Document:

Exhibit
10.2

 

PLEDGE AGREEMENT

 

PLEDGE AGREEMENT, dated
as of February 8, 2005 (as amended, restated, modified and/or supplemented
from time to time, the “Agreement”), made by each of the undersigned
pledgors (each, a “Pledgor” and together with any other entity that
becomes a party hereto pursuant to Section 24 hereof, collectively, the “Pledgors”),
in favor of DEUTSCHE BANK TRUST COMPANY AMERICAS, as Collateral Agent
(including any successor collateral agent, the “Pledgee”) for the
benefit of the Secured Creditors (as defined below).  Except as otherwise defined herein, terms
used herein and defined in the Credit Agreement (as defined below) shall be
used herein as therein defined.

 

W I T N E S S E T H
:

 

WHEREAS, FairPoint
Communications, Inc. (the “Borrower”), the lenders from time to time
party thereto (the “Lenders”), Bank of America, N.A., as Syndication
Agent (the “Syndication Agent”), CoBank, ACB and General Electric
Capital Corporation, as Co-Documentation Agents (the “Co-Documentation
Agents”), and Deutsche Bank Trust Company Americas, as Administrative Agent
(the “Administrative Agent” and together with the Lenders, the Swingline
Lender, the Syndication Agent, the Co-Documentation Agents, the Collateral
Agent, each Letter of Credit Issuer and the Pledgee, the “Lender Creditors”),
have entered into a Credit Agreement, dated as of February 8, 2005 (as
amended, restated, modified and/or supplemented from time to time, the “Credit
Agreement”), providing for the making of Loans and the issuance of, and participation
in, Letters of Credit as contemplated therein;

 

WHEREAS, the Borrower may
from time to time be a party to one or more Interest Rate Agreements (each such
Interest Rate Agreement with an Interest Rate Creditor (as defined below), a “Secured
Interest Rate Agreement”) with Deutsche Bank Trust Company Americas, in its
individual capacity (“DBTCA”), any Lender, a syndicate of financial
institutions organized by DBTCA or such Lender or an affiliate of DBTCA or such
Lender (even if DBTCA or any such Lender ceases to be a Lender under the Credit
Agreement for any reason), and any institution that participates therein, and
in each case their subsequent assigns (collectively, the “Interest Rate
Creditors” and, together with the Lender Creditors, collectively, the “Secured
Creditors”);

 

WHEREAS, it is a
condition precedent to the making of Loans and the issuance of, and
participation in, Letters of Credit under the Credit Agreement that each
Pledgor shall have executed and delivered to the Pledgee this Agreement; and

 

WHEREAS, each Pledgor
desires to execute this Agreement to satisfy the condition described in the
preceding paragraph;

 

NOW, THEREFORE, in
consideration of the benefits accruing to each Pledgor, the receipt and
sufficiency of which are hereby acknowledged, each Pledgor hereby makes the
following representations and warranties to the Pledgee and hereby covenants
and agrees with the Pledgee as follows:

 

 

1.                                       SECURITY
FOR OBLIGATIONS.  This Agreement is
made by each Pledgor for the benefit of the Secured Creditors to secure:

 

(i)                                     the
full and prompt payment when due (whether at the stated maturity, by
acceleration or otherwise) of all obligations (including obligations which, but
for the automatic stay under Section 362(a) of the Bankruptcy Code, would
become due) and liabilities of the Borrower (in the case of the Borrower or an
NSG Pledgor) or such Pledgor (in the case of a Pledgor that is a Subsidiary
Guarantor), now existing or hereafter incurred under, arising out of or in
connection with any Credit Document to which the Borrower or such Pledgor, as
the case may be, is a party (including, in the case of a Pledgor that is a
Subsidiary Guarantor, all such obligations of such Pledgor under the Subsidiary
Guaranty) and the due performance of and compliance by the Borrower or such
Pledgor, as the case may be, with the terms of each such Credit Document (all
such obligations and liabilities under this clause (i), except to the extent
consisting of obligations or indebtedness with respect to Secured Interest Rate
Agreements, being herein collectively called the “Credit Document
Obligations”);

 

(ii)                                  the
full and prompt payment when due (whether at the stated maturity, by
acceleration or otherwise) of all obligations (including obligations which, but
for the automatic stay under Section 362(a) of the Bankruptcy Code, would
become due) and liabilities of the Borrower (in the case of the Borrower and
each NSG Pledgor) or such Pledgor (in the case of any Pledgor that is a
Subsidiary Guarantor), now existing or hereafter incurred under, arising out of
or in connection with any Secured Interest Rate Agreement (all such obligations
and liabilities under this clause (ii) being herein collectively called the “Interest
Rate Obligations”);

 

(iii)                               any
and all sums advanced by the Pledgee in order to preserve the Collateral (as
hereinafter defined) and/or its security interest therein;

 

(iv)                              in
the event of any proceeding for the collection of the Obligations (as defined
below) or the enforcement of this Agreement, after an Event of Default (such
term, as used in this Agreement, shall mean any Event of Default under the
Credit Agreement or any payment default by the Borrower under any Secured
Interest Rate Agreement after the expiration of any applicable grace period) shall
have occurred and be continuing, the reasonable out-of-pocket expenses of
retaking, holding, preparing for sale or lease, selling or otherwise disposing
of or realizing on the Collateral, or of any exercise by the Pledgee of its
rights hereunder, together with reasonable attorneys’ fees and disbursements of
counsel; and

 

(v)                                 all
amounts paid by any Secured Creditor as to which such Secured Creditor has the
right to reimbursement under Section 11 of this Agreement;

 

all such
obligations, liabilities, sums and expenses set forth in clauses (i) through
(v) of this Section 1 being herein collectively called the “Obligations”.

 

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2.                                       DEFINITION
OF STOCK, NOTES, PARTNERSHIP INTERESTS, 
MEMBERSHIP INTERESTS, SECURITIES, ETC.  The following capitalized terms used herein
shall have the definitions specified below:

 

“Certificated Security”
shall have the meaning given such term in Section 8-102(a)(4) of the UCC.

 

“Clearing Corporation”
shall have the meaning given such term in Section 8-102(a)(5) of the UCC.

 

“Collateral” shall
have the meaning provided in Section 3.1.

 

“Collateral Accounts”
shall mean any and all accounts established and maintained by the Pledgee in
the name of any Pledgor to which Collateral may be credited.

 

“Excluded Entity”
shall mean (x) any corporation, partnership, limited liability company or
association which is not (I) a Parent Company, (II) an Intermediary Holding
Company, (III) a TelCo, (IV) a Carrier Services Company or (V) an entity that
the Borrower has designated as a “Pledged Entity” in a written notice to the
Collateral Agent specifying such entity’s legal name, type of organization,
jurisdiction of organization, Location, organizational identification number
(if any), and whether such entity is or is not a Registered Organization and/or
a Transmitting Utility and (y) any TelCo or Carrier Services Company acquired
or created pursuant to a Permitted Acquisition after the Effective Date if,
after giving effect to the acquisition or creation of such TelCo or Carrier
Services Company, the Pro  Forma EBITDA Test is satisfied.

 

“Exempted Foreign
Entity” shall mean any Foreign Corporation, Foreign LLC or Foreign
Partnership that, in any such case, is treated as a corporation or an
association taxable as a corporation for U.S. Federal income tax purposes.

 

“Financial Asset”
shall have the meaning given such term in Section 8-102(a)(9) of the UCC.

