Document:

EXHIBIT
      10.5

    

    CHANGE
      OF CONTROL AND SEVERANCE AGREEMENT BETWEEN THE COMPANY AND TERRY MANNING DATED
      AS OF 4/27/07

     

    This
      agreement is made
      as
      of this date
      of
      __4/27/2007  by
      and
between Zoom
      Technologies, Inc. (the
      “Company”), Zoom
      Telephonics, Inc.
      (“Zoom”),
      and
      Terry Manning (“Zoom
      Executive”).

     

    This
      agreement specifies the
      entire agreement between the Company, Zoom and the Zoom Executive regarding
      severance pay
      and
      acceleration of stock
      options.
      This agreement supercedes other agreements, if any, between the
      Company or Zoom
      and
      the named Zoom
      Executive
      that relate
      to
severance
      pay
      or
      acceleration of stock
      options.

    

    
      	1.	
              In
                the event of a “change
                of control” (as
                defined in Section 4 below) or
                liquidation
                of
                the Company,
                all issued and outstanding stock
                options
                issued to the Zoom
                Executive
                after December 7, 2006 will become
                immediately vested,
                with the right to be exercised at the grant price upon change of
                control. 

            

    

     

    
      	2.	
              The
                Zoom
                Executive will receive 6 months base
                salary
                as severance pay
                if:

            

    

    

    
      	(i)	
              the
                Zoom Executive is terminated without “cause”
                (as defined in Section 4 below)
                within 6 months after
                a change
                of control; or 

            

    

     

    
      	(ii)	
              the
                Zoom Executive’s job responsibilities, reporting
                status,
                or compensation are
                materially
                diminished after change of control (including but not limited to
                no longer
                reporting to as senior an executive position of the acquiring company)
                and
                the Zoom
                Executive leaves the acquiring company within 6 months after
                the change
                of control; or 

            

    

     

    
      	(iii)	
              the
                Company
                is
                liquidated.

            

    

    

    
      	3.	
              Zoom
                has the right to terminate the Zoom Executive’s employment “at
                will”.
                In the event Zoom
                Executive’s employment is
                terminated by Zoom for any
                reason
                other than for
                cause, a
                change of control
                or
                liquidation of the Company,
                then
                (i) all
                outstanding stock
                options
                issued to
                the Zoom
                Executive after
                December 7, 2006 will become
                immediately vested
                and will be exercisable for
                up
                to 30 days after termination.;
                and (ii) Zoom
                will pay severance
                to
                the 
                Zoom Executive in
                an amount equal to the
                greater of either a) 3 months base
                salary,
                or b) a
                number of weeks of base salary equal to the
                number of full years employed by Zoom divided by
                2.

            

    

    

    
      	4.	
              For
                the purpose of this agreement, “cause”
                shall mean (i) deliberate dishonesty, illegal or unethical behavior
                or
                other willful behavior detrimental to the best interest of the
                Company
                or
                its subsidiaries;
                (ii) conduct by the Zoom
                Executive constituting
                an act of moral turpitude; (iii) willful disloyalty to the Company
                or
                its subsidiaries or
                refusal or failure of the Zoom
                Executive to
                obey the directions of the President or Board of
                Directors
                of
                the Company or its subsidiaries;
                (iv) incompetent performance or substantial or continuing inattention
                to
                or neglect of duties and responsibilities, provided that the Zoom
                Executive will
                be notified in writing of such deficiencies and given a period of
                60 days
                to correct them. For
                purposes hereof, “change of control" shall mean: (A) any merger,
                consolidation, share exchange, business combination or other similar
                transaction in which the shareholders of the Company would own less
                than
                50% of the surviving entity following the consummation thereof; (B)
                any
                sale, lease, exchange, transfer or other disposition of 50% or more
                of the
                assets of the Company and its subsidiaries, taken as a whole, in
                a single
                transaction or series of transactions; or (C) the acquisition by
                a person
                or entity, or any “group” (as such term is defined under Section 13(d) of
                the Securities Exchange Act of 1934) of beneficial ownership of 50%
                or
                more of the Stock whether by tender offer, exchange offer or
                otherwise.

            

    

     

    [Signature
      Page Follows on Next Page]

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Agreed:

     

    
      
        
          
            	 	 	 	 
	/s/
                    Terry
                    Manning	 	 	/s/
                    Frank B.
                    Manning
	
                    
Zoom
                    Executive
                    Signature	 	 	
                    
Signature
                    - President
                    or Executive VP
                    of
                    Zoom and the Company

          

           

          
            	 	 	 	 
	Terry
                    Manning	 	 	Frank
                    B. Manning
	
                    
Zoom
                    Executive
                    Name (print)	 	 	
                    
Name
                    (print)
	
                  	 	 	
                  
	4/27/2007	 	 	5/7/2007
	Date	 	 	Date--------------------------------------------------------------------------------

                      AMENDED AND RESTATED CREDIT AGREEMENT

                            DATED AS OF MAY 14, 2007

                                     Between

                             SUREWEST COMMUNICATIONS

                                  as Borrower,

                                       and

                                  COBANK, ACB,

                                    as Lender

--------------------------------------------------------------------------------

<PAGE>

                                TABLE OF CONTENTS

SECTION 1 AMOUNTS AND TERMS OF LOANS.........................................1
      1.1   Loans............................................................1
            (A)   Term Loan..................................................1
            (B)   Revolving Loans............................................1
            (C)   Swingline Loans............................................2
            (D)   Letters of Credit..........................................2
            (E)   Notes......................................................5
            (F)   Advances...................................................5
      1.2   Interest.........................................................5
            (A)   Interest Options...........................................5
            (B)   Applicable Margins.........................................6
            (C)   Interest Periods...........................................6
            (D)   Calculation and Payment....................................7
            (E)   Default Rate of Interest...................................7
            (F)   Excess Interest............................................7
            (G)   Selection, Conversion or Continuation of Loans;
                  LIBOR Availability.........................................8
      1.3   Notice of Borrowing, Conversion or Continuation of
            Loans............................................................8
      1.4   Fees and Expenses................................................9
            (A)   Commitment Fee.............................................9
            (B)   Certain Other Fees.........................................9
            (C)   Breakage Fee...............................................9
            (D)   Expenses and Attorneys Fees...............................10
            (E)   Letter of Credit Fees.....................................10
      1.5   Payments........................................................10
      1.6   Repayments and Reduction of Term Loan and Revolving
            Loan Commitment and Related Mandatory Repayments................11
            (A)   Scheduled Repayments and Reductions of Term Loan
                  and Revolving Loan Commitment.............................11
            (B)   Voluntary Reduction of Loan Commitments...................11
            (C)   Mandatory Repayments......................................12
      1.7   Voluntary Prepayments and Other Mandatory  Repayments...........12
            (A)   Voluntary Prepayment of Loans.............................12
            (B)   Repayments from Insurance Proceeds........................12
            (C)   Repayments from Asset Dispositions........................13
      1.8   Application of Prepayments and Repayments; Payment of
            Breakage Fees, Etc..............................................13
      1.9   Loan Accounts...................................................13
      1.10  Changes in LIBOR Rate Availability..............................13
      1.11  Capital Adequacy and Other Adjustments..........................14
      1.12  Taxes: No Deductions............................................14
      1.13  Changes in Tax Laws.............................................15
      1.14  Term of This Agreement..........................................15
      1.15  Letter of Credit Liability......................................15

                                      -i-
<PAGE>

SECTION 2 AFFIRMATIVE COVENANTS.............................................16
      2.1   Compliance With Laws............................................16
      2.2   Maintenance of Books and Records; Properties;
            Insurance.......................................................16
      2.3   Inspection......................................................17
      2.4   Legal Existence, Etc............................................17
      2.5   Use of Proceeds.................................................17
      2.6   Further Assurances..............................................17
      2.7   CoBank Patronage Capital........................................18
      2.8   Investment Company Act..........................................18
      2.9   Payment of Obligations..........................................18
      2.10  Environmental Laws..............................................18
      2.11  ERISA Compliance................................................19

SECTION 3 NEGATIVE COVENANTS................................................19
      3.1   Indebtedness....................................................19
      3.2   Liens and Related Matters.......................................20
      3.3   Investments.....................................................20
      3.4   Restricted Junior Payments......................................20
      3.5   Restriction on Fundamental Changes..............................20
      3.6   Disposal of Assets or Significant Subsidiary Stock..............21
      3.7   Transactions with Affiliates....................................22
      3.8   Conduct of Business.............................................22
      3.9   Fiscal Year.....................................................22
      3.10  Inconsistent Agreements.........................................22

SECTION 4 FINANCIAL COVENANTS AND REPORTING.................................23
      4.1   Leverage Ratio..................................................23
      4.2   Interest Coverage Ratio.........................................23
      4.3   Net Worth.......................................................23
      4.4   Financial Statements and Other Reports..........................23
            (A)   Quarterly Financials......................................23
            (B)   Year-End Financials.......................................23
            (C)   Borrower Compliance Certificate...........................24
            (D)   Budgets...................................................24
            (E)   SEC Filings...............................................24
            (F)   Events of Default, Etc....................................24
            (G)   Litigation................................................24
            (H)   Environmental Notices.....................................25
            (I)   ERISA Events..............................................25
            (J)   Other Information.........................................25
      4.5   Accounting Terms; Utilization of GAAP for Purposes of
            Calculations Under Agreement....................................25

SECTION 5 REPRESENTATIONS AND WARRANTIES....................................26
      5.1   Disclosure......................................................26
      5.2   No Material Adverse Effect......................................26

                                      -ii-

<PAGE>

      5.3   Organization, Powers, Authorization and Good Standing...........26
            (A)   Organization and Powers...................................26
            (B)   Authorization; Binding Obligation.........................26
            (C)   Qualification.............................................27
      5.4   Compliance of Agreement, Loan Documents and
            Borrowings with Applicable Law..................................27
      5.5   Compliance with Law; Governmental Approvals.....................27
      5.6   Tax Returns and Payments........................................27
      5.7   Environmental Matters...........................................27
      5.8   Financial Statements............................................28
      5.9   Intellectual Property...........................................28
      5.10  Litigation, Investigations, Audits, Etc.........................28
      5.11  Employee Labor Matters..........................................29
      5.12  ERISA Compliance................................................29
      5.13  Communications Regulatory Matters...............................29
      5.14  Solvency........................................................30
      5.15  Investment Company Act..........................................30
      5.16  Certain Agreements and Material Contracts.......................30
      5.17  Title to Properties.............................................30
      5.18  Transactions with Affiliates....................................31
      5.19  OFAC............................................................31
      5.20  Patriot Act.....................................................31

SECTION 6 EVENTS OF DEFAULT AND RIGHTS AND REMEDIES.........................31
      6.1   Event of Default................................................31
            (A)   Payment...................................................31
            (B)   Default in Other Agreements...............................31
            (C)   Breach of Certain Provisions..............................32
            (D)   Breach of Warranty........................................32
            (E)   Other Defaults Under Loan Documents.......................32
            (F)   Involuntary Bankruptcy; Appointment of Receiver;
                  Etc.......................................................32
            (G)   Voluntary Bankruptcy; Appointment of Receiver; Etc........32
            (H)   Judgment and Attachments..................................33
            (I)   Dissolution...............................................33
            (J)   Solvency..................................................33
            (K)   Injunction................................................33
            (L)   ERISA; Pension Plans......................................33
            (M)   Invalidity of Loan Documents..............................33
            (N)   Licenses and Permits......................................33
            (O)   Change in Control.........................................34
      6.2   Suspension of Commitments.......................................34
      6.3   Acceleration....................................................34
      6.4   Rights of Collection............................................34
      6.5   Consents........................................................34
      6.6   Performance by CoBank...........................................34

                                     -iii-

<PAGE>

      6.7   Set Off and Sharing of Payments.................................35

SECTION 7 CONDITIONS TO LOANS...............................................35
      7.1   Conditions to Effectiveness of this Agreement...................35
            (A)   Executed Loan and Other Documents.........................35
            (B)   Closing Certificates; Opinions............................35
            (C)   Consents..................................................36
            (D)   Fees, Expenses, Taxes, Etc................................36
            (E)   Miscellaneous.............................................37
      7.2   Conditions to All Loans.........................................37

SECTION 8 ASSIGNMENT AND PARTICIPATION......................................38

SECTION 9 MISCELLANEOUS.....................................................38
      9.1   Indemnities.....................................................38
      9.2   Amendments and Waivers..........................................39
      9.3   Notices.........................................................39
      9.4   Failure or Indulgence Not Waiver; Remedies Cumulative...........39
      9.5   Severability....................................................39
      9.6   Headings........................................................40
      9.7   Governing Law...................................................40
      9.8   No Fiduciary Relationship.......................................40
      9.9   Construction....................................................40
      9.10  Confidentiality.................................................40
      9.11  Consent to Jurisdiction and Service of Process..................40
      9.12  Waiver of Jury Trial............................................41
      9.13  Survival of Warranties and Certain Agreements...................42
      9.14  Entire Agreement................................................42
      9.15  Counterparts; Effectiveness.....................................42
      9.16  Patriot Act.....................................................42
      9.17  Effectiveness of Amendment and Restatement; No
            Novation........................................................42

SECTION 10 DEFINITIONS......................................................43
      10.1  Certain Defined Terms...........................................43
      10.2  Other Definitional Provisions...................................55

                                      -iv-
<PAGE>

                                    SCHEDULES

    Schedule 3.8     Transactions with Affiliates
    Schedule 5.3(A)  Jurisdiction of Organization
    Schedule 5.3(C)  Qualification to Transact Business
    Schedule 5.4     Governmental Approvals
    Schedule 5.6     Tax Returns and Payments
    Schedule 5.10    Litigation, Etc.
    Schedule 5.11    Employee Labor Matters

                                    EXHIBITS

    Exhibit 1.3      Form of Notice of Borrowing/Conversion/Continuation
    Exhibit 4.4(C)   Form of Compliance Certificate
    Exhibit 10.1(A)  Form of Revolving Loan Promissory Note
    Exhibit 10.1(B)  Form of Term Loan Promissory Note
    Exhibit 10.1(C)  Form of Swingline Promissory Note

                        INDEX OF DEFINED TERMS

    Defined Term                                           Defined in Section
    ------------                                           ------------------

    Accounting Changes                                           ss.4.5
    Acquired Indebtedness                                        ss.10.1
    Adjusted Consolidated Net Worth                              ss.10.1
    Adjustment Date                                              ss.10.1
    Affiliate                                                    ss.10.1
    Agreement                                                    Preamble
    Applicable Law                                               ss.10.1
    Asset Disposition                                            ss.10.1
    Banking Day                                                  ss.10.1
    Bankruptcy Code                                              ss.10.1
    Base Rate                                                    ss.10.1
    Base Rate Loan                                               ss.10.1
    Base Rate Margin                                             ss.10.1
    Borrower                                                     Preamble
    Breakage Fees                                                ss.1.4(C)
    Budget                                                       ss.10.1
    Business Day                                                 ss.10.1
    Calculation Period                                           ss.10.1
    Capital Leases                                               ss.10.1
    Cash Equivalents                                             ss.10.1
    Closing Date                                                 ss.10.1
    CoBank                                                       Preamble
    Communications Act                                           ss.10.1
    Compliance Certificate                                       ss.4.4(C)
    Consolidated Net Assets                                      ss.10.1
    Consolidated Net Worth                                       ss.10.1
    Contingent Obligation                                        ss.10.1
    Default                                                      ss.10.1
    EBITDA                                                       ss.10.1
    Environmental Laws                                           ss.10.1
    ERISA                                                        ss.10.1
    ERISA Affiliate                                              ss.10.1
    ERISA Event                                                  ss.10.1
    Event of Default                                             ss.6.1
    Evergreen Letter of Credit                                   ss.1.1(D)(7)
    Existing Credit Agreement                                    Preamble
    Facility(ies)                                                ss.10.1
    FCC                                                          ss.10.1
    Funding Date                                                 ss.7.2

                                      -vi-

<PAGE>

    GAAP                                                         ss.10.1
    Governmental Approvals                                       ss.10.1
    Governmental Authority                                       ss.10.1
    Indebtedness                                                 ss.10.1
    Indemnitees                                                  ss.9.1
    Intellectual Property Rights                                 ss.5.9
    Interest Coverage Ratio                                      ss.10.1
    Interest Period                                              ss.1.2(C)
    Interest Rate Agreement                                      ss.10.1
    Investment                                                   ss.10.1
    IRC                                                          ss.10.1
    Letter of Credit Liability                                   ss.10.1
    Letter(s) of Credit                                          ss.1.1(D)
    Leverage Ratio                                               ss.10.1
    LIBOR                                                        ss.10.1
    LIBOR Breakage Fees                                          ss.1.4(C)
    LIBOR Loans                                                  ss.10.1
    LIBOR Margin                                                 ss.10.1
    Licenses                                                     ss.10.1
    Lien                                                         ss.10.1
    Loan(s)                                                      ss.10.1
    Loan Commitment(s)                                           ss.10.1
    Loan Documents                                               ss.10.1
    Material Adverse Effect                                      ss.10.1
    Material Contracts                                           ss.10.1
    Multi-employer Plan                                          ss.10.1
    Net Proceeds                                                 ss.10.1
    Nonrenewal Notice Date                                       ss.1.1(D)(7)
    Note(s)                                                      ss.10.1
    Note Purchase Agreement                                      ss.10.1
    Notice of Borrowing/Conversion/Continuation                  ss.1.3
    Obligations                                                  ss.10.1
    Overnight LIBOR                                              ss.10.1
    Patriot Act                                                  ss.9.16
    PBGC                                                         ss.10.1
    Permitted Encumbrances                                       ss.10.1
    Person                                                       ss.10.1
    Plan                                                         ss.10.1
    Priority Debt                                                ss.10.1
    PUC                                                          ss.10.1
    Quoted Rate                                                  ss.10.1
    Quoted Rate Breakage Fees                                    ss.1.4(C)
    Quoted Rate Loans                                            ss.10.1
    Quoted Rate Period                                           ss.1.2(A)(i)
    Related Interest Rate Agreement                              ss.10.1

                                     -vii-

<PAGE>

    Reportable Event                                             ss.10.1
    Restricted Investments                                       ss.10.1
    Restricted Junior Payment                                    ss.10.1
    Revolving Loan(s)                                            ss.10.1
    Revolving Loan Commitment                                    ss.10.1
    Revolving Loan Expiration Date                               ss.10.1
    Revolving Loan Facility                                      ss.10.1
    Revolving Note(s)                                            ss.10.1
    SEC                                                          ss.4.4(A)
    Statement                                                    ss.4.4(B)
    Swingline Facility                                           ss.10.1
    Swingline Funding Date                                       ss.7.3
    Swingline Loan Commitment                                    ss.10.1
    Swingline Loans                                              ss.10.1
    Swingline Note(s)                                            ss.10.1
    Subsidiary                                                   ss.10.1
    Tax Liabilities                                              ss.1.12
    Telecommunications System                                    ss.10.1
    Term Loan                                                    ss.10.1
    Term Loan Availability Expiration Date                       ss.10.1
    Term Loan Commitment                                         ss.10.1
    Term Loan Facility                                           ss.10.1
    Term Loan Maturity Date                                      ss.10.1
    Term Loan Note(s)                                            ss.10.1
    UCP                                                          ss.1.1(D)(6)

                                     -viii-

<PAGE>
                      AMENDED AND RESTATED CREDIT AGREEMENT

         This AMENDED AND RESTATED CREDIT  AGREEMENT (as amended,  supplemented,
modified,  extended  or  restated as  permitted  herein  from time to time,  and
including all schedules and exhibits hereto,  this  "Agreement") is entered into
as of May 14, 2007, between SUREWEST  COMMUNICATIONS,  a California  corporation
("Borrower"),  and COBANK, ACB ("CoBank"),  and amends and restates that certain
Credit  Agreement,  dated as of May 1, 2006,  between  Borrower  and CoBank (the
"Existing Credit  Agreement").  Capitalized terms used and not otherwise defined
herein shall have the meanings given to them in Section 10.1 of this Agreement.

                                R E C I T A L S:

         WHEREAS, Borrower desires that CoBank extend a term loan facility and a
revolving  loan facility to Borrower,  the proceeds of which are to be available
for general  corporate  purposes of Borrower  and its  Subsidiaries,  including,
without limitation,  refinancing existing  indebtedness,  capital  expenditures,
permitted acquisitions and working capital needs;

         NOW,  THEREFORE,  in  consideration of the premises and the agreements,
provisions  and  covenants  herein  contained,  and for other good and  valuable
consideration,  the receipt and adequacy of which are hereby  acknowledged,  the
parties  agree,  and amend and  restate the  Existing  Credit  Agreement  in its
entirety, as follows:

                                   SECTION 1

                           AMOUNTS AND TERMS OF LOANS

      1.1 Loans.  Subject to the terms and  conditions of this  Agreement and in
reliance  upon  the  representations,   warranties  and  covenants  of  Borrower
contained herein and in the other Loan Documents:

         (A) Term Loan.  CoBank  has lent to  Borrower  the Term  Loan.  Amounts
borrowed  under this  Subsection  1.1(A)  that are repaid or prepaid  may not be
reborrowed.

         (B)  Revolving  Loans.  CoBank  agrees to lend to Borrower,  during the
period commencing on the date all conditions  precedent set forth in Subsections
7.1 and 7.2 are  satisfied or waived and ending on the Business Day  immediately
preceding the Revolving Loan Expiration Date,  Revolving Loans;  provided,  that
the aggregate principal amount of all Revolving Loans outstanding may not exceed
the Revolving  Loan  Commitment  less the sum of (i) the  outstanding  Letter of
Credit Liability and (ii) the aggregate  principal amount of the Swingline Loans
then  outstanding.  Within the limits of the Revolving Loan  Commitment and this
Subsection  1.1(B) and Subsections 1.6, 1.7 and 1.8, amounts borrowed under this
Subsection  1.1(B)  may be  prepaid  and  reborrowed  at any  time  prior to the
Revolving Loan Expiration Date.

<PAGE>

         (C)  Swingline  Loans.  CoBank  agrees to lend to Borrower,  during the
period commencing on the date all conditions  precedent set forth in Subsections
7.1 and 7.2 are  satisfied or waived and ending on the Business Day  immediately
preceding the Revolver Loan Expiration Date, Swingline Loans; provided, that the
aggregate principal amount of all Swingline Loans outstanding may not exceed the
Swingline  Loan  Commitment  and  provided,  further,  that CoBank  shall not be
required at any time to lend more than the Revolver Loan Commitment less the sum
of (i) the  outstanding  Letter  of  Credit  Liability  and (ii)  the  aggregate
principal  amount of the Revolver  Loans and Swingline  Loans then  outstanding.
Within the limits of the Swingline  Commitment  and this  Subsection  1.1(C) and
Subsections 1.6, 1.7 and 1.8, amounts borrowed under this Subsection  1.1(C) may
be prepaid and  reborrowed  at any time prior to the  Revolver  Loan  Expiration
Date.

         (D) Letters of Credit.  The Revolving Loan  Commitment may, in addition
to advances as Revolving Loans, be utilized,  upon the request of Borrower,  for
the  issuance  of  irrevocable  letters  of credit  (individually,  a "Letter of
Credit" and, collectively, the "Letters of Credit") by CoBank for the account of
Borrower  or any of its  Subsidiaries.  Each Letter of Credit  shall  reduce the
amount  available  under the Revolving  Loan  Commitment  by the maximum  amount
capable of being drawn under such Letter of Credit.

            (1)  Maximum  Amount.  The  aggregate  amount  of  Letter  of Credit
Liability with respect to all Letters of Credit  outstanding at any time for the
account of Borrower or any of its Subsidiaries may not exceed  $25,000,000,  and
the aggregate  amount of Letter of Credit  Liability with respect to all Letters
of Credit  outstanding  for the account of  Borrower or any of its  Subsidiaries
plus the aggregate  principal amount of Revolving Loans  outstanding at any time
may not exceed the Revolving Loan Commitment.

            (2)  Reimbursement.  Borrower  is  irrevocably  and  unconditionally
obligated without presentment,  demand, protest or other formalities of any kind
to  reimburse  CoBank in  immediately  available  funds for any amounts  paid by
CoBank with respect to a Letter of Credit  issued  hereunder  for the account of
Borrower or any of its  Subsidiaries.  Borrower  hereby  authorizes  and directs
CoBank,  at  CoBank's  option,  to make a  Revolving  Loan in the  amount of any
payment  made by CoBank  with  respect  to any  Letter of Credit  issued for the
account  of  Borrower  or any of its  Subsidiaries.  If the  Letter of Credit is
payable in a foreign  currency,  the amount owed by Borrower in connection  with
such Letter of Credit shall equal an amount in United States Dollars  equivalent
to CoBank's  actual cost of settling its obligation  under such Letter of Credit
in such foreign currency.  All amounts paid by CoBank with respect to any Letter
of Credit  that are not  immediately  repaid by  Borrower or that are not repaid
with a Revolving  Loan shall bear  interest at the sum of the Base Rate plus the
Base Rate Margin applicable from time to time as provided in Subsection 1.2(B).

            (3) Conditions of Issuance of Letters of Credit.  In addition to all
other terms and conditions set forth in this  Agreement,  the issuance by CoBank
of any Letter of Credit shall be subject to the  conditions  precedent  that the
Letter of Credit shall support a transaction entered into in the ordinary course
of  Borrower's  or any of its  Subsidiaries'  businesses,  shall be in an amount
equal to or greater  than  $50,000  and shall be in such form and  contain  such
terms and conditions as are reasonably  satisfactory  to CoBank.  The expiration
date of each Letter of Credit must be on a date which is the earlier of one year
from its date of  issuance  or the 30th day  before the date set forth in clause
(iii) of the  definition of the term  Revolving  Loan  Expiration  Date, or such
other date as agreed to by both CoBank, in its sole discretion.

                                      -2-
<PAGE>

            (4)  Request  for  Letters of Credit.  Borrower  must give CoBank at
least  three  Business  Days'  prior  written  notice,   which  notice  will  be
irrevocable,  specifying  the date a Letter of Credit is  requested to be issued
and the  amount and the  currency  in which  such  Letter of Credit is  payable,
identifying  the  beneficiary  and  describing  the  nature of the  transactions
proposed to be supported thereby. Any notice requesting the issuance of a Letter
of  Credit  shall be  accompanied  by the form of the  Letter  of  Credit  to be
provided by CoBank.  Borrower must also complete any application  procedures and
documents  required by CoBank in  connection  with the issuance of any Letter of
Credit,  including  a  certificate  regarding  Borrower's  compliance  with  the
provisions of Subsection 7.2 of this Agreement.

