereunder; and (b) a report, in form and
        substance satisfactory to Bank, covering the System and showing (i) the
        number of Basic Subscribers at the beginning and at the end of such
        quarter, and (ii) any other information reasonably requested by Bank.

5.3     Annual Financial Statements.  Borrower will furnish Bank within one
        ---------------------------
        hundred and thirty-five (135) days after the close of each fiscal year
        commencing with fiscal 1995 with audited annual financial statements,
        including the financial statements and information required under
        Section 5.2 hereof, which financial statements shall be prepared in
        accordance with GAAP and shall be fully certified by a nationally
        recognized independent certified public accounting firm.

5.4     Disclosures to Partners.  To the extent not already provided for in 
        -----------------------
        Sections 5.2 and 5.3 above, Borrower will furnish to Bank a copy of all
        information material to Borrower or its financial condition sent to
        Borrower's limited partners from time to time, within ten (10) days

                                      -20-
<PAGE>
 
        after the date any such information is sent to the limited partners.

5.5     Books and Records.  Borrower will keep and maintain satisfactory and
        -----------------
        adequate books and records of account in accordance with generally
        accepted accounting practices and principles consistently applied and
        make or cause the same to be made available to Bank or its agents or
        nominees at any reasonable time upon reasonable notice for inspection
        and to make extracts thereof.

5.6     Insurance.  Borrower will keep and maintain all of its property and
        ---------
        assets in good order and repair, ordinary wear and tear excepted, and
        fully covered by insurance with reputable and financially sound
        insurance companies against such hazards and in such amounts as is
        customary in the industry, under policies requiring the insurer to
        furnish reasonable notice to Bank and opportunity to cure any nonpayment
        of premiums prior to termination of coverage; and, as required above,
        furnish Bank with certificates of such insurance and cause Bank to be
        named as an additional insured thereof.

5.7     Litigation.  Borrower will notify Bank in writing immediately of the 
        ----------
        institution of any litigation, the commencement of any administrative
        proceedings, the happening of any event or the assertion or threat of
        any claim which would reasonably be expected to have a materially
        adverse effect on its business, operations or financial condition, or
        the occurrence of any Event of Default hereunder or an event which with
        the passage of time or the giving of notice or both would constitute an
        Event of Default hereunder.

5.8     Taxes.  Borrower will pay and discharge all taxes, assessments or
        -----
        other governmental charges or levies imposed on it or any of its
        property or assets prior to the date on which any penalty for non-
        payment or late payment is incurred, unless the same are currently being
        contested in good faith by appropriate proceedings.

5.9     Costs and Expenses.  Borrower will pay or reimburse Bank for all out-of-
        ------------------
        pocket costs and expenses including all reasonable attorneys' fees and
        disbursements relating to the filing of any Collateral Documents to
        create and perfect the Security Interests or which Bank may pay or incur
        in connection with the preparation and review of this Agreement, all
        waivers, consents and amendments in connection therewith and all other
        documentation related thereto and the making of the Loan hereunder; and
        Borrower will pay or reimburse Bank for all costs and expenses which
        Bank may pay or incur in connection with the collection or enforcement
        of the same.

                                      -21-
<PAGE>
 
5.10    Compliance.  Borrower will comply in all material respects with all
        ----------
        local, state and federal laws and regulations applicable to its business
        including, without limitation, Environmental Control Statutes, the
        Communications Act and all laws and regulations of the FCC and the Local
        Authorities, the provisions and requirements of all franchises, permits,
        certificates of compliance and approval issued by regulatory authorities
        and other like grants of authority held by Borrower, and the
        requirements of the Copyright Act; and Borrower will notify Bank
        immediately in detail of any actual or alleged material failure to
        comply with or perform, or any actual or alleged material breach,
        violation or default under, any such laws or regulations or under the
        terms of any of such franchises or grants of authority, or of the
        occurrence or existence of any facts or circumstances which with the
        passage of time, the giving of notice or otherwise could create such a
        breach, violation or default or could occasion the termination of any of
        such franchises or grants of authority.

5.11    ERISA.  Borrower will comply in all respects with the provisions of
        -----
        ERISA to the extent applicable to any employee benefit plan. Borrower
        will comply in all respects with the provisions of ERISA to the extent
        applicable to any Plan maintained for any of Borrower's or a
        Subsidiary's employees; not incur any accumulated funding deficiency
        (within the meaning of ERISA and the regulations thereunder) or any
        liability to the Pension Benefit Guaranty Corporation ("PBGC"); not
        permit any "reportable event" (as defined in ERISA) or other event to
        occur which may indicate that its Plans are not sound or which may be
        the basis for PBGC to assert a liability against it or which may result
        in the imposition of a lien on its properties or assets; and notify Bank
        in writing promptly after it has come to the attention of Borrower of
        the assertion or threat of any "reportable event," the existence of any
        "reportable threat" or other event which may indicate that a Plan is not
        sound or may be the basis for PBGC to assert a liability against it or
        impose a lien on Borrower's properties or assets.

5.12    Other Information.  Borrower will provide Bank with any other documents
        -----------------
        and information, financial or otherwise, reasonably requested by Bank
        from time to time.

5.13    Funded Debt to Annualized Operating Cash Flow.  Borrower will maintain
        ---------------------------------------------
        as of the last day of each fiscal quarter of Borrower a ratio of Funded
        Debt to Annualized Operating Cash Flow at the last day of such fiscal
        quarter not to exceed 4.0:1 through June 30, 1997, 3.5:1 from September
        30, 1997 through June 30, 1999, and 3.0:1 thereafter.

                                      -22-
<PAGE>
 
5.14    Interest Coverage Ratio.  At all times, Borrower will maintain as of the
        -----------------------
        last day of each fiscal quarter of Borrower a ratio of (a) Operating
        Cash Flow for such quarter to (b) interest payable on Funded Debt for
        such quarter, which will not be less than 2.25:1.

5.15    Debt Service Coverage Ratio.  At all times, Borrower will maintain as of
        ---------------------------
        the last day of each fiscal quarter of Borrower a ratio of (a)
        Annualized Operating Cash Flow to (b) Debt Service, which will not be
        less than 1.5:1 through December 31, 1997 and thereafter not less than
        1.25:1.

6.      NEGATIVE COVENANTS.  So long as the Commitment or any indebtedness  of
        ------------------
        Borrower to Bank remains outstanding hereunder, Borrower covenants and
        agrees that without Bank's prior written consent, Borrower will not:

6.1     Borrowings.  Borrow any monies except borrowings from Bank hereunder,
        ----------
        borrowings permitted by Section 6.2 and subordinated debt
        subordinated to the Loan pursuant to the Subordination Agreement.

6.2     Additional Indebtedness.  Create any additional indebtedness other than
        -----------------------
        (a) trade indebtedness in the normal and ordinary course of business for
        value received, (b) indebtedness to Jones for Management Fees or loans
        or advances subordinated to the Loan pursuant to the Subordination
        Agreement, (c) indebtedness to Jones Intercable for Home Office
        Allocations or loans or advances subordinated to the Loan pursuant to
        the Subordination Agreement, and (d) other indebtedness, not exceeding,
        in the aggregate, $750,000, pursuant to capital leases, purchase money
        obligations and other obligations incurred in the normal course of
        Borrower's business.

6.3     Guaranties.  Guarantee or assume or agree to become liable in any way
        ----------
        for, either directly or indirectly, any additional indebtedness or
        liability of others except (a) to endorse checks or drafts in the
        ordinary course of business and (b) to perform its indemnification
        obligations pursuant to Section 9.6 of the Partnership Agreement.

6.4     Loans.  Make any loans or advances to others, except Borrower may make
        -----
        loans and advances to employees, subcontractors and suppliers in the
        ordinary course of business not to exceed $100,000 in the aggregate
        principal amount outstanding at any time.

6.5     Liens and Encumbrances.  Create, permit or suffer the creation of any
        ----------------------
        liens, security interests, or any other encumbrances on any of its
        property, real or personal, except (a) liens arising in favor of sellers
        or lessors for

                                      -23-
<PAGE>
 
        indebtedness and obligations incurred to purchase or lease fixed or
        capital assets permitted under Section 6.2(d) hereof, provided, however,
        that such liens are limited to the indebtedness and obligations created
        thereunder and the assets purchased or leased pursuant thereto; (b)
        liens for taxes, assessments or other governmental charges, federal,
        state or local, which are then being currently contested in good faith
        by appropriate proceedings, (c) pledges or deposits to secure
        obligations under workmen's compensation, unemployment insurance or
        social security laws or similar legislation, (d) deposits to secure
        performance or payment bonds, bids, tenders, contracts, leases,
        franchises or public and statutory obligations required in the ordinary
        course of business, (e) deposits to secure surety, appeal or custom
        bonds required in the ordinary course of business, (f) liens to secure
        judgments not in excess of $250,000 so long as they are being currently
        contested in good faith by appropriate proceedings and execution thereon
        has been stayed, and (g) liens in favor of Bank.

6.6     Restricted Payments.  Make any Restricted Payments, except for a
        -------------------
        distribution to partners of certain proceeds from the sale of cable
        franchises in Indiana not exceeding in the aggregate $31,000,000.00.

6.7     Transfer of Assets; Liquidation.  Sell, lease, transfer or otherwise
        -------------------------------
        dispose of any part or amount of its assets, real or personal, or
        discontinue or liquidate any substantial part of its operations or
        business, other than any such transaction in the normal and ordinary
        course of business for value received.

6.8     Acquisitions and Investments.  Purchase or otherwise acquire any part or
        ----------------------------
        amount of the capital stock or assets of, or make any investments in,
        any other firm or corporation; or enter into any new business activities
        or ventures not directly related to its present business; or merge or
        consolidate with or into any other firm or corporation; or create any
        subsidiary corporations; except Borrower may invest in or purchase
        readily marketable direct obligations of the United States of America,
        certificates of deposit issued by commercial banks of recognized
        standing operating in the United States of America and prime commercial
        paper.