 

“Instrument” shall
have the meaning given such term in Section 9-102(a)(47) of the UCC.

 

“Investment Property”
shall have the meaning given such term in Section 9-102(a)(49) of the UCC.

 

“Location” of any
Pledgor has the meaning given such term in Section 9-307 of the UCC.

 

“Membership Interest”
shall mean (x) the entire membership interest at any time owned by any Pledgor
in any limited liability company (other than (I) an Excluded Entity and (II) a
limited liability company that is not organized under the laws of the United
States or any State or territory thereof (a “Foreign LLC”)) and (y) with
respect to a Foreign LLC (other than an Excluded Entity), the entire membership
interest at any time owned by any Pledgor in such Foreign LLC, provided that such Pledgor shall not be
required to pledge hereunder (and the term

 

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“Membership Interest” shall not include) more than 65% of the total
voting power of all classes of the membership interests of any Foreign LLC
(that is an Exempted Foreign Entity) entitled to vote (with any limited
liability company (other than an Excluded Entity) in which any Pledgor owns a
membership interest being herein called a “Pledged LLC”).

 

“Notes” shall mean
all promissory notes at any time issued to, or held by, any Pledgor.

 

“NSG Pledgor”
shall mean each Pledgor which is not a Subsidiary Guarantor.

 

“Obligations”
shall have the meaning provided in Section 1.

 

“Partnership Interest”
shall mean (x) the entire partnership interest (whether general and/or limited
partnership interests) at any time owned by any Pledgor in any partnership
(other than (I) an Excluded Entity and (II) a partnership that is not organized
under the laws of the United States or any State or territory thereof (a “Foreign
Partnership”)) and (y) with respect to a Foreign Partnership (other than an
Excluded Entity), the entire partnership interest at any time owned by any
Pledgor in such Foreign Partnership, provided
that such Pledgor shall not be required to pledge hereunder (and the term “Partnership
Interest” shall not include) more than 65% of the total voting power of all
classes of partnership interests of any Foreign Partnership (that is an
Exempted Foreign Entity) entitled to vote (with any partnership (other than an
Excluded Entity) in which any Pledgor owns a partnership interest being herein
called a “Pledged Partnership”).

 

“Pledged Membership
Interests” shall mean all Membership Interests at any time pledged or
required to be pledged hereunder.

 

“Pledged Notes”
shall mean all Notes at any time pledged or required to be pledged hereunder.

 

“Pledged Partnership
Interests” shall mean all Partnership Interests at any time pledged or
required to be pledged hereunder.

 

“Pledged Securities”
shall mean all Pledged Stock, Pledged Notes, Pledged Partnership Interests and
Pledged Membership Interests.

 

“Pledged Stock”
shall mean all Stock at any time pledged or required to be pledged hereunder.

 

“Proceeds” shall
have the meaning given such term in Section 9-102(a)(64) of the UCC.

 

“Registered
Organization” shall have the meaning given such term in Section 9-102(a)(70)
of the UCC.

 

“Secured Debt
Agreements” shall have the meaning provided in Section 5.

 

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“Securities” shall
mean all of the Stock, Notes, Partnership Interests and Membership Interests.

 

“Securities Intermediary”
shall have the meaning given such term in Section 8-102(14) of the UCC.

 

“Security Entitlement”
shall have the meaning given such term in Section 8-102(a)(17) of the UCC.

 

“Stock” shall mean
(x) all of the issued and outstanding shares of stock at any time owned by any
Pledgor of any corporation (other than (I) any Excluded Entity and (II) a
corporation that is not organized under the laws of the United States or any
State or territory thereof (a “Foreign Corporation”)) and (y) with
respect to a Foreign Corporation that is a 1st-Tier Subsidiary
(other than any Excluded Entity), all of the issued and outstanding shares of
capital stock at any time owned by any Pledgor of such Foreign Corporation, provided that such Pledgor shall not be
required to pledge hereunder (and the term “Stock” shall not include) more than
65% of the total combined voting power of all classes of capital stock of any
Exempted Foreign Entity entitled to vote.

 

“Transmitting Utility”
has the meaning given such term in Section 9-102(a)(80) of the UCC.

 

“UCC” shall mean
the Uniform Commercial Code as in effect in the State of New York from
time to time; provided that all references herein to specific Sections
or subsections of the UCC are references to such Sections or subsections, as
the case may be, of the Uniform Commercial Code as in effect in the State of
New York on the date hereof.

 

“Uncertificated
Security” shall have the meaning given such term in Section 8-102(a)(18)
of the UCC.

 

3.                                       PLEDGE OF
SECURITIES, ETC.

 

3.1                                 Pledge.  To secure the Obligations now or hereafter
owed or to be performed by such Pledgor, each Pledgor does hereby grant,
pledge, hypothecate, mortgage, charge and assign to the Pledgee for the benefit
of the Secured Creditors, and does hereby create a continuing security interest
(subject to those Liens permitted to exist with respect to the Collateral
pursuant to the terms of all Secured Debt Agreements then in effect) in favor
of the Pledgee for the benefit of the Secured Creditors in, all of its right,
title and interest in and to the following, whether now existing or hereafter
from time to time acquired (collectively, the “Collateral”):

 

(i)                                     all
of the Securities owned or held by such Pledgor from time to time and all
options and warrants owned by such Pledgor from time to time to purchase
Securities (and all certificates or instruments evidencing such Securities);

 

(ii)                                  each
Collateral Account, including any and all assets of whatever type or kind
deposited by such Pledgor in any such Collateral Account, whether now owned or
hereafter acquired, existing or arising (including, without limitation, all
Financial Assets,

 

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Investment Property, monies, checks, drafts,
Instruments or interests therein of any type or nature deposited or required by
the Credit Agreement or any other Secured Debt Agreement to be deposited in
such Collateral Account, and all investments and all certificates and other
instruments (including depository receipts, if any) from time to time representing
or evidencing the same, and all dividends, interest, distributions, cash and
other property from time to time received, receivable or otherwise distributed
in respect of or in exchange for any or all of the foregoing);

 

(iii)                               all
of such Pledgor’s (x) Partnership Interest and all of such Pledgor’s right,
title and interest in each Pledged Partnership and (y) Membership Interest and
all of such Pledgor’s right, title and interest in each Pledged LLC, in each
case including, without limitation:

 

(a)                                  all the capital
thereof and its interest in all profits, losses and other distributions to
which such Pledgor shall at any time be entitled in respect of such Partnership
Interest and/or Membership Interest;

 

(b)                                 all other payments due
or to become due to such Pledgor in respect of such Partnership Interest and/or
Membership Interest, whether under any partnership agreement, limited liability
company agreement or otherwise, whether as contractual obligations, damages,
insurance proceeds or otherwise;

 

(c)                                  all of its claims,
rights, powers, privileges, authority, options, security interest, liens and
remedies, if any, under any partnership agreement, limited liability company
agreement or at law or otherwise in respect of such Partnership Interest and/or
Membership Interest;

 

(d)                                 all present and future
claims, if any, of the Pledgor against any Pledged Partnership and any Pledged
LLC for moneys loaned or advanced, for services rendered or otherwise;

 

(e)                                  all of such Pledgor’s
rights under any partnership agreement or limited liability company agreement
or at law to exercise and enforce every right, power, remedy, authority, option
and privilege of such Pledgor relating to the Partnership Interest and/or
Membership Interest, including any power to terminate, cancel or modify any
partnership agreement or any limited liability company agreement, to execute
any instruments and to take any and all other action on behalf of and in the
name of such Pledgor in respect of any Partnership Interest or Membership
Interest and any Pledged Partnership and any Pledged LLC to make
determinations, to exercise any election (including, but not limited to,
election of remedies) or option or to give or receive any notice, consent,
amendment, waiver or approval, together with full power and authority to
demand, receive, enforce, collect or receipt for any of the foregoing, to
enforce or execute any checks, or other instruments or orders, to file any
claims and to take any action in connection with any of the foregoing; and

 

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(f)                                    all other property
hereafter delivered in substitution for or in addition to any of the foregoing,
all certificates and instruments representing or evidencing such other property
and all cash, securities, interest, dividends, rights and other property at any
time and from time to time received, receivable or otherwise distributed in
respect of or in exchange for any or all thereof;

 

(iv)                              all
Security Entitlements owned by such Pledgor from time to time in any and all of
the foregoing; and

 

(v)                                 all
Proceeds of any and all of the foregoing.