            (5) Borrower Obligations Absolute. The obligations of Borrower under
this  Subsection  1.1(C) are  irrevocable,  will remain in full force and effect
until CoBank has no further  obligations  to make any payments or  disbursements
under any circumstances with respect to any Letter of Credit,  shall be absolute
and unconditional, shall not be subject to counterclaim, setoff or other defense
or any  other  qualification  or  exception  whatsoever  and  shall  be  paid in
accordance   with  the  terms  and  conditions  of  this  Agreement   under  all
circumstances,   including,   without   limitation,   any   of   the   following
circumstances:

               (a) Any lack of validity or enforceability of this Agreement, any
of the other Loan  Documents  or any  documents or  instruments  relating to any
Letter of Credit;

               (b) Any change in the time,  manner or place of payment of, or in
any other  term of,  all or any of the  obligations  in respect of any Letter of
Credit or any other  amendment,  modification  or waiver of or any consent to or
departure  from any Letter of Credit,  any  documents  or  instruments  relating
thereto,  or any Loan  Document  in each case  whether  or not  Borrower  or its
Subsidiaries has notice or knowledge thereof;

               (c) The  existence of any claim,  setoff,  defense or other right
that  Borrower or its  Subsidiaries  may have at any time against a  beneficiary
named in a Letter of  Credit,  any  transferee  of any  Letter of Credit (or any
Person for whom any such transferee may be acting),  CoBank or any other Person,
whether in connection with this Agreement,  any other Loan Document,  any Letter
of  Credit,  the  transactions  contemplated  hereby  or any  other  related  or
unrelated  transaction or  transactions  (including  any underlying  transaction
between  Borrower  or its  Subsidiaries  and the  beneficiary  named in any such
Letter of Credit);

               (d) Any draft,  certificate or any other document presented under
any Letter of Credit proving to be forged,  fraudulent,  invalid or insufficient
in any  respect or any  statement  therein  being  untrue or  inaccurate  in any
respect,  any errors,  omissions,  interruptions  or delays in  transmission  or
delivery of any messages,  by mail,  telecopier  or otherwise,  or any errors in
translation or in interpretation of technical terms;

                                      -3-
<PAGE>

               (e) Payment under any Letter of Credit against  presentation of a
demand,  draft or  certificate  or other document which does not comply with the
terms of such Letter of Credit;

               (f) Any defense  based upon the failure of any drawing  under any
Letter of Credit to conform to the terms of such Letter of Credit (provided that
any draft,  certificate or other document  presented  pursuant to such Letter of
Credit appears on its face to comply with the terms thereof), any nonapplication
or  misapplication  by the beneficiary or any transferee of the proceeds of such
drawing  or any other act or  omission  of such  beneficiary  or  transferee  in
connection with such Letter of Credit;

               (g)  The  exchange,  release,  surrender  or  impairment  of  any
collateral or other security for the obligations;

               (h) The occurrence of any Default or Event of Default; or

               (i)  Any  other  circumstance  or  event  whatsoever,  including,
without  limitation,  any other  circumstance that might otherwise  constitute a
defense available to, or a discharge of, Borrower or any Subsidiary.

Any action  taken or omitted to be taken by CoBank under or in  connection  with
any Letter of  Credit,  if taken or omitted  in the  absence  of  negligence  or
willful misconduct,  is binding upon Borrower and its Subsidiaries and shall not
create  or  result  in  any  liability  of  CoBank  to  Borrower  or  any of its
Subsidiaries. It is expressly agreed that, for purposes of determining whether a
wrongful  payment under a Letter of Credit resulted from CoBank's  negligence or
willful  misconduct,  none  of the  following  shall  be  deemed  to  constitute
negligence or willful misconduct by CoBank: (i) CoBank's acceptance of documents
that  appear on their  face to comply  with the terms of such  Letter of Credit,
without  responsibility  for  further  investigation,  (ii)  CoBank's  exclusive
reliance on the documents  presented to it under such Letter of Credit as to any
and all matters set forth therein,  including the amount of any draft  presented
under such  Letter of Credit,  whether or not the amount due to the  beneficiary
thereunder  equals  the amount of such  draft and  whether  or not any  document
presented  pursuant to such Letter of Credit  proves to be  insufficient  in any
respect (so long as such  document  appears on its face to comply with the terms
of such Letter of Credit),  and whether or not any other  statement or any other
document  presented  pursuant  to such  Letter of Credit  proves to be forged or
invalid  or any  statement  therein  proves  to be  inaccurate  or untrue in any
respect whatsoever, and (iii) any noncompliance in any immaterial respect of the
documents presented under such Letter of Credit with the terms thereof.

            (6) UCP. The Uniform Customs and Practice for Documentary Credits as
most  recently  published  from  time to time by the  International  Chamber  of
Commerce  (the  "UCP") is hereby  incorporated  in this  Agreement  and shall be
deemed incorporated by this reference into each Letter of Credit issued pursuant
to this  Agreement.  The terms and conditions of the UCP shall be binding on the
parties to this  Agreement and each  beneficiary  of any Letter of Credit issued
pursuant to this Agreement .

                                      -4-
<PAGE>

            (7)  Evergreen  Letters of Credit.  If  Borrower  so requests in any
applicable  Letter of  Credit  application,  CoBank  agrees to issue a Letter of
Credit that has automatic  renewal  provisions  (each,  an "Evergreen  Letter of
Credit");  provided that any such Evergreen  Letter of Credit must permit CoBank
to  prevent  any  such  renewal  at  least  once  in  each  twelve-month  period
(commencing  with the date of issuance of such Letter of Credit) by giving prior
notice to the beneficiary  thereof not later than a day (the "Nonrenewal  Notice
Date") in each  such  twelve-month  period  to be  agreed  upon at the time such
Letter of Credit is issued. Unless otherwise directed by CoBank,  Borrower shall
not be  required  to make a specific  request  to CoBank  for any such  renewal.
Notwithstanding  anything to the contrary contained herein, CoBank shall have no
obligation to permit the renewal of any Evergreen Letter of Credit at any time.

         (E) Notes.  Borrower  shall  execute  and deliver to CoBank a Term Loan
Note, a Revolving  Loans Note and a Swingline Note, each dated the Closing Date,
in the aggregate  principal  amount of the Term Loan  Commitment,  the Revolving
Loan Commitment and the Swingline Commitment, respectively.

         (F)  Advances.  Loans  will  be made  available  by  wire  transfer  of
immediately  available  funds.  Wire  transfers  will be made to such account or
accounts as may be authorized by Borrower.

      1.2 Interest.

            (A) Interest Options.(i) From the date each Loan is made, based upon
      Borrower's  election  at such  time and from time to time  thereafter  (as
      provided in Subsection 1.3 and subject to the conditions set forth in such
      Subsection 1.3 and Subsection 1.2 (C)), each Loan shall accrue interest as
      follows:

                  (a) as a portion of the Base Rate Loan, at the sum of the Base
            Rate  plus the Base  Rate  Margin  applicable  from  time to time as
            provided in Subsection 1.2(B);

                  (b) as a LIBOR Loan, for the applicable  Interest  Period,  at
            the sum of LIBOR plus the LIBOR Margin  applicable from time to time
            as provided in Subsection 1.2(B); or

                  (c) as a Quoted Rate Loan, at the Quoted Rate. The Quoted Rate
            may be fixed for periods (each, a "Quoted Rate Period") ranging from
            365 days to, in the case of the Term Loan,  the date in clause  (ii)
            of the  definition of "Term Loan Maturity  Date" and, in the case of
            Revolving  Loans,  the date in  clause  (iii) of the  definition  of
            "Revolving  Loan  Expiration  Date,",  such  rate and  period  to be
            established by CoBank in its sole discretion; provided, however, the
            period  during  which the Quoted  Rate  applies may only expire on a
            Business Day;

            provided, further, that for each Swingline Loan, such Swingline Loan
            shall  accrue  interest  at  the  sum of the  Overnight  LIBOR  Rate
            applicable  from time to time plus the LIBOR Margin  applicable from
            time to time as provided in Subsection 1.2(B);

                                      -5-
<PAGE>

            (ii) Except as  otherwise  provided in  Subsections  1.2(E) and 6.6,
      interest on all  Obligations  (other than the interest  payments  required
      pursuant  to  Subsection  1.2(A)(i)  above) not paid when due will  accrue
      interest at the Base Rate plus 0.25% per annum.

      (B)  Applicable  Margins.   Initially,  and  continuing  through  the  day
immediately preceding the first Adjustment Date, the applicable Base Rate Margin
and LIBOR Margin shall be 0.00% and 0.875% per annum,  respectively.  Commencing
on such Adjustment  Date, the applicable Base Rate Margin and LIBOR Margin shall
be for each Calculation  Period the applicable per annum percentage set forth in
the pricing  table below  opposite the  applicable  Leverage  Ratio of Borrower;
provided,  that at the election of CoBank,  effective  upon the occurrence of an
Event of Default pursuant to Subsection 6.1(A) or Subsection 6.1(C) with respect
to failure to comply with a  financial  covenant in Section 4 and for so long as
it continues the applicable Base Rate Margin and LIBOR Margin shall be 0.25% and
1.00% per annum, respectively.

                                  PRICING TABLE

                                     Base Rate
            Leverage Ratio            Margin           LIBOR Margin
       -------------------------- ---------------- ---------------------
               = 2.00:1                0.25%              1.00%
       -------------------------- ---------------- ---------------------
           < 2.00:1 = 1.00:1           0.00%              0.875%
       -------------------------- ---------------- ---------------------
               < 1.00:1                0.00%              0.75%
       -------------------------- ---------------- ---------------------

      (C)  Interest  Periods.  Each LIBOR Loan may be obtained  for a one,  two,
three,  six,  nine or 12 month  period  (each  such  period  being an  "Interest
Period"). With respect to all LIBOR Loans:

            (i) the  Interest  Period  will  commence on the date that any LIBOR
      Loan is made or the date on which  any  portion  of the Base  Rate Loan is
      converted  into a LIBOR Loan,  or, in the case of  immediately  successive
      Interest  Periods,  each successive  Interest Period shall commence on the
      day on which the immediately preceding Interest Period expires;

            (ii) if the Interest Period would otherwise  expire on a day that is
      not a  Business  Day,  then it  will  expire  on the  next  Business  Day,
      provided, that if any Interest Period would otherwise expire on a day that
      is not a  Business  Day and such day is a day of a  calendar  month  after
      which no further  Business Day occurs in such month,  such Interest Period
      shall expire on the Business Day next preceding such day;

            (iii) any Interest  Period that begins on the last Business Day of a
      calendar month or on a day for which there is no numerically corresponding
      day in the last calendar  month in such  Interest  Period shall end on the
      last Business Day of the last calendar month in such Interest Period; and

                                      -6-
<PAGE>

            (iv) no Interest  Period shall be selected for any LIBOR Loan if, in
      order to make repayments required pursuant to Subsection 1.6 in connection
      with scheduled  installments  on the Term Loan or scheduled  reductions of
      the Revolving Loan Commitment pursuant to Subsection 1.6, repayment of all
      or any portion of a Loan prior to the  expiration of such Interest  Period
      would be necessary.

      (D)  Calculation  and  Payment.  Interest  on  all  Loans  and  all  other
Obligations  and the  amount  of any fees set forth in  Subsection  1.4 shall be
calculated  on the basis of a 360-day  year (of twelve  30-day  months)  for the
actual  number of days  elapsed.  The date of funding or  conversion to the Base
Rate Loan or a Swingline  Loan, the first day of an Interest Period with respect
to a LIBOR  Loan and the first day of a Quoted  Rate  Period  with  respect to a
Quoted Rate Loan shall be included in the  calculation of interest.  The date of
payment of any Loan, the last day of an Interest  Period with respect to a LIBOR
Loan and the last day of a Quoted Rate Period with respect to a Quoted Rate Loan
shall be excluded  from the  calculation  of  interest;  provided,  if a Loan is
repaid on the same day that it is made, one day's interest shall be charged.

      Interest  accruing  on the Base Rate  Loan,  and  Swingline  Loan and each
Quoted Rate Loan is payable in arrears on each of the following dates or events:
(i) the last day of each calendar quarter,  (ii) the prepayment of such Loan (or
portion  thereof) and (iii) the Term Loan Maturity  Date or the  Revolving  Loan
Expiration Date, as applicable,  whether by acceleration or otherwise.  Interest
accruing on each LIBOR Loan is payable in arrears on each of the following dates
or events:  (i) the last day of each  applicable  Interest  Period,  (ii) if the
Interest Period is longer than three months, on each three-month  anniversary of
the commencement date of such Interest Period, (iii) the prepayment of such Loan
(or portion  thereof) and (iv) the Term Loan Maturity Date or the Revolving Loan
Expiration Date, as applicable, whether by acceleration or otherwise.

      (E)  Default  Rate of  Interest.  At the  election  of  CoBank,  after the
occurrence of an Event of Default  pursuant to  Subsection  6.1(A) or Subsection
6.1(C) with respect to failure to comply with a financial  covenant in Section 4
and for so long as it  continues,  all Loans and other  Obligations  shall  bear
interest  at rates  that are 2.00% in excess of the rates  otherwise  in effect,
including,  without  limitation,  rates in effect pursuant to the proviso in the
second  sentence  of  Subsection  1.2(B),  with  respect to such Loans and other
Obligations.

      (F) Excess  Interest.  Notwithstanding  anything to the contrary set forth
herein,  the aggregate  interest,  fees and other amounts required to be paid by
Borrower  to  CoBank  hereunder  are  hereby  expressly  limited  so  that in no
contingency or event  whatsoever,  whether by reason of acceleration of maturity
of the  Indebtedness  evidenced  hereby or  otherwise,  shall the amount paid or
agreed to be paid to CoBank for the use or the  forbearance of the  Indebtedness
or Obligations  evidenced hereby exceed the maximum permissible under Applicable
Law. If under or from any circumstances whatsoever, fulfillment of any provision
hereof or of any of the other Loan  Documents at the time of performance of such
provision shall be due, shall involve exceeding the limit of such as is validity
prescribed  by  Applicable  Law  then  the  obligation  to  be  fulfilled  shall
automatically  be reduced to the limit of such validity and if under or from any
circumstances whatsoever CoBank should ever receive as interest any amount which
would  exceed the  highest  lawful  rate,  the amount of such  interest  that is
excessive  shall be applied to the  reduction  of the  principal  balance of the
Obligations  evidenced hereby and not to the payment of interest.  Additionally,
should the method used for calculating  interest (i.e., using a 360-day year) be
unlawful,  such calculation method shall be automatically changed to a 365-6-day
year or such other lawful  calculation  method as is  reasonably  acceptable  to
CoBank. This provision shall control every other provision of this Agreement and
all provisions of every other Loan Document.

                                      -7-
<PAGE>

            (G)  Selection,   Conversion  or   Continuation   of  Loans;   LIBOR
Availability.  Borrower shall have the option to (i) select all or any part of a
new  borrowing  to be (a) a portion of the Base Rate Loan in a principal  amount
equal to $100,000 or any whole multiple of $5,000 in excess thereof, (b) a LIBOR
Loan in a principal  amount equal to $500,000 or any whole  multiple of $100,000
in excess thereof,  (c) a Swingline Loan in a principal  amount equal to $50,000
or any whole multiple of $5,000 in excess thereof or (d) a Quoted Rate Loan in a
principal  amount equal to  $10,000,000  or any whole  multiple of $1,000,000 in
excess  thereof,  (ii)  convert at any time all or any  portion of the Base Rate
Loan in a principal  amount equal to $500,000 or any whole  multiple of $250,000
in  excess  thereof  into  a  LIBOR  Loan  or in a  principal  amount  equal  to
$10,000,000  or any whole multiple of $1,000,000 in excess thereof into a Quoted
Rate Loan, (iii) upon the expiration of its Interest Period,  convert all or any
part of any LIBOR  Loan into the Base Rate Loan or into a Quoted  Rate Loan in a
principal  amount equal to  $10,000,000  or any whole  multiple of $1,000,000 in
excess  thereof  for such new Quoted Rate  Period(s)  as selected by Borrower or
upon the expiration of its Quoted Rate Period, or convert all or any part of any
Quoted  Rate Loan into the Base  Rate Loan or into a LIBOR  Loan in a  principal
amount equal to $500,000 or any whole multiple of $100,000 in excess thereof for
such  new  Interest  Period(s)  as  selected  by  Borrower,  and  (iv)  upon the
expiration of its Interest Period, continue any LIBOR Loan in a principal amount
equal to $500,000 or any whole  multiple of $100,000 in excess  thereof into one
or more LIBOR Loans for such new Interest Period(s) as selected by Borrower,  or
upon the expiration of its Quoted Rate Period,  continue any Quoted Rate Loan in
a principal  amount equal to  $10,000,000 or any whole multiple of $1,000,000 in
excess  thereof  into one or more  Quoted  Rate Loans for such new  Quoted  Rate
Period(s)  as  selected  by  Borrower.  During  any period in which any Event of
Default is continuing,  as the Interest  Periods for LIBOR Loans and Quoted Rate
Loans then in effect  expire,  such Loans shall be converted  into the Base Rate
Loan and the LIBOR  option and the Quoted Rate option will not be  available  to
Borrower  until all  Events of Default  are cured or waived.  Each LIBOR Loan or
Quoted  Rate Loan must be made under a single  Facility.  In the event  Borrower
fails to elect a LIBOR Loan or Quoted  Rate Loan upon any advance  hereunder  or
upon the  termination  of any Interest  Period or Quoted Rate  Period,  Borrower
shall be deemed to have elected to have such amount  constitute a portion of the
Base Rate Loan. Notwithstanding the foregoing, there may be no more than a total
of ten LIBOR Loans and Quoted Rate Loans outstanding under the Facilities at any
one time.

      1.3   Notice of Borrowing, Conversion or Continuation of Loans.

            Whenever  Borrower  desires to request a Loan pursuant to Subsection
1.1 or to  convert  or  continue  Base Rate,  LIBOR  Loans or Quoted  Rate Loans
pursuant to Subsection  1.2(G),  Borrower  shall give CoBank  irrevocable  prior
written  notice  in the form  attached  hereto  as  Exhibit  1.3 (a  "Notice  of
Borrowing/Conversion/Continuation"),   (i)  if   requesting   a  borrowing   of,
conversion to or continuation of the Base Rate Loan (or any portion  thereof) or
a Quoted  Rate Loan,  not later than 11:00 a.m.  (Denver,  Colorado  time),  one
Business Day before the proposed borrowing,  conversion or continuation is to be
effective,  (ii) if requesting a borrowing of a Swingline  Loan,  not later than
2:00 p.m.  (Denver,  Colorado time) on the date the proposed  borrowing is to be
effective  or  (iii)  if  requesting  a  borrowing  of,  a  conversion  to  or a
continuation of a LIBOR Loan, not later than 11:00 a.m. (Denver, Colorado time),
three Banking Days before the proposed borrowing,  conversion or continuation is
to be effective. Each Notice of Borrowing/Conversion/Continuation  shall specify
(a) the Loan (or portion thereof) to be converted or continued and, with respect
to any LIBOR Loan to be  converted  or  continued,  the last day of the  current
Interest  Period  therefore  and with  respect  to any  Quoted  Rate  Loan to be
converted or continued, the last day of the current Quoted Rate Period therefor,
(b) the effective  date of such  borrowing,  conversion or  continuation  (which
shall be a Business  Day, and in the case of a LIBOR Loan,  also a Banking Day),
(c) the  principal  amount of such Loan to be borrowed,  converted or continued,
(d) the  Interest  Period to be  applicable  to any new LIBOR Loan or the Quoted
Rate Period to be applicable  to any new Quoted Rate Loan,  and (e) the Facility
under which such  borrowing,  conversion  or  continuation  is to be made.  Upon
satisfaction of the notice requirement set forth in this Subsection 1.3, and the
other applicable  conditions set forth in this Agreement,  CoBank shall make the
Loan, or requested conversion or continuation, on the requested effective date.

                                      -8-
<PAGE>

      1.4   Fees and Expenses.

            (A) Commitment Fee. From the Closing Date through the Revolving Loan
Expiration  Date,  Borrower shall pay CoBank a fee in an amount equal to (i) the
Revolving  Loan  Commitment  less the sum of (a) the average  daily  outstanding
balance of Revolving  Loans plus (b) the average  daily  outstanding  balance of
Swingline  Loans  plus  (c) the  average  daily  outstanding  Letter  of  Credit
Liability, in each case during the preceding calendar quarter multiplied by (ii)
either (a)  0.125% per annum,  when such  aggregate  average  daily  outstanding
balance  during the  applicable  period equals or exceeds 50% of the  applicable
Revolving Loan Commitment,  or (b) 0.25% per annum,  when such aggregate average
daily  outstanding  balance during the applicable period is less than 50% of the
applicable  Revolving  Loan  Commitment.  Such  fee is to be paid  quarterly  in
arrears on the last day of each calendar  quarter for such calendar  quarter (or
portion  thereof),  with  the  final  such  payment  due on the  Revolving  Loan
Expiration Date.

            (B)  Certain  Other  Fees.  Borrower  shall pay to  CoBank  the fees
specified in that certain letter agreement,  dated April 5, 2006, from CoBank to
Borrower,  in such  amounts  and at  such  times  as  specified  in such  letter
agreement.

            (C) Breakage  Fee.  Upon any repayment or payment of a LIBOR Loan on
any day that is not the  last  day of the  Interest  Period  applicable  thereto
(regardless of the source of such repayment or prepayment and whether voluntary,
mandatory,  by acceleration  or otherwise),  Borrower shall pay CoBank an amount
(the "LIBOR  Breakage Fee") equal to the greater of (i) $300 or (ii) the present
value of any losses,  expenses and  liabilities  (including any loss  (including
interest  paid but  excluding the loss of any  applicable  margin)  sustained by
CoBank in  connection  with the good faith  re-employment  of such  funds)  that
CoBank may  sustain  as a result of the  payment of such LIBOR Loan on such day.
Upon any  repayment  or payment of a Quoted Rate Loan on any day that is not the
last day of the Quoted Rate Period applicable thereto  (regardless of the source
of  such  repayment  or  prepayment  and  whether   voluntary,   mandatory,   by
acceleration  or  otherwise),  Borrower  shall pay CoBank an amount (the "Quoted
Rate  Breakage  Fee";  and together  with the LIBOR  Breakage Fee, the "Breakage
Fees") equal to the greater of (i) $300 or (ii) the sum of (a) the present value
of any losses,  expenses and liabilities (including any loss (including interest
paid)  sustained by CoBank in connection  with the good faith  re-employment  of
such  funds)  that  CoBank may sustain as a result of the payment of such Quoted
Rate Loan on such day plus (b) a per annum yield of 1/2 of 1 percent  (0.50%) on
the  amount  prepaid  for the period  such  amount  was  scheduled  to have been
outstanding at Quoted Rate.

                                      -9-
<PAGE>

            (D) Expenses and Attorneys Fees. Borrower agrees to pay promptly all
reasonable  fees,  costs and expenses  (including  those of external  attorneys)
incurred by CoBank in connection with (i) any matters contemplated by or arising
out of the Loan  Documents,  and (ii) any fees,  costs and expenses  incurred in
connection with any amendments,  modifications and waivers.  In addition to fees
due under  Subsections  1.4(A) and (B),  Borrower shall also reimburse on demand
CoBank for its out-of-pocket  expenses (including reasonable attorneys' fees and
expenses and expenses) incurred in connection with the transactions contemplated
herein. Borrower agrees to pay promptly all reasonable out-of-pocket fees, costs
and  expenses  incurred by CoBank in  connection  with any action to enforce any
Loan Document or to collect any payments due from Borrower.  In addition to fees
due under  Subsections  1.4(A) and (B),  Borrower agrees to pay promptly (i) all
reasonable  fees,  costs and expenses  incurred by CoBank in connection with any
amendment,  supplement,  waiver or modification of any of the Loan Documents and
(ii) all reasonable  out-of-pocket  fees, costs and expenses incurred by each of
CoBank in connection with any Default or Event of Default and any enforcement of
collection proceeding resulting therefrom or any workout or restructuring of any
of the transactions  hereunder or contemplated  thereby or any action to enforce
any Loan Document or to collect any payments due from Borrower.  All fees, costs
and expenses for which  Borrower is  responsible  under this  Subsection  1.4(D)
shall be deemed part of the Obligations  when incurred,  payable upon demand and
in accordance with the second paragraph of Subsection 1.5.

            (E) Letter of Credit  Fees.  Borrower  shall pay CoBank a yearly fee
for each Letter of Credit  from the date of issuance to the date of  termination
in an amount equal to the applicable LIBOR Margin  multiplied by the face amount
of such  Letter of Credit.  Such fee is to be paid  quarterly  in arrears on the
last day of each calendar  quarter and the  termination of the Letter of Credit.
With  respect  to each  Letter of  Credit,  Borrower  shall  also pay  CoBank an
issuance fee equal to 0.125% of the face amount of such Letter of Credit,  which
amount shall be paid upon the date of issuance  and, if the  expiration  date of
such  Letter of Credit is later  than one year from its date of  issuance,  upon
each  anniversary  of the date of  issuance  during  the term of such  Letter of
Credit.

         1.5 Payments. All payments by Borrower of the Obligations shall be made
in same day funds and  delivered  to CoBank by wire  transfer  to the  following
account or such other place as CoBank may from time to time designate:

                CoBank, ACB
                Greenwood Village, Colorado
                ABA Number 3070-8875-4
                Account No. 00039293-RX0407 (indicate whether a payment on
                         Term Loan Facility, Swingline Facility or the Revolving
                         Loan Facility)
                Reference:  CoBank for the benefit of SureWest Communications

                                      -10-
<PAGE>

Borrower shall receive credit on the day of receipt for funds received by CoBank
by 11:00 a.m. (Denver, Colorado time) on any Business Day. Funds received on any
Business  Day  after  such  time  shall be  deemed to have been paid on the next
Business Day.  Whenever any payment to be made  hereunder  shall be stated to be
due on a day that is not a Business  Day,  the payment  shall be due on the next
succeeding  Business  Day and such  extension  of time shall be  included in the
computation of the amount of interest and fees due hereunder.

         At any time that funds have been drawn thereunder,  Borrower authorizes
CoBank to make (but CoBank  shall not be  obligated  to make) the Base Rate Loan
under the Revolving  Loan  Facility,  for Letter of Credit  Liability  payments.
Following an Event of Default,  Borrower  authorizes  CoBank to make (but CoBank
shall  not be  obligated  to make) a Base Rate Loan  under  the  Revolving  Loan
Facility for the payment of interest,  commitment fees and Breakage Fees.  Prior
to an Event of  Default,  other fees,  costs and  expenses  (including  those of
attorneys)  reimbursable  pursuant to  Subsections  1.4(A),  1.4(B),  1.4(D) and
1.4(E) or  elsewhere  in any Loan  Document may be debited to the Base Rate Loan
under the Revolving Loan Facility after 15 days' notice. After the occurrence of
an Event of Default,  any such other fees,  costs and expenses may be debited to
the Base Rate Loan under the Revolving Loan Facility without notice.

         To the extent  Borrower  makes a payment or payments  to CoBank,  which
payments  or any part  thereof  are  subsequently  invalidated,  declared  to be
fraudulent or preferential, set aside and/or required to be repaid to a trustee,
receiver or any other  party under any  bankruptcy  law,  state or federal  law,
common law or equitable  cause,  then, to the extent of such payment or proceeds
repaid,  the  Obligations  or part  thereof  intended to be  satisfied  shall be
revived and  continued  in full force and effect as if such  payment or proceeds
had not been received by CoBank.

         1.6 Repayments and Reduction of Term Loan and Revolving Loan Commitment
and Related Mandatory Repayments.

            (A) Scheduled  Repayments  and Reductions of Term Loan and Revolving
Loan Commitment.

               (1) Term Loan. In addition to any  prepayments or repayments made
or required pursuant to Subsection 1.7, the outstanding principal balance of the
Term Loan not sooner due and  payable  shall  become due and payable on the Term
Loan Maturity Date.

               (2)  Revolving  Loan  Commitment  and  Swingline  Commitment.  In
addition to any  reductions  pursuant to Subsection  1.6(B),  the Revolving Loan
Commitment  and the  Swingline  Commitment  shall  be  permanently  reduced  and
terminated in full on the Revolving Loan  Expiration  Date, and any  outstanding
principal  balance of the Revolver Loans and the Swingline  Loans not sooner due
and payable will become due and payable on the Revolving Loan Expiration Date.

            (B) Voluntary Reduction of Loan Commitments. Borrower shall have the
right,  upon at least three  Business  Days'  notice to CoBank,  to  permanently
reduce the then unused portion of the Revolving Loan Commitment or the Swingline
Commitment.  Each reduction shall be in a minimum amount of at least $1,000,000,
or any whole  multiple  of  $250,000  in  excess  thereof.  Notwithstanding  the
foregoing,  no reduction of the Revolving Loan Commitment shall be permitted if,
after giving effect thereto and to any prepayment made therewith,  the aggregate
principal   balance  of  the  Revolving  Loans  and  the  Swingline  Loans  then
outstanding plus the amount of the Letter of Credit Liability then  outstanding,
would exceed the Revolving Loan Commitment,  as so reduced.  Notwithstanding the
foregoing, no reduction of the Swingline Commitment shall be permitted if, after
giving  effect  thereto and to any  prepayment  made  therewith,  the  aggregate
principal  balance of the  Swingline  Loans then  outstanding  would  exceed the
Swingline Commitment, as applicable as so reduced.