6.9     Management Fees and Home Office Allocations.  Make any payments of or
        -------------------------------------------
        accrue (a) Management Fees for any fiscal quarter of Borrower in an
        amount greater than five percent (5%) of Borrower's Gross Operating
        Revenues for such quarter, or (b) Home Office Allocations for any fiscal
        quarter of Borrower in an amount greater than twenty-five percent (25%) 
        of Borrower's Gross Operating Revenues for

                                     -24-
<PAGE>
 
        such quarter. Borrower shall not make any payment of or accrue Home
        Office Allocations which are not either (i) overhead and administrative
        expenses directly attributable to the management or operation of the
        Borrower by Jones or (ii) Borrower's proportionate share of general
        overhead and administrative expenses incurred by Jones in the management
        of all of the partnerships of which Jones is the manager.
        Notwithstanding the foregoing, so long as there exists no Event of
        Default under this Agreement and Borrower is otherwise in compliance
        with the terms and covenants of this Agreement (and such payment,
        together with any payments made pursuant to this Section 6.9 and 
        Section 6.6 hereof, will not create an Event of Default), deferred
        Management Fees and Home Office Allocations (including any interest
        related thereto, at an interest rate not to exceed Jones Intercable's
        weighted average cost of borrowing) may be paid in any fiscal quarter.
        Any Management Fees and Home Office Allocations accrued but unpaid for
        any fiscal quarter shall be deferred and subordinated to Bank pursuant
        to the Subordination Agreement.

6.10    Use of Proceeds.  Use any of the proceeds of the Loan, directly or
        --------------- 
        indirectly, to purchase or carry margin securities within the meaning of
        Regulation U of the Board of Governors of the Federal Reserve System; or
        engage as its principal business in the extension of credit for
        purchasing or carrying such securities.

6.11    Partnership Documents.  Amend or permit any amendments to the 
        ---------------------
        Partnership Agreement after the date hereof except Jones may make
        certain routine amendments as permitted by Section 6.1 of the
        Partnership Agreement.

7.      DEFAULT.
        -------

7.1     Events of Default.  Each of the following events shall be an "Event of
        -----------------
        Default" hereunder:

        (a)  If Borrower shall fail to pay when due any installment of principal
             or any other sum payable to Bank hereunder or otherwise or, within
             three (3) days after the date when due, any payment of interest; or

        (b)  If any representation or warranty made herein or in connection
             herewith or in any statement, certificate or other document
             furnished hereunder is or proves to have been false or misleading
             when made in any material respect; or

        (c)  If Borrower shall default in the payment or performance of any
             obligation or indebtedness to


                                     -25-
<PAGE>
 
          another in excess of $100,000, whether now or hereafter incurred; or

     (d)  If Borrower shall default in the performance of any other agreement or
          covenant contained herein or in any document executed or delivered in
          connection herewith and such default shall continue unsecured for
          thirty (30) days after notice thereof to Borrower given by Bank; or

     (e)  If the Managing General Partner of Borrower ceases to be Jones unless
          Jones is replaced by Jones Intercable or another wholly owned
          subsidiary of Jones Intercable; or

     (f)  If custody or control of any substantial part of the property of
          Borrower shall be assumed by any governmental agency or any court of
          competent jurisdiction at the instance of any governmental agency; if
          any franchise shall be suspended, revoked or otherwise terminated, or
          if Borrower is required by any franchising authority or by court order
          or administrative order to halt operations under the franchise and
          such action shall continue unstayed or uncollected for thirty (30)
          days after Borrower has received notice thereof or the action of any
          such authority has not been stayed within such thirty day period; or
          if any governmental regulatory authority or judicial body shall make
          any other final non-appealable determination which has a materially
          adverse effect on Borrower; or

     (g)  If Borrower, Jones or Jones Intercable shall become insolvent,
          bankrupt or generally fail to pay its debts as such debts become due;
          or if Borrower, Jones or Jones Intercable admits in writing its
          inability to pay its debts; or if Borrower, Jones or Jones Intercable
          shall suffer a receiver or trustee for it or substantially all of its
          property to be appointed and if appointed without its consent, not be
          discharged within sixty (60) days; or if Borrower, Jones or Jones
          Intercable makes an assignment for the benefit of creditors; or if
          Borrower, Jones or Jones Intercable suffers proceedings under any law
          related to bankruptcy or insolvency or the reorganization or the
          release of debtors to be instituted against it and if contested by it,
          not dismissed or stayed within sixty (60) days; or if proceedings
          under any law related to bankruptcy or insolvency or the
          reorganization or the release of debtors is instituted or commenced by
          Borrower, Jones or Jones Intercable; or


                                     -26-
<PAGE>
 
        (h)  If any judgment, writ, warrant or attachment or execution or
             similar process which calls for payment or presents liability in
             excess of $250,000 (not covered by insurance) shall be rendered or
             issued against or levied against Borrower or its property and such
             process shall not be paid, waived, stayed, vacated, discharged,
             settled, satisfied or fully bonded within sixty (60) days after its
             issuance or levy.

7.2     Remedies.  Upon the happening of any Event of Default and at any time
        --------
        thereafter, at the election of Bank, and by notice by Bank to Borrower
        (except if an Event of Default described in Section 7.1(g) shall occur
        in which case acceleration shall occur automatically without notice) :
        (a) Bank may declare the entire unpaid balance, principal and interest,
        of all indebtedness of Borrower to Bank, hereunder or otherwise, to be
        immediately due and payable and shall have the immediate right to
        enforce or realize on any collateral security granted therefor in any
        manner or order it deems expedient without regard to any equitable
        principles of marshalling or otherwise; and (b) in addition or in the
        alternative, Bank may terminate its obligation to lend hereunder and the
        Commitment shall immediately and automatically terminate and Bank shall
        have no further obligation to make any advances. In addition to any
        rights granted hereunder or in any documents delivered in connection
        herewith, Bank shall have all, the rights and remedies granted by any
        applicable law, all of which shall be cumulative in nature.

8.      MISCELLANEOUS.
        -------------

8.1     Non-Recourse.  Anything contained in this Agreement to the contrary
        ------------
        notwithstanding, in any action or proceeding brought on the Note, this
        Agreement, or the indebtedness evidenced or secured thereby, no
        deficiency judgment shall be sought or obtained against Jones, IDS or
        any limited partner of Borrower or enforced against the separate assets
        of Jones, IDS or any limited partner of Borrower, and the liability of
        Jones, IDS or any limited partner of Borrower for any amounts due under
        the Note or this Agreement, shall be limited to the interest of Jones or
        any limited partner of Borrower in the assets of Borrower. Bank may join
        Jones and IDS in their capacity as general partners as defendants in any
        legal action it undertakes to enforce its rights and remedies under the
        Note or this Agreement, but any judgment in any such action may be
        satisfied by recourse only to the assets of Borrower, but not by
        recourse directly to or by execution on Jones's or IDS's separate
        assets. Notwithstanding the foregoing, nothing set forth herein shall be
        deemed to limit the liability of Jones or IDS or

                                      -27-
<PAGE>
 
        prohibit Bank from taking any legal action (a) against Jones, IDS or
        their assets for any fraud or intentional misconduct of Jones or IDS, or
        (b) against Jones or its assets for breach of its undertakings under its
        Subordination Agreement.

8.2     Set Offs.  As collateral for the payment of any and all of Borrower's
        --------
        indebtedness and obligations to Bank, whether matured or unmatured, now
        existing or hereafter incurred or created hereunder or otherwise,
        Borrower hereby grants to Bank a security interest in and lien upon all
        funds, balances or other property of any kind of Borrower, or in which
        Borrower has an interest, limited to the interest of Borrower therein,
        at any time in the possession, custody or control of Bank.

8.3     Binding and Governing Law.  This Agreement and all documents executed
        -------------------------
        hereunder shall be binding upon and inure to the benefit of the parties
        hereto and their respective successors and assigns and shall be governed
        as to their validity, interpretation and effect by the laws of the State
        of Colorado.

8.4     Survival. All agreements, representations, warranties and covenants of
        --------
        Borrower contained herein or in any documentation required hereunder
        shall survive the execution of this Agreement and the making of the Loan
        hereunder and will continue in full force and effect as long as any
        indebtedness hereunder of Borrower to Bank remains outstanding.

8.5     No Waiver; Delay.  If Bank shall waive any power, right or remedy
        ----------------
        arising hereunder or under any applicable law, such waiver shall not be
        deemed to be a waiver upon the later occurrence or recurrence of any of
        said events.  No delay by Bank in the exercise of any power, right or
        remedy shall, under any circumstances, constitute or be deemed to be a
        waiver, express or implied, of the same and no course of dealing between
        the parties hereto shall constitute a waiver of Bank's powers, rights or
        remedies.  The remedies herein provided are cumulative and not exclusive
        of any remedies provided by law.

8.6     Modification.  Except as otherwise provided in this Agreement, no
        ------------
        modification or amendment hereof shall be effective unless made in a
        writing signed by appropriate officers of the parties hereto.

8.7     Headings.  The various headings in this Agreement are inserted for 
        --------
        convenience only and shall not affect the meaning or interpretation of
        this Agreement or any provision hereof.


                                      -28-
<PAGE>
 
8.8     Notices.  Any notice, request or consent required hereunder or in 
        -------    
        connection herewith shall be deemed satisfactorily given if in writing
        and delivered by hand or by facsimile transmission or mailed (registered
        or certified mail) to the parties at their respective addresses set
        forth in the beginning of this Agreement or their facsimile number set
        forth hereafter or such other addresses or facsimile numbers as may be
        given by either party to the other in writing, if to Borrower or Jones
        to the attention of the Treasurer (Facsimile No. (303) 790-7324), with a
        copy to the General Counsel (Facsimile No. (303) 799-1644), and if to
        Bank, to the attention of Leslie Kelly, Vice President (Facsimile No.
        (303) 585-4135).
        
8.9     Payment on Non-Business Days.  Whenever any payment to be made hereunder
        ----------------------------
        shall be stated to be due on a day which is not a Business Day, such
        payment may be made on the next succeeding  business  day,  provided
        however  that  such extension of time shall be included in the
        computation of interest due in conjunction with such payment or other
        fees due hereunder, as the case may be.

8.10    Time of Day.  All time of day restrictions imposed herein shall be
        ----------- 
        calculated using Bank's local time.

8.11    Severability.  If any provision of this Agreement or the application
        ------------
        thereof to any person or circumstance shall be invalid or enforceable to
        any extent, the remainder of this Agreement and the application of such
        provisions to other persons or circumstances shall not be affected
        thereby and shall be enforced to the greatest extent permitted by law.

8.12    Counterparts.  This Agreement may be executed in any number of 
        ------------ 
        counterparts with the same effect as if all the signatures on such
        counterparts appeared on one document, and each such counterpart shall
        be deemed to be an original.