 

Notwithstanding
anything to the contrary contained in this Section 3.1, except as
otherwise required by Section 6.12 of the Credit Agreement, no Pledgor
shall be required to pledge hereunder any Margin Stock owned by such Pledgor.

 

3.2                                 Procedures.  (a)  To
the extent that any Pledgor at any time or from time to time owns, acquires or
obtains any right, title or interest in any Collateral, such Collateral shall
automatically (and without the taking of any action by such Pledgor) be pledged
pursuant to Section 3.1 of this Agreement and, in addition thereto, such
Pledgor shall (to the extent provided below) forthwith take the following
actions as set forth below:

 

(i)                                     with respect to a Certificated
Security (other than a Certificated Security credited on the books of a
Clearing Corporation or Securities Intermediary), such Pledgor shall physically
deliver such Certificated Security to the Pledgee, endorsed to the Pledgee or
endorsed in blank;

 

(ii)                                  with respect to an
Uncertificated Security (other than an Uncertificated Security credited on the
books of a Clearing Corporation or Securities Intermediary), such Pledgor shall
cause the issuer of such Uncertificated Security to duly authorize, execute,
and deliver to the Pledgee, an agreement for the benefit of the Pledgee and the
other Secured Creditors substantially in the form of Annex E hereto
(appropriately completed to the satisfaction of the Pledgee and with such
modifications, if any, as shall be satisfactory to the Pledgee) pursuant to
which such issuer agrees to comply with any and all instructions originated by
the Pledgee without further consent by the registered owner and not to comply
with instructions regarding such Uncertificated Security (and any Partnership
Interests and Membership Interests issued by such issuer) originated by any
other Person other than a court of competent jurisdiction;

 

(iii)                               with respect to a Certificated
Security, Uncertificated Security, Partnership Interest or Membership Interest
credited on the books of a Clearing Corporation or Securities Intermediary
(including a Federal Reserve Bank, Participants Trust Company or The Depository
Trust Company), such Pledgor shall promptly notify the Pledgee thereof and
shall promptly take (x) all actions required (i) to comply with the applicable
rules of such Clearing Corporation or Securities Intermediary and (ii) to
perfect the security interest of the Pledgee under applicable law (including,
in any event, under Sections 9-314(a), (b) and (c), 9-106 and 8-106(d) of the
UCC) and (y) such other actions as the Pledgee deems necessary or desirable to
effect the foregoing;

 

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(iv)                              with respect to a Partnership
Interest or a Membership Interest (other than a Partnership Interest or
Membership Interest credited on the books of a Clearing Corporation or
Securities Intermediary), (1) if such Partnership Interest or Membership
Interest is represented by a certificate and is a Security for purposes of the
UCC, the procedure set forth in Section 3.2(a)(i) hereof, and (2) if such
Partnership Interest or Membership Interest is not represented by a certificate
or is not a Security for purposes of the UCC, the procedure set forth in Section 3.2(a)(ii)
hereof;

 

(v)                                 with respect to any Note,
physical delivery of such Note to the Pledgee, endorsed in blank, or, at the
request of the Pledgee, endorsed to the Pledgee; and

 

(vi)                              with respect to cash proceeds
from any of the Collateral described in Section 3.1 hereof, (i) the
establishment by the Pledgee of a cash account in the name of such Pledgor over
which the Pledgee shall have “control” within the meaning of the UCC and, at
any time any Event of Default is in existence, no withdrawals or transfers may
be made therefrom by any Person except with the prior written consent of the
Pledgee and (ii) the deposit of such cash in such cash account.

 

(b)                                 In
addition to the actions required to be taken pursuant to Section 3.2(a)
hereof, each Pledgor shall take the following additional actions with respect
to the Collateral:

 

(i)                                     with respect to all Collateral
of such Pledgor whereby or with respect to which the Pledgee may obtain “control”
thereof within the meaning of Section 8-106 of the UCC (or under any
provision of the UCC as same may be amended or supplemented from time to time,
or under the laws of any relevant State other than the State of New York),
such Pledgor shall take all actions as may be requested from time to time by
the Pledgee so that “control” of such Collateral is obtained and at all times
held by the Pledgee; and

 

(ii)                                  each Pledgor shall from time to
time cause appropriate financing statements (on appropriate forms) under the
Uniform Commercial Code as in effect in the various relevant States, covering
all Collateral hereunder (with the form of such financing statements to be
satisfactory to the Pledgee), to be filed in the relevant filing offices so
that at all times the Pledgee’s security interest in all Investment Property
and other Collateral which can be perfected by the filing of such financing
statements (in each case to the maximum extent perfection by filing may be
obtained under the laws of the relevant States, including, without limitation, Section 9-312(a)
of the UCC) is so perfected.

 

3.3                                 Subsequently
Acquired Collateral.  If any Pledgor
shall acquire (by purchase, stock dividend or otherwise) any additional
Collateral at any time or from time to time after the date hereof, such Pledgor
will forthwith thereafter take (or cause to be taken) all action with respect
to such Collateral in accordance with the procedures set forth in Section 3.2
hereof, and will promptly thereafter deliver to the Pledgee a certificate
executed by a principal executive officer of such Pledgor describing such
Collateral and certifying that the same have been duly pledged with the Pledgee
hereunder. Each Pledgor further agrees to provide an opinion of counsel
reasonably satisfactory to the Pledgee with respect to any pledge of Collateral

 

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constituting Uncertificated Securities promptly upon request of the
Pledgee. No Pledgor shall be required at any time to pledge hereunder any
Securities which constitute more than 65% of the total combined voting power of
all classes of ownership interests of any Exempted Foreign Entity entitled to
vote.  Notwithstanding anything to the
contrary contained above in this Section 3.3, except as otherwise required
by Section 6.12 of the Credit Agreement, no Pledgor shall be required to
pledge hereunder any Margin Stock acquired by such Pledgor after the date
hereof.