                                      -11-
<PAGE>

            (C)  Mandatory  Repayments.  On  the  date  of  any  Revolving  Loan
Commitment  reduction  provided for in this Subsection 1.6, Borrower shall repay
Revolving Loans and the Swingline Loans or reduce the Letter of Credit Liability
pursuant  to  Subsection  1.15 in an amount at least  sufficient  to reduce  the
aggregate  principal  balance of Revolving  Loans and the  Swingline  Loans then
outstanding  plus the amount of the Letter of Credit  Liability then outstanding
to the amount of the Revolving Loan Commitment as so reduced. If at any time the
aggregate outstanding amount of Revolving Loans and the Swingline Loans plus the
amount of the Letter of Credit Liability then outstanding  exceeds the Revolving
Loan  Commitment,  Borrower shall repay  Revolving  Loans and Swingline Loans or
reduce the Letter of Credit  Liability  pursuant to Subsection 1.15 in an amount
at least sufficient to reduce the aggregate principal balance of Revolving Loans
and  Swingline  Loans then  outstanding  plus the amount of the Letter of Credit
Liability then outstanding to the amount of the Revolving Loan  Commitment,  and
until such repayment is made, CoBank shall not be obligated to make any Loans or
issue any Letters of Credit.  Any repayments  pursuant to this Subsection 1.6(C)
shall be applied in accordance  with Subsection 1.8, and shall be accompanied by
accrued  interest on the amount repaid and any  applicable  Breakage Fees. If at
any time the aggregate  outstanding  amount of the Swingline  Loans  outstanding
exceeds the Swingline Loan  Commitment,  Borrower shall repay Swingline Loans in
an amount at least  sufficient  to reduce  the  aggregate  principal  balance of
Swingline Loans then outstanding to the amount of the Swingline Loan Commitment,
and until such  repayment  is made,  CoBank  shall not be  obligated to make any
Loans or issue any Letters of Credit. Any repayments pursuant to this Subsection
1.6(C)  shall be  applied  in  accordance  with  Subsection  1.8,  and  shall be
accompanied by accrued interest on the amount repaid and any applicable Breakage
Fees.

      1.7 Voluntary  Prepayments  and Other  Mandatory  Repayments (A) Voluntary
Prepayment  of Loans.  Subject to the  provisions  of Section  1.8, at any time,
Borrower may prepay the Base Rate Loan,  in whole or in part,  without  penalty.
Subject to the  provisions of Section 1.8,  payment of applicable  Breakage Fees
and the notice requirement in the following  sentence,  at any time Borrower may
prepay any LIBOR Loan or any Quoted  Rate Loan,  in whole or in part.  Notice of
any prepayment of a LIBOR Loan or Quoted Rate Loan shall be given not later than
11:00 a.m. (Denver,  Colorado time) on the third Business Day preceding the date
of prepayment.  All prepayment  notices shall be  irrevocable.  All  prepayments
shall  be  accompanied  by  accrued  interest  on the  amount  prepaid  and  any
applicable Breakage Fees.

            (B)  Repayments  from Insurance  Proceeds.  Borrower shall repay the
Term Loan in an amount equal to the Net Proceeds  received by Borrower or any of
its Subsidiaries  which are insurance proceeds from any Asset Disposition to the
extent that such  proceeds are not  reinvested in equipment or other assets that
are used or useful in the business of Borrower or any of its Subsidiaries within
180 days of receipt by Borrower or such  Subsidiary of such  proceeds.  All such
repayments  shall  be  applied  in  accordance  with  Subsection  1.8.  All such
repayments shall be accompanied by accrued interest on the amount repaid and any
applicable Breakage Fees.

                                      -12-
<PAGE>

            (C)  Repayments  from Asset  Dispositions.  Promptly upon receipt by
Borrower or any of its  Subsidiaries  of Net  Proceeds of an Asset  Disposition,
other than insurance  proceeds  reinvested  pursuant to Subsection 1.7(B) or Net
Proceeds of Asset Dispositions permitted pursuant to Subsection 3.7, without the
consent of CoBank (unless pursuant to Subsection 3.7(vi) Borrower is required to
apply  such  proceeds  to the  repayment  of the  Term  Loan  pursuant  to  this
Subsection 1.7(C)), Borrower shall repay the Term Loan in an amount equal to the
Net  Proceeds  received  by  Borrower  or  any  of its  Subsidiaries.  All  such
repayments  shall  be  applied  in  accordance  with  Subsection  1.8.  All such
repayments shall be accompanied by accrued interest on the amount repaid and any
applicable Breakage Fees.

      1.8 Application of Prepayments  and Repayments;  Payment of Breakage Fees,
Etc. All  prepayment and  repayments  made pursuant to  Subsections  1.6 and 1.7
shall first be applied to such of the applicable type of Loans as Borrower shall
direct in writing and, in the absence of such direction,  shall first be applied
to the Base Rate Loan and then to such  LIBOR  Loans and  Quoted  Rate  Loans as
Borrower and CoBank shall agree (in the absence of agreement,  such  prepayments
and  repayments  shall be  applied to the LIBOR  Loans and Quoted  Rate Loans on
which the lowest  amount of Breakage  Fees would be due).  All  prepayments  and
repayments  required or permitted  hereunder  shall be accompanied by payment of
all applicable Breakage Fees and accrued interest on the amount repaid.

      1.9 Loan Accounts.  CoBank will maintain loan account  records for (i) all
Loans,  interest  charges  and  payments  thereof,  (ii) all  Letter  of  Credit
Liability,  (iii) the charging  and payment of all fees,  costs and expenses and
(iv) all other debits and credits  pursuant to this  Agreement.  Absent manifest
error,  the balance in the loan accounts  shall be  presumptive  evidence of the
amounts due and owing to CoBank, provided that any failure by CoBank to maintain
such records shall not limit or affect Borrower's  obligation to pay. During the
continuance  of an Event of Default,  Borrower  irrevocably  waives the right to
direct the application of any and all payments and Borrower  hereby  irrevocably
agrees  that  CoBank  shall  have the  continuing  exclusive  right to apply and
reapply payments in any manner it deems appropriate.

      1.10 Changes in LIBOR Rate  Availability.  If with respect to any proposed
Interest Period,  CoBank  determines that deposits in dollars (in the applicable
amount) are not being offered in the relevant  market for such Interest  Period,
CoBank shall  forthwith  give notice  thereof to Borrower,  whereupon  and until
CoBank notifies Borrower that the circumstances giving rise to such situation no
longer exist, the obligations of CoBank to make LIBOR Loans shall be suspended.

         If the  introduction  of, or any change in, any  Applicable  Law or any
change in the  interpretation  or  administration  thereof  by any  Governmental
Authority,  central bank or comparable agency charged with the interpretation or
administration  thereof,  or  compliance by CoBank with any request or directive
(whether  or not  having the force of law) of any such  Governmental  Authority,
central bank or  comparable  agency,  shall make it unlawful or  impossible  for
CoBank to honor its  obligations  hereunder  to make or maintain any LIBOR Loan,
CoBank shall promptly give notice thereof to Borrower.  Thereafter, until CoBank
notifies  Borrower that such  circumstances no longer exist, (i) the obligations
of CoBank to make LIBOR  Loans and the right of  Borrower to convert any Loan or
continue any Loan as a LIBOR Loan shall be suspended  and (ii) if CoBank may not
lawfully  continue  to  maintain  a LIBOR  Loan to the end of the  then  current
Interest Period applicable thereto,  such Loan shall immediately be converted to
the Base Rate Loan.

                                      -13-
<PAGE>

      1.11 Capital Adequacy and Other Adjustments.

            (A) If the introduction of or the  interpretation  of any law, rule,
or regulation would increase the reserve  requirement or otherwise  increase the
cost to CoBank of making or maintaining a LIBOR Loan, then CoBank shall submit a
certificate  to  Borrower  setting  forth  the  amount  and   demonstrating  the
calculation of such increased cost.  CoBank may seek recovery of such additional
amounts from Borrower only to the extent it seeks recovery for such amounts from
similarly  situated  borrowers.  Borrower shall pay the amount of such increased
cost  to  CoBank  within  15  days  after  receipt  of  such  certificate.  Such
certificate shall,  absent manifest error, be final,  conclusive and binding for
all  purposes.  There is no limitation on the number of times such a certificate
may be submitted.

            (B) In the event that CoBank shall have determined that the adoption
after the date hereof of any law, treaty,  governmental (or  quasi-governmental)
rule,  regulation,  guideline  or  order  regarding  capital  adequacy,  reserve
requirements or similar  requirements or compliance by CoBank or any corporation
controlling  CoBank with any request or directive  regarding  capital  adequacy,
reserve requirements or similar requirements (whether or not having the force of
law and whether or not failure to comply  therewith  would be unlawful) from any
central bank or governmental  agency or body having  jurisdiction  does or shall
have the effect of  increasing  the amount of  capital,  reserves or other funds
required to be maintained by CoBank or any  corporation  controlling  CoBank and
thereby reducing the rate of return on CoBank's or such corporation's capital as
a consequence  of its  obligations  hereunder,  then Borrower shall from time to
time  within 15 days after  notice and demand  from  CoBank  (together  with the
certificate  referred to in the next sentence) pay to CoBank additional  amounts
sufficient to compensate CoBank for such reduction.  CoBank may seek recovery of
such  additional  amounts from Borrower only to the extent it seeks recovery for
such amounts from similarly situated  borrowers.  A certificate as to the amount
of such cost and showing the basis of the  computation of such cost submitted by
CoBank to Borrower  shall,  absent  manifest  error,  be final,  conclusive  and
binding for all  purposes.  There is no limitation on the number of times such a
certificate may be submitted.

      1.12 Taxes:  No Deductions.  Any and all payments or  reimbursements  made
hereunder  or under  the  Notes  shall be made  free  and  clear of and  without
deduction  for  any and all  taxes,  levies,  imposts,  deductions,  charges  or
withholdings,  and all liabilities with respect thereto, excluding, however, any
tax imposed on the revenues,  income or net income of CoBank by its jurisdiction
of incorporation or by the federal,  state,  local or foreign taxing authorities
in the  jurisdiction  in which  the  principal  place of  business  of CoBank is
located or by any  jurisdiction  or taxing  authority  thereof or therein,  with
which CoBank has or had a connection (other than a connection  arising solely as
a result of CoBank having  executed,  delivered or performed its  obligations or
received  a payment  under,  or  enforced,  this  Agreement  or any  other  Loan
Document)  (all  such  non-excluded  taxes,  levies,   imposts,   deductions  or
withholdings,  and all  liabilities  with respect  thereto,  collectively,  "Tax
Liabilities").  If  Borrower  shall  be  required  by  law  to  deduct  any  Tax
Liabilities from or in respect of any sum payable hereunder to CoBank,  then the
sum payable  hereunder  shall be increased  as may be  necessary so that,  after
making all required  deductions,  CoBank  receives an amount equal to the sum it
would have received had no such deductions been made.

                                      -14-
<PAGE>

      1.13  Changes in Tax Laws.  In the event that,  subsequent  to the Closing
Date, (i) any changes in any existing law, regulation, treaty or directive or in
the interpretation or application thereof, (ii) any new law, regulation,  treaty
or directive  enacted or any  interpretation  or application  thereof,  or (iii)
compliance  by CoBank with any request or  directive  (whether or not having the
force of law) from any Governmental Authority:

            (i) does or shall subject  CoBank to any tax of any kind  whatsoever
      with respect to this Agreement, the other Loan Documents or any Loans made
      or any Letters of Credit issued hereunder, or change the basis of taxation
      of payments to CoBank of  principal,  fees,  interest or any other  amount
      payable hereunder (except for net income taxes, or franchise taxes imposed
      in lieu of net income taxes, imposed generally by federal,  state or local
      taxing  authorities  with respect to interest or  commitment or other fees
      payable  hereunder or changes in the rate of tax on the overall net income
      of CoBank); or

            (ii) does or shall impose on CoBank any other condition or increased
      cost  in  connection  with  the   transactions   contemplated   hereby  or
      participations herein;

and the  result of any of the  foregoing  is to  increase  the cost to CoBank of
making or continuing any Loan or of issuing any Letters of Credit hereunder,  or
to reduce any amount  receivable  hereunder,  then,  in any such case,  Borrower
shall promptly pay to CoBank,  upon its demand, any additional amounts necessary
to compensate CoBank, on an after-tax basis, for such additional cost or reduced
amount receivable, as determined by CoBank with respect to this Agreement or the
other Loan Documents. If CoBank becomes entitled to claim any additional amounts
pursuant to this Subsection 1.13, it shall promptly notify Borrower of the event
by reason of which  CoBank  has  become so  entitled.  A  certificate  as to any
additional  amounts  payable  pursuant to the  foregoing  sentence  submitted by
CoBank to Borrower  shall,  absent  manifest  error,  be final,  conclusive  and
binding for all  purposes.  There is no limitation on the number of times such a
certificate  may  be  submitted.

      1.14 Term of This Agreement.  All of the Obligations  shall become due and
payable as otherwise  set forth herein,  but in any event,  all of the remaining
Obligations  shall become due and payable on the Term Loan Maturity Date.  Until
all Obligations  have been  indefeasibly  and irrevocably  paid and satisfied in
full,  all  Letters  of  Credit  have been  terminated  and the  Revolving  Loan
Commitment has been  terminated,  this Agreement  shall remain in full force and
effect.

      1.15  Letter of Credit  Liability.  Upon the  occurrence  and  during  the
continuance  of an Event of Default,  and in the event any Letters of Credit are
outstanding at the time that Borrower  terminates the Revolving Loan Commitment,
then (a) with respect to each such Letter of Credit,  Borrower  shall either (i)
deliver to CoBank a letter of credit in the same  currency  that such  Letter of
Credit is payable,  with a term that extends 60 days beyond the expiration  date
of such  Letter of  Credit,  issued by a bank  satisfactory  to CoBank and in an
amount equal to 105% of the  aggregate  outstanding  Letter of Credit  Liability
with respect to such Letter of Credit,  which letter of credit shall be drawable
by CoBank to reimburse  payments of drafts drawn under such Letter of Credit and
to pay any fees and expenses  related thereto or (ii)  immediately  deposit with
CoBank an amount equal to the aggregate  outstanding  Letter of Credit Liability
to enable CoBank to make payments  under the Letters of Credit when required and
such amount shall become  immediately  due and payable,  and (b) Borrower  shall
prepay the fees payable under Subsection 1.4(E) with respect to all such Letters
of  Credit  for the  full  remaining  terms  of such  Letters  of  Credit.  Upon
termination of any such Letter of Credit,  the unearned  portion of such prepaid
fee attributable to such Letter of Credit shall be refunded to Borrower.

                                      -15-
<PAGE>

                                   SECTION 2

                              AFFIRMATIVE COVENANTS

         Borrower  covenants  and  agrees  that so long as the Loan  Commitments
remain in effect, or any Letter of Credit, any Loan, any interest on any Loan or
any fee payable to CoBank  hereunder  remains  outstanding,  or any other amount
then due and  payable  is owing to CoBank  hereunder,  and unless  CoBank  shall
otherwise  give its prior written  consent,  Borrower  shall and shall cause its
Significant  Subsidiaries  to,  perform  and comply with all  covenants  in this
Section 2.

      2.1 Compliance With Laws. Borrower will (i) comply with and will cause its
Significant  Subsidiaries to comply with the requirements of all Applicable Laws
(including laws, rules,  regulations and orders relating to taxes,  employer and
employee  contributions,  securities,  employee retirement and welfare benefits,
environmental  protection  matters  and  employee  health and  safety) as now in
effect  and which may be imposed  in the  future in all  jurisdictions  in which
Borrower  or any of  its  Significant  Subsidiaries  is now or  hereafter  doing
business,  other than those Applicable Laws the  noncompliance  with which could
not reasonably be expected to have, either  individually or in the aggregate,  a
Material Adverse Effect, (ii) obtain and maintain and will cause its Significant
Subsidiaries  to obtain and maintain all  licenses,  qualifications  and permits
(including  the Licenses) now held or hereafter  required to be held by Borrower
or any of its Significant  Subsidiaries,  the loss,  suspension or revocation of
which or which the  failure to obtain or renew could  reasonably  be expected to
have a  Material  Adverse  Effect  and  (iii)  comply  with and will  cause  its
Significant  Subsidiaries to comply with all Material Contracts,  other than, in
all such cases, as would not,  individually  or in the aggregate,  reasonably be
expected  to have a  Material  Adverse  Effect.  This  Subsection  2.1 shall not
preclude  Borrower or any of its Subsidiaries from contesting any taxes or other
payments,  if they are being diligently  contested in good faith and if adequate
reserves therefor are maintained in conformity with GAAP.

      2.2 Maintenance of Books and Records; Properties; Insurance. Borrower will
keep  and will  cause  each of its  Significant  Subsidiaries  to keep  adequate
records and books of account,  in which full,  true and correct  entries will be
made in accordance  with GAAP  consistently  applied,  reflecting  all financial
transactions  of such Persons.  Borrower will maintain or cause to be maintained
and will cause each of its  Significant  Subsidiaries to maintain or cause to be
maintained in good repair,  working  order and  condition all material  property
used in its business and the business of its Significant Subsidiaries,  and will
make or cause to be made all  appropriate  repairs,  renewals  and  replacements
thereof.  Borrower will and will cause each of its  Significant  Subsidiaries to
maintain complete,  accurate and up-to-date books,  records,  accounts and other
information  relating to all  property in such form and in such detail as may be
reasonably  satisfactory  to  CoBank.  Borrower  will  maintain  or  cause to be
maintained and will cause each of its  Significant  Subsidiaries  to maintain or
cause  to  be  maintained,   with  financially  sound  and  reputable  insurers,
commercial general liability,  property loss and damage,  business  interruption
and workers' compensation  insurance with respect to its business and properties
and the business and properties of its Significant Subsidiaries against loss and
damage of the  kinds  customarily  carried  or  maintained  by  corporations  of
established  reputation  engaged  in  the  telecommunications  service  provider
industries,  which may include  self-insurance,  if determined by Borrower to be
reasonably  prudent,  and will deliver evidence thereof to CoBank on or prior to
the  Closing  Date,  and  thereafter  at least 30 days  prior to any  expiration
thereof,  evidence of renewal of such  insurance.  All property  loss and damage
insurance  shall be on an all risk basis and shall insure  property for the full
replacement cost thereof.

                                      -16-
<PAGE>

         CoBank shall be entitled,  upon reasonable  advance  notice,  to review
and/or receive copies of, the insurance policies of Borrower and its Significant
Subsidiaries carried and maintained with respect to Borrower's obligations under
this  Subsection  2.2.  Notwithstanding  anything  to the  contrary  herein,  no
provision of this Subsection 2.2 or any provision of this Agreement shall impose
on CoBank any duty or  obligation  to verify the  existence  or  adequacy of the
insurance coverage maintained by Borrower and its Significant Subsidiaries,  nor
shall CoBank be responsible for any  representations or warranties made by or on
behalf of Borrower and its  Significant  Subsidiaries  to any insurance  broker,
company or underwriter. CoBank, at its sole option, may obtain such insurance if
not provided by Borrower and in such event, Borrower shall reimburse CoBank upon
demand for the cost thereof.

      2.3 Inspection.  Borrower will and will cause its Significant Subsidiaries
to permit any authorized  representatives of CoBank (i) to visit and inspect any
of the properties of Borrower and its  Significant  Subsidiaries,  including its
financial  and  accounting  records,  and  to  make  copies  and  take  extracts
therefrom,  and (ii) to discuss its  affairs,  finances  and  business  with its
officers,  employees and certified  public  accountants,  all upon at least five
days notice, at such reasonable times during normal business hours and, unless a
Default or Event of Default has occurred and is continuing,  not more than twice
a year.

      2.4 Legal Existence, Etc. Except as otherwise permitted by Subsection 3.6,
Borrower  will and will  cause  its  Significant  Subsidiaries  to at all  times
preserve and keep in full force and effect its or their legal existence and good
standing and all rights and franchises material to its or their business.

      2.5 Use of  Proceeds.  Borrower  will use and will  cause its  Significant
Subsidiaries to use the proceeds of the Loans solely for the purposes  described
in the recital paragraphs to this Agreement. No part of any Loan will be used to
purchase any margin  securities or otherwise in violation of the  regulations of
the Federal Reserve System.

      2.6  Further  Assurances.  Borrower  will,  and  will  cause  each  of its
Significant Subsidiaries to, from time to time, do, execute and deliver all such
additional  and further acts,  documents and  instruments  as CoBank  reasonably
requests  to  consummate  the  transactions  contemplated  hereby  and  to  vest
completely in and assure CoBank of its rights under this Agreement and the other
Loan Documents.

                                      -17-
<PAGE>

      2.7  CoBank   Patronage   Capital.   Borrower   will  acquire   non-voting
participation certificates in CoBank in such amounts and at such times as CoBank
may require in accordance  with CoBank's Bylaws and Capital Plan (as each may be
amended  from time to time),  except  that the maximum  amount of  participation
certificates  that  Borrower may be required to purchase in CoBank in connection
with the Loans may not exceed the maximum amount  permitted by the Bylaws at the
time this Agreement is entered into.  The rights and  obligations of the parties
with respect to such  participation  certificates and any distributions  made on
account  thereof or on account of  Borrower's  patronage  with  CoBank  shall be
governed by CoBank's Bylaws. Borrower hereby consents and agrees that the amount
of any distributions  with respect to its patronage with CoBank that are made in
qualified  written notices of allocation (as defined in 26 U.S.C.  ss. 1388) and
that are  received  by  Borrower  from  CoBank,  will be taken  into  account by
Borrower at the stated dollar amounts whether the distribution is evidenced by a
participation certificate or other form of written notice that such distribution
has been made and recorded in the name of Borrower on the records of CoBank. The
Obligations  shall be secured  by a  statutory  first  lien on all equity  which
Borrower may now own or hereafter acquire in CoBank.

      2.8 Investment  Company Act.  Neither  Borrower nor any of its Significant
Subsidiaries shall be or become an "investment  company" as that term is defined
in and is not otherwise subject to regulation under, the Investment  Company Act
of 1940, as amended.

      2.9 Payment of Obligations.  Unless contested in good faith by appropriate
proceedings and then only to the extent reserves  required by GAAP have been set
aside  therefore,  Borrower  will,  and  will  cause  each  of  its  Significant
Subsidiaries to, (i) pay,  discharge or otherwise  satisfy at or before maturity
all  liabilities  and  obligations  as and when due  (subject to any  applicable
subordination provisions), and any additional costs that are imposed as a result
of any failure to so pay,  discharge  or  otherwise  satisfy  such  obligations,
except to the extent  failure to do so would not be reasonably  likely to have a
Material  Adverse  Effect,  and (ii) pay and discharge  all taxes,  assessments,
claims and  governmental  charges or levies  imposed upon it, upon its income or
profits  or upon any of its  properties,  prior  to the date on which  penalties
would attach thereto or a lien would attach to any of the properties of Borrower
if unpaid unless the same are being  contested in good faith and by  appropriate
proceedings  and then only if and to the extent  reserves  required by GAAP have
been set aside therefor.

      2.10 Environmental  Laws.  Borrower will, and will at all times cause each
of its Significant Subsidiaries to: (

         (A) Comply in all material  respects with, and ensure compliance in all
material  respects  by all  its  tenants  and  subtenants,  if  any,  with,  all
applicable  Environmental  Laws and obtain and comply in all  material  respects
with and  maintain,  and ensure that all its tenants and  subtenants  obtain and
comply  in all  material  respects  with  and  maintain,  any and all  licenses,
approvals,  notifications,  registrations  or  permits  required  by  applicable
Environmental  Laws  except  to the  extent  that  failure  to do so  could  not
reasonably be expected to have a Material Adverse Effect;

                                      -18-
<PAGE>

         (B) Conduct and  complete  all  investigations,  studies,  sampling and
testing,   and  all  remedial,   removal  and  other  actions   required   under
Environmental  Laws and promptly comply in all material respects with all lawful
orders and directives of all Governmental  Authorities  regarding  Environmental
Laws  except to the extent  that the same are being  contested  in good faith by
appropriate   proceedings  and  the  pendency  of  such  proceedings  could  not
reasonably be expected to have a Material Adverse Effect.

         (C) Defend,  indemnify and hold  harmless  CoBank,  and its  respective
employees,  agents, officers and directors, from and against any and all claims,
demands, penalties, fines, liabilities, settlements, damages, costs and expenses
of whatever kind or nature known or unknown,  contingent  or otherwise,  arising
out of,  or in any way  relating  to the  violation  of,  noncompliance  with or
liability under, any  Environmental Law applicable to the operations of Borrower
or any of its Significant  Subsidiaries or their respective  properties,  or any
orders,  requirements or demands of Governmental  Authorities  related  thereto,
including,  without  limitation,  reasonable  attorney's and consultant's  fees,
investigation  and laboratory fees,  response costs,  court costs and litigation
expenses,  except to the extent that any of the  foregoing  is  determined  by a
final judgment of a court of competent  jurisdiction  or pursuant to arbitration
as set  forth  herein to have  resulted  from the gross  negligence  or  willful
misconduct of the party seeking indemnification therefor. The agreements in this
Subsection  2.10 shall survive  repayment of the Obligations and the termination
of this Agreement.

      2.11  ERISA  Compliance.  With  respect  to any Plan that is  intended  to
qualify  under Section  401(a) of the IRC,  Borrower will apply for and obtain a
favorable  determination  letter within the period  required by Applicable  Law.

                                   SECTION 3

                               NEGATIVE COVENANTS

      Borrower  covenants and agrees that so long as the Loan Commitments remain
in effect,  or any Letter of Credit,  any Loan,  any interest on any Loan or any
fee payable to CoBank hereunder  remains  outstanding,  or any other amount then
due and payable is owing to CoBank hereunder,  and unless CoBank shall otherwise
give its prior written consent,  Borrower shall, and shall cause its Significant
Subsidiaries to, perform and comply with all covenants in this Section 3.

      3.1  Indebtedness.  Borrower will not and will not permit its  Significant
Subsidiaries  directly  or  indirectly  to create,  incur,  assume,  guaranty or
otherwise become or remain liable with respect to any Indebtedness other than:

         (A) the Obligations;

         (B) Acquired  Indebtedness if after giving effect to the incurrence the
Acquired  Indebtedness,  Borrower, on a combined and consolidated basis with its
Significant  Subsidiaries  as set forth in Section 4, are in compliance on a pro
forma basis with the  covenants  set forth in Section 4 recomputed  for the most
recently ended fiscal quarter for which information is available;

                                      -19-
<PAGE>

         (C)  Indebtedness  issued or incurred by any of Borrower's  Significant
Subsidiaries  if after giving  effect  thereto and the  application  of proceeds
therefrom,  the aggregate of all Priority Debt incurred  after  December 8, 1998
would not exceed 15% of Consolidated Net Worth as of the most recently completed
fiscal quarter of Borrower;

         (D) secured Indebtedness issued by Borrower secured by a Lien described
in clause (9) of the definition of Permitted Encumbrances;

         (E) Other unsecured Indebtedness issued by Borrower,  provided, that no
Default  or  Event  of  Default  exists  at the  time of or will  result  in the
succeeding 12 months after such issuance,  including  under  Subsections 4.1 and
4.2,  taking such  additional  Indebtedness  (and a  reasonable  estimate of its
related interest expense into account);

         (F) Indebtedness  incurred in connection with any Related Interest Rate
Agreement; and

         (G) Indebtedness  under purchase money security  agreements and Capital
Leases not to exceed $25,000,000 in the aggregate principal at any one time.