                                     -29-
<PAGE>
 
IN WITNESS WHEREOF, the undersigned, by their duly authorized partners or
officers, have executed this Agreement the day and year first above written.

                                 IDS/JONES GROWTH PARTNERS 87-A, LTD., a
                                 Colorado limited partnership

                                 By:  JONES CABLE CORPORATION, a
                                      Colorado corporation, its 
                                      Managing General Partner



                                    By:  [SIGNATURE APPEARS HERE]
                                       ------------------------------
                                    Title: Treasurer
                                          ----------------------------

                                 COLORADO NATIONAL BANK, a national 
                                 banking association



                                 By:  [SIGNATURE APPEARS HERE]
                                    ----------------------------------
                                 Title:  Vice President
                                       -------------------------------

                                     -30-
<PAGE>
 
                                   EXHIBIT A
                                   ---------

                             ADVANCE REQUEST FORM


          In accordance with Section 2.6 of the Revolving Credit Agreement (as
amended, the "Loan Agreement") dated the 28th day of February, 1996, between
IDS/Jones Growth Partners 87-A, Ltd., a Colorado limited partnership (herein
"Borrower"), and Colorado National Bank, a national banking association, the
undersigned, being the President, Vice President/Finance or Treasurer of Jones
Cable Corporation, a Colorado corporation, and the Managing General Partner of
Borrower, being the duly authorized representative of the Borrower, hereby
requests on behalf of the Borrower an advance.

          As of the date hereof, the undersigned hereby requests, represents and
certifies that:


          (a)  the aggregate amount of the requested advance is $_____________;

          (b)  Borrower has elected the [Adjusted Libor Rate/Reference Rate] to
apply to the requested advance; [or Borrower has elected the Adjusted Libor Rate
to apply to $_____________ of the requested advance and the Reference Rate to
apply to $___________ of the requested advance]; and

          (c)  the representations and warranties set forth in Section 3 of the
Loan Agreement are true and correct; no Event of Default (as defined in the Loan
Agreement) or event which with the passage of time or the giving of notice or
both would constitute an Event of Default under the Loan Agreement has occurred
and is continuing; and there has been no material adverse change in Borrower's
financial condition or business since the date of the Loan Agreement.

          IN WITNESS WHEREOF, the undersigned, being the President, Vice
President/Finance or Treasurer of Jones has executed this Certificate this 28th
day of February, 1996.


                                By:  JONES CABLE CORPORATION, a
                                     Colorado corporation


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


                                      
<PAGE>
 
                                   EXHIBIT B
                                   ---------

                            FORM OF PROMISSORY NOTE


$10,000,000.00                                                February 28, 1996

FOR VALUE RECEIVED, the undersigned, IDS/JONES GROWTH PARTNERS 87-A, LTD., a
Colorado limited partnership, with its principal office at 9697 East Mineral
Avenue, Englewood, Colorado 80112 (herein "Borrower"),  hereby promises to pay
to the order of COLORADO NATIONAL BANK (herein "Bank") at its offices at 918
l7th Street, Denver, Colorado 80202, the principal sum of Ten Million Dollars
($l0,000,000.00), or such lesser sum as may be advanced hereunder, together with
interest thereon, as provided below.

Borrower promises to pay interest on the unpaid principal balance hereof  in
accordance with Section 2.5 of the Loan Agreement referenced below.

Borrower promises to pay principal in quarterly installments on the last day of
each calendar quarter commencing on March 31, 1999, and ending on December 31,
2003 in accordance with Section 2.4 of the Loan Agreement referenced below.

Borrower hereby waives presentment, demand for payment, notice of dishonor or
acceleration, protest or notice of protest, and any and all other notices or
demands in connection with the delivery, acceptance, performance, default or
enforcement of this Note, excepting any notice requirements set forth in the
Loan Agreement referenced below.

This Note arises out of a certain Revolving Credit Agreement of even date
herewith by and between Borrower and Colorado National Bank (as amended from
time to time, herein the "Loan Agreement") to which reference is made for a
statement of the respective rights and obligations of the parties and the terms
and conditions therein provided under which the principal hereof and accrued
interest thereon, if any, may become immediately due and payable.

Notwithstanding the face amount of this Note, the undersigned's liability
hereunder shall be limited at all times to the actual aggregate outstanding
indebtedness to Bank, principal and interest, under the Loan (as defined in the
Loan Agreement), together with all fees and expenses provided for in the Loan
Agreement.

Anything contained in this Note to the contrary notwithstanding, in any action
or proceeding brought on this Note, the Loan Agreement, or the indebtedness
evidenced hereby, no deficiency judgment shall be sought or obtained against
Jones Cable Corporation, a Colorado corporation and Borrower's Managing General
Partner ("Jones"), IDS Cable Corporation, a Minnesota corporation, and the
Borrower's

                                      
<PAGE>
 
Supervising General Partner ("IDS") or any limited partner of Borrower or
enforced against the separate assets of Jones, IDS or any limited partner of
Borrower, and the liability of Jones, IDS or any limited partner of Borrower for
any amounts due under this Note or the Loan Agreement, shall be limited to the
interest of Jones, IDS or any limited partner of Borrower in the assets of
Borrower. Bank may join Jones or IDS in their capacity as general partners as
defendants in any legal action it undertakes to enforce its rights and remedies
under this Note or the Loan Agreement, but any judgment in any such action may
be satisfied by recourse only to the assets of Borrower, but not by recourse
directly to or by execution on Jones' or IDS' separate assets. Notwithstanding
the foregoing, nothing set forth herein shall be deemed to limit the liability
of Jones or IDS or prohibit Bank from taking any legal action (a) against Jones
or IDS or their assets for any fraud or intentional misconduct of Jones or IDS
or (b) against Jones or its assets for breach of its undertakings under its
Subordination Agreement.

Capitalized terms used herein and not defined shall have the meaning ascribed to
such terms in the Loan Agreement.

IN WITNESS WHEREOF, the undersigned, by its Managing General Partner, has
executed this Note the day and year first above written.

                                 IDS/JONES GROWTH PARTNERS 87-A, LTD., a
                                 Colorado limited
                                 partnership

                                 By:  JONES CABLE CORPORATION, a
                                      Colorado corporation, its 
                                      Managing General Partner



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


                                 COLORADO NATIONAL BANK, a national 
                                 banking association



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

                                      
<PAGE>
 
(21172)
02/21/96
Page 1



                                   EXHIBIT C

                          ROSEVILLE, CALIFORNIA SYSTEM


BASIC SUBSCRIBER COUNT THROUGH JANUARY 31, 1996: 16,560

FRANCHISES
----------

County of Placer, California
----------------------------

 .  Placer County Code, Chapter 28, Franchises for Cable Television Systems
 .  Ordinance No. 3612-B dated November 5, 1985, granting a cable television
   franchise to West Star Communications, Inc.
 .  Ordinance No. 3861-B dated November 10, 1987, granting an extension to the
   existing cable television franchise area to Weststar Communications, Inc.
 .  Ordinance No. 3883-B dated January 12, 1988, consenting to the transfer and
   assignment of the franchise to Jones Intercable, Inc. ("Jones"), IDS/Jones
   Growth Partners 87-A, Ltd., or, subject to certain conditions, any limited
   partnership(s) of which Jones is a general partner or any joint venture or
   general partnership of which Jones or any such limited partnership(s) is a
   constituent partner (an "Affiliate"), and subsequent transfers and
   assignments among Affiliates; the Ordinance also consents to the grant of a
   security interest
 .  Letter to the Placer County Board of Supervisors from Jones Intercable, Inc.
   dated February 1, 1988, accepting every term, condition and limitation
   contained in the Franchise
 .  Letter to the Senior Deputy County Counsel of Placer County from Jones
   Intercable, Inc. dated April 20, 1988, confirming that no further action
   needs to be taken to facilitate the transfer of the franchise from Jones
   Intercable, Inc. to IDS/Jones Growth Partners 87-A, Ltd.

Expiration Date:  November 5, 2000
<PAGE>
 
(21172)
02/21/96
Page 2

City of Roseville, California
-----------------------------
 
 .  Chapter 2.40 of Title 2, Community Antenna Television System, Roseville
   Municipal Code
 .  Ordinance No.1822 dated November 28, 1984, consenting to the transfer of the
   cable television franchise from Roseville Cablevision, Inc. and Stoner Cable
   Television, Inc. to Weststar Communications II, to restate in its entirety
   the terms and conditions of the franchise, and to repeal all prior CATV
   system franchise ordinances
 .  Ordinance No.2088 dated January 20, 1988, consenting to the transfer of the
   franchise to Jones Intercable, Inc., and/or to any limited partnership(s) of
   which Jones Intercable , Inc. or Jones Cable Corporation is a general
   partner, or to any joint venture or general partnership(s) of which Jones
   Intercable, Inc. or any such limited partnership is a constituent partner (an
   "Affiliate"), provided that, regardless of whether Jones Cable Corporation or
   any other Affiliate becomes the grantee and franchisee, that Jones
   Intercable, Inc. shall act as manager of the System; if Jones Intercable,
   Inc. shall at any time be removed by the grantee and franchisee as manager of
   the System, such grantee and franchisee shall, within 90 days after such
   removal, replace the manager of the System and obtain the City's consent
   thereto, which consent shall not be unreasonably withheld; the Ordinance also
   consents to the grant of a security interest in the franchise
 .  Acceptance of CATV Franchise by Jones Intercable, Inc. dated February 1, 1988
 .  Letter to the Roseville City Attorney from Jones Intercable, Inc. dated March
   8, 1988, providing the City with the names and addresses of the lending
   institutions which Jones Intercable has granted a security interest in the
   franchise to pursuant to Section 6 of Ordinance 2088
 .  Letter to the Roseville City Attorney from Jones Intercable, Inc. dated April
   19, 1988, notifying the City that Jones intends to transfer the franchise
   within 30 days to IDS/Jones Growth Partners 87-A, Ltd. (of which Jones Cable
   Corporation is the Managing General Partner); enclosing a certificate of
   insurance (bonds to be delivered 4/21/88), form of Acceptance of CATV
   Franchise, and form of Agreement by Jones Intercable, Inc. agreeing to act as
   manager of the system; also consenting to a waiver of the notice requirements
   of Section 6 of Ordinance No.2088
 .  Letter to the Deputy Clerk of the City of Roseville dated April 28, 1988,
   providing the City with the name and address of a lending institution which
   IDS/Jones Growth Partners 87-A, Ltd. granted a security interest in the
   franchise to pursuant to Section 6 of Ordinance 2088
 .  Acceptance of CATV Franchise by IDS/Jones Growth Partners 87-A, Ltd. dated
   April 29, 1988
<PAGE>
 
(21172)
02/21/96
Page 3


 .  Agreement executed by Jones Intercable, Inc. dated April 29, 1988, agreeing
   to act as manager of the Roseville system subject to the terms of a
   Management Agreement dated July 20, 1987, between Jones Intercable, Inc. and
   Jones Cable Corporation (attached as Exhibit A)
 .  Letter dated January 31, 1992, regarding the initiation of negotiations for
   renewal of the franchise.
 .  Ordinance No.2813 adopted September 21, 1994, extending the term of the
   franchise and amending Ordinance Nos .1822 and 2088.
 .  Acceptance of terms and conditions of Ordinance No.2813 by IDS/Jones Growth
   Partners 87-A, Ltd. dated September 30, 1994.
 .  Letter Agreement dated October 14, 1994, between the City of Roseville and
   Jones, regarding capital grant for access studio equipment.
 .  Letter dated February 14, 1996 notifying the City that IDS/Jones Growth
   Partners 87-A, Ltd. intends to grant a security interest in the franchise to
   Colorado National Bank.