 

3.4                                 Certain
Representations and Warranties Concerning the Collateral.  Each Pledgor represents and warrants that on
the date hereof: (a) each Subsidiary of such Pledgor whose equity interest is
required to be pledged hereunder, and the direct ownership thereof, is listed
on Annex A hereto; (b) the Stock held by such Pledgor consists of the number
and type of shares of the stock of the corporations as described in Annex B
hereto; (c) such Stock constitutes that percentage of the issued and
outstanding capital stock of the issuing corporation as set forth in Annex B
hereto; (d) the Notes held by such Pledgor consist of the promissory notes
described in Annex C hereto; (e) such Pledgor is the holder of record and sole
beneficial owner of the Stock and Notes held by such Pledgor and there exists
no options or preemption rights in respect of any of the Stock; (f) the
Partnership Interests and Membership Interests, as the case may be, held by
such Pledgor constitute that percentage of the entire interest of the
respective Pledged Partnership or Pledged LLC, as the case may be, as is set
forth under its name in Annex D hereto; (g) on the date hereof, such Pledgor owns
or possesses no other Securities except as described on Annexes B, C and D
hereto; and (h) the Pledgor has complied with the respective procedure set
forth in Section 3.2(a) hereof with respect to each item of Collateral
described in Annexes B, C and D hereto.

 

4.                                       APPOINTMENT
OF SUB-AGENTS; ENDORSEMENTS, ETC. 
The Pledgee shall have the right to appoint one or more sub-agents for
the purpose of retaining physical possession of the Pledged Securities, which
may be held (in the discretion of the Pledgee) in the name of the relevant
Pledgor, endorsed or assigned in blank or in favor of the Pledgee or any
nominee or nominees of the Pledgee or a sub-agent appointed by the Pledgee.

 

5.                                       VOTING,
ETC., WHILE NO EVENT OF DEFAULT. 
Unless and until there shall have occurred and be continuing an Event of
Default, each Pledgor shall be entitled to exercise all voting rights attaching
to any and all Pledged Securities owned by it, and to give consents, waivers or
ratifications in respect thereof, provided
that no vote shall be cast or any consent, waiver or ratification given or any
action taken which would violate, result in breach of any covenant contained
in, or be inconsistent with, any of the terms of this Agreement, the Credit
Agreement, any other Credit Document or any Secured Interest Rate Agreement
(collectively, the “Secured Debt Agreements”), or which would have the
effect of impairing the value of the Collateral or any part thereof or the
position or interests of the Pledgee or any other Secured Creditor therein.  All such rights of a Pledgor to vote and to
give consents, waivers and ratifications shall cease in case an Event of
Default shall occur and be continuing and Section 7 hereof shall become
applicable.

 

6.                                       DIVIDENDS
AND OTHER DISTRIBUTIONS.  Unless and
until an Event of Default shall have occurred and be continuing, all cash
dividends, distributions or other amounts payable in respect of the Pledged
Securities shall be paid to the respective Pledgor, provided that all dividends, distributions or other amounts payable
in respect of the Pledged

 

9

 

Securities which are determined by the Pledgee, in its absolute
discretion, to represent in whole or in part an extraordinary, liquidating or
other distribution in return of capital not permitted by the Credit Agreement
shall be paid, to the extent so determined to represent an extraordinary,
liquidating or other distribution in return of capital not permitted by the
Credit Agreement, to the Pledgee and retained by it as part of the Collateral
(unless such cash dividends or distributions are applied to repay the
Obligations pursuant to Section 9 of this Agreement).  The Pledgee shall also be entitled to receive
directly, and to retain as part of the Collateral:

 

(i)                                     all
other or additional stock, notes, membership interests, partnership interests
or other securities or property (other than cash) paid or distributed by way of
dividend or otherwise in respect of the Collateral;

 

(ii)                                  all
other or additional stock, notes, membership interests, partnership interests
or other securities or property (including cash) paid or distributed in respect
of the Collateral by way of stock-split, spin-off, split-up, reclassification,
combination of shares or similar rearrangement; and

 

(iii)                               all
other or additional stock, notes, membership interests, partnership interests
or other securities or property (including cash) which may be paid in respect
of the Collateral by reason of any consolidation, merger, exchange of stock,
conveyance of assets, liquidation or similar corporate reorganization (other
than the Net Cash Proceeds from any Asset Sale applied to repay Loans and/or
reinvested in accordance with the relevant provisions of the Credit Agreement).

 

Nothing contained
in this Section 6 shall limit or restrict in any way the Pledgee’s right
to receive the proceeds of the Collateral in any form in accordance with Section 3
of this Agreement.  All dividends,
distributions or other payments which are received by the respective Pledgor
contrary to the provisions of this Section 6 or Section 7 shall be
received in trust for the benefit of the Pledgee, shall be segregated from
other property or funds of such Pledgor and shall be forthwith paid over to the
Pledgee as Collateral in the same form as so received (with any necessary
endorsement).

 

7.                                       REMEDIES
IN CASE OF AN EVENT OF DEFAULT.  (a)  In case an Event of Default shall have
occurred and be continuing, the Pledgee shall be entitled to exercise all of
the rights, powers and remedies (whether vested in it by this Agreement or any
other Secured Debt Agreement or by law) for the protection and enforcement of
its rights in respect of the Collateral, including, without limitation, all the
rights and remedies of a secured party upon default under the Uniform
Commercial Code of the State of New York, and the Pledgee shall be entitled,
without limitation, to exercise any or all of the following rights, which each
Pledgor hereby agrees to be commercially reasonable:

 

(i)                                     to
receive all amounts payable in respect of the Collateral otherwise payable
under Section 6 to such Pledgor;

 

(ii)                                  to
transfer all or any part of the Collateral into the Pledgee’ s name or the name
of its nominee or nominees;

 

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(iii)                               to
accelerate any Pledged Note which may be accelerated in accordance with its
terms, and take any other lawful action to collect upon any Pledged Note
(including, without limitation, to make any demand for payment thereon);

 

(iv)                              to
vote all or any part of the Collateral (whether or not transferred into the
name of the Pledgee) and give all consents, waivers and ratifications in
respect of the Collateral and otherwise act with respect thereto as though it
were the outright owner thereof (each Pledgor hereby irrevocably constituting
and appointing the Pledgee the proxy and attorney-in-fact of such Pledgor, with
full power of substitution to do so);

 

(v)                                 to
set off any and all Collateral against any and all Obligations, and to withdraw
any and all cash or other Collateral from any and all Collateral Accounts and
to apply such cash and other Collateral to the payment of any and all
Obligations; and

 

(vi)                              at
any time or from time to time to sell, assign and deliver, or grant options to
purchase, all or any part of the Collateral, or any interest therein, at any
public or private sale, without demand of performance, advertisement or notice
of intention to sell or of the time or place of sale or adjournment thereof or
to redeem or otherwise (all of which are hereby waived by each Pledgor), for
cash, on credit or for other property, for immediate or future delivery without
any assumption of credit risk, and for such price or prices and on such terms
as the Pledgee in its absolute discretion may determine, provided that at least 10 days’ notice of the time and place of any
such sale shall be given to such Pledgor. 
The Pledgee shall not be obligated to make such sale of Collateral
regardless of whether any such notice of sale has theretofore been given.  Each purchaser at any such sale shall hold
the property so sold absolutely free from any claim or right on the part of any
Pledgor, and each Pledgor hereby waives and releases to the fullest extent
permitted by law any right or equity of redemption with respect to the Collateral,
whether before or after sale hereunder, all rights, if any, of marshalling the
Collateral and any other security for the Obligations or otherwise, and all
rights, if any, of stay and/or appraisal which it now has or may at any time in
the future have under rule of law or statute now existing or hereafter
enacted.  At any such sale, unless
prohibited by applicable law, the Pledgee on behalf of all Secured Creditors
(or certain of them) may bid for and purchase (by bidding in Obligations or
otherwise) all or any part of the Collateral so sold free from any such right
or equity of redemption.  Neither the
Pledgee nor any Secured Creditor shall be liable for failure to collect or
realize upon any or all of the Collateral or for any delay in so doing nor
shall it be under any obligation to take any action whatsoever with regard
thereto.