      3.2 Liens and Related  Matters.  Borrower will not and will not permit its
Significant  Subsidiaries  directly or  indirectly to create,  incur,  assume or
permit to exist any Lien on or with respect to any property or asset  (including
any  document or  instrument  with respect to goods or accounts  receivable)  of
Borrower  or its  Significant  Subsidiaries,  whether  now  owned  or  hereafter
acquired, or any income or profits therefrom, except Permitted Encumbrances.

      3.3  Investments.  Borrower  will not make or own and will not  permit its
Significant  Subsidiaries  to make or own any  Investment  in any Person that is
prohibited  by its  investment  policy as then in  effect,  except  equities  in
CoBank, as set forth in Subsection 2.8.

      3.4 Restricted  Junior Payments.  Borrower will not directly or indirectly
declare,  order,  pay,  make or set  apart  any sum  for any  Restricted  Junior
Payment;  provided,  however,  that so long as no  Default  or Event of  Default
exists   before  or  will  result  in  the   succeeding  12  months  after  such
distribution,  based upon  Borrower's  Budget  delivered  to CoBank  pursuant to
Subsection  4.4(G),  Borrower  may  declare or pay lawful  distributions  to its
shareholders  (i) during each of the fiscal years ending December 31, 2006, 2007
and 2008, up to an aggregate  amount of $20,000,000  during any such fiscal year
and (ii) during each fiscal year thereafter,  up to an aggregate amount equal to
the higher of $20,000,000 or 100% of the net income of the immediately preceding
fiscal year;  provided,  further,  however,  that  Borrower may (i) satisfy on a
non-cash  basis the  exercise  of any  stock  option or  similar  award  under a
stock-based  compensation plan and (ii) may otherwise  repurchase its issued and
outstanding stock in an aggregate amount not to exceed $20,000,000.

      3.5  Restriction  on Fundamental  Changes.  Borrower will not and will not
permit its  Significant  Subsidiaries  directly or indirectly to: (i) unless and
only to the extent required by law, amend, modify or waive any term or provision
of its articles of organization,  partnership  agreement,  operating  agreement,
management agreements, articles of incorporation or certificates of designations
pertaining  to preferred  stock or by-laws  without the consent of CoBank (which
consent  shall  not  be  unreasonably   withheld),   other  than  an  amendment,
modification or waiver that is solely ministerial or administrative in nature or
the  reincorporation  of Borrower in the State of Delaware;  provided,  however,
Borrower shall promptly give CoBank notice of any such  amendment,  modification
or waiver; (ii) enter into any transaction of merger or consolidation or acquire
by purchase or otherwise all or any  substantial  part of the business or assets
of any other Person, except (a) any Subsidiary of Borrower may be merged with or
into Borrower or any wholly owned Subsidiary of Borrower  provided that Borrower
or such wholly  owned  Subsidiary  of Borrower is the  surviving  entity and (b)
Borrower or its  Subsidiaries  may  consolidate  or merge with or into any other
Person or acquire by purchase or otherwise  all or any  substantial  part of the
business  or assets of any other  Person,  provided  that no Default or Event of
Default  then  exists or would  result from such  transaction,  Borrower or such
Subsidiary is the surviving or continuing  entity and the consideration for each
such  transaction  provided by Borrower  (whether in the form of stock,  cash or
other consideration) does not exceed $100,000,000 and such consideration for all
such  transactions  under this  subclause (b) does not in the  aggregate  exceed
$200,000,000;  or (iii)  liquidate,  wind-up or  dissolve  itself (or suffer any
liquidation or dissolution).

                                      -20-
<PAGE>

      3.6 Disposal of Assets or Significant Subsidiary Stock. Borrower will not,
and  will  not  permit  any of its  Significant  Subsidiaries  to,  directly  or
indirectly, convey, sell (including, without limitation,  pursuant to a sale and
leaseback  transaction),  lease (including,  without  limitation,  pursuant to a
lease and leaseback transaction), sublease, transfer or otherwise dispose of, or
grant  any  Person  an  option to  acquire,  in one  transaction  or a series of
transactions,  any of its property,  business or assets, or the capital stock of
or other equity interests in any of its Significant Subsidiaries, except for (i)
bona fide sales or leases of inventory  to  customers in the ordinary  course of
business,  dispositions  of  equipment  not used or  useful in the  business  or
otherwise obsolete and any sale, conveyance,  lease, sublease, transfer or other
disposition of assets of any of Borrower or its  Subsidiaries to Borrower or any
wholly owned  Subsidiary;  (ii) fair market value sales of Cash  Equivalents  or
other  Investments  permitted by Section 3.3; (iii) leasing or subleasing of its
property in the ordinary  course of business;  (iv) other Asset  Dispositions if
all of the following  conditions  are met: (a) the aggregate  book value of such
assets sold in any one  transaction  or series of related  transactions  for any
12-month period does not exceed 20% of Consolidated Net Assets  determined as of
the end of the immediately  preceding  fiscal year in the aggregate for Borrower
and its Significant Subsidiaries,  (b) the consideration received by Borrower or
such  Significant  Subsidiary is at least equal to the fair market value of such
assets, (c) the sole consideration  received is cash or other assets (other than
a note or other  delayed  payment  transaction),  (d) after giving effect to the
Asset  Disposition,  Borrower,  on a combined  and  consolidated  basis with its
Significant  Subsidiaries  as set forth in Section 4, are in compliance on a pro
forma basis with the  covenants  set forth in Section 4 recomputed  for the most
recently ended fiscal quarter for which information is available and Borrower is
in compliance  with all other terms and conditions  contained in this Agreement,
and (e) no Default  or Event of Default  then  exists or would  result  from the
Asset  Disposition;  (v) the sale by Borrower or any  Significant  Subsidiary of
property and the subsequent lease, as lessee,  of the same property,  within 180
days following the acquisition or construction of such property, in an aggregate
amount  not to  exceed  $25,000,000;  and (vi) an Asset  Disposition  if (a) the
aggregate  Net  Proceeds of such assets  disposed of under this clause (vi) does
not exceed $100,000,000, (b) the consideration received is at least equal to the
fair market value of such assets, (c) the sole consideration received is cash or
other assets (other than a note or other delayed  payment  transaction),  (d) no
Default  or  Event  of  Default  then  exists  or would  result  from the  Asset
Disposition,  (e) after giving effect to the Asset Disposition,  Borrower,  on a
combined and consolidated  basis with its Significant  Subsidiaries as set forth
in Section 4, are in  compliance  on a pro forma  basis with the  covenants  set
forth in Section 4 recomputed  for the most  recently  ended fiscal  quarter for
which  information  is available  and Borrower is in  compliance  with all other
terms and conditions contained in this Agreement,  and (f) the proceeds from any
sale under this clause (vi) are promptly used to repay the Term Loan pursuant to
Subsection  1.7(C),  provided that if at the time of such disposition under this
clause  (vi)  Borrower's  Leverage  Ratio is less than or equal to 2.2:1.0 for a
disposition  occurring on or before  December 31, 2007 and less than or equal to
2.0:1.0 for a disposition occurring on or after January 1, 2008, Borrower may in
lieu of repaying the Term Loan apply such proceeds to the  acquisition  of fixed
assets or other property  useful and intended to be used in the operation of the
business of Borrower is Significant  Subsidiaries within 365 days of the date of
sale of such assets, any remaining  unapplied proceeds after such 365 days to be
applied promptly to repay the Term Loan pursuant to Subsection 1.7(C).

                                      -21-
<PAGE>

      3.7 Transactions  with  Affiliates.  Borrower will not and will not permit
its Significant  Subsidiaries  directly or indirectly to enter into or permit to
exist any transaction  (including the purchase,  sale,  lease or exchange of any
property  or the  rendering  of any  service)  with  any  Affiliate  or with any
director,  officer or employee of Borrower or any  Affiliate,  except (i) as set
forth on Schedule 3.8; (ii)  transactions  between  Borrower or any wholly owned
Subsidiaries with Borrower or any wholly owned  Subsidiaries;  (iii) pursuant to
the reasonable  requirements  of the business of Borrower or such Subsidiary and
upon fair and  reasonable  terms and are no less  favorable  to Borrower or such
Subsidiary than would be obtained in a comparable arm's length  transaction with
a Person that is not an Affiliate; or (iv) payment of compensation to directors,
officers and employees in the ordinary course of business for services  actually
rendered in their capacities as directors, officers and employees, provided such
compensation is reasonable and comparable with compensation paid by companies of
like nature and similarly situated.

      3.8  Conduct  of  Business.  Borrower  will not and will  not  permit  its
Significant  Subsidiaries directly or indirectly to engage in any business other
than    businesses   of   owning,    constructing,    managing   and   operating
Telecommunications Systems, or other lines of business necessary to or ancillary
to the foregoing or consistent with advances in the  Telecommunications  Systems
industry.

      3.9 Fiscal  Year.  Borrower  will not and will not permit its  Significant
Subsidiaries  to change its or their  fiscal  year from a fiscal  year ending on
December 31 of each year.

      3.10 Inconsistent  Agreements.  Borrower will not, and will not permit any
of its  Significant  Subsidiaries  to, enter into any agreement  containing  any
provision  which would (a) be violated or breached by any  borrowing by Borrower
hereunder or by the  performance by Borrower or such  Significant  Subsidiary of
any of its obligations hereunder or under any other Loan Document, or (b) create
or permit to exist or become  effective any  encumbrance  or  restriction on the
ability  of such  Significant  Subsidiary  to (i) pay  dividends  or make  other
distributions  to Borrower or pay any Indebtedness  owed to Borrower,  (ii) make
loans or advances to Borrower or (iii)  transfer any of its assets or properties
to Borrower,  the effect of which encumbrance or restriction would reasonably be
to have a Material Adverse Effect;  provided,  however, that the foregoing shall
not apply to  restrictions  and  conditions  imposed by applicable  governmental
rules or by this Agreement.

                                      -22-
<PAGE>

                                   SECTION 4

                        FINANCIAL COVENANTS AND REPORTING

      Borrower  covenants and agrees that so long as the Loan Commitments remain
in effect,  or any Letter of Credit,  any Loan,  any interest on any Loan or any
fee payable to CoBank hereunder  remains  outstanding,  or any other amount then
due and payable is owing to CoBank hereunder,  and unless CoBank shall otherwise
give its prior written  consent,  Borrower  shall  perform and comply with,  and
shall  cause its  Significant  Subsidiaries  to  perform  and comply  with,  all
covenants  in this  Section 4. For  purposes  of this  Section 4, all  covenants
calculated for Borrower shall be calculated on a consolidated basis for Borrower
and its Significant Subsidiaries.

      4.1  Leverage  Ratio.  Borrower  shall have at each  fiscal  quarter end a
Leverage  Ratio  less  than or equal to  3.0:1.0.

      4.2 Interest  Coverage  Ratio.  Borrower shall have at each fiscal quarter
end an Interest Coverage Ratio greater than or equal to 3.0:1.0.

      4.3 Net Worth.  Borrower shall have at each fiscal quarter end an Adjusted
Consolidated Net Worth not less than $160,000,000.

      4.4 Financial  Statements and Other Reports.  Borrower will and will cause
its Significant  Subsidiaries to maintain a system of accounting established and
administered in accordance with sound business  practices to permit  preparation
of  financial  statements  in  conformity  with GAAP (it being  understood  that
quarterly financial  statements are not required to have footnote disclosures or
reflect year end  adjustments).  Borrower  will  deliver  each of the  financial
statements and other reports described below to CoBank.

         (A) Quarterly Financials.  As soon as available and in any event within
60 days after the end of each of the first three fiscal  quarters of each fiscal
year,  Borrower  will deliver  consolidated  balance  sheets of Borrower and its
Significant Subsidiaries,  as at the end of such fiscal quarter, and the related
consolidated  statements of income and cash flow for such fiscal quarter and for
the period from the beginning of the then current fiscal year of Borrower to the
end of such quarter;  provided that  delivery  within the time period  specified
above of  copies  of  Borrower's  Quarterly  Report  on Form  10-Q  prepared  in
compliance  with the  requirements  therefore and filed with the  Securities and
Exchange  Commission  (the "SEC") will be deemed to satisfy the  requirements of
this Subsection 4.4(A).

         (B) Year-End  Financials.  As soon as available and in any event within
105 days after the end of each fiscal year of  Borrower,  Borrower  will deliver
(i) consolidated balance sheets of Borrower and its Significant Subsidiaries, as
at the end of such year,  and the  related  consolidated  statements  of income,
stockholders'  equity and cash flow for such  fiscal year and (ii) a report with
respect to the financial  statements  from Ernst & Young LLP, or another firm of
certified public accountants  selected by Borrower and reasonably  acceptable to
CoBank,  which report shall be prepared in accordance with Statement of Auditing
Standards No. 58 (the  "Statement"),  as amended,  entitled  "Reports on Audited
Financial  Statements" and such report shall be  "Unqualified"  (as such term is
defined in such  Statement)  ;  provided  that  delivery  within the time period
specified  above of copies of Borrower's  Annual Report on Form 10-K prepared in
compliance with the requirements therefore and filed with the SEC will be deemed
to satisfy the requirements of this Subsection 4.4(B).

                                      -23-
<PAGE>

         (C) Borrower  Compliance  Certificate.  Together  with each delivery of
financial  statements of Borrower and its Significant  Subsidiaries  pursuant to
Subsections  4.4(A)  and  4.4(B),  Borrower  will  deliver a fully and  properly
completed  compliance  certificate  in  substantially  the same form as  Exhibit
4.4(C) (each, a "Compliance  Certificate") signed by the chief financial officer
of Borrower.

         (D)  Budgets.  As soon as  available  and in any event no later than 90
days prior to the first day of each of Borrower's  fiscal  years,  Borrower will
deliver a final Budget of Borrower  and its  Significant  Subsidiaries  for such
fiscal year approved by Borrower's senior management and Board of Directors.

         (E) SEC Filings. Promptly upon their becoming available,  Borrower will
deliver  copies of (i) all  financial  statements,  reports,  notices  and proxy
statements sent or made available by Borrower or its Significant Subsidiaries to
its or their security  holders and (ii) all regular and periodic reports and all
registration  statements and  prospectuses,  if any, filed by Borrower or any of
its Significant Subsidiaries with any securities exchange or with the SEC or any
governmental or private  regulatory  authority,  provided,  that, such financial
statements and reports shall be deemed to have been delivered upon the filing of
such financial statements and reports by Borrower through the SEC's EDGAR system
or  publication  by Borrower  of such  financial  statements  and reports on its
website.

         (F) Events of Default,  Etc.  Promptly  upon any  executive  officer of
Borrower  obtaining  knowledge  of any of the  following  events or  conditions,
Borrower  shall  deliver  copies of all notices given or received by Borrower or
any of its Significant  Subsidiaries with respect to any such event or condition
and a certificate of Borrower's  chief executive  officer  specifying the nature
and period of existence of such event or condition and what action  Borrower has
taken, is taking and proposes to take with respect thereto: (i) any condition or
event that constitutes an Event of Default or Default;  (ii) any notice that any
Person has given to Borrower or any of its Significant Subsidiaries or any other
action taken with respect to a claimed default or event or condition of the type
referred to in  Subsection  6.1(B);  or (iii) any event or condition  that could
reasonably be expected to have a Material Adverse Effect.

         (G)  Litigation.  Promptly  upon  any  executive  officer  of  Borrower
obtaining  knowledge of (i) the  institution  of any action,  suit,  proceeding,
governmental  investigation or arbitration  against or affecting Borrower or any
of its Significant  Subsidiaries not previously  disclosed by Borrower to CoBank
which,  in each case,  could  reasonably be expected to have a Material  Adverse
Effect  or (ii)  any  material  development  in any  action,  suit,  proceeding,
governmental  investigation  or  arbitration  at any  time  pending  against  or
affecting Borrower or any of its Significant  Subsidiaries  which, in each case,
could  reasonably be expected to have a Material  Adverse Effect,  Borrower will
give  notice  thereof to CoBank and  provide  such other  information  as may be
reasonably  available  to Borrower to enable  CoBank and its counsel to evaluate
such matter.

                                      -24-
<PAGE>

         (H)  Environmental  Notices.  Immediately  after  becoming aware of any
material  violation by Borrower or any  Signficant  Subsidiary of  Environmental
Laws or immediately upon receipt of any notice that a Governmental Authority has
asserted  that  Borrower  or any  Significant  Subsidiary  is  not  in  material
compliance with Environmental Laws or that its compliance is being investigated,
which,  in each case,  could  reasonably be expected to have a Material  Adverse
Effect,  Borrower  will give notice to CoBank  thereof  and  provide  such other
information as may be reasonably  available to Borrower to enable CoBank and its
counsel to reasonably evaluate such matter.

         (I) ERISA Events.  Promptly  after  becoming  aware of any ERISA Event,
accompanied  by any  materials  required to be filed with the PBGC with  respect
thereto;  promptly after any Borrower's or any of its Significant  Subsidiaries'
receipt of any notice  concerning  the  imposition of any  withdrawal  liability
under  Section  4042  of  ERISA  with  respect  to a  Plan;  promptly  upon  the
establishment  of any  Pension  Plan not  existing  at the  Closing  Date or the
commencement  of  contributions  by any  Borrower  or  any  of  its  Significant
Subsidiaries to any Pension Plan to which any Borrower or any of its Significant
Subsidiaries  was not  contributing  at the  Closing  Date;  and  promptly  upon
becoming  aware  of any  other  event  or  condition  regarding  a  Plan  or any
Borrower's,  or any of its  Significant  Subsidiaries'  or an ERISA  Affiliate's
compliance  with ERISA  which  could  reasonably  be expected to have a Material
Adverse  Effect,  such Borrower  will give notice to CoBank  thereof and provide
such other information as may be reasonably available to such Borrower to enable
CoBank and its counsel to reasonably evaluate such matter.

         (J)  Other  Information.  With  reasonable  promptness,  Borrower  will
deliver such other  information  and data with respect to Borrower or any of its
Significant  Subsidiaries  as from time to time may be  reasonably  requested by
CoBank.

      4.5 Accounting  Terms;  Utilization  of GAAP for Purposes of  Calculations
Under  Agreement.  For  purposes of this  Agreement,  all  accounting  terms not
otherwise  defined  herein  shall have the  meanings  assigned  to such terms in
conformity  with  GAAP.  Except  as  otherwise  expressly  provided,   financial
statements and other information  furnished to CoBank pursuant to this Agreement
shall be  prepared  in  accordance  with  GAAP as in  effect at the time of such
preparation.  No "Accounting  Changes" (as defined below) shall affect financial
covenants,  standards or terms in this  Agreement;  provided that Borrower shall
prepare  footnotes to each Compliance  Certificate and the financial  statements
required  to be  delivered  hereunder  that  show the  differences  between  the
financial  statements  delivered (which reflect such Accounting Changes) and the
basis for calculating  financial covenant  compliance  (without  reflecting such
Accounting  Changes).  "Accounting  Changes"  means:  (i) changes in  accounting
principles  required  by GAAP and  implemented  by  Borrower;  (ii)  changes  in
accounting principles recommended by Borrower's certified public accountants and
implemented by Borrower; and (iii) changes in the method of determining carrying
value of Borrower's or any of its Significant Subsidiaries' assets,  liabilities
or equity  accounts.  All such  adjustments  resulting  from  expenditures  made
subsequent to the Closing Date (including, but not limited to, capitalization of
costs and expenses or payment of pre-Closing Date liabilities)  shall be treated
as expenses in the period the expenditures are made.

                                      -25-
<PAGE>

                                   SECTION 5

                         REPRESENTATIONS AND WARRANTIES

      In order to induce CoBank to enter into this  Agreement and to make Loans,
Borrower  represents  and warrants to CoBank on the Closing Date and on the date
of each  request  for a Loan or the  issuance  of a Letter  of  Credit  that the
following statements are true, correct and complete:

      5.1 Disclosure.  The information furnished by or on behalf of Borrower and
its  Significant   Subsidiaries  contained  in  this  Agreement,  the  financial
statements  referred to in Subsection 5.8 and any other  document,  certificate,
opinion or written  statement  furnished to CoBank pursuant to this Agreement or
any other Loan Document  (other than  projections),  taken as a whole,  does not
contain any untrue statement of a material fact or omit to state a material fact
necessary  in order to make the  statements  contained  herein  or  therein  not
misleading  in light of the  circumstances  in which  the same  were  made.  Any
projections   provided  by  or  on  behalf  of  Borrower  and  its   Significant
Subsidiaries  have been  prepared  by  management  in good  faith and based upon
assumptions  believed by management to be reasonable at the time the projections
were  prepared.  Borrower is not aware of any fact which it has not disclosed in
writing to CoBank having or which could  reasonably be expect to have a Material
Adverse Effect.

      5.2 No Material Adverse Effect. Since December 31, 2006, there has been no
event or  change  in facts or  circumstances  affecting  Borrower  or any of its
Significant  Subsidiaries  which  individually  or in the aggregate  have had or
could reasonably be expected to have a Material Adverse Effect and that have not
been disclosed herein or in the attached Schedules.

      5.3 Organization, Powers, Authorization and Good Standing.

         (A)  Organization  and  Powers.  Each of Borrower  and its  Significant
Subsidiaries  is a  corporation  duly  organized,  validly  existing and in good
standing under the laws of its jurisdiction of organization  (which jurisdiction
is set forth on Schedule  5.3(A) as of the Closing  Date).  Each of Borrower and
its Significant  Subsidiaries has all requisite legal power and authority to own
and operate  its  properties,  to carry on its  business  as now  conducted  and
proposed  to be  conducted,  to enter into each Loan  Document  to which it is a
party and to carry out its respective obligations with respect thereto.

         (B)  Authorization;  Binding  Obligation.  Each  of  Borrower  and  its
Significant  Subsidiaries has taken all necessary  corporate and other action to
authorize the execution,  delivery and performance of this Agreement and each of
the other Loan  Documents  to which it is a party.  This  Agreement  is, and the
other Loan  Documents when executed and delivered will be, the legally valid and
binding obligations of the applicable parties thereto (other than CoBank),  each
enforceable  against each of such parties,  as  applicable,  in accordance  with
their respective terms, except as such enforcement may be limited by bankruptcy,
insolvency,  reorganization,  moratorium  or similar  state or  federal  debt or
relief  laws  from  time to time in  effect  which  affect  the  enforcement  of
creditors' rights in general and general principles of equity.

                                      -26-
<PAGE>

         (C) Qualification. Each of Borrower and its Significant Subsidiaries is
duly  qualified  and  authorized  to do  business  and in good  standing in each
jurisdiction  where the nature of its  business  and  operations  requires  such
qualification  and  authorization,  except where the failure to be so qualified,
authorized  and in good  standing  could not  reasonably  be  expected to have a
Material  Adverse  Effect.  All  jurisdictions  in which  each  such  Person  is
qualified and  authorized to do business are set forth on Schedule  5.3(C) as of
the Closing Date.

      5.4 Compliance of Agreement, Loan Documents and Borrowings with Applicable
Law.  Except as set forth on Schedule 5.4 hereto,  the  execution,  delivery and
performance by Borrower and its  Significant  Subsidiaries of the Loan Documents
to  which  each is a  party,  the  borrowings  hereunder  and  the  transactions
contemplated hereby and thereby do not and will not, by the passage of time, the
giving of notice or otherwise,  (i) require any Governmental Approval or violate
any Applicable Law relating to Borrower or any of its Significant  Subsidiaries,
the violation of which could  reasonably be expected to have a Material  Adverse
Effect,  (ii) conflict with, result in a breach of or constitute a default under
the  articles of  incorporation,  bylaws or other  organizational  documents  of
Borrower or any of its Significant Subsidiaries,  (iii) conflict with, result in
a breach of or  constitute a default  under any Material  Contract to which such
Person  is a  party  or by  which  any of its  properties  may be  bound  or any
Governmental  Approval  relating to such Person,  the breach or default of which
could reasonably be expected to have a Material  Adverse Effect,  or (iv) result
in or require the creation or imposition of any Lien upon or with respect to any
property  now owned or  hereafter  acquired  by such  Person,  the  creation  or
imposition  of which could  reasonably  be  expected to have a Material  Adverse
Effect.

      5.5 Compliance with Law; Governmental Approvals.  Each of Borrower and its
Significant  Subsidiaries  (i)  has,  or has  the  right  to use,  all  material
Governmental Approvals,  including the Licenses,  required by any Applicable Law
for it to conduct  its  business  and (ii) is in material  compliance  with each
Governmental  Approval,  including  the  Licenses,   applicable  to  it  and  in
compliance  with  all  other  Applicable  Laws  relating  to it or  any  of  its
respective  properties  the  violation of which could  reasonably be expected to
have a Material Adverse Effect. Each such Governmental Approval is in full force
and effect,  is final and not subject to review on appeal and is not the subject
of any pending or threatened attack by direct or collateral proceeding.

      5.6 Tax  Returns  and  Payments.  Each  of  Borrower  and its  Significant
Subsidiaries  has duly  filed or  caused  to be  filed,  except  as set forth on
Schedule  5.6,  all  federal,  state,  local and other tax  returns  required by
Applicable  Law to be filed,  and has paid, or made  adequate  provision for the
payment  of,  all  federal,  state,  local  and  other  taxes,  assessments  and
governmental  charges or levies upon it and its  property,  income,  profits and
assets which are due and payable,  except where the payment of such tax is being
diligently  contested in good faith and  adequate  reserves  therefor  have been
established in compliance  with GAAP. The charges,  accruals and reserves on the
books of Borrower and its Significant Subsidiaries in respect of federal, state,
local and other  taxes for all  fiscal  years and  portions  thereof  are in the
judgment of Borrower adequate.

      5.7   Environmental   Matters.   Each  of  Borrower  and  its  Significant
Subsidiaries  is in  compliance  in all material  respects  with all  applicable
Environmental  Laws,  and  there is no  contamination  at,  under  or about  the
properties  or operations of Borrower and its  Significant  Subsidiaries,  which
interfere  in  any  material  respect  with  the  continued  operation  of  such
properties or impair in any material  respect the fair saleable value thereof or
with such  operations,  except for any such violations or contamination as could
not reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect.

                                      -27-
<PAGE>

      5.8 Financial Statements.

         (A) All financial  statements  concerning  Borrower and its Significant
Subsidiaries which have been furnished to CoBank pursuant to this Agreement have
been prepared in accordance with GAAP consistently  applied (except as disclosed
therein)  and present  fairly the  financial  condition  of the Persons  covered
thereby  as of the date  thereof  and the  results of their  operations  for the
periods covered thereby and disclose all material liabilities of Borrower or its
Significant  Subsidiaries as at the dates thereof.  Neither  Borrower nor any of
its Significant Subsidiaries has outstanding,  as of the Closing Date, and after
giving  effect  to  the  initial  Loans  hereunder  on  the  Closing  Date,  any
Indebtedness  for  borrowed  money  other  than  (i)  the  Loans  and  (ii)  the
Indebtedness permitted under Subsection 3.1.

         (B) All Budgets  concerning  Borrower and its Significant  Subsidiaries
which have been  furnished to CoBank were prepared in good faith by or on behalf
of  Borrower  and such  Significant  Subsidiaries.  No fact is known to Borrower
which  materially  and  adversely  affects or is  reasonably  expected to have a
Material Adverse Effect which has not been set forth in the financial statements
referred to in Subsection  5.8(A) or in such  information,  reports,  papers and
data or otherwise disclosed in writing to CoBank prior to the date hereof.

      5.9   Intellectual   Property.   Each  of  Borrower  and  its  Significant
Subsidiaries owns, or possesses through valid licensing arrangements,  the right
to  use  all  patents,  copyrights,  trademarks,  trade  names,  service  marks,
technology  know-how and  processes  used in or necessary for the conduct of its
business  as  currently  or  anticipated  to  be  conducted  (collectively,  the
"Intellectual  Property Rights"), to its knowledge,  without infringing upon any
validly asserted rights of others,  except for any Intellectual  Property Rights
the absence of which could not reasonably be expected to have a Material Adverse
Effect. No event has occurred which permits, or after notice or lapse of time or
both would permit,  the revocation or termination of any such rights the absence
of which could not reasonably be expected to have a Material Adverse Effect.