Expiration Date:  December 28, 1999
<PAGE>
 
(21172)
02/21/96
Page 4

 
FCC LICENSES (Granting of a security interest in FCC licenses is prohibited.)
------------
<TABLE> 
<S>                             <C> 
Business Radio                  KNAX84O
Business Radio                  WPCG511
Business Radio                  WPCK220
Business Radio                  KD37440 (Itinerant)
Earth Station                   E930212
Microwave                       WNES942
</TABLE> 

POLE AGREEMENTS/LINE CROSSING AGREEMENTS
----------------------------------------

1.   Pole Attachment Agreement (Support Structure Use Agreement) dated April 9,
     1991, with Roseville Telephone Company for the City of Roseville, Placer
     County, California.

2.   Pole Attachment Agreement (Support Structure Use Agreement) dated April 9,
     1991, with Roseville Telephone Company for Placer County, California

3.*  Pole Attachment Agreement dated October 15, 1990, with Pacific Gas and
     Electric Company for the town(s) and surrounding area(s) of Roseville
     served by PG&E, within PG&E's Drum Division of the Sacramento Valley
     Region.

4.*  Pole Attachment Agreement dated April 4, 1990, with Sacramento Municipal
     Utility District ("Permittor") for the area served by Permittor in the
     vicinity of Sacramento, California.

EASEMENTS AND RIGHTS OF WAY LICENSES AND PERMITS
------------------------------------------------

1.   Easement and Right-of-Way dated December 14, 1994, granted by Daniel W.
     Sanford and Barbara J. Sanford for certain property known as 8530 Sunrise
     Avenue in Roseville, Placer County, California 95661 (Parcel ID #470-211-
     001-000).

REAL PROPERTY OWNED 
-------------------

None.


--------------------------------
*Consent to the grant of a security interest required, but not yet obtained.
<PAGE>
 
(21172)
02/21/96
Page 5


REAL PROPERTY LEASED
--------------------

1.   Industrial Real Estate Lease/Multi-Tenant Facility (office/warehouse
     space) dated November 4, 1991, between Y.A. Bar Livestock Co., successor in
     interest to MTA Investment Company, and IDS/Jones Growth Partners 87-A,
     Ltd.; Letter agreement dated June 30, 1995, providing for an additional 700
     square feet of office space known as Suite G and increasing the rental
     amount.

     Record Owner: Y.A. Bar Livestock Co. 

     Description of Leased Premises:

     501 Guiseppe Court, Unit C, D, E and G 
     Roseville, California 95678

     (Approximately 8,400 square feet of warehouse space and approximately 3,900
     square feet of office space within an approximately 17,200 square foot
     industrial building. The property also includes approximately 17,000 square
     feet of fenced and paved yard area. Approximately 700 square feet of office
     space, known as Suite G, was added to the Lease effective July 1, 1995.)


     A.   Sublease dated October 4, 1991, between IDS/Jones Growth Partners 87-
          A, Ltd. and A & T Sprinklers, Inc.; Addendum to Sublease dated October
          25, 1991; Letter dated September 22, 1993, clarifying the expiration
          date of the Sublease; Letter dated September 7, 1994, extending the
          term of the Sublease.

          Description of Leased Premises:

          Approximately 2,400 square feet of warehouse space within Unit C and
          approximately 8,000 square feet of fenced and paved yard space.

     B.   Lease Agreement for Tower and Ground Space dated April 16, 1992,
          between IDS/Jones Growth Partners 87-A, Ltd. ("87-A") and RAM Mobile
          Data USA Limited Partnership for space on 87-A's tower, land and other
          personal property at 501-C Guiseppe Court, Roseville, California .
<PAGE>
 
(21172)
02/21/96
Page 6


          Legal Description of Property:

          The property located at 501-C Guiseppe Court, City of Roseville,
          County of Placer, State of California 95678.

          The geodetic coordinates of the property are as follows:
          38 degrees 42' 48"  N. Latitude
          121 degrees 17' 56" W. Longitude

          The leased premises shall consist of the following:

          (a)  ground space area of approximately eighty (80) square feet
               located near the southern base of the tower.

          (b)  space on the tower for two (2) antenna mounts for the
               installation, maintenance and operation of radio transmitting and
               receiving antennas .

     C.   Lease Agreement for Tower Space commencing January 1, 1995, between
          IDS/Jones Growth Partners 87-A, Ltd. ("87-A") and Destineer
          Corporation for space on 87-A's tower, land and other personal
          property at 501-C Guiseppe Court, Roseville, California.

          Description of Leased Premises:

          The property located at 501-C Guiseppe Court, City of Roseville,
          County of Placer, State of California 95678.
<PAGE>
 
(21172)
02/21/96
Page 7



ERISA PLANS
-----------

The following benefit plans, neither of which is a defined benefit plan, are
covered by ERISA:

1.   401(k) Plan - "Jones Intercable, Inc. et al Profit Sharing/Retirement Plan"

2.   Health Insurance Plan (Medical, dental, life, accidental death and
     dismemberment, long-term disability) - "Jones Intercable, Inc. et al Health
     and Welfare Plan"
<PAGE>
 
                               February 28, 1996



Colorado National Bank
Seventeenth Street at Champa
Denver, Colorado  80202

     Re:  Revolving Credit Agreement dated as of February 26, 1996, by and
          between IDS/Jones Growth Partners
          87-A and Colorado National Bank

Ladies and Gentlemen:

     I am Vice President and General Counsel of each of Jones Intercable, Inc.
("Intercable"), a Colorado corporation, Jones Cable Corporation ("JCC"), a
Colorado corporation and the Managing General Partner of IDS/Jones Growth
Partners 87-A, a Colorado limited partnership (the "Borrower"), and have acted
as counsel to Intercable, JCC and the Borrower in connection with a $10,000,000
credit facility extended to the Borrower pursuant to a Revolving Credit
Agreement (the "Loan Agreement") dated as of February 28, 1996, by and between
the Borrower and Colorado National Bank (the "Bank").  The $10,000,000 credit
facility is evidenced by the Note issued by the Borrower to the Bank pursuant to
the Loan Agreement.  The indebtedness of the Borrower to the Bank is secured in
part by the Security Agreement, which grants the Security Interest in the
Collateral (as defined therein) to the Bank.

     This opinion is being rendered to you in compliance with Paragraph 4.1 of
the Loan Agreement.  Capitalized terms used herein without definition have the
same meanings as in the Loan Agreement.

     In my capacity as such counsel, I have examined originals, or copies
identified to my satisfaction as being true copies, of such records, documents
or other instruments as in my judgment are necessary or appropriate to enable me
to render the opinions expressed below.  These records, documents and
instruments included the following:



                                   EXHIBIT D
                                   ---------
<PAGE>
 
Colorado National Bank
February 28, 1996
Page 2



     1.   The Limited Partnership Agreement (the "Partnership Agreement") and
          the Certificate of Limited Partnership of the Borrower, each as
          amended to date;

     2.   The Articles of Incorporation of each of Intercable and JCC, as
          amended to date;

     3.   The bylaws of each of Intercable and JCC, as amended to date;

     4.   All records of proceedings and actions of the Board of Directors of
          each of Intercable and JCC relating to the transactions contemplated
          by the Loan Agreement;

     5.   The Loan Agreement;

     6.   The Note;

     7.   The Security Agreement;

     8.   The Subordination Agreements;

     9.   Uniform Commercial Code financing statements naming the Bank as a
          secured party and the Borrower as debtor to be filed in the offices
          of the Colorado Secretary of State, the California Secretary of State
          and the Placer County, California Recorder; the foregoing being
          referred to herein as the "Financing Statements";

     10.  The Collateral Assignment of Management Agreement and Consent (the
          "Consent");

     11.  Searches conducted by Search Company International of the Uniform
          Commercial Code records of (a) the Secretary of State of Colorado,
          indexed under the name of the Borrower as a "debtor", dated January
          11, 1996 and effective through January 4, 1996; (b) the Arapahoe
          County, Colorado Clerk and Recorder, indexed under the name of the
          Borrower as a "debtor", dated January 12, 1996 and effective through
          December 27, 1995; (c) the Secretary of State of California indexed
          under the name of the Borrower as a "debtor", dated January 18, 1996
          and effective through December 28, 1995;
<PAGE>
 
Colorado National Bank
February 28, 1996
Page 3



          and (d) the Placer County, California Recorder, indexed under the name
          of the Borrower as a "debtor" dated January 18, 1996 and effective
          through January 9, 1996; the foregoing having been delivered to the
          Bank and being referred to herein as the "UCC Searches"; and

     12.  Searches under the name of the Borrower conducted by Search Company
          International of the Clerks of (a) the Arapahoe County, Colorado
          District Court, dated January 12, 1996 and effective through November
          27, 1995, (b) the Placer County, California Superior Court, dated
          January 18, 1996 and effective through January 9, 1996, (c) the United
          States District Court for the Eastern District of California,
          Sacramento Division, dated January 12, 1996 and effective through
          January 5, 1996 and (d) the United States District Court for the
          District of Colorado, dated January 18, 1996 and effective through
          January 11, 1996; the foregoing having been delivered to the Bank and
          being referred to herein as the "Litigation Searches."