 

8.                                       REMEDIES,
ETC., CUMULATIVE.  Each right, power
and remedy of the Pledgee provided for in this Agreement or any other Secured
Debt Agreement, or now or hereafter existing at law or in equity or by statute
shall be cumulative and concurrent and shall be in addition to every other such
right, power or remedy.  The exercise or
beginning of the exercise by the Pledgee or any other Secured Creditor of any
one or more of the rights, powers or remedies provided for in this Agreement or
any other Secured Debt Agreement or now or hereafter existing at law or in
equity or by statute or otherwise shall not preclude the simultaneous or later
exercise by the Pledgee or any other Secured Creditor of all such other rights,
powers or remedies, and no failure or delay on the part of the Pledgee or any
other

 

11

 

Secured Creditor to exercise any such right, power or remedy shall
operate as a waiver thereof.  Unless
otherwise required by the Credit Documents, no notice to or demand on any
Pledgor in any case shall entitle it to any other or further notice or demand
in similar other circumstances or constitute a waiver of any of the rights of the
Pledgee or any other Secured Creditor to any other further action in any
circumstances without demand or notice. 
The Secured Creditors agree that this Agreement may be enforced only by
the action of the Administrative Agent or the Pledgee, in each case acting upon
the instructions of the Required Lenders (or, after the date on which all
Credit Document Obligations have been paid in full, the holders of at least the
majority of the outstanding Interest Rate Obligations) and that no other
Secured Creditor shall have any right individually to seek to enforce or to
enforce this Agreement or to realize upon the security to be granted hereby, it
being understood and agreed that such rights and remedies may be exercised by
the Administrative Agent or the Pledgee or the holders of at least a majority
of the outstanding Interest Rate Obligations, as the case may be, for the
benefit of the Secured Creditors upon the terms of this Agreement.

 

9.                                       APPLICATION
OF PROCEEDS.  (a)  All moneys collected by the Pledgee or the
Collateral Agent upon any sale or other disposition of the Collateral, together
with all other moneys received by the Pledgee or the Collateral Agent
hereunder, shall be applied as follows:

 

(i)                                     first,
to the payment of all Obligations owing to the Pledgee or the Collateral Agent
of the type described in clauses (iii) and (iv) of the definition of “Obligations”
contained in Section 1 hereof;

 

(ii)                                  second,
to the extent proceeds remain after the application pursuant to preceding
clause (i), an amount equal to the outstanding Obligations to the Secured
Creditors shall be paid to the Secured Creditors as provided in Section 9(c),
with each Secured Creditor receiving an amount equal to its outstanding
Obligations or, if the proceeds are insufficient to pay in full all such
Obligations, its Pro Rata Share of the
amount remaining to be distributed to be applied, with respect to the Credit
Document Obligations, firstly, to the payment of interest in respect of
the unpaid principal amount of Loans outstanding, secondly, to the
payment of principal of Loans outstanding, then to the other Credit
Document Obligations; and

 

(iii)                               third,
to the extent proceeds remain after the application pursuant to the preceding
clauses (i) and (ii) and following the termination of this Agreement pursuant
to Section 18 hereof, to the relevant Pledgor or, to the extent directed
by such Pledgor or a court of competent jurisdiction, to whomever may be
lawfully entitled to receive such surplus.

 

(b)                                 For purposes of this Agreement, “Pro
Rata Share” shall mean, when calculating a Secured Creditor’s portion of
any distribution or amount, the amount (expressed as a percentage) equal to a
fraction the numerator of which is the then outstanding amount of the relevant
Obligations owed such Secured Creditor and the denominator of which is the then
outstanding amount of all Obligations.

 

12

 

(c)                                  All payments required to be made
to the (i) Lender Creditors hereunder shall be made to the Administrative Agent
for the account of the respective Lender Creditors and (ii) Interest Rate
Creditors hereunder shall be made to the paying agent under the applicable
Secured Interest Rate Agreement or, in the case of Secured Interest Rate
Agreements without a paying agent, directly to the applicable Interest Rate
Creditor.

 

(d)                                 For purposes of applying
payments received in accordance with this Section 9, the Pledgee and the
Collateral Agent shall be entitled to rely upon (i) the Administrative Agent
for a determination (which the Administrative Agent agrees to provide upon
request to the Pledgee and the Collateral Agent) of the outstanding Credit
Document Obligations and (ii) any Interest Rate Creditor for a determination
(which each Interest Rate Creditor agrees to provide upon request to the
Pledgee and the Collateral Agent) of the outstanding Interest Rate Obligations
owed to such Interest Rate Creditor. 
Unless it has actual knowledge (including by way of written notice from
a Secured Creditor) to the contrary, the Administrative Agent under the Credit
Agreement, in furnishing information pursuant to the preceding sentence, and
the Pledgee and the Collateral Agent, in acting hereunder, shall be entitled to
assume that (x) no Credit Document Obligations other than principal, interest
and regularly accruing fees are owing to any Lender Creditor and (y) no Secured
Interest Rate Agreements or Interest Rate Obligations with respect thereto are
in existence.

 

(e)                                  It is understood that each
Pledgor shall remain jointly and severally liable to the extent of any
deficiency between (x) the amount of the Obligations for which it is liable
directly or as a Guarantor that are satisfied with proceeds of the Collateral
and (y) the aggregate outstanding amount of the Obligations.

 

10.                                 PURCHASERS
OF COLLATERAL.  Upon any sale of the
Collateral by the Pledgee hereunder (whether by virtue of the power of sale
herein granted, pursuant to judicial process or otherwise), the receipt of the
Pledgee or the officer making the sale shall be a sufficient discharge to the
purchaser or purchasers of the Collateral so sold, and such purchaser or
purchasers shall not be obligated to see to the application of any part of the
purchase money paid over to the Pledgee or such officer or be answerable in any
way for the misapplication or nonapplication thereof.

 

11.                                 INDEMNITY.  Each Pledgor jointly and severally agrees (i)
to indemnify and hold harmless the Pledgee and the other Secured Creditors from
and against any and all claims, demands, losses, judgments and liabilities
(including liabilities for penalties) of whatsoever kind or nature, and (ii) to
reimburse the Pledgee for all reasonable out-of-pocket costs and expenses,
including reasonable attorneys’ fees, arising in connection with any amendment,
waiver or modification to this Agreement and the Pledgee and the other Secured
Creditors for all reasonable costs and expenses (including reasonable attorney’s
fees) growing out of or resulting from the exercise by the Pledgee of any right
or remedy granted to it hereunder or under any other Secured Debt Agreement
except, with respect to clauses (i) and (ii) above, for those arising from such
Person’s gross negligence or willful misconduct (as determined by a court of
competent jurisdiction in a final and non-appealable decision).  In no event shall the Pledgee be liable, in
the absence of gross negligence or willful misconduct on its part (as
determined by a court of competent jurisdiction in a final and non-appealable
decision), for any matter or thing in connection with this Agreement other than
to account for moneys or

 

13

 

other property actually received by it in accordance with the terms
hereof.  If and to the extent that the
obligations of any Pledgor under this Section 11 are unenforceable for any
reason, such Pledgor hereby agrees to make the maximum contribution to the
payment and satisfaction of such obligations which is permissible under
applicable law.