      5.10  Litigation,  Investigations,  Audits,  Etc.  Except  as set forth on
Schedule 5.10, there is no action,  suit,  proceeding or  investigation  pending
against,  or, to the knowledge of Borrower,  threatened  against or in any other
manner relating adversely to, Borrower or any of its Significant Subsidiaries or
any of their  respective  properties,  including the  Licenses,  in any court or
before any  arbitrator  of any kind or before or by any  Governmental  Authority
(including  the FCC),  except  such as affect  the  telecommunications  industry
generally which, in each case or in the aggregate,  could reasonably be expected
to have a Material Adverse Effect.  None of the actions,  suits,  proceedings or
investigations  disclosed on Schedule  5.10 (i) calls into question the validity
of  this  Agreement  or  any  other  Loan  Document,  or  (ii)  individually  or
collectively  could  reasonably be expected to result in a judgment or liability
not fully covered by insurance which, if determined adversely to Borrower or any
of its Significant Subsidiaries, could reasonably be expected to have a Material
Adverse Effect. Neither Borrower nor any of its Significant  Subsidiaries is the
subject  of  any  review  or  audit  by  the  Internal  Revenue  Service  or any
investigation by any Governmental Authority concerning the violation or possible
violation of any law.

                                      -28-
<PAGE>

      5.11 Employee  Labor  Matters.  Except as set forth on Schedule  5.11, (i)
none of  Borrower,  its  Significant  Subsidiaries  nor any of their  respective
employees is subject to any collective  bargaining  agreement,  (ii) no petition
for  certification or union election is pending with respect to the employees of
any such  Person and no union or  collective  bargaining  unit has  sought  such
certification  or  recognition  with respect to the employees of any such Person
and (iii) there are no strikes,  slowdowns,  unfair labor  practice  complaints,
work  stoppages or  controversies  pending or, to the best knowledge of Borrower
after  due  inquiry,  threatened  between  any such  Person  and its  respective
employees,  other than  employee  grievances  arising in the ordinary  course of
business which could not reasonably be expected to have, either  individually or
in the aggregate, a Material Adverse Effect.

      5.12 ERISA Compliance.

         (A)  Each  Plan is in  compliance  in all  material  respects  with the
applicable provisions of ERISA, the IRC and other federal or state law. Borrower
and each ERISA Affiliate has made all required contributions to any Plan subject
to  Section  412 of the IRC,  and no  application  for a  funding  waiver  or an
extension of any amortization period pursuant to Section 412 of the IRC has been
made with respect to any Plan.

         (B)  There  are no  pending  or,  to the best  knowledge  of  Borrower,
threatened claims, actions or lawsuits, or action by any Governmental Authority,
with respect to any Plan which has resulted or could  reasonably  be expected to
have a Material  Adverse  Effect.  There has been no prohibited  transaction  or
violation of the fiduciary  responsibility  rules with respect to any Plan which
has resulted or could reasonably be expected to have a Material Adverse Effect.

         (C) (i) No ERISA Event has occurred or is reasonably expected to occur;
(ii) no Pension Plan has any unfunded liability;  (iii) neither Borrower nor any
ERISA  Affiliate has incurred,  or  reasonably  expects to incur,  any liability
under Title IV of ERISA with  respect to any Pension  Plan (other than  premiums
due and not delinquent  under Section 4007 of ERISA);  (iv) neither Borrower nor
any ERISA Affiliate has incurred,  or reasonably expects to incur, any liability
(and no event has occurred  which,  with the giving of notice under Section 4219
of ERISA,  would result in such  liability)  under Section 4201 or 4243 of ERISA
with respect to a  Multi-employer  Plan; and (v) neither  Borrower nor any ERISA
Affiliate has engaged in a transaction  that could subject any Person to Section
4069 or 4212(c) of ERISA.

      5.13 Communications Regulatory Matters.

         (A) The  Licenses  are  valid  and in full  force  and  effect  without
conditions except for such conditions as are generally  applicable to holders of
such Licenses. No event has occurred and is continuing which could reasonably be
expected  to (i)  result  in the  imposition  of a  material  forfeiture  or the
revocation,  termination  or adverse  modification  of any such  License or (ii)
materially  and  adversely  affect any  rights of  Borrower  or its  Significant
Subsidiaries or any other holder  thereunder.  Borrower has no reason to believe
and has no  knowledge  that any  License  will not be  renewed  in the  ordinary
course.  Except as disclosed on Schedule 5.10,  neither  Borrower nor any of its
Significant  Subsidiaries is a party to any investigation,  notice of violation,
order or complaint  issued by or before the FCC or any  applicable  Governmental
Authority,  and there are no  proceedings  pending  by or before  the FCC or any
applicable  Governmental  Authority,  which  could  in any  manner  threaten  or
adversely affect the validity of any License.

                                      -29-
<PAGE>

         (B) All of the material properties, equipment and systems owned, leased
or managed by Borrower or its  Significant  Subsidiaries  are,  and (to the best
knowledge of Borrower) all such  property,  equipment and systems to be acquired
or added in connection with any  contemplated  system  expansion or construction
will be, in good repair,  working order and condition  (reasonable wear and tear
excepted)  and are  and  will be in  material  compliance  with  all  terms  and
conditions   of  the  Licenses  and  all  standards  or  rules  imposed  by  any
Governmental  Authority  or as  imposed  under  any  agreements  with  telephone
companies and customers.

         (C) Each of  Borrower  and its  Significant  Subsidiaries  has paid all
material  franchise,  license or other fees and  charges  which have  become due
pursuant to any  Governmental  Approval in respect of its  business and has made
appropriate  provision  as is  required by GAAP for any such  material  fees and
charges which have accrued.

      5.14 Solvency. Each of Borrower and its Significant Subsidiaries: (i) owns
and will own assets the  present  fair  saleable  value of which are (a) greater
than the total  amount of  liabilities  (including  contingent  liabilities)  of
Borrower or its  Significant  Subsidiaries  and (b) greater than the amount that
will be required to pay the probable  liabilities of its then existing debts and
liabilities  as they become  absolute  and  matured  considering  all  financing
alternatives and potential asset sales reasonably  available to Borrower or such
Significant  Subsidiary;  (ii) has  capital  that is not  unreasonably  small in
relation to its  business as presently  conducted or after giving  effect to any
contemplated  transaction;  and  (iii)  does not  intend  to incur  and does not
believe that it will incur debts and liabilities  beyond its ability to pay such
debts and liabilities as they become due.

      5.15  Investment  Company Act. None of Borrower or any of its  Significant
Subsidiaries  is an  "investment  company" as that term is defined in and is not
otherwise  subject to regulation  under, the Investment  Company Act of 1940, as
amended.

      5.16 Certain Agreements and Material  Contracts.  Each of Borrower and its
Significant Subsidiaries has performed all of its material obligations under all
loan agreements,  indentures,  guarantees, capital leases and Material Contracts
and,  to the  best  knowledge  of  Borrower,  each  other  party  thereto  is in
compliance with each such agreement or Material Contract. Each such agreement or
Material  Contract  is in full  force and  effect in  accordance  with the terms
thereof.

      5.17  Title  to   Properties.   Borrower  and  each  of  its   Significant
Subsidiaries has such title or leasehold interest in and to the real property or
interests therein, including material easements,  licenses and similar rights in
real  estate,  owned or leased by it as is necessary or desirable to the conduct
of its business and valid and legal title or leasehold interest in and to all of
its  personal  property,  including  those  reflected  on the balance  sheets of
Borrower  delivered  pursuant to  Subsection  5.8,  except those which have been
disposed of by Borrower  subsequent to such date which dispositions have been in
the ordinary course of business or as otherwise expressly permitted hereunder.

                                      -30-
<PAGE>

      5.18 Transactions with Affiliates.  No Affiliate of Borrower is a party to
any  agreement,  contract,  commitment or  transaction  with Borrower or has any
material interest in any material property used by Borrower, except as permitted
by Subsection 3.8.

      5.19 OFAC.  None of  Borrower  or its  Significant  Subsidiaries  (i) is a
person whose  property or interest in property is blocked or subject to blocking
pursuant to Section 1 of Executive  Order 13224 of September  23, 2001  Blocking
Property  and  Prohibiting  Transactions  With  Persons Who Commit,  Threaten to
Commit,  or Support  Terrorism (66 Fed. Reg. 49079 (2001)),  (ii) engages in any
dealings or transactions  prohibited by Section 2 of such executive order, or is
otherwise  associated with any such person in any manner violative of Section 2,
or (iii) is a person on the list of Specially  Designated  Nationals and Blocked
Persons or  subject  to the  limitations  or  prohibitions  under any other U.S.
Department  of  Treasury's  Office  of  Foreign  Assets  Control  regulation  or
executive order.

      5.20 Patriot Act. Each of Borrower and its Significant  Subsidiaries is in
compliance,  in all material respects,  with the (i) Trading with the Enemy Act,
as amended,  and each of the foreign  assets  control  regulations of the United
States Treasury  Department (31 CFR,  Subtitle B, Chapter V, as amended) and any
other enabling legislation or executive order relating thereto, and (ii) Uniting
And Strengthening  America By Providing  Appropriate Tools Required To Intercept
And Obstruct Terrorism (USA Patriot Act of 2001). No part of the proceeds of the
Loans will be used, directly or indirectly, for any payments to any governmental
official or employee,  political party, official of a political party, candidate
for political office, or anyone else acting in an official capacity, in order to
obtain, retain or direct business or obtain any improper advantage, in violation
of the United States Foreign Corrupt Practices Act of 1977, as amended.

                                   SECTION 6

                    EVENTS OF DEFAULT AND RIGHTS AND REMEDIES

      6.1 Event of Default.  "Event of  Default"  shall mean the  occurrence  or
existence of any one or more of the following:

         (A) Payment.  Failure to repay any  outstanding  amount of the Loans at
the time required  pursuant to this  Agreement,  or to reimburse  CoBank for any
payment  made by CoBank  under or with respect to any Letter of Credit when due,
or failure to pay, within five days after the due date, any interest on any Loan
or failure to pay,  within  five days after  receipt by  Borrower of notice from
CoBank,  any other  amount  due under  this  Agreement  or any of the other Loan
Documents; or

         (B) Default in Other Agreements.  (i) Failure of Borrower or any of its
Significant  Subsidiaries to pay when due or within any applicable  grace period
any  principal or interest on  Indebtedness  (other than the Loans) in excess of
$5,000,000  or (ii) any  other  breach  or  default  of  Borrower  or any of its
Significant  Subsidiaries  with  respect  to the Note  Purchase  Agreement,  any
Indebtedness  (other than the Loans), if the effect of such breach or default is
to cause or to permit  the holder or  holders  then to cause  such  Indebtedness
having  an  aggregate   principal   amount  for  Borrower  and  its  Significant
Subsidiaries  in excess of  $5,000,000 to become or be declared due prior to its
stated maturity; or

                                      -31-
<PAGE>

         (C) Breach of Certain  Provisions.  Failure of  Borrower  or any of its
Significant  Subsidiaries  to  perform  or  comply  with any  term or  condition
contained in that portion of Subsection 2.2 relating to Borrower's or any of its
Significant  Subsidiaries'  obligation to maintain  insurance,  Subsection  2.4,
Section 3 or Section 4; or

         (D) Breach of Warranty. Any representation,  warranty, certification or
other statement made by Borrower or any of its  Significant  Subsidiaries in any
Loan Document or in any statement or  certificate  at any time given by Borrower
or any of its Significant  Subsidiaries in writing pursuant to any Loan Document
is false in any material respect on the date made or deemed made; or

         (E)  Other  Defaults  Under  Loan  Documents.   Borrower,  any  of  its
Significant  Subsidiaries  or any other party  (other than  CoBank)  breaches or
defaults in the  performance  of or compliance  with any term  contained in this
Agreement or the other Loan Documents and such default is not remedied or waived
within 30 days after  receipt by Borrower,  any such  Significant  Subsidiary or
such other party of notice from CoBank of such default  (other than  occurrences
described in other provisions of this Subsection 6.1 for which a different grace
or cure period is specified or which constitute immediate Events of Default); or

         (F) Involuntary  Bankruptcy;  Appointment of Receiver; Etc. (i) A court
enters a decree or order for  relief  with  respect  to  Borrower  or any of its
Significant Subsidiaries in an involuntary case under the Bankruptcy Code, which
decree or order is not stayed or other  similar  relief is not granted under any
applicable  federal or state law within 60 days; or (ii) the  continuance of any
of the following events for 60 days unless dismissed,  bonded or discharged: (a)
an  involuntary  case is commenced  against  Borrower or any of its  Significant
Subsidiaries,  under any applicable bankruptcy,  insolvency or other similar law
now or  hereafter  in  effect;  or (b) a  decree  or  order  of a court  for the
appointment of a receiver, liquidator, sequestrator, trustee, custodian or other
officer  having  similar  powers  over  Borrower  or  any  of  its   Significant
Subsidiaries,  or over all or a substantial part of its property, is entered; or
(c) an interim  receiver,  trustee or other  custodian is appointed  without the
consent  of  Borrower  or any  of its  Significant  Subsidiaries,  for  all or a
substantial  part  of the  property  of  Borrower  or  any  of  its  Significant
Subsidiaries; or

         (G) Voluntary Bankruptcy; Appointment of Receiver; Etc. Borrower or any
of its  Significant  Subsidiaries  (i)  commences  a  voluntary  case  under the
Bankruptcy  Code,  files a petition  seeking to take  advantage of any other law
relating to bankruptcy,  insolvency,  reorganization,  winding up or composition
for adjustment of debts of Borrower or any of its Significant  Subsidiaries,  or
consents to, or fails to contest in a timely and appropriate  manner,  the entry
of an order for relief in an involuntary  case, the conversion of an involuntary
case to a  voluntary  case under any such law, or the  appointment  of or taking
possession  by a receiver,  trustee or other  custodian of all or a  substantial
part of the property of Borrower or any of its Significant Subsidiaries; or (ii)
makes  any  assignment  for the  benefit  of  creditors;  or (iii)  the Board of
Directors or the shareholders of Borrower or any of its Significant Subsidiaries
adopts any  resolution  or  otherwise  authorizes  action to approve  any of the
actions referred to in this Subsection 6.1(G); or

                                      -32-
<PAGE>

         (H) Judgment and  Attachments.  Any money judgment,  writ or warrant of
attachment or similar  process  involving an amount in any individual case or in
the  aggregate  for Borrower  and its  Significant  Subsidiaries  at any time in
excess of $5,000,000 (in either case not  adequately  covered by insurance as to
which the insurance company has not denied coverage) is entered or filed against
Borrower  or any of its  Significant  Subsidiaries  or any of  their  respective
assets and remains undischarged, unvacated, unbonded or unstayed for a period of
60 days or in any event later than five  Business  Days prior to the date of any
proposed sale thereunder; or

         (I)  Dissolution.  Any order,  judgment  or decree is  entered  against
Borrower or any of its  Significant  Subsidiaries  decreeing the  dissolution or
split up of  Borrower  or any of its  Significant  Subsidiaries  and such  order
remains undischarged or unstayed for a period in excess of 15 days; or

         (J) Solvency. Borrower or any of its Significant Subsidiaries ceases to
be solvent or Borrower or any of its Significant  Subsidiaries admits in writing
its present or prospective inability to pay its debts as they become due; or

         (K)  Injunction.  Borrower or any of its  Significant  Subsidiaries  is
enjoined,  restrained  or in any way  prevented by the order of any court or any
Governmental Authority from conducting all of its business or otherwise for more
than 60 days to the extent  that the  results of such  injunction  or  restraint
could reasonably be expected to have a Material Adeverse Effect; or

         (L)  ERISA;  Pension  Plans.  (i)  Borrower  or any of its  Significant
Subsidiaries fails to make full payment when due of all amounts which, under the
provisions  of any employee  benefit plans or any  applicable  provisions of the
IRC,  any such  Person is  required  to pay as  contributions  thereto  and such
failure  results in or could  reasonably be expected to have a Material  Adverse
Effect; or (ii) an accumulated  funding deficiency occurs or exists,  whether or
not waived, with respect to any such employee benefit plans and such accumulated
funding deficiency results in or could reasonably be expected to have a Material
Adverse  Effect;  or (iii) any  employee  benefit plan of Borrower or any of its
Significant  Subsidiaries loses its status as a qualified plan under the IRC and
such loss results in or could  reasonably be expected to have a Material Adverse
Effect; or

         (M)  Invalidity of Loan  Documents.  Any of the Loan  Documents for any
reason,  other  than a partial  or full  release  in  accordance  with the terms
thereof,  ceases to be in full  force and effect or is  declared  to be null and
void and Borrower or any  applicable  Significant  Subsidiary  fails to promptly
correct such  cessation or  declaration,  or Borrower or any of its  Significant
Subsidiaries  denies that it has any further  liability under any Loan Documents
to which it is party, or gives notice to such effect; or

         (N) Licenses and Permits.  The loss,  suspension or  revocation  of, or
failure to renew,  any license or permit,  including  any  License,  now held or
hereafter acquired by Borrower or any of its Significant  Subsidiaries,  if such
loss, suspension, revocation or failure to renew could reasonably be expected to
have a Material Adverse Effect; or

                                      -33-
<PAGE>

         (O)  Change in  Control.  Any Person  acquires  or  beneficially  owns,
directly  or  indirectly,  and  controls  at least 35% of the  voting  equity in
Borrower.

      6.2  Suspension  of  Commitments.  Upon  the  occurrence  and  during  the
continuation  of any  Default or Event of  Default,  CoBank,  without  notice or
demand,  may immediately  cease making  additional  Loans and issuing Letters of
Credit  and cause  its  obligation  to lend  under  the Loan  Commitments  to be
suspended;  provided that, in the case of a Default, if the subject condition or
event is cured, or waived by CoBank, within any applicable grace or cure period,
any suspended portion of the Loan Commitments shall be reinstated.

      6.3 Acceleration. Upon the occurrence of any Event of Default described in
the foregoing  Subsections  6.1(F) or 6.1(G), the unpaid principal amount of and
accrued interest and fees on the Loans, payments under the Letters of Credit and
all other Obligations shall  automatically  become  immediately due and payable,
without presentment,  demand, protest, notice of intent to accelerate, notice of
acceleration  or  other  requirements  of any  kind,  all of  which  are  hereby
expressly  waived by Borrower,  and the  obligations of CoBank to make Loans and
issue  Letters of Credit shall  thereupon  terminate.  Upon the  occurrence  and
during the  continuance  of any other  Event of  Default,  CoBank may by written
notice to Borrower declare all or any portion of the Loans, all or any Letter of
Credit  and all or some of the  other  Obligations  to be,  and the  same  shall
forthwith  become,  immediately due and payable  together with accrued  interest
thereon,  and upon such acceleration the obligations of CoBank to make Loans and
issue Letters of Credit shall thereupon terminate and Borrower shall immediately
comply with the provisions of Subsection 1.15.

      6.4 Rights of Collection.  Upon the occurrence and during the continuation
of any Event of Default and at any time thereafter,  unless and until such Event
of Default is cured or waived by CoBank,  CoBank may  exercise all of its rights
and remedies under this Agreement,  the other Loan Documents and Applicable Law,
in order to satisfy all of the Obligations.

      6.5 Consents. Borrower acknowledges that certain transactions contemplated
by this Agreement and the other Loan Documents and certain  actions which may be
taken by CoBank in the exercise of its rights under this Agreement and the other
Loan Documents may require the consent of a Governmental  Authority.  If counsel
to CoBank reasonably determines that the consent of a Governmental  Authority is
required in connection  with the execution,  delivery and  performance of any of
the  aforesaid  Loan  Documents  or any Loan  Documents  delivered  to CoBank in
connection  therewith or as a result of any action  which may be taken  pursuant
thereto, then Borrower,  at Borrower's sole cost and expense,  agrees to use its
reasonable  efforts,  and to cause  its  Significant  Subsidiaries  to use their
reasonable best efforts,  to secure such consent and to cooperate with CoBank in
any action commenced by CoBank or CoBank to secure such consent.

      6.6 Performance by CoBank. If Borrower shall fail to perform any covenant,
duty or agreement contained in any of the Loan Documents,  CoBank may perform or
attempt to perform such covenant,  duty or agreement on behalf of Borrower after
the  expiration  of any cure or grace  periods  set  forth  herein,  subject  to
Applicable  Law.  In such  event,  Borrower  shall,  at the  request  of CoBank,
promptly pay any amount  reasonably  expended by CoBank in such  performance  or
attempted  performance to CoBank,  together with interest thereon at the highest
rate of  interest  in  effect  upon the  occurrence  of an Event of  Default  as
specified in  Subsection  1.2(E) from the date of such  expenditure  until paid.
Notwithstanding the foregoing, it is expressly agreed that CoBank shall not have
any  liability  or  responsibility  for the  performance  of any  obligation  of
Borrower under this Agreement or any other Loan Document.

                                      -34-
<PAGE>

      6.7 Set Off and  Sharing of  Payments.  In  addition  to any rights now or
hereafter  granted under applicable law and not by way of limitation of any such
rights,  during  the  continuance  of any  Event of  Default,  CoBank  is hereby
authorized by Borrower at any time or from time to time, with reasonably  prompt
subsequent notice to Borrower (any prior or contemporaneous  notice being hereby
expressly  waived) to set off and to  appropriate  and to apply  against  and on
account of any of the Obligations any and all (A) balances held by CoBank at any
of  its  offices  for  the  account  of  Borrower  or  any  of  its  Significant
Subsidiaries  (regardless  of whether such  balances are then due to Borrower or
any of its  Significant  Subsidiaries),  and (B) all other  property at any time
held or owing by CoBank to or for the credit or for the  account of  Borrower or
any of its Significant Subsidiaries.

                                   SECTION 7

                               CONDITIONS TO LOANS

      The obligations of CoBank to make Loans are subject to satisfaction of all
of the applicable conditions set forth below.

      7.1 Conditions to  Effectiveness of this Agreement.  The  effectiveness of
this  Agreement,  and the  amendments  set  forth  herein,  are  subject  to the
satisfaction of each of the following conditions:

         (A) Executed Loan and Other  Documents.  (i) This  Agreement,  (ii) the
Notes and  (iii)  all  other  documents  and  instruments  contemplated  by such
agreements,  shall have been duly  authorized  and executed by Borrower or other
Person,  as  applicable,  in form and  substance  satisfactory  to  CoBank,  and
Borrower or such other Person,  as  applicable,  shall have  delivered  original
counterparts thereof to CoBank.

         (B) Closing Certificates; Opinions.

            (1) Officers' Certificate.  CoBank shall have received a certificate
from the chief executive  officer and vice president,  treasuer of Borrower,  in
form and substance  reasonably  satisfactory  to CoBank,  to the effect that, to
their knowledge after reasonable  diligence,  all representations and warranties
of Borrower and its Significant Subsidiaries contained in this Agreement and the
other Loan Documents are true,  correct and complete in all material respects on
and as of the date  thereof;  that neither  Borrower nor any of its  Significant
Subsidiaries is in violation of any of the covenants contained in this Agreement
and the other Loan  Documents;  that,  after giving  effect to the  transactions
contemplated by this Agreement,  no Default or Event of Default has occurred and
is continuing; and that Borrower has satisfied each of the closing conditions to
be satisfied hereby.

                                      -35-
<PAGE>

            (2) Certificate of Secretary of Borrower. CoBank shall have received
a  certificate  of the secretary or assistant  secretary of Borrower  certifying
that  attached  thereto  is  a  true  and  complete  copy  of  its  articles  of
incorporation,  and all amendments thereto, certified as of a recent date by the
Secretary of State of the state of its organization;  that attached thereto is a
true  and  complete  copy  of its  bylaws  as in  effect  on the  date  of  such
certification;  that attached  thereto is a true and complete copy of resolution
of its Board of Directors authorizing the borrowings contemplated hereunder, and
the  execution,  delivery and  performance  of this Agreement and the other Loan
Documents;  and as to the incumbency and genuineness of the signature of each of
its officers executing Loan Documents.

            (3)  Certificates  of Good  Standing.  CoBank  shall  have  received
certificates as of a recent date of the good standing of Borrower under the laws
of  its  jurisdiction  of  organization  and  such  other  jurisdictions  as are
requested by CoBank.

            (4)  Opinion of  Counsel.  CoBank  shall have  received a  favorable
opinion of counsel to Borrower  addressed to CoBank with respect to Borrower and
the Loan Documents reasonably satisfactory in form and substance to CoBank.

         (C) Consents.

            (1)  Governmental  and Third Party  Approvals.  Borrower  shall have
delivered  to  CoBank  all  necessary  material  approvals,  authorizations  and
consents, if any, of all Persons,  Governmental  Authorities,  including the FCC
and all  applicable  PUCs,  and courts having  jurisdiction  with respect to the
execution and delivery of this Agreement and the other Loan  Documents,  and all
such approvals shall be in form and substance satisfactory to CoBank.

            (2)  No  Injunction,  Etc.  No  action,  proceeding,  investigation,
regulation or  legislation  shall have been  instituted,  threatened or proposed
before,  nor any adverse ruling  received from,  any  Governmental  Authority to
enjoin, restrain or prohibit, or to obtain substantial damages in respect of, or
which is related to or arises out of this  Agreement or the other Loan Documents
or the  consummation  of the  transactions  contemplated  hereby or thereby,  or
which,  as  determined  by CoBank in its  reasonable  discretion,  would make it
inadvisable to consummate the  transactions  contemplated  by this Agreement and
such other Loan Documents.

         (D) Fees, Expenses,  Taxes, Etc. There shall have been paid by Borrower
to  CoBank  the fees set forth or  referenced  in  Subsection  1.4 and any other
accrued and unpaid fees or commissions due hereunder  (including  legal fees and
expenses),  and to any  other  Person  such  amount  as  may be due  thereto  in
connection with the transactions  contemplated hereby, including all taxes, fees
and other charges in connection with the execution,  delivery, recording, filing
and registration of any of the Loan Documents.

                                      -36-
<PAGE>

         (E) Miscellaneous.

            (1) Proceedings and Documents. All opinions,  certificates and other
instruments and all proceedings in connection with the transactions contemplated
by this  Agreement  shall be  reasonably  satisfactory  in form and substance to
CoBank.  CoBank shall have received  copies of all other  instruments  and other
evidence as CoBank may  reasonably  request,  in form and  substance  reasonably
satisfactory to CoBank,  with respect to the  transactions  contemplated by this
Agreement and the taking of all actions in connection therewith.

            (2)  Litigation,  Investigations,  Audits,  Etc. There is no action,
suit,  proceeding  or  investigation  pending  against,  or, to the knowledge of
Borrower after due inquiry,  threatened  against or in any other manner relating
adversely to,  Borrower or any of its  Significant  Subsidiaries or any of their
respective  properties,  including  the  Licenses,  in any court or  before  any
arbitrator of any kind or before or by any Governmental Authority (including the
FCC),  except such as affect the  telecommunications  industry  generally,  that
would reasonably be expected to have a Material Adverse Effect.

      7.2  Conditions  to All Loans.  The  obligations  of CoBank to make Loans,
including the initial Loan, and of CoBank to issue Letters of Credit,  including
the initial Letter of Credit, on any date (each such date a "Funding Date"), are
subject to the further conditions precedent set forth below.

         (A) CoBank shall have  received,  in accordance  with the provisions of
Subsection  1.3, a Notice of Borrowing  requesting  an advance of a Loan or such
notice as CoBank shall require for the issuance of a Letter of Credit.