Collectively, the Loan Agreement, the Security Agreement, the Note, the
Subordination Agreements, the Consent, and the Financing Statements are referred
to herein as the "Loan Documents."

     I have obtained and relied upon such certificates and assurances from
public officials as I have deemed necessary in connection with the opinion set
forth herein.  I have also relied upon and assumed, with the Bank's consent, the
accuracy and completeness of the UCC Searches, the Litigation Searches and the
records upon which they are based.

     I have investigated such questions of law for the purpose of rendering this
opinion as I have deemed necessary.  This opinion is limited in all respects to
the internal laws of the State of Colorado and to United States federal law
(except that no opinion is expressed herein as to the Communications Act of
1934, as amended, the rules and regulations of the Federal Communications
Commission promulgated pursuant thereto, or to the rules and regulations of the
United States Copyright Office and the Copyright Royalty Tribunal, or to matters
controlled by,
<PAGE>
 
Colorado National Bank
February 28, 1996
Page 4



required by, or issued pursuant to, any of the foregoing). I express no opinion
herein as to whether a Colorado or other court would apply Colorado law to any
particular aspect of the subject matter hereof.

     On the basis of the foregoing and in reliance thereon, and subject to the
limitations, qualifications and exceptions set forth below, I am of the opinion
that:

     1.   The Borrower is a limited partnership duly organized, validly existing
and in good standing under the laws of the State of Colorado.  The Borrower is
duly qualified to do business as a foreign limited partnership and in good
standing in the State of California and each other jurisdiction in which the
ownership of its properties or the nature of its activities or both makes such
qualification necessary, except to the extent that failure to be so qualified
does not have a material adverse effect on the business, operations or financial
condition of the Borrower.

     2.   Each of Intercable and JCC is a corporation duly incorporated validly
existing and in good standing under the laws of the State of Colorado.  JCC is
duly qualified to do business as a foreign corporation and in good standing in
the State of California and each other jurisdiction in which the ownership of
its properties or the nature of its activities or both makes such qualification
necessary, except to the extent that failure to be so qualified does not have a
material adverse effect on the business, operations or financial condition of
the Borrower.  JCC is the Managing General Partner of the Borrower, with such
powers and authority as are conferred upon it by the Partnership Agreement and
applicable law.

     3.   (a)  The Borrower has partnership power and authority to execute and
deliver the Loan Documents, to make the borrowings provided for in the Loan
Agreement, to execute and deliver the Note in evidence of such borrowings and to
perform its obligations under the Loan Documents, and all such action has been
duly and validly authorized by all necessary partnership proceedings on its
part.

          (b)  JCC has corporate power and authority to execute and deliver on
behalf of the Partnership the Loan Documents and perform its obligations
thereunder, and all
<PAGE>
 
Colorado National Bank
February 28, 1996
Page 5



such action has been duly and validly authorized by all necessary corporate
proceedings on its part.

          (c)  Each of Intercable and JCC has corporate power and authority to
execute and deliver the Consent and perform its obligations thereunder, and all
such action has been duly and validly authorized by all necessary corporate
proceedings on the part of each.

     4.   (a)  The Loan Documents have been duly and validly executed and
delivered by the Borrower, and constitute the legal, valid and binding
obligations of the Borrower, enforceable against it in accordance with the
respective terms thereof.

          (b)  The Consent has been duly and validly executed and delivered by
each of Intercable and JCC, and constitutes the legal, valid and binding
obligation of each of Intercable and JCC, enforceable against each of them in
accordance with the terms thereof, to the extent of the applicability of such
terms to each of them.

     5.   No consent or approval by, and no filing with, any federal or Colorado
governmental agency or regulatory body, is necessary on the part of the
Borrower, Intercable or JCC in connection with the execution, delivery and
performance by the Borrower of the Loan Documents or by Intercable and JCC of
the Consent, except filings required to perfect and maintain a security interest
in the Collateral in favor of the Bank, and except for certain consents,
approvals and filings listed on Exhibit C to the Loan Agreement which have not
been obtained.

     6.   Neither the execution, delivery or performance by the Borrower of the
Loan Documents or by Intercable or JCC of the Consent (a) constitutes a
violation of any Colorado or federal law, except for violations which, in the
aggregate, would not materially and adversely effect the business, operations or
financial condition of the Borrower or the ability of the Borrower, Intercable
or JCC to perform their respective obligations under the Loan Documents, (b)
constitutes a breach of or a default under the Partnership Agreement or the
Articles of Incorporation or bylaws of either of Intercable or JCC or, to my
knowledge, any agreement or instrument to which the Borrower, Intercable or JCC
is a party or to or by which any of their respective properties are subject or
bound, the breach of or default
<PAGE>
 
Colorado National Bank
February 28, 1996
Page 6



under which would have a materially adverse effect on the business, operations
or financial condition of the Borrower or (c) creates any interest in any
property of the Borrower, except the Security Interest.

     7.   To my knowledge and except for litigation and proceedings affecting
the cable industry generally, there is no pending or threatened proceeding by or
before any court or other tribunal against the Borrower which if adversely
decided would have a material adverse effect on the business, operations or
financial condition of the Borrower.

     8.   Subject to the provisions of Section 9-306 of the Uniform Commercial
Code of the State of Colorado (the "Code"), the provisions of the Security
Agreement are sufficient to create the Security Interest.  Under the Code, the
description of the Collateral set forth in the Financing Statement to be filed
in Colorado (the "Colorado Financing Statement") is sufficient to create a
security interest in the items and types of Collateral (other than fixtures)
described therein.  Upon the filing of the Colorado Financing Statement with the
office of the Secretary of State of Colorado, such filing is sufficient, subject
to Section 9-306 of the Code, to perfect the Security Interest in all right,
title and interest of the Borrower in accounts and general intangibles, and in
those items and types of Collateral described in the Security Agreement in which
a security interest may be perfected by the filing of a financing statement in
the State of Colorado under the Code and which is in the possession of the
Borrower, except that I express no opinion as to the perfection of the Security
Interest in personal property affixed to real property in such manner as to
become a fixture under the laws of the State of Colorado.

     My opinion in Paragraph 4 above as to the enforceability of the Loan
Documents is subject to the following limitations:  (i) such enforceability may
be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors' rights generally; (ii) the remedy of
specific performance and injunctive and other forms of equitable relief may be
subject to equitable defenses and to the discretion of the court before which
any proceeding therefor may be brought; (iii) the Code and other laws and
judicial decisions of Colorado require that the Bank exercise its rights under
the Loan Documents in good faith and in a
<PAGE>
 
Colorado National Bank
February 28, 1996
Page 7



commercially reasonable manner and a court may decline to strictly enforce
certain covenants therein if it concludes that such enforcement would be
unreasonable under the then existing circumstances; (iv) public policy
considerations may limit the rights of the Bank to obtain certain remedies and
to indemnification; (v) the granting by the Borrower of the Security Interest
and the transfer of certain rights of the Borrower or the Bank in such property
to a foreclosure purchaser may, in some instances, require or be conditioned
upon receipt of the consent of certain third parties who have granted the
Borrower certain contractual or other rights; (vi) no opinion is expressed as to
the enforceability of the choice of law, severability, waiver, or set off
provisions (including the waiver of any defenses or procedural rights available
to the Borrower or JCC contained in the Loan Documents); (vii) to the extent
that any Loan Document might be deemed to provide that the Bank may enter upon
and take possession of the Collateral by force amounting to a breach of the
peace or public disturbance, without liability by reason of the manner of such
entry and possession, such provisions would not be enforceable; (viii) no
opinion is expressed as to the enforceability of the provisions of the Loan
Documents which purport to authorize the Bank to sign and file documents in the
name or on behalf of the Borrower or JCC without the signatures of the
appropriate representatives of the Borrower or officers of JCC, acting on behalf
of the Borrower; (ix) no opinion is expressed as to the enforceability of any
future advances provisions in the Loan Documents (other than with respect to any
advances made pursuant to the Loan Agreement) with respect to any future
advances which were not reasonably within the contemplation of the parties at
the time such documents were executed; (x) the duty to exercise reasonable care
in the custody and preservation of collateral in a secured party's possession
may not be disclaimed by agreement, waived or varied prior to default; and (xi)
no opinion is expressed as to the enforceability, priority or perfection of the
Security Interest to the extent it relates to Collateral located outside the
State of Colorado.  With respect to the opinion set forth in Paragraph 5, the
limitation stated in clause (v) hereof is also applicable.

     For purposes of rendering the opinion expressed in Paragraph 7 hereof, I
have, with your permission, relied upon my own knowledge, without investigation
or inquiry, and the Litigation Searches.
<PAGE>
 
Colorado National Bank
February 28, 1996
Page 8



          With respect to my opinion in Paragraph 8, (i) the opinion expressed
herein does not purport to cover the title to or existence of any of the
Collateral; (ii) I have assumed that the Company has rights in the Collateral
and that sufficient value has been given for purposes of satisfying Sections 
9-203(1)(c) and (b), respectively, of the Code; (iii) I call your attention to
the necessity of filing a continuation statement with respect to the Colorado
Financing Statements between July 1, 1996 and December 31, 1997, in order to
continue the perfection of the security interest perfected thereby after
December 31, 1997, and to the necessity of filing continuation statements from
time to time thereafter in appropriate five year intervals under the applicable
provisions of the Code; (iv) additional filings under the Code may be required,
among other things, upon the change of location of the debtor as provided in
Section 9-103 (3) (e) of the Code or the change of the name of the debtor as
provided in Section 9-402(7) thereof; (v) in the case of property which becomes
Collateral after the date hereof, Section 552 of the United States Bankruptcy
Code limits the extent to which property acquired by a debtor after the
commencement of a case under the United States Bankruptcy Code may be subject to
a security interest arising from a security agreement entered into by the debtor
before commencement of the case; (vi) no opinion is expressed as to the
perfection or priority of the Security Interest in any Collateral consisting of
copyrights, other literary property rights, trade and service marks, patents and
applications therefor, know-how, processes, trade secrets, undocumented computer
software, unrecorded and unwritten data and information, and rights and licenses
thereunder, cash which is not in the Banks' possession, documents of title and
goods subject thereto, uncertificated securities, interests in minerals or the
like (including oil and gas) before extraction and accounts arising from the
sale thereof at the wellhead or minehead, timber, farm products and crops and
Collateral subject to the Assignment of Claims Act of 1940, as amended; and
(vii) no opinion is expressed as to the effect of any event occurring subsequent
to the date hereof on the existence or perfection of the Security Interest.
Furthermore, the transfer of Collateral may require the consent of a Local
Authority to avoid forfeiture of any franchise issued by such Local Authority.