 

12.                                 FURTHER
ASSURANCES; POWER OF ATTORNEY.  (a)  Each Pledgor agrees that it will join with
the Pledgee in executing and, at such Pledgor’s own expense, file and refile
under the Uniform Commercial Code such financing statements, continuation
statements and other documents in such offices as the Pledgee may reasonably
deem necessary or appropriate and wherever required or permitted by law in
order to perfect and preserve the Pledgee’s security interest in the Collateral
hereunder and hereby authorizes the Pledgee to file financing statements and
amendments thereto relative to all or any part of the Collateral without the
signature of such Pledgor where permitted by law, and agrees to do such further
acts and things and to execute and deliver to the Pledgee such additional
conveyances, assignments, agreements and instruments as the Pledgee may
reasonably require or deem advisable to carry into effect the purposes of this
Agreement or to further assure and confirm unto the Pledgee its rights, powers
and remedies hereunder or thereunder.

 

(b)                                 Each Pledgor hereby appoints the
Pledgee, such Pledgor’s attorney-in-fact, with full authority in the place and
stead of such Pledgor and in the name of such Pledgor or otherwise, from time
to time after the occurrence and during the continuance of an Event of Default,
in the Pledgee’s reasonable discretion to take any action and to execute any
instrument which the Pledgee may reasonably deem necessary or advisable to
accomplish the purposes of this Agreement.

 

13.                                 THE
PLEDGEE AS COLLATERAL AGENT.  The
Pledgee will hold in accordance with this Agreement all items of the Collateral
at any time received under this Agreement. 
It is expressly understood and agreed that the obligations of the
Pledgee as holder of the Collateral and interests therein and with respect to
the disposition thereof, and otherwise under this Agreement, are only those
expressly set forth in this Agreement. 
The Pledgee shall act hereunder on the terms and conditions set forth
herein and in Section 10 of the Credit Agreement.

 

14.                                 TRANSFER
BY THE PLEDGORS.  No Pledgor will
sell or otherwise dispose of, grant any option with respect to, or mortgage,
pledge or otherwise encumber any of the Collateral or any interest therein
(except in accordance with the terms of this Agreement and the other Secured
Debt Agreements).

 

15.                                 REPRESENTATIONS,
WARRANTIES AND COVENANTS OF THE PLEDGORS. 
(a)  Each Pledgor represents,
warrants and covenants that:

 

(i)                                     it
is, or at the time when pledged hereunder will be, the legal, beneficial and
record owner of, and has (or will have) good and marketable title to, all
Securities pledged by it hereunder, subject to no pledge, lien, mortgage,
hypothecation, security interest, charge, option or other encumbrance
whatsoever, except (x) the liens and security interests created by this Agreement
and (y) liens permitted by Section 7.03(a) of the Credit Agreement;

 

14

 

(ii)                                  it
has full power, authority and legal right to pledge all the Collateral pledged
by it pursuant to this Agreement;

 

(iii)                               this
Agreement has been duly authorized, executed and delivered by such Pledgor and
constitutes a legal, valid and binding obligation of such Pledgor enforceable
in accordance with its terms, except to the extent that the enforceability
thereof may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium or other similar laws generally affecting creditors’ rights and by
equitable principles (regardless of whether enforcement is sought in equity or
at law);

 

(iv)                              except
to the extent already obtained or made, no consent of any other party
(including, without limitation, any stockholder, limited or general partner,
member or creditor of such Pledgor or any of its Subsidiaries) and no consent,
license, permit, approval or authorization of, exemption by, notice or report
to, or registration, filing or declaration with, any governmental authority is
required to be obtained by such Pledgor in connection with (a) the execution,
delivery or performance of this Agreement, (b) the validity or enforceability
of this Agreement, (c) the perfection or enforceability of the Pledgee’ s
security interest in the Collateral or (d) except for compliance with or as may
be required by applicable securities laws, the exercise by the Pledgee of any
of its rights or remedies provided herein;

 

(v)                                 the
execution, delivery and performance of this Agreement by such Pledgor will not
violate any provision of any applicable law or regulation or of any order,
judgment, writ, award or decree of any court, arbitrator or governmental
authority, domestic or foreign, applicable to such Pledgor, or of the
certificate of incorporation, certificate of formation, by-laws, certificate of
limited partnership, partnership agreement or limited liability company
agreement, as the case may be, of such Pledgor or of any securities issued by
such Pledgor or any of its Subsidiaries, or of any mortgage, indenture, lease,
loan agreement, credit agreement or other material contract, agreement or
instrument or undertaking to which such Pledgor or any of its Subsidiaries is a
party or which purports to be binding upon such Pledgor or any of its
Subsidiaries or upon any of their respective assets and will not result in the
creation or imposition of (or the obligation to create or impose) any lien or encumbrance
on any of the assets of such Pledgor or any of its Subsidiaries except as
contemplated by this Agreement;

 

(vi)                              all
the shares of the Stock have been duly and validly issued, are fully paid and
non-assessable and are subject to no options to purchase or similar rights;

 

(vii)                           each of
the Pledged Notes constitutes, or when executed by the obligor thereof will
constitute, the legal, valid and binding obligation of such obligor,
enforceable in accordance with its terms, except to the extent that the enforceability
thereof may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium or other similar laws generally affecting creditors’ rights and by
equitable principles (regardless of whether enforcement is sought in equity or
at law);

 

(viii)                        the
pledge, assignment and delivery to the Pledgee of the Securities (other than
those constituting Uncertificated Securities) pursuant to this Agreement
creates a

 

15

 

valid and, assuming such Securities are held
in the continued possession of the Collateral Agent in the State of New York,
perfected first priority Lien in the Securities and the proceeds thereof,
subject to no other Lien or to any agreement purporting to grant to any third
party a Lien on the property or assets of such Pledgor which would include the
Securities (other than Liens permitted by Section 7.03(a) of the Credit
Agreement);

 

(ix)                                it
has the unqualified right to pledge and grant a security interest in the
Partnership Interests and Membership Interests as herein provided without the
consent of any other Person, firm, association or entity which has not been
obtained;

 

(x)                                   the
Partnership Interests and the Membership Interests pledged by it pursuant to
this Agreement have been validly acquired and are fully paid for and are duly
and validly pledged hereunder;

 

(xi)                                it
is not in default in the payment of any portion of any mandatory capital
contribution, if any, required to be made under any partnership agreement or
limited liability company agreement to which such Pledgor is a party, and such
Pledgor is not in violation of any other material provisions of any partnership
agreement or limited liability company agreement to which such Pledgor is a
party, or otherwise in default or violation thereunder, no Partnership Interest
or Membership Interest is subject to any defense, offset or counterclaim, nor
have any of the foregoing been asserted or alleged against such Pledgor by any
Person with respect thereto and as of the Initial Borrowing Date, there are no
certificates, instruments, documents or other writings (other than the
partnership agreements and certificates, if any, delivered to the Collateral
Agent) which evidence any Partnership Interest or Membership Interest of such
Pledgor;

 

(xii)                             the
pledge and assignment of the Partnership Interests and the Membership Interests
pursuant to this Agreement, together with the relevant filings, consents or
recordings (which filings, consents and recordings have been made or obtained),
creates a valid, perfected and continuing first security interest in such
Partnership Interests and Membership Interest and the proceeds thereof, subject
to no prior lien or encumbrance or to any agreement purporting to grant to any
third party a lien or encumbrance on the property or assets of such Pledgor
which would include the Collateral;