         (B) The representations  and warranties  contained in Section 5 of this
Agreement  and  elsewhere  herein and in the Loan  Documents  shall be (and each
request  by  Borrower  for a Loan or a  Letter  of  Credit  shall  constitute  a
representation and warranty by Borrower that such representations and warranties
are) true,  correct  and  complete  in all  material  respects on and as of such
Funding  Date to the same extent as though  made on and as of that date,  except
for any  representation  or warranty limited by its terms to a specific date and
taking into account any  amendments  to the Schedules or Exhibits as a result of
any disclosures  made in writing by Borrower to CoBank after the Closing Date so
long as what is being  disclosed  does not give rise to a Default or an Event of
Default.

         (C) No event shall have occurred and be continuing or would result from
the consummation of the borrowing or issuance contemplated that would constitute
an Event of Default or a Default.

         (D)  No  order,  judgment  or  decree  of  any  court,   arbitrator  or
Governmental  Authority  shall purport to enjoin or restrain  CoBank from making
any Loan or issuing any Letter of Credit.

         (E) Since December 31, 2006, there shall not have occurred any event or
condition  that has had or  could  reasonably  be  expected  to have a  Material
Adverse Effect.

         (F) All Loan Documents shall be in full force and effect.

                                      -37-
<PAGE>

                                   SECTION 8

                          ASSIGNMENT AND PARTICIPATION

This  Agreement  shall be binding  upon and inure to the  benefit of the parties
hereto and their respective  successors and assigns except that Borrower may not
assign  its rights or  obligations  hereunder  without  the  written  consent of
CoBank.  CoBank may assign its rights and  delegate its  obligations  under this
Agreement to one or more  Persons,  with the written  consent of Borrower  other
than during the  continuance  of a Default or an Event of Default,  such consent
not to be  unreasonably  withheld,  except  in the case of an  assignment  to an
affiliate of CoBank.  CoBank may sell  participations  in all or any part of its
obligations  and rights under this  Agreement to one or more  Persons;  provided
that CoBank's obligations under this Agreement shall remain unchanged;  Borrower
shall  continue  to deal solely and  directly  with  CoBank in  connection  with
CoBank's  rights and obligations  under this  Agreement;  all amounts payable by
Borrower  hereunder  shall  be  determined  as  if  CoBank  had  not  sold  such
participation; and the holder of any such participation shall not be entitled to
require  CoBank  to take or omit to take  any  action  hereunder  except  action
directly  affecting  (i)  any  reduction,  modification  or  forgiveness  in the
principal  amount,  interest rate or fees payable with respect to any Loan; (ii)
any  extension  of the Term Loan  Availability  Expiration  Date,  the Term Loan
Maturity  Date, the Revolving  Loan  Expiration  Date, or any change of any date
fixed for any  payment of any of the  Obligations;  and (iii) any consent to the
assignment,  delegation or other transfer by Borrower or any of its  Significant
Subsidiaries  of any of its  rights  and  obligations  under any Loan  Document.
Borrower hereby acknowledges and agrees that any participation will give rise to
a direct  obligation of Borrower to the participant,  and the participant  shall
have direct rights for purposes of Subsections  1.11,  1.12,  1.13, 6.7 and 9.1.
However,  a  participant  shall not be entitled  to receive any greater  payment
under  Subsections  1.11,  1.12,  1.13,  6.7 and 9.1 than CoBank would have been
entitled to receive with respect to the participation  sold to such participant,
unless the  participation  is made with Borrower's prior written consent to such
greater payments. CoBank may furnish any information concerning Borrower and its
Significant  Subsidiaries  in the  possession  of  CoBank  from  time to time to
assignees and participants  (including  prospective assignees and participants),
subject to the  provisions  of  Subsection  9.10.  CoBank  reserves the right to
assign or sell  participations  in all or any part of its obligations and rights
under this Agreement on a non-patronage basis.

                                    SECTION 9

                                  MISCELLANEOUS

      9.1  Indemnities.  Borrower agrees to indemnify,  pay, and hold CoBank and
its  respective  officers,  directors,  employees,  agents,  and attorneys  (the
"Indemnitees")  harmless from and against any and all liabilities,  obligations,
losses, damages, penalties,  actions, judgments, suits and claims of any kind or
nature  whatsoever that may be imposed on, incurred by, or asserted  against the
Indemnitee as a result of its being a party to this  Agreement;  provided,  that
Borrower  shall have no obligation to an  Indemnitee  hereunder  with respect to
liabilities arising from the negligence or willful misconduct of that Indemnitee
as determined by a court of competent jurisdiction.  This Subsection 9.1 and all
indemnification  provisions  contained  within  any other  Loan  Document  shall
survive the termination of this Agreement.

                                      -38-
<PAGE>

      9.2  Amendments  and Waivers.  Except as  otherwise  provided  herein,  no
amendment,  modification,  termination  or  waiver  of  any  provision  of  this
Agreement,  the Notes or any of the other  Loan  Documents,  or  consent  to any
departure by Borrower therefrom, shall in any event be effective unless the same
shall  be in  writing  and  signed  by  Borrower  and  CoBank.  Each  amendment,
modification,  termination  or waiver  shall be  effective  only in the specific
instance  and for the specific  purpose for which it was given.  No notice to or
demand on  Borrower in any case shall  entitle  Borrower to any other or further
notice or demand in similar or other circumstances. Any amendment, modification,
termination,  waiver or consent  effected in accordance with this Subsection 9.2
shall be binding  upon each  holder of the Notes at the time  outstanding,  each
future holder of the Notes, and, if signed by Borrower, on Borrower.

      9.3  Notices.  Any  required  notice  or other  communication  shall be in
writing  addressed  to the  respective  party  as set  forth  below  and  may be
personally delivered, telecopied, sent by overnight courier service or U.S. mail
and shall be deemed  to have  been  given:  (i) if  delivered  in  person,  when
delivered;  (ii) if delivered by telecopy, on the date of confirmed transmission
if  transmitted on a Business Day before 2:00 p.m.  (Denver,  Colorado time) and
otherwise on the Business Day next succeeding the date of  transmission;  (c) if
delivered by overnight courier,  two days after delivery to the courier properly
addressed;  or (d) if delivered by U.S.  mail,  four Business Days after deposit
with postage prepaid and properly addressed.

         Notices shall be addressed as follows:

         If to Borrower:            SureWest Communications
                                    200 Vernon Street
                                    Roseville, CA 95678
                                    Attn:  Chief Financial Officer
                                    Fax:   (916) 786-1800

         If to CoBank:              CoBank, ACB
                                    5500 South Quebec Street
                                    Greenwood Village, Colorado 80111
                                    Attn: Communications & Energy Banking Group
                                    Fax: (303) 224-2639

      9.4 Failure or Indulgence Not Waiver;  Remedies Cumulative.  No failure or
delay on the part of CoBank to exercise, nor any partial exercise of, any power,
right or privilege hereunder or under any other Loan Documents shall impair such
power,  right,  or  privilege  or be  construed to be a waiver of any Default or
Event of Default.  All rights and remedies existing hereunder or under any other
Loan  Document  are  cumulative  to and not  exclusive of any rights or remedies
otherwise available.

      9.5 Severability.  The invalidity,  illegality, or unenforceability in any
jurisdiction  of any  provision  under the Loan  Documents  shall not  affect or
impair the  remaining  provisions  in the Loan  Documents  or any such  invalid,
unenforceable  or  illegal  provision  in any  jurisdiction  in  which it is not
invalid, unenforceable or illegal.

                                      -39-
<PAGE>

      9.6  Headings.  Section and  Subsection  headings are included  herein for
convenience  of reference only and shall not constitute a part of this Agreement
for any other purposes or be given substantive effect.

      9.7  Governing  Law.  THIS  AGREEMENT  SHALL BE  GOVERNED  BY AND SHALL BE
CONSTRUED  AND ENFORCED IN  ACCORDANCE  WITH THE  INTERNAL  LAWS OF THE STATE OF
COLORADO  WITHOUT  REGARD TO CONFLICTS OF LAW  PRINCIPLES  THAT WOULD REQUIRE OR
PERMIT APPLICATION OF THE LAWS OF ANY OTHER STATE OR JURISDICTION.

      9.8 No Fiduciary  Relationship.  No provision in the Loan Documents and no
course of dealing  between the parties  shall be deemed to create any  fiduciary
duty owing to Borrower by CoBank.

      9.9  Construction.  CoBank and Borrower  acknowledge that each of them has
had the  benefit of legal  counsel of its own  choice and has been  afforded  an
opportunity  to review the Loan  Documents  with its legal  counsel and that the
Loan  Documents  shall be  constructed  as if  jointly  drafted  by  CoBank  and
Borrower.

      9.10 Confidentiality.  CoBank agrees to hold any confidential  information
that it may receive from  Borrower or any of its  Subsidiaries  pursuant to this
Agreement in confidence,  except for disclosure: (i) on a confidential basis, as
necessary or appropriate,  to directors,  officers,  employees,  agents or legal
counsel,  independent  public  accountants  and other  professional  advisors of
CoBank; (ii) to regulatory  officials having jurisdiction over CoBank;  (iii) as
required by Applicable Law or legal process or (iv) in connection with any legal
proceeding between CoBank and Borrower (provided that, in the event CoBank is so
required to disclose such confidential  information pursuant to clauses (iii) or
(iv) of this Subsection  9.10,  CoBank shall promptly notify  Borrower,  so that
Borrower or any of its  Subsidiaries  may seek, at its sole cost and expense,  a
protective  order or other  appropriate  remedy);  and (v) to another  Person in
connection  with a disposition or proposed  disposition to that Person of all or
part of CoBank's interests hereunder or a participation interest,  provided that
such disclosure is made subject to an appropriate  confidentiality  agreement on
terms  substantially  similar  to this  Subsection  9.10.  For  purposes  of the
foregoing,  "confidential  information"  shall mean all  information  respecting
Borrower or any of its Subsidiaries, other than (A) information previously filed
by Borrower  or any of its  Subsidiaries  with any  Governmental  Authority  and
available  to the public,  (B)  information  previously  published in any public
medium  from a  source  other  than,  directly  or  indirectly,  CoBank  and (C)
information  obtained  by CoBank  from a source  independent  of Borrower or its
Subsidiaries.

      9.11 Consent to Jurisdiction  and Service of Process.  (A) BORROWER HEREBY
IRREVOCABLY  SUBMITS TO THE  NON-EXCLUSIVE  JURISDICTION  OF ANY  UNITED  STATES
FEDERAL COURT OR COLORADO  STATE COURT IN THE STATE OF COLORADO  HAVING  SUBJECT
MATTER  JURISDICTION OVER ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO
ANY LOAN  DOCUMENTS.  BORROWER  HEREBY  IRREVOCABLY  AGREES  THAT ALL  CLAIMS IN
RESPECT OF SUCH ACTION OR  PROCEEDING  MAY BE HEARD AND  DETERMINED  IN ANY SUCH
COURT AND  IRREVOCABLY  WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER  HAVE AS TO
THE VENUE OF ANY SUCH SUIT,  ACTION OR  PROCEEDING  BROUGHT  IN ANY SUCH  COURT,
PERSONAL  JURISDICTION  OF ANY SUCH COURT OR THAT SUCH COURT IS AN  INCONVENIENT
FORUM.  NOTHING  HEREIN  SHALL  LIMIT THE  RIGHT OF COBANK TO BRING  PROCEEDINGS
AGAINST BORROWER IN THE COURTS OF ANY OTHER JURISDICTION.

                                      -40-
<PAGE>

      (B) BORROWER  HEREBY  AGREES THAT SERVICE OF THE SUMMONS AND COMPLAINT AND
ALL OTHER PROCESS WHICH MAY BE SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING MAY
BE EFFECTED BY MAILING BY REGISTERED MAIL, RETURN RECEIPT  REQUESTED,  A COPY OF
SUCH PROCESS TO BORROWER AT THE ADDRESS TO WHICH NOTICES TO BORROWER ARE THEN TO
BE SENT  PURSUANT TO SUBSECTION  9.3 AND THAT PERSONAL  SERVICE OF PROCESS SHALL
NOT BE  REQUIRED.  NOTHING  HEREIN  SHALL BE  CONSTRUED  TO PROHIBIT  SERVICE OF
PROCESS BY ANY OTHER METHOD PERMITTED BY LAW.

      9.12 Waiver of Jury  Trial.  BORROWER  AND COBANK EACH HEREBY  WAIVE THEIR
RESPECTIVE  RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR
ARISING OUT OF THIS AGREEMENT,  ANY OF THE OTHER LOAN DOCUMENTS, OR ANY DEALINGS
BETWEEN THEM  RELATING TO THE SUBJECT  MATTER OF THIS LOAN  TRANSACTION  AND THE
LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED. THE SCOPE OF THIS WAIVER
IS INTENDED TO BE  ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN
ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS  TRANSACTION,  INCLUDING
WITHOUT LIMITATION, CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL
OTHER COMMON LAW AND STATUTORY CLAIMS. BORROWER AND COBANK EACH ACKNOWLEDGE THAT
THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT
EACH HAS ALREADY  RELIED ON THE WAIVER IN ENTERING INTO THIS  AGREEMENT AND THAT
EACH WILL  CONTINUE  TO RELY ON THE  WAIVER IN THEIR  RELATED  FUTURE  DEALINGS.
BORROWER AND COBANK EACH FURTHER  WARRANT AND  REPRESENT  THAT EACH HAS REVIEWED
THIS WAIVER WITH ITS LEGAL  COUNSEL,  AND THAT EACH  KNOWINGLY  AND  VOLUNTARILY
WAIVES ITS JURY TRIAL RIGHTS  FOLLOWING  CONSULTATION  WITH LEGAL COUNSEL.  THIS
WAIVER IS  IRREVOCABLE,  MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN
WRITING,  AND THE WAIVER  SHALL APPLY TO ANY  SUBSEQUENT  AMENDMENTS,  RENEWALS,
SUPPLEMENTS OR MODIFICATIONS TO THE LOAN DOCUMENTS, OR TO ANY OTHER DOCUMENTS OR
AGREEMENTS RELATING TO THE LOANS. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY
BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.  BORROWER AND COBANK ALSO
EACH WAIVE ANY BOND OR SURETY OR SECURITY  UPON SUCH BOND WHICH  MIGHT,  BUT FOR
THIS WAIVER, BE REQUIRED OF COBANK.

                                      -41-
<PAGE>

      9.13  Survival of  Warranties  and  Certain  Agreements.  All  agreements,
representations  and  warranties  made herein shall  survive the  execution  and
delivery of this Agreement, the making of the Loans, the issuances of Letters of
Credit and the execution and delivery of the Notes.  Notwithstanding anything in
this Agreement or implied by law to the contrary, the agreements of Borrower set
forth in Subsections 1.4(D),  1.11, 1.12, 1.13, 9.1, 9.11 and 9.12 shall survive
the payment of the Loans,  the payment of the Letter of Credit  Liabilities  and
the termination of this Agreement.

      9.14  Entire  Agreement.  This  Agreement,  the Notes  and the other  Loan
Documents  referred  to herein  embody the  final,  entire  agreement  among the
parties  hereto  and  supersede  any  and  all  prior  commitments,  agreements,
representations,  understandings,  whether  oral  or  written,  relating  to the
subject  matter  hereof and may not be  contradicted  or varied by  evidence  of
prior,  contemporaneous  or subsequent  oral  agreements or  discussions  of the
parties hereto.

      9.15  Counterparts;  Effectiveness.  This  Agreement  and any  amendments,
waivers,  consents or supplements  may be executed in any number of counterparts
and by different parties hereto in separate counterparts,  each of which when so
executed  and  delivered  shall  be  deemed  an  original,   but  all  of  which
counterparts  together shall  constitute but one and the same  instrument.  This
Agreement shall become  effective upon the execution of a counterpart  hereof by
each of the parties hereto.

      9.16 Patriot Act.  CoBank  notifies  Borrower  and its  Subsidiaries  that
pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56
(signed  into law October  26,  2001)) (the  "Patriot  Act"),  it is required to
obtain,  verify and record  information that identifies each of Borrower and its
Subsidiaries, which information includes the name and address of such entity and
other information that will allow CoBank to identify such in accordance with the
Patriot Act. Each of Borrower and its  Subsidiaries  shall provide to the extent
commercially  reasonable,  such  information  and take such other actions as are
reasonably  requested  by  CoBank  in  order to  assist  CoBank  in  maintaining
compliance with the Patriot Act.

      9.17  Effectiveness  of  Amendment  and  Restatement;   No  Novation.  The
amendment and  restatement  of the Existing  Credit  Agreement  pursuant to this
Agreement  shall be effective as of the  Amendment  Date.  All  obligations  and
rights of Borrower and its Significant Subsidiaries and CoBank arising out of or
relating to the period commencing on the Amendment Date shall be governed by the
terms  and  provisions  of this  Agreement;  the  obligations  of and  rights of
Borrower and its Significant  Subsidiaries and CoBank arising out of or relating
to the period prior to the Amendment  Date shall  continue to be governed by the
Existing   Credit   Agreement   without  giving  effect  to  the  amendment  and
restatements provided for herein. This Agreement shall not constitute a novation
or termination of Borrower's or any of its Significant  Subsidiary's obligations
under the Existing Credit Agreement or any document,  note or agreement executed
or delivered in  connection  therewith,  but shall  constitute  an amendment and
restatement  of the  obligations  and covenants of Borrower and its  Significant
Subsidiaries under the such documents,  notes and agreements,  and each Borrower
and its  Significant  Subsidiaries  hereby  reaffirms all such  obligations  and
covenants, as amended and restated hereby.

                                      -42-
<PAGE>

                                   SECTION 10

                                   DEFINITIONS

      10.1  Certain  Defined  Terms.  The terms  defined  below are used in this
Agreement  as so defined.  Terms  defined in the  preamble  and recitals to this
Agreement are used in this Agreement as so defined.

      "Acquired  Indebtedness" shall mean Indebtedness of a Person or any of its
Subsidiaries  existing at the time such Person  becomes a  Subsidiary  or at the
time it merges or consolidates  with or into Borrower or any of its Subsidiaries
or assumed in connection  with the acquisition of assets from such Person and in
each case not incurred by such Person in connection  with, or in anticipation or
contemplation  of, such Person becoming a party to the Credit  Agreement or such
acquisition,  merger or consolidation and which Indebtedness is without recourse
to Borrower or any Subsidiary or to any of their respective properties or assets
other than the Person or the assets to which such Indebtedness  related prior to
the time such Person became a Subsidiary or the time of such acquisition, merger
or consolidation.  Acquired Indebtedness shall not include any Indebtedness that
refinances or replaces any Acquired Indebtedness.

      "Adjusted  Consolidated Net Worth" means, as of any date of determination,
the  result of (i)  Consolidated  Net  Worth  minus  (ii) the sum of  Restricted
Investments incurred after December 9, 1998 in excess of 10% of Consolidated Net
Worth, all as of the such date of determination.

      "Adjustment  Date" means each date which is the fifth (5th)  Business  Day
after the  receipt by CoBank of (i) each  Compliance  Certificate  delivered  by
Borrower  pursuant  to  Subsection  4.4(C) and (ii) in the case a decrease in an
applicable margin is warranted,  a written notice from Borrower to decrease such
margin.

      "Affiliate"  means any Person:  (i)  directly or  indirectly  controlling,
controlled  by,  or  under  common   control  with,   Borrower  or  any  of  its
Subsidiaries; (ii) directly or indirectly owning or holding five percent (5%) or
more of any equity  interest in Borrower  or any of its  Subsidiaries;  or (iii)
five percent  (5%) or more of whose  voting  stock or other  equity  interest is
directly or indirectly owned or held by Borrower or any of its Subsidiaries. For
purposes of this definition, "control" (including with correlative meanings, the
terms "controlling,"  "controlled by" and "under common control with") means the
possession  directly or indirectly of the power to direct or cause the direction
of the  management  and policies of a Person,  whether  through the ownership of
voting securities or by contract or otherwise.

      "Amendment Date" means the date hereof.

      "Applicable  Law"  means,  in respect of any  Person,  all  provisions  of
constitutions, statutes, rules, regulations and orders of governmental bodies or
regulatory  agencies  applicable to such Person,  including  the  Licenses,  the
Communications  Act and all  Environmental  Laws,  and  all  orders,  decisions,
judgments and decrees of all courts and arbitrators in proceedings or actions to
which the Person in question is a party or by which it is bound.

                                      -43-
<PAGE>

      "Asset  Disposition"  means  the  disposition,  whether  by  sale,  lease,
transfer, loss, damage,  destruction,  condemnation or otherwise, by Borrower or
any of its Subsidiaries,  of any of the following:  (i) any of the capital stock
or the ownership interests of any of its Subsidiaries, or (ii) any or all of its
assets.

      "Banking Day" means a day on which CoBank is open for  business,  dealings
in U.S.  dollar deposits are being carried out in the London  interbank  market,
and banks are open for business in New York City and London, England.

      "Bankruptcy  Code"  means  Title 11 of the  United  States  Code  entitled
"Bankruptcy,"  as  amended  from  time  to time  or any  applicable  bankruptcy,
insolvency or other similar  federal or state law now or hereafter in effect and
all rules and regulations promulgated thereunder.

      "Base Rate" means a variable rate of interest per annum equal, on any day,
to the rate of  interest  established  by CoBank from time to time as its CoBank
Base Rate,  which rate is intended by CoBank to be a reference  rate and not its
lowest rate. The CoBank Base Rate will change on the date  established by CoBank
as the effective date of any change thereof.

      "Base Rate Loan" means,  at any time,  the  aggregate  amount of all Loans
then bearing interest at the rate determined by reference to the Base Rate.

      "Base Rate Margin" means the  applicable  percent per annum  determined in
accordance with Subsection 1.2(B).

      "Budget" means,  for Borrower  prepared on a segment basis, (i) profit and
loss  statements  and (ii) cash flow  statements,  all  prepared on a consistent
basis with Borrower's or such  Subsidiaries'  historical  financial  statements,
together  with  appropriate  supporting  details and a statement  of  underlying
assumptions. The Budget represents and will represent as of the date thereof the
good faith estimate of Borrower and its senior management  concerning the course
of its business.

      "Business  Day" means (i) for all purposes other than as covered by clause
(ii)  below,  any day  excluding  Saturday,  Sunday and any day which is a legal
holiday  under the laws of the State of Colorado,  or is a day on which  banking
institutions located in such state are closed or which the Federal Reserve Banks
are closed, and (ii) with respect to all notices,  determinations,  fundings and
payments  in  connection  with  LIBOR  Loans,  any day  that is a  Business  Day
described  in clause (a) above and that is also a day for trading by and between
banks in U.S. dollar deposits in the applicable interbank LIBOR market.

      "Calculation  Period" means each period commencing on each Adjustment Date
and ending on the day preceding each subsequent Adjustment Date.

      "Capital  Lease"  means any lease of real or  personal  property  which is
required to be capitalized  under GAAP or which is treated as an operating lease
under  regulations  applicable  to  Borrower  and  its  Subsidiaries  but  which
otherwise would be required to be capitalized under GAAP.

                                      -44-
<PAGE>

      "Cash  Equivalents"  means: (i) marketable  direct  obligations  issued or
unconditionally  guarantied  by the United  States  Government  or issued by any
agency thereof and backed by the full faith and credit of the United States,  in
each case  maturing  within one (1) year from the date of  acquisition  thereof;
(ii)  commercial  paper  maturing no more than one (1) year from the date issued
and, at the time of acquisition, having a rating of at least A-1 from Standard &
Poor's  Rating  Service or at least P-1 from Moody's  Investors  Service,  Inc.;
(iii)  certificates of deposit or bankers'  acceptances  maturing within one (1)
year  from  the  date of  issuance  thereof  issued  by,  or  overnight  reverse
repurchase  agreements from, any commercial bank organized under the laws of the
United States of America or any state thereof or the District of Columbia having
combined  capital  and  surplus  of not less  than  $500,000,000;  and (iv) time
deposits  maturing no more than 30 days from the date of creation  thereof  with
commercial banks having membership in the Federal Deposit Insurance  Corporation
in amounts at any one such  institution  not exceeding the lesser of $100,000 or
the maximum amount of insurance applicable to the aggregate amount of Borrower's
deposits at such institution.

      "Closing Date" means May 1, 2006.

      "Communications  Act" means the Communications Act of 1934, as amended and
any similar or successor  federal statute,  and the rules and regulations of the
FCC thereunder, all as the same may be in effect from time to time.

      "Consolidated Net Assets" means, on a consolidated  basis for Borrower and
its Subsidiaries,  total assets minus the sum of (a) Restricted  Investments and
(b) current liabilities.

      "Consolidated  Net Worth" means the consolidated  stockholders'  equity of
Borrower and its Subsidiaries.

      "Default"  means a condition or event that,  after notice or lapse of time
or both,  would  constitute an Event of Default if that  condition or event were
not cured or removed within any applicable grace or cure period.

      "Excluded  Subsidiary"  means  any  Subsidiary  that is not a  Significant
Subsidiary.

      "EBITDA"  means the sum of (a) (i) net income or deficit,  as the case may
be  (excluding  extraordinary  gains,  the  write  up of any  asset  or any gain
realized  upon the sale of an asset and excluding  any  extraordinary,  non-cash
losses,  the write down of any asset and the loss  realized upon the sale of any
asset),  (ii)  total  interest  expense  (including  non-cash  interest),  (iii)
depreciation  and  amortization  expense,  and (iv) income or  franchise  taxes,
federal, state or local. For any period of calculation, EBITDA shall be adjusted
to give effect to any acquisition, sale or other disposition of any operation or
business (or any portion  thereof)  during the period of  calculation as if such
acquisition,  sale or other disposition occurred on the first day of such period
of calculation.

      "Environmental  Laws" means all applicable  federal,  state or local laws,
statutes,   rules,  regulations  or  ordinances,   codes,  common  law,  consent
agreements,  orders,  decrees,  judgments or  injunctions  issued,  promulgated,
approved  or  entered  thereunder  relating  to  public  health,  safety  or the
pollution  or  protection  of  the  environment,  including  those  relating  to
releases,  discharges,  emissions,  spills,  leaching, or disposals of hazardous
substances  (including  petroleum,  crude  oil or  any  fraction  or  derivative
thereof,  or other  hydrocarbons)  to air,  water,  land or ground water, to the
withdrawal  or use of  ground  water,  to  the  use,  handling  or  disposal  of
polychlorinated  biphenyls,  asbestos or urea  formaldehyde,  to the  treatment,
storage,  disposal or management of hazardous substances  (including  petroleum,
crude  oil or any  fraction  or  derivative  thereof,  or  other  hydrocarbons),
pollutants or contaminants, to exposure to toxic, hazardous or other controlled,
prohibited,  or regulated substances,  including,  without limitation,  any such
provisions  under the  Comprehensive  Environmental  Response,  Compensation and
Liability Act of 1980, as amended (42 U.S.C.  ss. 9601 et seq.), or the Resource
Conservation and Recovery Act of 1976, as amended (42 U.S.C. ss. 6901 et seq.).

                                      -45-
<PAGE>

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

      "ERISA   Affiliate"   means  any  trade  or   business   (whether  or  not
incorporated)  which is a member of a controlled  group or under common  control
with  Borrower  within  the  meaning  of  Section  414(b) or (c) of the IRC (and
Sections  414(m)  and (o) of the IRC for  purposes  of  provisions  relating  to
Section 412 of the IRC).

      "ERISA Event" means, with respect to Borrower,  any ERISA Affiliate or any
Pension Plan, the occurrence of any of the  following:  (a) a Reportable  Event;
(b) a withdrawal by a substantial employer (as defined in Section 4001(a)(12) of
ERISA) subject to Section 4063 of ERISA;  (c) a cessation of operations which is
treated  as a  withdrawal  under  Section  4062(e) of ERISA;  (d) a complete  or
partial  withdrawal  under  Section 4203 or 4205 of ERISA from a  Multi-employer
Plan; (e) a notification that a Multi-employer  Plan is in reorganization  under
Section  4242 of ERISA;  (f) the  filing of a notice  of intent to  terminate  a
Pension Plan under 4041 of ERISA; (g) the treatment of an amendment of a Pension
Plan  as  a  termination   under  4041  of  ERISA;  (h)  the  termination  of  a
Multi-employer  Plan  under  Section  4041A of ERISA;  (i) the  commencement  of
proceedings by the PBGC to terminate a Pension Plan under 4042 of ERISA;  (j) an
event or condition  which could  reasonably  be expected to  constitute  grounds
under  Section 4042 of ERISA for the  termination  of, or the  appointment  of a
trustee to  administer,  a Pension Plan; or (k) the  imposition of any liability
under Title IV of ERISA,  other than PBGC premiums due but not delinquent  under
Section 4007 of ERISA.