     To the extent that the obligations of the Borrower, Intercable or JCC may
be dependent upon such matters, I assume for purposes of this opinion that the
Bank is duly
<PAGE>
 
Colorado National Bank
February 28, 1996
Page 9


organized, validly existing and in good standing under its jurisdiction of
organization; that to the extent contemplated thereby, the Loan Documents have
been duly authorized, executed and delivered by the Bank and constitute the
legal, valid and binding obligations of the Bank, enforceable against the Bank
in accordance with their respective terms; and that the Bank has the requisite
corporate or other organizational power and authority to perform its obligations
under the Loan Documents.

     This opinion is as of the date hereof and I disclaim any undertaking or
obligation to advise the Bank of changes which may hereafter be brought to my
attention. This opinion is rendered only to the Bank, and is solely for its
benefit in connection with the transactions contemplated by the Loan Agreement
This opinion may not be relied upon by the Bank for any other purpose or relied
upon by any other person, firm or corporation for any purpose without my prior
written consent.

                              Very truly yours,


                              Elizabeth M. Steele 
                              General Counsel
<PAGE>
 
                            SUBORDINATION AGREEMENT


        This Subordination Agreement (this "Agreement") is made as of this 28th
day of February, 1996, by and between JONES INTERCABLE, INC., a Colorado
corporation with offices at 9697 East Mineral Avenue, Englewood, Colorado 80112
(herein "Subordinated Creditor") and COLORADO NATIONAL BANK, a national banking
association with offices at 918 17th Street, Denver, Colorado 80202 (herein
"Bank")

        In order to induce Bank to extend credit to IDS/JONES GROWTH PARTNERS 
87-A, LTD., a Colorado limited partnership (herein "Borrower"), and in
consideration therefor, and for other good and valuable consideration, the
parties hereto hereby agree as follows:

        1.  "Senior Debt" shall mean all of the indebtedness, liabilities and
obligations of Borrower to Bank, whether now existing or hereafter arising,
including, without limitation, the indebtedness, liabilities and obligations
arising under that certain Revolving Credit Agreement of even date herewith
between Borrower and Bank (the "Loan Agreement") and all principal and interest
under and evidenced by that certain Promissory Note of even date herewith
executed by Borrower in favor of Bank in the principal amount of $10,000,000.00,
as such indebtedness, agreement and instrument may be amended, extended,
renewed, refinanced, supplemented or assigned from time to time hereafter.

        "Subordinated Debt" shall mean all indebtedness, liabilities and
obligations of Borrower to Subordinated Creditor, whether now existing or
hereafter arising, including any advances, indebtedness, liabilities and
obligations, all interest and other fees which may be or become due with respect
thereto, whether or not evidenced by promissory notes, and any accrued and
unpaid Home Office Allocations. As used herein, the term "Home Office
Allocations" shall have the definition set forth in the Loan Agreement.

        2.  The payment of any and all Subordinated Debt is hereby expressly
subordinated to all Senior Debt to the extent and in the manner set forth in
this Agreement.

        3.  Subordinated Creditor shall not accelerate, demand, sue for,
commence any collection or enforcement action or proceeding, take, receive,
accept or retain any payment or distribution of any character, whether in cash,
securities or other property, in respect of the principal of, premium on, or
interest on, the Subordinated Debt or any collateral security thereof or until
all Senior Debt shall have been paid in full with interest, including interest
during any bankruptcy or similar proceeding involving Borrower from the date of
the filing thereof to the date of distribution (notwithstanding any statute,
including without

                                   EXHIBIT E
                                   ---------
<PAGE>
 
limitation the Federal Bankruptcy Code,  any rule of law or bankruptcy
procedures to the contrary); provided, however, that if there is not continuing
an Event of Default under the Loan Agreement and Borrower is not at the time
otherwise in default under the Senior Debt, and such payment will not constitute
an Event of Default or an event which, with the passage of time or giving
notice, would constitute an Event of Default, Borrower may pay Subordinated Debt
to Subordinated Creditor with interest thereon except as otherwise limited by
Section 6.9 of the Loan Agreement.

        4.  Subordinated Creditor hereby acknowledges that the payment of Home
Office Allocations by Borrower to Subordinated Creditor and the repayment by
Borrower to Subordinated Creditor of advances or indebtedness and any interest
and fees due thereon are subject to the limitations set forth in the Loan
Agreement and Subordinated Creditor hereby confirms that it is bound by such
limitations.

        5.  In the event of the institution of and in connection with any
insolvency, bankruptcy, receivership, liquidation, reorganization or other
similar proceedings relative to Borrower, or its property, or any proceeding for
the voluntary liquidation, dissolution or other winding-up of Borrower and
whether or not involving insolvency or bankruptcy proceedings:

            (a)  all Senior Debt shall first be paid in full before any payment
                 or distribution of any character, whether in cash, securities
                 or other property, shall be made in respect of any Subordinated
                 Debt;

            (b)  any payment or distribution of any character, whether in cash,
                 securities or other property, which would otherwise (but for
                 the terms hereof) be payable or deliverable in respect of any
                 Subordinated Debt shall be paid or delivered directly to Bank,
                 until all Senior Debt shall have been paid in full, and
                 Subordinated Creditor irrevocably authorizes, empowers and
                 directs all receivers, trustees, liquidators, conservators and
                 others having authority to effect all such payments and
                 deliveries; and

            (c)  Subordinated Creditor shall execute and deliver to Bank all
                 such further instruments confirming the authorization referred
                 to in the foregoing clause (b) and all such powers of attorney,
                 proofs of claim, assignments of claim and other instruments and
                 shall take all such other actions as may be requested by Bank
                 in order to enable Bank to enforce

                                      
<PAGE>
 
                 all of its rights hereunder and all claims of Bank upon or in
                 respect of the Subordinated Debt, and failing execution of such
                 instruments or taking of such actions by Subordinated Creditor,
                 Bank is hereby authorized and empowered to execute and perform
                 the same on behalf of the Subordinated Creditor.

        6.  In the event any payment or distribution of any character, whether
in cash, securities or other property, is received by Subordinated Creditor in
contravention of the terms of this Agreement or the Loan Agreement, and before
all Senior Debt shall have been paid in full, such payment or distribution shall
be held by Subordinated Creditor, as trustee of an express trust, in trust for
the benefit of Bank, and shall be paid over or delivered and transferred to Bank
for application to all Senior Debt remaining unpaid until such Senior Debt shall
have been paid in full. Subordinated Creditor hereby assigns to Bank all rights
of Subordinated Creditor to any such payments or distributions, which Bank may
exercise in Bank's name or in the name of Subordinated Creditor, and agrees to
execute such instruments as may be required by Bank to enable Bank to enforce
such claims. Any payments or distributions received in excess of the amount
sufficient to pay all Senior Debt in full shall be returned by Bank to
Subordinated Creditor.

        7.  If the Subordinated Debt is evidenced in whole or part by any
promissory note or other instruments, Subordinated Creditor agrees, at Bank's
request, to endorse and deliver such notes and instruments to Bank to be held by
Bank subject to the provisions of this Agreement, or to note on the face thereof
that the same is subject to this Agreement.

        8.  Notwithstanding anything to the contrary contained in any other
instrument or document delivered in connection with the Subordinated Debt or
otherwise, including, without limitation, any prior or subsequent perfection of
a security interest or lien, any security interests and liens now or hereafter
held by Subordinated Creditor in any collateral security for the Subordinated
Debt shall be junior and subordinate to any security interests and liens now or
hereafter held by Bank in the same collateral.  So long as the Senior Debt shall
remain unpaid, Bank may at all times in its sole discretion exercise any and all
powers and rights which it now has or may hereafter acquire with respect to any
of the collateral securing the Senior Debt, all without the necessity of
obtaining any consent or approval of Subordinated Creditor.

        9.  Subordinated Creditor represents and warrants that Subordinated
Creditor is duly organized, validly existing and in good standing under the laws
of the State of Colorado and has the power and authority under the laws of
Colorado and under its

                                      
<PAGE>
 
articles of incorporation and by-laws or other organizational documents to enter
into this Agreement; all actions necessary or appropriate for its execution and
performance of this Agreement have been taken and upon its execution, this
Agreement will constitute its valid and binding obligation enforceable in
accordance with its terms; and the making and performance of this Agreement will
not violate any law or regulation, federal, state or local, or its articles of
incorporation or by-laws or other organizational documents or result in any
violation of or constitute a default under any material agreement or instrument
by which it or any of its property is bound.

        10.  This Agreement is a continuing agreement of subordination and Bank
may continue to make loans to or otherwise accept the obligations of Borrower in
reliance hereon, without notice to Subordinated Creditor, until this Agreement
is revoked by notice, actually received, given to Bank by Subordinated Creditor
in writing. Such notice of revocation shall not affect this Agreement as to any
Senior Debt existing prior to receipt of the aforesaid notice or as to any
Senior Debt arising thereafter and created pursuant to an enforceable commitment
given Borrower by Bank prior to receipt of such notice; but as to such Senior
Debt, this Agreement shall remain in full force and effect and all indebtedness
of Borrower to Subordinated Creditor, then existing or thereafter created shall
be subordinated to such Senior Debt. Before or after any such notice of
revocation is received, Bank may make any renewals, extensions or other
modifications of any kind relating to the terms and conditions of any Senior
Debt or any collateral security or guaranty therefor, and may release or
exchange or otherwise deal with any collateral security or guaranty or may
release any balance of funds on deposit or otherwise held by Bank without notice
or consent of Subordinated Creditor and without impairing or affecting Bank's
rights under this Agreement.

        11.  While this Agreement remains in effect, Subordinated Creditor
covenants and agrees that it will not modify or amend or permit modification or
amendment of the terms and conditions of the Subordinated Debt without obtaining
Bank's prior written consent thereto.