 

(xiii)                          there
are no currently effective financing statements under the UCC covering any
property which is now or hereafter may be included in the Collateral and such
Pledgor will not, without the prior written consent of the Pledgee, execute
and, until the Termination Date (as hereinafter defined), there will not ever
be on file in any public office, any enforceable financing statement or
statements covering any or all of the Collateral, except financing statements
filed or to be filed in favor of the Pledgee as secured party;

 

(xiv)                         it shall
give the Pledgee prompt notice of any written claim relating to the Collateral
and shall deliver to the Pledgee a copy of each other demand, notice or
document received by it which may adversely affect the Pledgee’s interest in
the

 

16

 

Collateral promptly upon, but in any event
within 10 days after, such Pledgor’ s receipt thereof;

 

(xv)                            it
shall not withdraw as a partner of any Pledged Partnership or member of any
Pledged LLC, or file or pursue or take any action which may, directly or
indirectly, cause a dissolution or liquidation of or with respect to any
Pledged Partnership or Pledged LLC or seek a partition of any property of any
Pledged Partnership or Pledged LLC, except as permitted by the Credit
Agreement;

 

(xvi)                         as of the
date hereof, all of its Partnership Interests and Membership Interests are
uncertificated and each Pledgor covenants and agrees that it will not approve
of any action by any Pledged Partnership or Pledged LLC to convert such
uncertificated interests into certificated interests;

 

(xvii)                      it will take
no action which would violate or be inconsistent with any of the terms of any
Secured Debt Agreement, or which would have the effect of impairing the
position or interests of the Pledgee or any other Secured Creditor under any
Secured Debt Agreement except as permitted by the Credit Agreement; and

 

(xviii)                   “control” (as
defined in Section 8-106 of the UCC) has been obtained by the Pledgee over
all of such Pledgor’s Collateral consisting of Securities (including, without
limitation, Notes which are Securities) with respect to which such “control”
may be obtained pursuant to Section 8-106 of the UCC, except to the extent
that the obligation of the applicable Pledgor to provide the Pledgee with “control”
of such Collateral has not yet arisen under this Agreement; provided
that in the case of the Pledgee obtaining “control” over Collateral consisting
of a Security Entitlement, such Pledgor shall have taken all steps in its
control so that the Pledgee obtains “control” over such Security Entitlement.

 

16.                                 PLEDGORS’
OBLIGATIONS ABSOLUTE, ETC.  The
obligations of each Pledgor under this Agreement shall be absolute and
unconditional and shall remain in full force and effect without regard to, and
shall not be released, suspended, discharged, terminated or otherwise affected
by, any circumstance or occurrence whatsoever, including, without limitation:

 

(i)                                     any
renewal, extension, amendment or modification of, or addition or supplement to
or deletion from any of the Secured Debt Agreements, or any other instrument or
agreement referred to therein, or any assignment or transfer of any thereof;

 

(ii)                                  any
waiver, consent, extension, indulgence or other action or inaction under or in
respect of any such agreement or instrument or this Agreement;

 

(iii)                               any
furnishing of any additional security to the Pledgee or its assignee or any
acceptance thereof or any release of any security by the Pledgee or its
assignee;

 

(iv)                              any
limitation on any party’s liability or obligations under any such instrument or
agreement or any invalidity or unenforceability, in whole or in part, of any
such instrument or agreement or any term thereof; or

 

17

 

(v)                                 any
bankruptcy, insolvency, reorganization, composition, adjustment, dissolution,
liquidation or other like proceeding relating to such Pledgor or any Subsidiary
of such Pledgor, or any action taken with respect to this Agreement by any
trustee or receiver, or by any court, in any such proceeding, whether or not
such Pledgor shall have notice or knowledge of any of the foregoing.

 

17.                                 REGISTRATION,
ETC.  (a)  If an Event of Default shall have occurred
and be continuing and any Pledgor shall have received from the Pledgee a
written request or requests that such Pledgor cause any registration,
qualification or compliance under any Federal or state securities law or laws to
be effected with respect to all or any part of the Pledged Stock, such Pledgor
as soon as practicable and at its expense will use its best efforts to cause
such registration to be effected (and be kept effective) and will use its best
efforts to cause such qualification and compliance to be effected (and be kept
effective) as may be so requested and as would permit or facilitate the sale
and distribution of such Pledged Stock, including, without limitation,
registration under the Securities Act of 1933, as then in effect (or any
similar statute then in effect), appropriate qualifications under applicable
blue sky or other state securities laws and appropriate compliance with any
other governmental requirements, provided
that the Pledgee shall furnish to such Pledgor such information regarding the
Pledgee as such Pledgor may request in writing and as shall be required in
connection with any such registration, qualification or compliance.  Each Pledgor will cause the Pledgee to be
kept reasonably advised in writing as to the progress of each such
registration, qualification or compliance and as to the completion thereof,
will furnish to the Pledgee such number of prospectuses, offering circulars and
other documents incident thereto as the Pledgee from time to time may
reasonably request, and will indemnify, to the extent permitted by law, the
Pledgee, each other Secured Creditor and all others participating in the
distribution of such Pledged Stock against all claims, losses, damages or
liabilities caused by any untrue statement (or alleged untrue statement) of a
material fact contained therein (or in any related registration statement,
notification or the like) or by any omission (or alleged omission) to state
therein (or in any related registration statement, notification or the like) a
material fact required to be stated therein or necessary to make the statements
therein not misleading, except insofar as the same may have been caused by an
untrue statement or omission based upon information furnished in writing to
such Pledgor by the Pledgee or such other Secured Creditor expressly for use
therein.

 

(b)                                 If at any time when the Pledgee
shall determine to exercise its right to sell all or any part of the Pledged
Securities pursuant to Section 7, and such Pledged Securities or the part
thereof to be sold shall not, for any reason whatsoever, be effectively
registered under the Securities Act of 1933, as then in effect, the Pledgee
may, in its sole and absolute discretion, sell such Pledged Securities or part
thereof by private sale in such manner and under such circumstances as the
Pledgee may deem necessary or advisable in order that such sale may legally be
effected without such registration. 
Without limiting the generality of the foregoing, in any such event the
Pledgee, in its sole and absolute discretion, (i) may proceed to make such
private sale notwithstanding that a registration statement for the purpose of
registering such Pledged Securities or part thereof shall have been filed under
such Securities Act, (ii) may approach and negotiate with a single possible
purchaser to effect such sale and (iii) may restrict such sale to a purchaser
who will represent and agree that such purchaser is purchasing for its own
account, for investment, and not with a view to the distribution or sale of
such Pledged Securities or part thereof. 
In the event of any such sale, the Pledgee shall incur no responsibility

 

18

 

or liability for selling all or any part of the Pledged Securities at a
price which the Pledgee, in its sole and absolute discretion, may in good faith
deem reasonable under the circumstances, notwithstanding the possibility that a
substantially higher price might be realized if the sale were deferred until
the registration as aforesaid.