      "Facility"  and  "Facilities"  mean,  respectively,  each of the Term Loan
Facility,   the  Swingline   Facility  and  the  Revolving  Loan  Facility  and,
collectively,  both of the Term Loan  Facility,  the Swingline  Facility and the
Revolving Loan Facility.

      "FCC" means the Federal Communications Commission, or any other similar or
successor agency of the federal government administering the Communications Act.

      "GAAP" means  generally  accepted  accounting  principles  as set forth in
statements from Auditing Standards No. 69, as amended,  entitled "The Meaning of
`Present Fairly in Conformance with Generally Accepted Accounting  Principles in
the Independent Auditors Reports'" issued by the Auditing Standards Board of the
American   Institute  of  Certified   Public   Accountants  and  statements  and
pronouncements of the Financial  Accounting  Standards Board that are applicable
to the circumstances as of the date of determination.

                                      -46-
<PAGE>

      "Governmental  Approvals" means all authorizations,  consents,  approvals,
licenses and exemptions of,  registrations and filings with, and reports to, all
Governmental Authorities, including all Licenses.

      "Governmental  Authority"  means  any  nation,  province,  or state or any
political subdivision of any of the foregoing,  and any government or any Person
exercising executive, legislative,  regulatory or administrative functions of or
pertaining  to  government,  and  any  corporation  or  other  entity  owned  or
controlled,  through  stock or capital  ownership  or  otherwise,  by any of the
foregoing, including the FCC and any PUC.

      "Guarantee Obligation":  as to any Person (the "guaranteeing person"), any
obligation,  including a reimbursement,  counterindemnity or similar obligation,
of the guaranteeing person that guarantees any Indebtedness,  leases,  dividends
or other obligations (the "primary  obligations") of any other third Person (the
"primary obligor") in any manner, whether directly or indirectly,  including any
obligation  of  the  guaranteeing  person,  whether  or not  contingent,  (i) to
purchase any such primary  obligation  or any  property  constituting  direct or
indirect security therefor, (ii) to advance or supply funds (1) for the purchase
or payment of any such primary  obligation or (2) to maintain working capital or
equity capital of the primary  obligor or otherwise to maintain the net worth or
solvency  of the primary  obligor,  (iii) to purchase  property,  securities  or
services  primarily  for the purpose of assuring  the owner of any such  primary
obligation of the ability of the primary obligor to make payment of such primary
obligation,  (iv)  otherwise  to assure or hold  harmless  the owner of any such
primary  obligation  against  loss in  respect  thereof or (v) to  reimburse  or
indemnify an issuer of a letter of credit,  surety bond or  guarantee  issued by
such issuer in respect of primary  obligations  of a primary  obligor other than
Borrower  or any  Significant  Subsidiary;  provided,  however,  that  the  term
Guarantee  Obligation shall not include  endorsements of instruments for deposit
or  collection in the ordinary  course of business.  The amount of any Guarantee
Obligation of any guaranteeing  person shall be deemed to be the lower of (a) an
amount equal to the stated or determinable  amount of the primary  obligation in
respect of which such  Guarantee  Obligation is made and (b) the maximum  amount
for which such  guaranteeing  person may be liable  pursuant to the terms of the
instrument embodying such Guarantee  Obligation,  unless such primary obligation
and the maximum amount for which such guaranteeing  person may be liable are not
stated or  determinable,  in which case the amount of such Guarantee  Obligation
shall be such guaranteeing person's reasonably  anticipated liability in respect
thereof as determined by Borrower in good faith.

      "Indebtedness" as applied to any Person,  means, without duplication:  (i)
all  indebtedness  for borrowed  money;  (ii) that portion of  obligations  with
respect to  Capital  Leases or other  capitalized  agreements  that is  properly
classified  as a liability on a balance  sheet in  conformity  with GAAP;  (iii)
notes payable and drafts accepted  representing  extensions of credit whether or
not  representing  obligations for borrowed money;  (iv) any obligation owed for
all or any part of the deferred  purchase price of property or services,  except
trade payables  arising in the ordinary course of business not more than 90 days
past due;  (v) all  indebtedness  secured by any Lien on any  property  or asset
owned or held by that  Person  regardless  of whether the  indebtedness  secured
thereby shall have been assumed by that Person or is  nonrecourse  to the credit
of that  Person,  but only to the extent of the fair value of such  property  or
asset; (vi) fixed rate hedging  obligations that are due (after giving effect to
any period of grace or notice requirement applicable thereto) and remain unpaid;
(viii) all  obligations of such Person,  contingent or otherwise,  as an account
party or applicant under or in respect of acceptances, letters of credit, surety
bonds or similar arrangements (other than reimbursement  obligations,  which are
not due and payable on such date,  in respect of  documentary  letters of credit
issued to provide for the payment of goods and services in the  ordinary  course
of  business);  (ix)  obligations  under  partnership,  organizational  or other
agreements to fund capital  contributions  or other equity calls with respect to
any Person or investment, or to redeem, repurchase or otherwise make payments in
respect  to  capital  stock  or  other  securities  of such  Person  and (x) all
Guarantee  Obligations  of such  Person in  respect of  obligations  of the kind
referred to in clauses (i) through (ix) above.

                                      -47-
<PAGE>

      "Interest  Coverage  Ratio" means the ratio derived by dividing (i) EBITDA
by (ii)  total  interest  expense,  in each  case  for the  then  most  recently
completed four fiscal quarters.

      "Interest Rate Agreement" means any interest rate swap, hedge, cap, collar
or  similar  agreement  or  arrangement  designed  to protect  Borrower  against
fluctuations in interest rates.

      "Investment"   means  (i)  any  direct  or  indirect   purchase  or  other
acquisition by Borrower or any of its Significant Subsidiaries of any beneficial
interest in, including stock,  partnership  interest or other equity  securities
of, any other Person,  other than trade  associations and similar  organizations
purchased or acquired in the ordinary course of business; and (ii) any direct or
indirect loan, advance,  guarantee,  assumption of liability or other obligation
of  liability,  or capital  contribution  by Borrower or any of its  Significant
Subsidiaries  to any other  Person,  including  all  indebtedness  and  accounts
receivable  from that other Person that are not current  assets or did not arise
from sales to that other Person in the ordinary  course of business.  The amount
of any Investment shall be the original cost of such Investment plus the cost of
all additions  thereto,  without any  adjustments  for increases or decreases in
value, or write-ups, write-downs or write-offs with respect to such Investment.

      "IRC" means the  Internal  Revenue  Code of 1986,  as amended from time to
time, and all rules and regulations promulgated thereunder.

      "Letter of Credit  Liability"  means,  as to each  Letter of  Credit,  all
reimbursement  obligations  of Borrower to CoBank  consisting  of (a) the amount
available to be drawn or which may become available to be drawn; (b) all amounts
which have been paid and made  available by CoBank to the extent not  reimbursed
by Borrower, whether by the making of a Revolving Loan or otherwise; and (c) all
accrued and unpaid interest, fees and expenses with respect thereto. In the case
of any Letter of Credit that is issued in a currency  other than  United  Stated
Dollars,  the  corresponding  Letter of Credit  Liability shall be determined in
United  States  Dollars  based on the currency  exchange  rate from time to time
applicable to the issuer of such Letter of Credit.

      "Leverage Ratio" means, for any period,  the ratio derived by dividing all
Indebtedness as of the last day of the applicable period by EBITDA, in each case
as determined for the immediately preceding four fiscal quarters.

      "LIBOR"  means the rate  (rounded  upward  to the  nearest  sixteenth  and
adjusted  for  reserves  required  on  Eurocurrency  Liabilities  (as defined in
Regulation D as  promulgated  by the Board of  Governors of the Federal  Reserve
System,  12 CFR Part 204, as amended) for banks subject to such  Regulation D or
required by any other federal law or regulation)  quoted by the British  Bankers
Association  at  11:00  a.m.  London  time  two  (2)  Banking  Days  before  the
commencement  of the Interest Period for the offering of U.S. dollar deposits in
the London interbank market for the Interest Period  designated by Borrower,  as
published by Bloomberg or another  major  information  vendor  listed on British
Bankers Association's official website.

                                      -48-
<PAGE>

      "LIBOR Loans" means Loans (excluding Swingline Loans) accruing interest at
rates determined by reference to the LIBOR.

      "LIBOR  Margin"  means the  applicable  percent  per annum  determined  in
accordance with Subsection 1.2(B).

      "Licenses"  means  any  material   telephone,   long  distance,   cellular
telephone,  microwave,  personal  communications or other  telecommunications or
similar license,  authorization,  waiver, certificate of compliance,  franchise,
approval or permit,  whether for the  acquisition,  construction or operation of
any  Telecommunications  System,  granted or issued by the FCC or any applicable
PUC and held by Borrower or any of its  Significant  Subsidiaries,  all of which
are listed as of the Closing Date on Schedule 5.13(A).

      "Lien" means any lien,  mortgage,  pledge,  security  interest,  charge or
encumbrance  of any  kind,  whether  voluntary  or  involuntary  (including  any
conditional sale or other title retention  agreement and any lease in the nature
thereof),  and any  agreement  to give  any  lien,  mortgage,  pledge,  security
interest, charge or encumbrance.

      "Loan"  or  "Loans"  means an  advance  or  advances  under  the Term Loan
Commitment, the Revolving Loan Commitment and the Swingline Commitment.

      "Loan Commitment" or "Loan  Commitments" mean,  respectively,  each of the
Term Loan Commitment, the Revolving Loan Commitment and the Swingline Commitment
and  collectively,  the Term Loan Commitment,  the Revolving Loan Commitment and
the Swingline Commitment.

      "Loan Documents"  means this Agreement,  the Notes, the Letters of Credit,
any Related  Interest Rate  Agreement and all other  instruments,  documents and
agreements executed and delivered concurrently herewith or at any time hereafter
to or for the  benefit  of  CoBank  in  connection  with  the  Loans  and  other
transactions  contemplated  by this Agreement,  all as amended,  supplemented or
modified from time to time.

      "Material  Adverse  Effect" means (i) a material  adverse  effect upon the
business,  operations,  properties, assets or condition (financial or otherwise)
of  Borrower  and its  Subsidiaries,  taken  as a whole,  or (ii)  the  material
impairment of the ability of Borrower or any of its  Subsidiaries to perform its
obligations  under  any Loan  Document  to which it is a party or of  CoBank  to
enforce  any Loan  Document or collect any of the  Obligations.  In  determining
whether any  individual  event could  reasonably  be expected to have a Material
Adverse  Effect,  notwithstanding  that such event does not of itself  have such
effect,  a  Material  Adverse  Effect  shall be deemed to have  occurred  if the
cumulative  effect of such  event  and all  other  then  existing  events  could
reasonably be expected to have a Material Adverse Effect.

                                      -49-
<PAGE>

      "Material  Contracts"  means  (a) any  contract  or any  other  agreement,
written or oral,  of  Borrower  or any of its  Subsidiaries  involving  monetary
liability  of or to any such  Person in an amount  in excess of  $1,000,000  per
annum, and (b) any other contract or agreement,  written or oral, of Borrower or
any of its  Subsidiaries  the failure to comply with which could  reasonably  be
expected to have a Material  Adverse  Effect;  provided,  however,  that any (i)
vendor  contract or (ii)  contract or agreement  which is  terminable by a party
other than Borrower or any of its  Subsidiaries  without cause upon notice of 95
days or less shall not be considered a Material Contract.

      "Multi-employer  Plan" means a  Multi-employer  plan as defined in Section
4001(a)(3) of ERISA to which Borrower or any ERISA  Affiliate  makes, is making,
made, or was at any time during the current year or the immediately  preceding 6
years obligated to make contributions.

      "Net  Proceeds"  means cash  proceeds  received  by Borrower or any of its
Subsidiaries from any Asset Disposition (including insurance proceeds, awards of
condemnation,  and  payments  under notes or other debt  securities  received in
connection  with any  Asset  Disposition),  net of (i) the  costs of such  sale,
lease, transfer or other disposition (including taxes attributable to such sale,
lease or transfer) and (ii) amounts applied to repayment of Indebtedness  (other
than the Obligations) secured by a Lien on the asset or property disposed.

      "Note" or "Notes" means one or more of the Term Loan Notes,  the Revolving
Notes and the Swingline Notes.

      "Note  Purchase  Agreement"  means that certain Note  Purchase  Agreement,
dated as of December 9, 1998,  between  Borrower  and the  purchasers  listed on
Schedule A thereto,  as supplemented by that certain Supplement to Note Purchase
Agreement,  dated as of March 13,  2003,  between  Borrower  and the  purchasers
listed on Schedule A thereto,  and as further amended,  supplemented,  modified,
extended or restated from time to time.

      "Obligations" means all obligations, liabilities and indebtedness of every
nature of  Borrower  from time to time owed to CoBank  under the Loan  Documents
including the principal amount of all debts,  claims and  indebtedness,  accrued
and unpaid interest, all reimbursement  obligations in respect of any Letters of
Credit and all fees, costs and expenses thereunder,  whether primary, secondary,
direct, contingent, fixed or otherwise, heretofore, now and/or from time to time
hereafter  owing,  due or  payable  whether  before  or after  the  filing  of a
proceeding  under  the  Bankruptcy  Code by or  against  Borrower  or any of its
Subsidiaries.

      "Overnight  LIBOR" with respect to any Swingline Loans, the per annum rate
of interest most  recently  announced  within CoBank at its principal  office in
Denver,  Colorado as its  Overnight  LIBOR  Rate,  with the  understanding  that
CoBank's  Overnight  LIBOR is one of its base rates and serves as the basis upon
which  effective  rates of  interest  are  calculated  for  those  loans  making
reference  thereto,  and  is  evidenced  by  the  recording  thereof  after  its
announcement  in  such  internal  publication  or  publications  as  CoBank  may
designate.  CoBank shall base its determination of the Overnight LIBOR upon such
offers for deposits on or other market  indicators  of the  interbank  market as
CoBank in its discretion deems appropriate, and the Overnight LIBOR available to
Borrower  hereunder  shall be  adjusted  by  CoBank  for  reserves  required  on
Eurocurrency Liabilities (as defined in Regulation D as promulgated by the Board
of Governors of the Federal  Reserve System,  12 CFR Part 204, as amended).  Any
change in the Overnight  LIBOR shall become  effective on the date on which each
such change in the Overnight LIBOR is announced within CoBank.

                                      -50-
<PAGE>

      "PBGC"  means the  Pension  Benefit  Guaranty  Corporation  or any  Person
succeeding to the functions thereof.

      "Pension  Plan" means a pension plan (as defined in Section 3(2) of ERISA)
subject to Title IV of ERISA which any Borrower or an ERISA Affiliate  sponsors,
maintains,   or  to  which  it  makes,  is  making,  or  is  obligated  to  make
contributions or, in the case of a Multi-employer  Plan, has made  contributions
at any time during the current year or the immediately preceding six plan years.

      "Permitted Encumbrances" means the following:

         (1) Liens for taxes,  assessments or other governmental charges not yet
due and payable unless the same are being diligently contested in good faith and
by  appropriate  proceedings  and then only if and to the extent  that  adequate
reserves therefor are maintained in accordance with GAAP;

         (2) statutory Liens of landlords,  carriers,  warehousemen,  mechanics,
materialmen  and other similar  liens imposed by law,  which are incurred in the
ordinary  course of business for sums not more than 90 days  delinquent or which
are being contested in good faith;  provided that a reserve or other appropriate
provision shall have been made therefor;

         (3) Liens incurred or deposits made in the ordinary  course of business
in connection with workers' compensation, unemployment insurance and other types
of social  security  (other  than any Lien  imposed by the  Employee  Retirement
Income Security Act of 1974 or any rule or regulation  promulgated  thereunder),
or to secure the performance of tenders,  statutory  obligations,  surety, stay,
customs and appeal bonds, bids, leases,  government contracts,  trade contracts,
performance and return of money bonds and other similar  obligations  (exclusive
of obligations for the payment of borrowed money);

         (4) deposits, in an aggregate amount not to exceed $1,000,000,  made in
the ordinary  course of business to secure  liability  to insurance  carriers or
others;

         (5) any  attachment  or  judgment  Lien  not  constituting  an Event of
Default under Subsection 6.1(H);

         (6) easements, rights of way, restrictions and other similar charges or
encumbrances  not interfering in any material  respect with the ordinary conduct
of the business of Borrower or any of its Subsidiaries;

         (7) Liens in favor of CoBank as set forth in Subsection 2.7;

         (8) Liens  securing  purchase  money  security  agreements  and capital
leases permitted under Section 3.1(G),  provided that such Liens do not encumber
any  property  other  than  the  items  purchased  with  the  proceeds  of  such
Indebtedness  or leased  pursuant  to such  Indebtedness  and such  liens do not
secure any amounts other than amounts necessary to purchase or lease such items;
and

                                      -51-
<PAGE>

         (9) other Liens securing  Priority Debt of Borrower or any  Significant
Subsidiary not otherwise permitted by this definition of Permitted Encumbrances,
provided that Priority Debt incurred  after December 8, 1998 does not exceed 15%
of Consolidated  Net Worth as of the most recently  completed  fiscal quarter of
Borrower.

      "Person"  means  and  includes  natural  persons,  corporations,   limited
liability  companies,  limited  partnerships,  limited  liability  partnerships,
general  partnerships,  joint stock  companies,  joint  ventures,  associations,
companies, trusts, banks, trust companies, land trusts, business trusts or other
organizations,  whether or not legal entities,  and governments and agencies and
political  subdivisions  thereof and their respective  permitted  successors and
assigns  (or in the case of a  governmental  person,  the  successor  functional
equivalent of such Person).

      "Plan"  means an  employee  benefit  plan (as  defined in Section  3(3) of
ERISA)  which any  Borrower or an ERISA  Affiliate  sponsors or  maintains or to
which any Borrower or an ERISA Affiliate  makes,  is making,  or is obligated to
make contributions and includes any Pension Plan.

      "Priority  Debt"  means  (without  duplication)  the sum of (a)  unsecured
Indebtedness of the Subsidiaries  other than  Indebtedness  owing to Borrower or
any other  Subsidiary  and (b)  Indebtedness  of Borrower  and its  Subsidiaries
secured  by a Lien  described  in  clause  (9) of the  definition  of  Permitted
Encumbrances.

      "PUC" means any state, provincial or other local regulatory agency or body
that  exercises  jurisdiction  over the  rates  or  services  or the  ownership,
construction or operation of any  Telecommunications  System or over Persons who
own, construct or operate a Telecommunications System, in each case by reason of
the nature or type of the  business  subject to  regulation  and not pursuant to
laws and regulations of general  applicability to Persons conducting business in
any such jurisdiction.

      "Quoted  Rate" means a fixed annual  interest  rate for a selected  Quoted
Rate Period to be quoted by CoBank in its sole and absolute discretion.

      "Quote Rate Loans" means Loans accruing interest at Quoted Rates.

      "Related  Interest  Rate  Agreement"  means any  Interest  Rate  Agreement
entered into between  CoBank and  Borrower to hedge the interest  rate  exposure
applicable to any portions of the Loans.

      "Reportable Event" means any of the events set forth in Section 4043(c) of
ERISA or the regulations thereunder,  other than any such event for which the 30
day notice  requirement under ERISA has been waived in regulations issued by the
PBGC.

      "Restricted  Investment"  means all Investments  except (i) property to be
used in the ordinary  course of business;  (ii) current  assets arising from the
sale of goods and services in the ordinary course of business; (iii) Investments
in  one  or  more  Subsidiaries  or  any  Person  that  concurrently  becomes  a
Subsidiary;  (iv)  Investments  existing on December 9, 1998; (v) Investments in
obligations,  maturing  within one year,  issued by or  guaranteed by the United
States  of  America  or  an  agency  thereof;   (vi)  Investments  in  municipal
securities,  maturing  within  one  year,  which are rated in one of the top two
ratings   classifications  by  at  least  one  national  rating  agency;   (vii)
Investments in certificates of deposit or banker's acceptances issued by Bank of
America or other  commercial  banks which are rated in one of the top two rating
classifications  by at least one national rating agency;  (viii)  Investments in
commercial paper,  maturing within 270 days, rating in one of the top two rating
classifications  by at least one national rating agency; and (ix) Investments in
money market  instrument  programs  which are  classified  as current  assets in
accordance with GAAP.

                                      -52-
<PAGE>

      "Restricted Junior Payment" means: (i) any dividend or other distribution,
direct or indirect, on account of any equity interest in Borrower, including any
shares of any class of stock of Borrower now or hereafter outstanding,  except a
dividend  payable  solely in shares of a class of stock to the  holders  of that
class; (ii) any redemption,  conversion,  exchange,  retirement, sinking fund or
similar payment, purchase or other acquisition for value, direct or indirect, of
any equity  interest in Borrower,  including any shares of any class of stock of
Borrower  now or  hereafter  outstanding;  (iii) any  payment or  prepayment  of
interest on, principal of, premium, if any,  redemption,  conversion,  exchange,
purchase,  retirement,  defeasance, sinking fund or similar payment with respect
to, any  Indebtedness  subject to  subordination  provisions  for the benefit of
CoBank;  and (iv) any payment made to retire, or to obtain the surrender of, any
outstanding warrants,  options or other rights to acquire any equity interest in
Borrower,  including  any  shares  of any  class  of stock  of  Borrower  now or
hereafter outstanding.

      "Revolving  Loan" or "Revolving  Loans" means an advance or advances under
the Revolving Loan Commitment.

      "Revolving Loan Commitment" means, initially,  $60,000,000, as such amount
is reduced from time to time as provided in this Agreement.

      "Revolving Loan  Expiration  Date" means the earlier of (i) the suspension
(subject to  reinstatement)  of CoBank's  obligations  to make Loans pursuant to
Subsection 6.2, (ii) the acceleration of the Obligations  pursuant to Subsection
6.3 or (iii) May 1, 2012.

      "Revolving  Loan  Facility"  means,  the  revolving  loan credit  facility
extended to Borrower pursuant to Section 1.1(B).

      "Revolving  Note" or  "Revolving  Notes" means one or more of the notes of
Borrower  substantially  in the  form of  Exhibit  10.1(A),  or any  combination
thereof, and any replacements,  restatements, renewals or extensions of any such
notes, in whole or in part.

      "Significant  Subsidiary":  as  defined  in  Article  1, Rule  1-02(w)  of
Regulation  S-X of the  Exchange  Act of 1934  as of the  Closing  Date.  Unless
otherwise  qualified,  all  references  to  a  "Significant  Subsidiary"  or  to
"Significant  Subsidiaries"  in this  Agreement  shall  refer  to a  Significant
Subsidiary or Significant Subsidiaries of Borrower;  provided,  however, that if
the 10%  requirement of Regulation S-X is replaced with 25% and in the aggregate
the Excluded Subsidiaries satisfy the 25% threshold, then all references in this
Agreement to a "Significant  Subsidiary" or to "Significant  Subsidiaries" shall
also apply to the Excluded Subsidiaries.

                                      -53-
<PAGE>

      "Subsidiary"   means,  with  respect  to  any  Person,   any  corporation,
partnership,  association  or other  business  entity of which  more than  fifty
percent  (50%) of the total  voting  power of  shares  of stock  (or  equivalent
ownership or controlling interest) entitled (without regard to the occurrence of
any  contingency)  to vote in the  election of  directors,  managers or trustees
thereof is at the time owned or  controlled,  directly  or  indirectly,  by that
Person or one or more of the other  Subsidiaries of that Person or a combination
thereof.

      "Swingline  Facility" means the working capital loan facility  extended to
Borrower pursuant to Subsection 1.1(C).

      "Swingline Loan Commitment" means, initially  $20,000,000,  as such amount
is reduced from time to time as provided in this Agreement.

      "Swingline  Loans" means an advance or advances  under the Swingline  Loan
Commitment.

      "Swingline  Note" or  "Swingline  Notes" means one or more of the Notes of
Borrower  substantially  in the  form of  Exhibit  10.1(C),  or any  combination
thereof, and any replacements, reinstatements, renewals or extension of any such
notes, in whole or in part.

      "Telecommunications  System" means a telephone,  long distance,  internet,
data  services,  video  and  satellite  services,  wireless  telecommunications,
telephone directories,  fiber and cable leasing,  telecommunications  equipment,
including  hand sets,  rental,  leasing,  installation,  selling or  maintenance
system or  business  and shall  include a  microwave  system or a paging  system
operated in connection with (and in the same general service area as) any of the
foregoing systems, and businesses related thereto.

      "Term Loan" means the Loan under the Term Loan Commitment.

      "Term Loan Commitment" means  $40,000,000,  as such amount is reduced from
time to time as provided in this Agreement.

      "Term Loan  Facility"  means the term loan  credit  facility  extended  to
Borrower pursuant to Subsection 1.1(A).

      "Term Loan Maturity Date" means the earlier of (i) the acceleration of the
Obligations pursuant to Subsection 6.3 or (ii) May 1, 2012.

      "Term Loan Note" or "Term  Loan  Notes"  means one or more of the notes of
Borrower  substantially  in the  form of  Exhibit  10.1(B),  or any  combination
thereof, and any replacements,  restatements, renewals or extensions of any such
notes, in whole or in part.

                                      -54-
<PAGE>

      10.2   Other   Definitional   Provisions.    References   to   "Sections,"
"Subsections,"  "Exhibits" and  "Schedules"  shall be to Sections,  Subsections,
Exhibits  and  Schedules,  respectively,  of  this  Agreement  unless  otherwise
specifically  provided.  Any of the terms defined in Subsection 10.1 may, unless
the context otherwise requires,  be used in the singular or the plural depending
on the reference.  In this Agreement,  "hereof," "herein," "hereto," "hereunder"
and the like mean and refer to this  Agreement  as a whole and not merely to the
specific  section,  paragraph or clause in which the  respective  word  appears;
words  importing any gender  include the other  gender;  references to "writing"
include printing,  typing, lithography and other means of reproducing words in a
tangible visible form; the words "including,"  "includes" and "include" shall be
deemed  to  be  followed  by  the  words  "without  limitation";  references  to
agreements  and  other  contractual  instruments  shall  be  deemed  to  include
subsequent amendments, assignments, and other modifications thereto, but only to
the  extent  such  amendments,  assignments  and  other  modifications  are  not
prohibited by the terms of this Agreement or any other Loan Document; references
to Persons include their respective  permitted successors and assigns or, in the
case of governmental  Persons,  Persons  succeeding to the relevant functions of
such  Persons;  and all  references  to statutes and related  regulations  shall
include any amendments of same and any successor statutes and regulations.

                                      -55-
<PAGE>

      Witness  the  due  execution  hereof  by the  respective  duly  authorized
officers of the undersigned as of the date first written above.