        12.  No waiver of Bank's rights hereunder shall be effective unless in a
writing signed by Bank, and each waiver shall extend only to the specific
instance involved and shall not impair or affect Bank's rights in any other
respect at any other time. Subordinated Creditor hereby waives all notices with
respect to the subject matter hereof, including, but not limited to, notice of
acceptance of this Agreement, of the making of loans or advances to the Borrower
or any extensions, renewals or modifications thereof, releases of collateral
security or guarantors or other indulgences of any character, or of the
occurrence or declaration of any default or the taking of any collection or
enforcement action. This Agreement shall be binding upon the successors and
assigns of

                                      
<PAGE>
 
Subordinated Creditor, may not be amended except by a writing signed by the
parties hereto, and shall be construed according to the laws of the State of
Colorado.

        13.  Subject to the provisions of this Agreement and the rights of Bank
hereunder, as between Borrower and Subordinated Creditor, nothing herein
contained shall impair the obligation of Borrower, which is absolute and
unconditional, to pay the Subordinated Debt as and when the same shall become
due and payable in accordance with the terms thereof, or prevent Subordinated
Creditor upon default with respect to the Subordinated Debt, from exercising all
rights, powers and remedies otherwise provided therein or by applicable law.

        14.  Subordinated Creditor hereby acknowledges that its undertakings
hereunder, including its agreement to be bound by the limitations on the payment
of Home Office Allocations set forth in the Loan Agreement, are not subject to
the non-recourse provisions set forth in Paragraph 8.1 of the Loan Agreement and
that Bank may take any legal action against Subordinated Creditor by reason of
such undertakings and Bank shall have unlimited recourse against the separate
assets of Subordinated Creditor in order to satisfy any liability of
Subordinated Creditor to Bank by reason of such undertakings.

        IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the day and year first above written.

ATTEST:                            JONES INTERCABLE, INC.,
                                   a Colorado corporation


By:                                By:
   --------------------------         -----------------------------

Title:                             Title:
      -----------------------            --------------------------

[CORPORATE SEAL]
                                   COLORADO NATIONAL BANK


                                   By:
                                      -----------------------------

                                   Title:
                                         --------------------------

                                      
<PAGE>
 
The undersigned hereby:

(a)  acknowledges and confirms that it has received an executed copy of this
     Subordination Agreement and approves of and consents to it in all respects;
     and

(b)  agrees to be bound by and to observe all of the terms and conditions of
     this Subordination Agreement.

IDS/JONES GROWTH PARTNERS 87-A, LTD.,
a Colorado limited partnership

By:  JONES CABLE CORPORATION,
     a Colorado corporation, 
     its Managing General Partner


     By:
        ---------------------------------

     Title:
           ------------------------------


                                      
<PAGE>
 
                            SUBORDINATION AGREEMENT


        This Subordination Agreement (this "Agreement") is made as of this 28th
day of February, 1996, by and between JONES CABLE CORPORATION, a Colorado
corporation with offices at 9697 East Mineral Avenue, Englewood, Colorado 80112
(herein "Subordinated Creditor") and COLORADO NATIONAL BANK, a national banking
association with offices at 918 17th Street, Denver, Colorado 80202 (herein
"Bank")

        In order to induce Bank to extend credit to IDS/JONES GROWTH PARTNERS 
87-A, LTD., a Colorado limited partnership in which Subordinated Creditor is the
Managing General Partner (herein "Borrower") and in consideration therefor, and
for other good and valuable consideration, the parties hereto hereby agree as
follows:

        1.  "Senior Debt" shall mean all of the indebtedness, liabilities and
obligations of Borrower to Bank, whether now existing or hereafter arising,
including, without limitation, the indebtedness, liabilities and obligations
arising under that certain Revolving Credit Agreement of even date herewith
between Borrower and Bank (the "Loan Agreement") and all principal and interest
under and evidenced by that certain Promissory Note of even date herewith
executed by Borrower in favor of Bank in the principal amount of $10,000,000.00,
as such indebtedness, agreement and instrument may be amended, extended,
renewed, refinanced, supplemented or assigned from time to time hereafter.

        "Subordinated Debt" shall mean all indebtedness, liabilities and
obligations of Borrower to Subordinated Creditor, whether now existing or
hereafter arising, including any advances, indebtedness, liabilities and
obligations, all interest and other fees which may be or become due with respect
thereto, whether or not evidenced by promissory notes, and any accrued and
unpaid Management Fees. As used herein, the term "Management Fees" shall have
the definition set forth in the Loan Agreement.

        2.  The payment of any and all Subordinated Debt is hereby expressly
subordinated to all Senior Debt to the extent and in the manner set forth in
this Agreement.

        3.  Subordinated Creditor shall not accelerate, demand, sue for,
commence any collection or enforcement action or proceeding, take, receive,
accept or retain any payment or distribution of any character, whether in cash,
securities or other property, in respect of the principal of, premium on, or
interest on, the Subordinated Debt or any collateral security therefor until all
Senior Debt shall have been paid in full with interest, including interest
during any bankruptcy or similar proceeding involving Borrower from the date of
the filing thereof to the date of distribution (notwithstanding any statute,
including without limitation the Federal Bankruptcy Code, any rule of law or

                                    EXHIBIT E
<PAGE>
 
bankruptcy procedures to the contrary); provided, however, that if there is not
continuing an Event of Default under the Loan Agreement and Borrower is not at
the time otherwise in default under the Senior Debt, and such payment will not
constitute an Event of Default or an event which, with the passage of time or
giving notice, would constitute an Event of Default, Borrower may pay
Subordinated Debt to Subordinated Creditor with interest thereon except as
otherwise limited by Section 6.9 of the Loan Agreement.

        4.  Subordinated Creditor hereby acknowledges that the payment of
Management Fees by Borrower to Subordinated Creditor and the repayment by
Borrower to Subordinated Creditor of advances or indebtedness and any interest
and fees due thereon are subject to the limitations set forth in the Loan
Agreement and Subordinated Creditor hereby confirms that it is bound by such
limitations.

        5.  In the event of the institution of and in connection with any
insolvency, bankruptcy, receivership, liquidation, reorganization or other
similar proceedings relative to Borrower, or its property, or any proceeding for
the voluntary liquidation, dissolution or other winding-up of Borrower and
whether or not involving insolvency or bankruptcy proceedings:

            (a)  all Senior Debt shall first be paid in full before any payment
                 or distribution of any character, whether in cash, securities
                 or other property, shall be made in respect of any Subordinated
                 Debt;

            (b)  any payment or distribution of any character, whether in cash,
                 securities or other property, which would otherwise (but for
                 the terms hereof) be payable or deliverable in respect of any
                 Subordinated Debt shall be paid or delivered directly to Bank,
                 until all Senior Debt shall have been paid in full, and
                 Subordinated Creditor irrevocably authorizes, empowers and
                 directs all receivers, trustees, liquidators, conservators and
                 others having authority to effect all such payments and
                 deliveries; and

            (c)  Subordinated Creditor shall execute and deliver to Bank all
                 such further instruments confirming the authorization referred
                 to in the foregoing clause (b) and all such powers of attorney,
                 proofs of claim, assignments of claim and other instruments and
                 shall take all such other actions as may be requested by Bank
                 in order to enable Bank to enforce all of its rights hereunder
                 and all claims of Bank upon or in respect of the

                                      
<PAGE>
 
                 Subordinated Debt, and failing execution of such instruments or
                 taking of such actions by Subordinated Creditor, Bank is hereby
                 authorized and empowered to execute and perform the same on
                 behalf of the Subordinated Creditor.

        6.  In the event any payment or distribution of any character, whether
in cash, securities or other property, is received by Subordinated Creditor in
contravention of the terms of this Agreement or the Loan Agreement, and before
all Senior Debt shall have been paid in full, such payment or distribution shall
be held by Subordinated Creditor, as trustee of an express trust, in trust for
the benefit of Bank, and shall be paid over or delivered and transferred to Bank
for application to all Senior Debt remaining unpaid until such Senior Debt shall
have been paid in full. Subordinated Creditor hereby assigns to Bank all rights
of Subordinated Creditor to any such payments or distributions, which Bank may
exercise in Bank's name or in the name of Subordinated Creditor, and agrees to
execute such instruments as may be required by Bank to enable Bank to enforce
such claims. Any payments or distributions received in excess of the amount
sufficient to pay all Senior Debt in full shall be returned by Bank to
Subordinated Creditor.

        7.  If the Subordinated Debt is evidenced in whole or part by any
promissory note or other instruments, Subordinated Creditor agrees, at Bank's
request, to endorse and deliver such notes and instruments to Bank to be held by
Bank subject to the provisions of this Agreement, or to note on the face thereof
that the same is subject to this Agreement.

        8.  Notwithstanding anything to the contrary contained in any other
instrument or document delivered in connection with the Subordinated Debt or
otherwise, including, without limitation, any prior or subsequent perfection of
a security interest or lien, any security interests and liens now or hereafter
held by Subordinated Creditor in any collateral security for the Subordinated
Debt shall be junior and subordinate to any security interests and liens now or
hereafter held by Bank in the same collateral.  So long as the Senior Debt shall
remain unpaid, Bank may at all times in its sole discretion exercise any and all
powers and rights which it now has or may hereafter acquire with respect to any
of the collateral securing the Senior Debt, all without the necessity of
obtaining any consent or approval of Subordinated Creditor.

        9.  Subordinated Creditor represents and warrants that Subordinated
Creditor is duly organized, validly existing and in good standing under the laws
of the State of Colorado and has the power and authority under the laws of
Colorado and under its articles of incorporation and by-laws or other
organizational documents to enter into this Agreement; all actions necessary or
appropriate for its execution and performance of this Agreement 


                                     
<PAGE>
 
have been taken and upon its execution, this Agreement will constitute its valid
and binding obligation enforceable in accordance with its terms; and the making
and performance of this Agreement will not violate any law or regulation,
federal, state or local, or its articles of incorporation or by-laws or other
organizational documents or result in any violation of or constitute a default
under any material agreement or instrument by which it or any of its property is
bound.

        10.  This Agreement is a continuing agreement of subordination and Bank
may continue to make loans to or otherwise accept the obligations of Borrower in
reliance hereon, without notice to Subordinated Creditor, until this Agreement
is revoked by notice, actually received, given to Bank by Subordinated Creditor
in writing. Such notice of revocation shall not affect this Agreement as to any
Senior Debt existing prior to receipt of the aforesaid notice or as to any
Senior Debt arising thereafter and created pursuant to an enforceable commitment
given Borrower by Bank prior to receipt of such notice; but as to such Senior
Debt, this Agreement shall remain in full force and effect and all indebtedness
of Borrower to Subordinated Creditor, then existing or thereafter created shall
be subordinated to such Senior Debt. Before or after any such notice of
revocation is received, Bank may make any renewals, extensions or other
modifications of any kind relating to the terms and conditions of any Senior
Debt or any collateral security or guaranty therefor, and may release or
exchange or otherwise deal with any collateral security or guaranty or may
release any balance of funds on deposit or otherwise held by Bank without notice
or consent of Subordinated Creditor and without impairing or affecting Bank's
rights under this Agreement.