                                 SUREWEST COMMUNICATIONS

                                     By: /s/ Steven C. Oldham
                                        ----------------------------------------
                                           Steven C. Oldham
                                           President and Chief Executive Officer

                    [Signatures Continued on Following Page]
<PAGE>

                    [Signatures Continued from Previous Page]

                                                COBANK, ACB

                                                By: /s/ Ted Koerner
                                                    ----------------------------
                                                      Ted Koerner
                                                      Vice President

<PAGE>

                                  SCHEDULE 3.8
                          TRANSACTIONS WITH AFFILIATES

None

<PAGE>

                                 SCHEDULE 5.3(A)
                          JURISDICTION OF ORGANIZATION

SureWest Communications                     California

SureWest Broadband                          California

SureWest Custom Data Services               California

SureWest Internet_                          California

SureWest Long Distance Company              California

SureWest Telephone                          California

SureWest TeleVideo                          California

SureWest TeleVideo of Roseville             California

SureWest Wireless_                          California

West Coast PCS LLC                          California

<PAGE>

                                 SCHEDULE 5.3(C)
                       QUALIFICATION TO TRANSACT BUSINESS

California

<PAGE>

                                  SCHEDULE 5.4
                             GOVERNMENTAL APPROVALS

None

<PAGE>

                                  SCHEDULE 5.6
                            TAX RETURNS AND PAYMENTS

None

<PAGE>

                                  SCHEDULE 5.10
                                LITIGATION, ETC.

      Borrower  reported  certain  regulatory  matters  in Item 3 of its  Annual
Report on Form 10-K for the year ended December 31, 2006, which are incorporated
in this Schedule 5.10.

<PAGE>

                                  SCHEDULE 5.11

                             EMPLOYEE LABOR MATTERS

None

<PAGE>

                                   EXHIBIT 1.3

                             SureWest Communications

                                     FORM OF
                   NOTICE OF BORROWING/CONVERSION/CONTINUATION

CoBank, ACB
5500 S. Quebec Street
Greenwood Village, Colorado 80111
Attention:
            -----------------------

Ladies and Gentlemen:

      Pursuant to the Amended and Restated Credit Agreement, dated as of May 14,
2007 (as such loan agreement may hereafter be amended, modified or supplemented,
the "Credit Agreement") between SureWest Communications ("Borrower") and CoBank,
ACB ("CoBank"),  Borrower hereby requests that CoBank take the actions indicated
below.  Capitalized terms used but not defined herein have the meanings given to
them in the Credit Agreement.

      Note: The following requirements apply to all requests:

      -     Requests  must be made no later than 11:00  a.m.  (Denver,  Colorado
            time) on a Business  Day  (however,  if  requesting a borrowing of a
            Swingline Loan, not later than 2:00 p.m. (Denver,  Colorado time) on
            the date the proposed borrowing is to be effective).

      -     In the case of a borrowing of or  conversion to or  continuation  of
            the Base Rate Loan or a Quoted Rate Loan,  requests  must be made at
            least  one  Business  Day  in  advance  of the  proposed  borrowing,
            conversion or continuation date.

      -     In the case of a borrowing of or conversion to or  continuation of a
            LIBOR Loan,  requests  must be made at least three  Banking  Days in
            advance of the proposed borrowing, conversion or continuation date.

      -     Borrowings  under the Base Rate Loan must be in a minimum  amount of
            $100,000 and whole multiples of $5,000 in excess of $100,000.

      -     LIBOR  Loans  must be in a minimum  amount of  $1,000,000  and whole
            multiples of $250,000 in excess of $1,000,000.
<PAGE>

      -     Borrowings under the Swingline  Facility must be in a minimum amount
            of $50,000 and whole multiples of $5,000 in excess of $50,000.

      -     Quoted Rate Loans must be in a minimum  account of  $10,000,000  and
            whole multiples of $1,000,000 in excess of $10,000,000.

      -     No more than a combined  total of five LIBOR  Loans and Quoted  Rate
            Loans under the Facilities may be outstanding at any one time.

__    REQUEST FOR BORROWING:

      Borrower   hereby   requests  an  advance   under  the   _________   [Term
      Loan/Revolving  Loan/Swingline]  Facility. In connection with such request
      under  the  Revolving  Loan  or  Swingline  Facilities,   Borrower  hereby
      certifies as follows ((a)-(d) in the case of a Revolving Loan; (a) -(g) in
      the case of Swingline Loan):

            (a)   The _________ Revolving Loan Commitment as reduced pursuant to
                  the Credit Agreement is $__________________; and

            (b)   The  aggregate  principal  balance of _________  Revolving and
                  Swingline   Loans   _________    [advanced/outstanding]   (not
                  including this requested Loan) is $_____________; and

            (c)   The  aggregate  amount  of all  outstanding  Letter  of Credit
                  Liability is $_____________; and

            (d)   Therefore,  the available  _________ Revolving Loan Commitment
                  is $_______________. [(a) minus (b) and also minus (c))][; and

            (e)   The _________ Swingline Loan Commitment as reduced pursuant to
                  the Credit Agreement is $__________________; and

            (f)   The aggregate  principal balance of _________  Swingline Loans
                  _________ [advanced/outstanding] (not including this requested
                  Loan) is $_____________; and

            (g)   Therefore,  the available  _________ Swingline Loan Commitment
                  is $_______________. [(a) minus (b))]].

      Borrower  hereby   requests  under  the  _________  [Term   Loan/Revolving
      Loan/Swingline] Facility an advance of $_____________________,  to be made
      on  ____________  and to  bear  interest  pursuant  to the  interest  rate
      option(s) checked below [check all applicable]:

      ___   A  portion  of the  Base  Rate  Loan  in  the  principal  amount  of
            $____________

      ___   A LIBOR  Loan  in the  principal  amount  of  $____________,  for an
            Interest Period of [check one]:

<PAGE>

            __1 month __2 months __3 months __6 months __9 months __12 months

      ___   If a Swingline Loan, at the Overnight LIBOR

      ___   A Quoted  Rate  Loan in the  principal  amount of  $_________,  of a
            Quoted Rate Period of __________, commencing __________

___   REQUEST FOR CONVERSION:

      Borrower  hereby  requests that the following  Loan(s) be converted to new
      interest rate option(s) as indicated:

      Description of Loan(s) to be Converted [check one]:

      ___   On _________,  convert $________________ of the Base Rate Loan under
            the _________ [Term/Revolving] Loan Facility

      ___   On   __________,   convert  the  LIBOR  Loan  under  the   _________
            [Term/Revolving]   Loan   Facility  in  the   principal   amount  of
            $_______________,   the  Interest   Period  for  which  expires  on:
            _____________

      ___   On  __________,  convert  the Quoted  Rate Loan under the  _________
            [Term/Revolving]   Loan   Facility  in  the   principal   amount  of
            $_______________,  the  Quoted  Rate  Period for which  expires  on:
            _____________

      Description of New Loan(s) [check all applicable]:

      ___   to the Base Rate Loan in the principal amount of $_________________

      ___   to a Quoted Rate Loan in the principal amount of $_________________,
            for  a  Quoted   Rate   Period  of   _________________,   commencing
            _________________

      ___   to a LIBOR Loan in the principal amount of $___________________, for
            an Interest Period of [check one]:

            __1   month __2 months __3 months __6 months __9 months __12 months

___   REQUEST FOR CONTINUATION:

      Borrower  hereby  requests that the interest rate option(s)  applicable to
      the following loan(s) be continued as indicated:

      Upon expiration of its current  Interest  Period,  continue the LIBOR Loan
      under the _________ [Term/Revolving] Loan Facility in the principal amount
      of $____________, the current Interest Period for which expires on _______
      for a new Interest Period of:

      __1 month __2 months __3 months __6 months __9 months __12 months
<PAGE>

      Upon  expiration  of its current  Quoted Rate Period,  continue the Quoted
      Rate  Loan  and  the  _________  [Term/Revolving]  Loan  Facility  in  the
      principal  amount of  $____________,  the  current  Quoted Rate Period for
      which expires on _______ for a new Quoted Rate Period of _______

<PAGE>

      The undersigned  hereby certifies that both before and after giving effect
to the  borrowing,  conversion or  continuation  request  above,  (i) all of the
representations  and warranties  contained in the Credit Agreement and the other
Loan Documents,  are true,  correct and complete in all material  respects as of
the date hereof as and to the extent  provided  in Section  7.2(B) of the Credit
Agreement, (ii) no Default or Event of Default has occurred and is continuing or
would result on the date hereof,  (iii) since  December 31, 2006,  there has not
occurred any event or condition that has had or could  reasonably be expected to
have a Material  Adverse  Effect,  (iv) the undersigned is authorized to execute
and deliver this Notice on behalf of Borrower, and (v) the Loan Documents remain
in full force and effect as to Borrower.

                                              SUREWEST COMMUNICATIONS

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

                                              Date:
                                                   -----------------------------
<PAGE>

                                 EXHIBIT 4.4(C)

                                     FORM OF
                             COMPLIANCE CERTIFICATE

      THIS   COMPLIANCE   CERTIFICATE   is  given  by   __________________   and
__________________,  the [chief  financial  officer] of SUREWEST  COMMUNICATIONS
("Borrower")  pursuant to Subsection 4.4(C) of that certain Amended and Restated
Credit  Agreement,  dated as of May 14, 2007 (as such agreement may hereafter be
amended, modified or supplemented,  the "Credit Agreement"),  among Borrower and
CoBank,  ACB.  Capitalized  terms used herein and not otherwise  defined  herein
shall have the meanings ascribed to them in the Credit Agreement.

      I hereby certify as follows:

      1. I am the [chief financial officer] of Borrower, and as such possess the
knowledge and  authority to certify to the matters set forth in this  Compliance
Certificate,  and hereby  certify  that the matters set forth below are true and
accurate to the best of my present  knowledge,  information and belief after due
inquiry;

      2.   Attached   hereto   as   Annex   A   are   the    [audited/unaudited]
[annual/quarterly]   financial   statements   of   Borrower,   for  the   fiscal
[year/quarter] ended ______________,  as required by Subsection  4.4[(A)/(B)] of
the Credit Agreement. Such financial statements were prepared in accordance with
GAAP  consistently   applied  (except  as  expressly   provided  in  the  Credit
Agreement),  fairly present the condition of Borrower during the periods covered
thereby and as of the dates thereof,  and are in a format that  demonstrates any
accounting or formatting  changes that may be required by various  jurisdictions
in which the business of Borrower is conducted  (to the extent not  inconsistent
with GAAP);

      3. As of the date of such financial statements,  Borrower is in compliance
with the  covenants  set forth in  Section 4 of the Credit  Agreement.  Attached
hereto as Annex B are calculations  which demonstrate the compliance by Borrower
with such covenants; and

      4.  I have  reviewed  the  activities  of  Borrower,  and  consulted  with
appropriate  representatives of Borrower during the fiscal  [year/quarter] ended
______________,  and reviewed the Credit Agreement and the other Loan Documents.
As of the date of this Compliance Certificate,  there is no condition,  event or
act  which  constitutes  a  Default  or an Event of  Default  under  the  Credit
Agreement, except as disclosed on Annex C hereto.

<PAGE>

      IN WITNESS  WHEREOF,  I have executed this  Compliance  Certificate  as of
_____________, _____.

                                                     ---------------------------
                                                     [chief financial officer]
                                                      SureWest Communications

<PAGE>

                                     ANNEX A

                    Annual (audited) or Quarterly (unaudited)
                              Financial Statements

<PAGE>

                                     ANNEX B

                     Financial Covenant Compliance Worksheet

<PAGE>

                                  COVENANT 4.1

                                 Leverage Ratio

      As of the fiscal year/quarter ended ______________, __________.

(A)   Indebtedness                                            $

(B)   EBITDA (the sum of 1 through 4, without  duplication;  (calculated for the
      then most recently completed four fiscal quarters))

      1.    Net income or deficit (excluding  extraordinary
            gains, the write up of any  asset  or gain and
            excluding  any  extraordinary,  non-cash losses,
            the write down of any asset and loss  realized
            upon sale of any asset), plus                     $
                                                               -----------------

      2.    Total interest expense (including non-cash
            interest), plus                                   $
                                                               -----------------

      3.    Depreciation and amortization expense,  plus      $
                                                               -----------------

      4.    Income and franchise taxes, federal, state
            or local                                          $
                                                               -----------------

      Sum of 1 through 4                                      $
                                                               -----------------

Leverage Ratio = (A) / (B)                                    =        :1.0
                                                               -----------------

Required Ratio:                                            Not more than 3.0:1.0

Compliance:                Yes              No

<PAGE>

                                  COVENANT 4.2

                             Interest Coverage Ratio

      As of the fiscal quarter/year ended ____________________, ____________.

     (Calculated for the then most recently completed four fiscal quarters)

(A)   EBITDA                                                  $
                                                               -----------------

(B)   Cash interest expense                                   $
                                                               -----------------

Pro Forma Debt Service Coverage Ratio = (A) / (B)             =        :1.0
                                                                ----------------

Required Ratio:                                            Not less than 3.0:1.0

Compliance:                Yes              No

<PAGE>

                                  COVENANT 4.3

                                    Net Worth

      As of the fiscal quarter/year ended __________, ____________.

(A)   Consolidated Net Worth                                  $
                                                               -----------------

(B)   Greater of (i) $0 or (ii) the result of (a)
      Restricted Investments incurred after
      December 9, 1998 minus (b) 10% of
      Consolidated Net Worth                                  $
                                                               -----------------

Net Worth = (A) - (B)                                         =$
                                                               -----------------

Required Amount:                                      Not less than $160,000,000

Compliance:                Yes              No

<PAGE>

                                 EXHIBIT 10.1(A)

                                     FORM OF
                                 REVOLVING NOTE

                             SUREWEST COMMUNICATIONS

[$___________]                                                   ______ __, 2007

      FOR VALUE RECEIVED, the undersigned ("Borrower"), hereby unconditionally
promises to pay to the order of __________ ("Lender") in lawful money of the
United States of America and in immediately available funds, the principal sum
of [_________________ UNITED STATES DOLLARS (US $__________)], or if less, the
aggregate unpaid principal amount of all advances made to Borrower by Lender
pursuant to Subsection 1.1(B) of the Credit Agreement described below, at such
times and in the manner specified therein.

      This Revolving Note is payable on the dates and in the amounts set forth
in the Credit Agreement described below. This Revolving Note may be prepaid in
whole or in part at any time subject to the terms of the Credit Agreement
described below.

      This Revolving Note is one of the Notes referred to in, was executed and
delivered pursuant to, evidences indebtedness of Borrower incurred under, and is
subject to all terms and conditions of, that certain Credit Agreement, dated as
May 14, 2007, between Borrower and Lender (as the same may be amended, restated,
supplemented or otherwise modified and in effect from time to time, the "Credit
Agreement"), to which reference is hereby made for a statement of, among other
things, the terms and conditions under which the indebtedness evidenced hereby
was made and is to be repaid and for a statement of Lender's remedies upon the
occurrence of an Event of Default, including without limitation, the remedy of
acceleration. Capitalized terms used herein but not otherwise specifically
defined shall have the meanings ascribed to such terms in the Credit Agreement.

      Borrower unconditionally promises to pay interest on the outstanding
unpaid principal amount hereof from the date hereof until payment in full at the
rates from time to time applicable to the Revolving Loans as determined in
accordance with the Credit Agreement; provided, however, that upon the
occurrence and during the continuance of an Event of Default, Borrower promises
to pay interest on the outstanding principal balance of this Revolving Note at
the rate of interest applicable following the occurrence of an Event of Default
as determined in accordance with the Credit Agreement.

      Interest on this Revolving Note shall be payable, at the times and from
the dates specified in the Credit Agreement for the Revolving Loans, on the date
of any prepayment hereof, at maturity, whether due by acceleration or otherwise,
and as otherwise provided in the Credit Agreement. From and after the date when
the principal balance hereof becomes due and payable, whether by acceleration or
otherwise, interest hereon shall be payable on demand, subject to any grace or
cure period set forth in the Credit Agreement. In no contingency or event
whatsoever shall interest charged hereunder, however such interest may be
characterized or computed, exceed the highest rate permissible under any law
which a court of competent jurisdiction shall, in a final determination, deem
applicable hereto. In the event that such a court determines that Lender has
received interest hereunder in excess of the highest rate applicable hereto,
such excess shall be applied in accordance with the terms of the Credit
Agreement. The indebtedness evidenced by this Revolving Note is secured pursuant
to the terms of the Loan Documents.

<PAGE>

      Except for any notices expressly required by the Loan Documents and as
otherwise required by applicable law, Borrower hereby waives demand, presentment
and protest and notice of demand, presentment, protest and nonpayment.

      Borrower further agrees, subject only to any limitation imposed by
applicable law or the Loan Documents, to pay all expenses, including reasonable
attorneys' fees and legal expenses, incurred by Lender in endeavoring to collect
any amounts payable hereunder which are not paid when due, whether by
acceleration or otherwise.

      THIS REVOLVING NOTE SHALL BE GOVERNED BY, AND INTERPRETED AND ENFORCED IN
ACCORDANCE WITH THE INTERNAL LAWS (AS OPPOSED TO CONFLICTS OF LAW PROVISIONS
THAT REQUIRE OR PERMIT APPLICATION OF THE LAWS OF ANY OTHER STATE OR
JURISDICTION) AND DECISIONS OF THE STATE OF COLORADO. Whenever possible each
provision of this Revolving Note shall be interpreted in such manner as to be
effective and valid under applicable law, but if any provision of this Revolving
Note shall be prohibited by or invalid under applicable law, such provision
shall be ineffective to the extent of such prohibition or invalidity in such
jurisdiction, without invalidating the remainder of such provision or the
remaining provisions of this Revolving Note or the effectiveness and validity of
such prohibited or invalid provision in any other jurisdiction. Whenever in this
Revolving Note reference is made to Lender or Borrower, such reference shall be
deemed to include, as applicable, a reference to their respective permitted
successors and assigns and in the case of Lender, any financial institution to
which it has sold or assigned all or any part of its interest in the Revolving
Loans or in its commitment to make the Revolving Loans as permitted by the
Credit Agreement. The provisions of this Revolving Note shall be binding upon
and shall inure to the benefit of such permitted successors and assigns.
Borrower's respective successors and assigns shall include, without limitation,
a receiver, trustee or debtor in possession of or for Borrower.

<PAGE>

      IN WITNESS WHEREOF, Borrower has caused this note to be executed and
delivered, by its duly authorized officer, on the date first shown above.

                                                     SUREWEST COMMUNICATIONS

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

<PAGE>

                                 EXHIBIT 10.1(B)

                                     FORM OF
                                 TERM LOAN NOTE

                             SUREWEST COMMUNICATIONS

[$___________]                                                   ______ __, 2007

      FOR VALUE RECEIVED, the undersigned ("Borrower"), hereby unconditionally
promises to pay to the order of __________ ("Lender") in lawful money of the
United States of America and in immediately available funds, the principal sum
of [_________________ UNITED STATES DOLLARS (US $__________)], or if less, the
aggregate unpaid principal amount of all advances made to Borrower by Lender
pursuant to Subsection 1.1(A) of the Credit Agreement described below, at such
times and in the manner specified therein.

      This Term Loan Note is payable in installments on the dates and in the
amounts set forth in the Credit Agreement described below. This Term Loan Note
may be prepaid in whole or in part at any time subject to the terms of the
Credit Agreement described below.

      This Term Loan Note is one of the Notes referred to in, was executed and
delivered pursuant to, evidences indebtedness of Borrower incurred under, and is
subject to all terms and conditions of, that certain Credit Agreement, dated as
of May 14, 2007, between Borrower and Lender (as the same may be amended,
restated, supplemented or otherwise modified and in effect from time to time,
the "Credit Agreement"), to which reference is hereby made for a statement of,
among other things, the terms and conditions under which the indebtedness
evidenced hereby was made and is to be repaid and for a statement of Lender's
remedies upon the occurrence of an Event of Default, including without
limitation, the remedy of acceleration. Capitalized terms used herein but not
otherwise specifically defined shall have the meanings ascribed to such terms in
the Credit Agreement.

      Borrower unconditionally promises to pay interest on the outstanding
unpaid principal amount hereof from the date hereof until payment in full at the
rates from time to time applicable to the Term Loan as determined in accordance
with the Credit Agreement; provided, however, that upon the occurrence and
during the continuance of an Event of Default, Borrower promises to pay interest
on the outstanding principal balance of this Term Loan Note at the rate of
interest applicable following the occurrence of an Event of Default as
determined in accordance with the Credit Agreement.

      Interest on this Term Loan Note shall be payable, at the times and from
the dates specified in the Credit Agreement for the Term Loan, on the date of
any prepayment hereof, at maturity, whether due by acceleration or otherwise,
and as otherwise provided in the Credit Agreement. From and after the date when
the principal balance hereof becomes due and payable, whether by acceleration or
otherwise, interest hereon shall be payable on demand, subject to any grace or
cure period set forth in the Credit Agreement. In no contingency or event
whatsoever shall interest charged hereunder, however such interest may be
characterized or computed, exceed the highest rate permissible under any law
which a court of competent jurisdiction shall, in a final determination, deem
applicable hereto. In the event that such a court determines that Lender has
received interest hereunder in excess of the highest rate applicable hereto,
such excess shall be applied in accordance with the terms of the Credit
Agreement. The indebtedness evidenced by this Term Loan Note is secured pursuant
to the terms of the Loan Documents.

<PAGE>

      Except for any notices expressly required by the Loan Documents and as
otherwise required by applicable law, Borrower hereby waives demand, presentment
and protest and notice of demand, presentment, protest and nonpayment.

      Borrower further agrees, subject only to any limitation imposed by
applicable law or the Loan Documents, to pay all expenses, including reasonable
attorneys' fees and legal expenses, incurred by Lender in endeavoring to collect
any amounts payable hereunder which are not paid when due, whether by
acceleration or otherwise.

      THIS TERM LOAN NOTE SHALL BE GOVERNED BY, AND INTERPRETED AND ENFORCED IN
ACCORDANCE WITH THE INTERNAL LAWS (AS OPPOSED TO CONFLICTS OF LAW PROVISIONS
THAT REQUIRE OR PERMIT APPLICATION OF THE LAWS OF ANY OTHER STATE OR
JURISDICTION) AND DECISIONS OF THE STATE OF COLORADO. Whenever possible each
provision of this Term Loan Note shall be interpreted in such manner as to be
effective and valid under applicable law, but if any provision of this Term Loan
Note shall be prohibited by or invalid under applicable law, such provision
shall be ineffective to the extent of such prohibition or invalidity in such
jurisdiction, without invalidating the remainder of such provision or the
remaining provisions of this Term Loan Note or the effectiveness and validity of
such prohibited or invalid provision in any other jurisdiction. Whenever in this
Term Loan Note reference is made to Lender or Borrower, such reference shall be
deemed to include, as applicable, a reference to their respective permitted
successors and assigns and in the case of Lender, any financial institution to
which it has sold or assigned all or any part of its interest in the Term Loan
or in its commitment to make the Term Loan as permitted by the Credit Agreement.
The provisions of this Term Loan Note shall be binding upon and shall inure to
the benefit of such permitted successors and assigns. Borrower's respective
successors and assigns shall include, without limitation, a receiver, trustee or
debtor in possession of or for Borrower.

<PAGE>

      IN WITNESS WHEREOF, Borrower has caused this note to be executed and
delivered, by its duly authorized officer, on the date first shown above.

                                                     SUREWEST COMMUNICATIONS

                                                     By:
                                                        ------------------------
                                                     Name:
                                                          ----------------------
<PAGE>

                                 EXHIBIT 10.1(C)

                                     FORM OF
                                 SWINGLINE NOTE

                             SUREWEST COMMUNICATIONS

$____________]                                                   ______ __, 2007

      FOR VALUE RECEIVED, the undersigned ("Borrower"), hereby unconditionally
promises to pay to the order of __________ ("Lender") in lawful money of the
United States of America and in immediately available funds, the principal sum
of [_________________ UNITED STATES DOLLARS (US $__________)], or if less, the
aggregate unpaid principal amount of all advances made to Borrower by Lender
pursuant to Subsection 1.1(C) of the Credit Agreement described below, at such
times and in the manner specified therein.

      This Swingline Note is payable on the dates and in the amounts set forth
in the Credit Agreement described below. This Swingline Note may be prepaid in
whole or in part at any time subject to the terms of the Credit Agreement
described below.

      This Swingline Note is one of the Notes referred to in, was executed and
delivered pursuant to, evidences indebtedness of Borrower incurred under, and is
subject to all terms and conditions of, that certain Credit Agreement, dated as
of May 14, 2007, between Borrower and Lender (as the same may be amended,
restated, supplemented or otherwise modified and in effect from time to time,
the "Credit Agreement"), to which reference is hereby made for a statement of,
among other things, the terms and conditions under which the indebtedness
evidenced hereby was made and is to be repaid and for a statement of Lender's
remedies upon the occurrence of an Event of Default, including without
limitation, the remedy of acceleration. Capitalized terms used herein but not
otherwise specifically defined shall have the meanings ascribed to such terms in
the Credit Agreement.

      Borrower unconditionally promises to pay interest on the outstanding
unpaid principal amount hereof from the date hereof until payment in full at the
rates from time to time applicable to the Swingline Loans as determined in
accordance with the Credit Agreement; provided, however, that upon the
occurrence and during the continuance of an Event of Default, Borrower promises
to pay interest on the outstanding principal balance of this Swingline Note at
the rate of interest applicable following the occurrence of an Event of Default
as determined in accordance with the Credit Agreement.

      Interest on this Swingline Note shall be payable, at the times and from
the dates specified in the Credit Agreement for the Swingline Loans, on the date
of any prepayment hereof, at maturity, whether due by acceleration or otherwise,
and as otherwise provided in the Credit Agreement. From and after the date when
the principal balance hereof becomes due and payable, whether by acceleration or
otherwise, interest hereon shall be payable on demand, subject to any grace or
cure period set forth in the Credit Agreement. In no contingency or event
whatsoever shall interest charged hereunder, however such interest may be
characterized or computed, exceed the highest rate permissible under any law
which a court of competent jurisdiction shall, in a final determination, deem
applicable hereto. In the event that such a court determines that Lender has
received interest hereunder in excess of the highest rate applicable hereto,
such excess shall be applied in accordance with the terms of the Credit
Agreement. The indebtedness evidenced by this Swingline Note is secured pursuant
to the terms of the Loan Documents.

<PAGE>

      Except for any notices expressly required by the Loan Documents and as
otherwise required by applicable law, Borrower hereby waives demand, presentment
and protest and notice of demand, presentment, protest and nonpayment.

      Borrower further agrees, subject only to any limitation imposed by
applicable law or the Loan Documents, to pay all expenses, including reasonable
attorneys' fees and legal expenses, incurred by Lender in endeavoring to collect
any amounts payable hereunder which are not paid when due, whether by
acceleration or otherwise.

      THIS SWINGLINE NOTE SHALL BE GOVERNED BY, AND INTERPRETED AND ENFORCED IN
ACCORDANCE WITH THE INTERNAL LAWS (AS OPPOSED TO CONFLICTS OF LAW PROVISIONS
THAT REQUIRE OR PERMIT APPLICATION OF THE LAWS OF ANY OTHER STATE OR
JURISDICTION) AND DECISIONS OF THE STATE OF COLORADO. Whenever possible each
provision of this Swingline Note shall be interpreted in such manner as to be
effective and valid under applicable law, but if any provision of this Swingline
Note shall be prohibited by or invalid under applicable law, such provision
shall be ineffective to the extent of such prohibition or invalidity in such
jurisdiction, without invalidating the remainder of such provision or the
remaining provisions of this Swingline Note or the effectiveness and validity of
such prohibited or invalid provision in any other jurisdiction. Whenever in this
Swingline Note reference is made to Lender or Borrower, such reference shall be
deemed to include, as applicable, a reference to their respective permitted
successors and assigns and in the case of Lender, any financial institution to
which it has sold or assigned all or any part of its interest in the Revolving
Loans or in its commitment to make the Swingline Loans as permitted by the
Credit Agreement. The provisions of this Swingline Note shall be binding upon
and shall inure to the benefit of such permitted successors and assigns.
Borrower's respective successors and assigns shall include, without limitation,
a receiver, trustee or debtor in possession of or for Borrower.

<PAGE>

      IN WITNESS WHEREOF, Borrower has caused this note to be executed and
delivered, by its duly authorized officer, on the date first shown above.

                                                     SUREWEST COMMUNICATIONS

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

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