        11.  While this Agreement remains in effect, Subordinated Creditor
covenants and agrees that it will not modify or amend or permit modification or
amendment of the terms and conditions of the Subordinated Debt without obtaining
Bank's prior written consent thereto.

        12.  No waiver of Bank's rights hereunder shall be effective unless in a
writing signed by Bank, and each waiver shall extend only to the specific
instance involved and shall not impair or affect Bank's rights in any other
respect at any other time. Subordinated Creditor hereby waives all notices with
respect to the subject matter hereof, including, but not limited to, notice of
acceptance of this Agreement, of the making of loans or advances to the Borrower
or any extensions, renewals or modifications thereof, releases of collateral
security or guarantors or other indulgences of any character, or of the
occurrence or declaration of any default or the taking of any collection or
enforcement action. This Agreement shall be binding upon the successors and
assigns of Subordinated Creditor, may not be amended except by a writing signed
by the parties hereto, and shall be construed according to the laws of the State
of Colorado.

                                     
<PAGE>
 
        13.  Subject to the provisions of this Agreement and the rights of Bank
hereunder, as between Borrower and Subordinated Creditor, nothing herein
contained shall impair the obligation of Borrower, which is absolute and
unconditional, to pay the Subordinated Debt as and when the same shall become
due and payable in accordance with the terms thereof, or prevent Subordinated
Creditor upon default with respect to the Subordinated Debt, from exercising all
rights, powers and remedies otherwise provided therein or by applicable law.

        14.  Subordinated Creditor hereby acknowledges that its undertakings
hereunder, including its agreement to be bound by the limitations on the payment
of Management Fees set forth in the Loan Agreement, are not subject to the non-
recourse provisions set forth in Paragraph 8.1 of the Loan Agreement and that
Bank may take any legal action against Subordinated Creditor by reason of such
undertakings and Bank shall have unlimited recourse against the separate assets
of Subordinated Creditor in order to satisfy any liability of Subordinated
Creditor to Bank by reason of such undertakings.

        IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the day and year first above written.

ATTEST:                            JONES CABLE CORPORATION,
                                   a Colorado corporation


By:                                By:
   ---------------------------        ---------------------------------

Title:                             Title:
      ------------------------           ------------------------------


[CORPORATE SEAL]                   
                                   COLORADO NATIONAL BANK


                                   By:
                                      ---------------------------------

                                   Title:
                                         ------------------------------


                                    
<PAGE>
 
The undersigned hereby:

(a)  acknowledges and confirms that it has received an executed copy of this
     Subordination Agreement and approves of and consents to it in all respects;
     and

(b)  agrees to be bound by and to observe all of the terms and conditions of
     this Subordination Agreement.

IDS/JONES GROWTH PARTNERS 87-A, LTD.,
a Colorado limited partnership

By:  JONES CABLE CORPORATION,
     a Colorado corporation, 
     its Managing General Partner


     By:
        --------------------------

     Title:
           -----------------------

                                     
<PAGE>
 
                               February 28, 1996



Colorado National Bank
Seventeenth Street at Champa
Denver, Colorado  80202

     Re:  Subordination Agreements dated as of February 28, 1996, by and between
          Colorado National Bank and each of Jones Intercable, Inc. and Jones
          Cable Corporation

Ladies and Gentlemen:

     I am Vice president and General Counsel of each of Jones Intercable, Inc.,
a Colorado corporation ("Intercable") and Jones Cable Corporation, a Colorado
corporation ("JCC"), and have acted as counsel to Intercable and to JCC in
connection with a $10,000,000 credit facility extended to IDS/Jones Growth
Partners 87-A, a Colorado limited partnership (the "Borrower") pursuant to a
Revolving Credit Agreement (the "Loan Agreement") dated as of February 28,
1996, by and between the Borrower and Colorado National Bank (the "Bank").

     This opinion is being rendered to you in compliance with Paragraph 4.6 of
the Loan Agreement.  Capitalized terms used herein without definition have the
same meanings as in the Loan Agreement.

     In my capacity as such counsel, I have examined originals, or copies
identified to my satisfaction as being true copies, of such records, documents
or other instruments as in my judgment are necessary or appropriate to enable me
to render the opinions expressed below.  These records, documents and
instruments included the following:

     1.   The Articles of Incorporation of each of Intercable and JCC, as
          amended to date;

     2.   The bylaws of each of Intercable and JCC, as amended to date;

                                   EXHIBIT F
                                   ---------
<PAGE>
 
Colorado National Bank
February 28, 1996
Page 2



     3.   All records of proceedings and actions of the Board of Directors of
          each of Intercable and JCC relating to the transactions contemplated
          by the Loan Agreement;

     4.   The Loan Agreement;

     5.   That certain Subordination Agreement dated the date hereof by and
          between Intercable and the Bank (the "Intercable Subordination
          Agreement") and

     6.   That certain Subordination Agreement dated the date hereof by and
          between JCC and the Bank (the "JCC Subordination Agreement").

     I have obtained and relied upon such certificates and assurances from
public officials as I have deemed necessary in connection with the opinions set
forth herein.

     I have investigated such questions of law for the purpose of rendering this
opinion as I have deemed necessary.  This opinion is limited in all respects to
the internal laws of the State of Colorado and to United States federal law
(except that no opinion is expressed herein as to the Communications Act of
1934, as amended, the rules and regulations of the Federal Communications
Commission promulgated pursuant thereto, or to the rules and regulations of the
United States Copyright Office and the Copyright Royalty Tribunal, or to
matters controlled by, required by, or issued pursuant to, any of the
foregoing). I express no opinion herein as to whether a Colorado or other court
would apply Colorado law to any particular aspect of the subject matter hereof.

     On the basis of the foregoing and in reliance thereon, and subject to the
limitations, qualifications and exceptions set forth below, I am of the opinion
that:

     1.   Each of Intercable and JCC is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of Colorado.

     2.   (a)  Intercable has the corporate power and authority to execute and
deliver the Intercable Subordination Agreement and perform its obligations
thereunder, and all such action has been duly and validly
<PAGE>
 
Colorado National Bank
February 28, 1996
Page 3



authorized by all necessary corporate proceedings on its part.

          (b)  JCC has the corporate power and authority to execute and deliver
the JCC Subordination Agreement and perform its obligations thereunder, and all
such action has been duly and validly authorized by all necessary corporate
proceedings on its part.

     3.   (a)  The Intercable Subordination Agreement has been duly and validly
executed and delivered by Intercable, and constitutes the legal, valid and
binding obligation of Intercable, enforceable against it in accordance with the
terms thereof.

          (b)  The JCC Subordination Agreement has been duly and validly
executed and delivered by JCC, and constitutes the legal, valid and binding
obligation of JCC, enforceable against it in accordance with the terms thereof.

     4.   No consent or approval by, and no filing with, any federal or Colorado
governmental agency or regulatory body, is necessary on the part of either
Intercable or JCC in connection with the execution, delivery and performance by
Intercable and JCC of the Intercable Subordination Agreement and the JCC
Subordination Agreement, respectively.

     5.   Neither the execution, delivery or performance by Intercable of the
Intercable Subordination Agreement or by JCC of the JCC Subordination Agreement
(a) constitutes a violation of any Colorado or federal law, except for
violations which, in the aggregate, would not materially and adversely effect
the business, operations or financial condition of Intercable or JCC or the
ability of either thereof to perform its respective obligations under the
Subordination Agreements or (b) constitutes a breach of or a default under the
respective Articles of Incorporation or bylaws of Intercable and JCC or, to my
knowledge, any agreement or instrument to which Intercable or JCC is a party or
to or by which any of their respective properties are subject or bound, the
breach of or default under which would have a materially adverse effect on the
business, operations or financial condition of Intercable and JCC

     My opinion in Paragraph 3 above as to the enforceability of the
Subordination Agreements is subject to the following limitations: (i) such
enforceability may be
<PAGE>
 
Colorado National Bank
February 28, 1996
Page 4



limited by bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors' rights generally; (ii) certain rights
and remedies granted to the Bank may be subject to equitable defenses and to the
discretion of the court before which any proceeding therefor may be brought;
(iii) the Colorado Uniform Commercial Code and other laws and judicial decisions
of Colorado require that the Bank exercise its rights in the Collateral in good
faith and in a commercially reasonable manner and a court may decline to
strictly enforce certain covenants in the Subordination Agreements if it
concludes that such enforcement would be unreasonable under the then existing
circumstances (iv) public policy considerations may limit the rights of the Bank
to obtain certain remedies; (v) no opinion is expressed as to the enforceability
of the provisions of the Subordination Agreements which purport to authorize the
Bank to execute documents in the name or on behalf of Intercable or JCC without
the signatures of the appropriate representatives thereof; and (vi) no opinion
is expressed as to the enforceability of any choice of law, severability, or
waiver provisions contained in the Subordination Agreements.

     To the extent that the obligations of either Intercable or JCC may be
dependent upon such matters, I assume for purposes of this opinion that the Bank
is duly organized, validly existing and in good standing under its jurisdiction
of organization; that to the extent contemplated thereby, the Subordination
Agreements have been duly authorized executed and delivered by the Bank and
constitute the legal, valid and binding obligations of the Bank, enforceable in
accordance with their respective terms; and that the Bank has the requisite
corporate or other organizational power and authority to perform its obligations
under the Subordination Agreements.

     This opinion is as of the date hereof and I disclaim any undertaking or
obligation to advise the Bank of changes which may hereafter be brought to my
attention.  This opinion is rendered only to the Bank, and is solely for its
benefit in connection with the transactions contemplated by the Loan Agreement
This opinion may not be relied upon by the Bank for any other purpose or relied
upon by any other
<PAGE>
 
Colorado National Bank
February 28, 1996
Page 5



person, firm or corporation for any purpose without my prior written consent.

                              Very truly yours,


                              Elizabeth M. Steele 
                              General Counsel