 

18.                                 TERMINATION;
RELEASE.  (a)  After the Termination Date (as defined
below), this Agreement shall terminate (provided
that all indemnities set forth herein including, without limitation, in Section 11
hereof shall survive any such termination) and the Pledgee, at the request and
expense of the respective Pledgor, will execute and deliver to such Pledgor a
proper instrument or instruments acknowledging the satisfaction and termination
of this Agreement as provided above, and will duly assign, transfer and deliver
to such Pledgor (without recourse and without any representation or warranty)
such of the Collateral as may be in the possession of the Pledgee and as has
not theretofore been sold or otherwise applied or released pursuant to this
Agreement, together with any moneys at the time held by the Pledgee hereunder
and, with respect to any Collateral consisting of an Uncertificated Security, a
Partnership Interest or a Membership Interest (other than an Uncertificated
Security, Partnership Interest or Membership Interest credited on the books of
a Clearing Corporation or Securities Intermediary), a termination of the
agreement relating thereto executed and delivered by the issuer of such
Uncertificated Security pursuant to Section 3.2(a)(ii) or by the
respective partnership or limited liability company pursuant to Section 3.2(a)(iv)(2).  As used in this Agreement, “Termination
Date” shall mean the date upon which the Total Commitment and all Secured
Interest Rate Agreements have been terminated, no Note under the Credit
Agreement is outstanding (and all Loans have been paid in full) and all other
Obligations have been paid in full (other than arising from indemnities for
which no request has been made).

 

(b)                                 In the event that any part of
the Collateral is sold or otherwise disposed of in connection with a sale or
other disposition permitted by Section 7.02 of the Credit Agreement or is
otherwise released at the direction of the Required Lenders (or all the Lenders
if required by Section 11.12 of the Credit Agreement), and the proceeds of
such sale or other disposition or from such release are applied in accordance
with the terms of the Credit Agreement to the extent required to be so applied,
the Pledgee, at the request and expense of the respective Pledgor, will release
such Collateral from this Agreement, duly assign, transfer and deliver to such
Pledgor (without recourse and without any representation or warranty) such of
the Collateral as is then being (or has been) so sold, disposed of or released
and as may be in possession of the Pledgee and has not theretofore been
released pursuant to this Agreement.

 

(c)                                  At any time that any Pledgor
desires that Collateral be released as provided in the foregoing Section 18(a)
or (b), it shall deliver to the Pledgee a certificate signed by a principal
executive officer stating that the release of the respective Collateral is
permitted pursuant to Section 18(a) or (b).  The Pledgee shall have no liability
whatsoever to any Secured Creditor as the result of any release of Collateral
by it in accordance with (or which the Pledgee in the absence of gross
negligence and willful misconduct believes to be in accordance with) this Section 18.

 

19.                                 NOTICES,
ETC.  All notices and other
communications hereunder shall be in writing (including telegraphic, telex,
telecopier, facsimile or cable communication) and

 

19

 

shall be delivered, telegraphed, telexed, telecopied, faxed, cabled, or
mailed (by first class mail, postage prepaid):

 

(i)                                     if
to any Pledgor, at its address set forth opposite its signature below;

 

(ii)                                  if
to the Pledgee, at:

 

Deutsche Bank Trust Company Americas

60 Wall Street

New York, New York  10005

Attention:  Anca Trifan

Tel:                            (212)
250-6159

Fax:                           (212)
797-5692

 

(iii)                               if
to any Lender Creditor (other than the Pledgee), either (x) to the
Administrative Agent, at the address of the Administrative Agent specified in
the Credit Agreement or (y) at such address as such Lender Creditor shall have
specified in the Credit Agreement;

 

(iv)                              if
to any Interest Rate Creditor, at such address as such Interest Rate Creditor
shall have specified in writing to the Pledgors and the Pledgee;

 

or at such other
address as shall have been furnished in writing by any Person described above
to the party required to give notice hereunder.

 

20.                                 WAIVER;
AMENDMENT.  None of the terms and
conditions of this Agreement may be changed, waived, modified or varied in any
manner whatsoever unless in writing duly signed by the Pledgee (with the
consent of the Required Lenders or, to the extent required by Section 11.12
of the Credit Agreement, all of the Lenders) and each Pledgor affected thereby,
provided that (i) no such change, waiver,
modification or variance shall be made to Section 9 hereof or this Section 20
without the consent of each Secured Creditor adversely affected thereby and
(ii) any change, waiver, modification or variance affecting the rights and
benefits of a single Class (as defined below) of Secured Creditors (and not all
Secured Creditors in a like or similar manner) shall require the written
consent of the Requisite Creditors (as defined below) of such Class of Secured
Creditors. 
For the purpose of this Agreement, the term “Class” shall
mean each class of Secured Creditors, i.e., whether (x) the Lender
Creditors as holders of the Credit Document Obligations or (y) the Interest
Rate Creditors as holders of the Interest Rate Obligations.  For the purpose of this Agreement, the term “Requisite
Creditors” of any Class shall mean (x) with respect to the Credit Document
Obligations, the Required Lenders (or, to the extent required by Section 11.12
of the Credit Agreement, all of the Lenders) and (y) with respect to the
Interest Rate Obligations, the holders of at least a majority of all
obligations outstanding from time to time under the Secured Interest Rate
Agreements.

 

21.                                 PLEDGEE
NOT BOUND.  (a)  Nothing herein shall be construed to make the
Pledgee or any other Secured Creditor liable as a general partner or limited partner
of any Pledged Partnership or a member of any Pledged LLC, and neither the
Pledgee nor any Secured Creditor by virtue of this Agreement or otherwise
(except as referred to in the following sentence) shall have any of the duties,
obligations or liabilities of a general partner or limited

 

20

 

partner of any Pledged Partnership or a member of any Pledged LLC.  The parties hereto expressly agree that,
unless the Pledgee shall become the absolute owner of a Partnership Interest or
a Membership Interest pursuant hereto, this Agreement shall not be construed as
creating a partnership or joint venture or membership agreement among the
Pledgee, any other Secured Creditor and/or a Pledgor.

 

(b)                                 Except as provided in the last
sentence of paragraph (a) of this Section 21, the Pledgee, by accepting
this Agreement, does not intend to become a general partner or limited partner
of any Pledged Partnership or a member of any Pledged LLC or otherwise be
deemed to be a co-venturer with respect to any Pledgor or any Pledged
Partnership or a member of any Pledged LLC either before or after an Event of
Default shall have occurred.  The Pledgee shall have only those powers
set forth herein and shall assume none of the duties, obligations or
liabilities of a general partner or limited partner of any Pledged Partnership
or of a member of any Pledged LLC or of a Pledgor.

 

(c)                                  The Pledgee shall not be
obligated to perform or discharge any obligation of a Pledgor as a result of
the collateral assignment hereby effected.

 

(d)                                 The acceptance by the Pledgee of
this Agreement, with all the rights, powers, privileges and authority so
created, shall not at any time or in any event obligate the Pledgee to appear
in or defend any action or proceeding relating to the Collateral to which it is
not a party, or to take any action hereunder or thereunder, or to expend any
money or incur any expenses or perform or discharge any obligation, duty or
liability under the Collateral.

 

22.                                 MISCELLANEOUS.  This Agreement shall create a continuing
security interest in the Collateral and shall (i) remain in full force and
effect, subject to release and/or termination as set forth in Section 18,
(ii) be binding upon each Pledgor, its successors and assigns; provided that no Pledgor shall assign any of
its rights or obligations hereunder without the prior written consent of the
Pledgee (with the prior written consent of the Required Lenders or to the
extent required by Section 11.12 of the Credit Agreement, all of the
Lenders), and (iii) inure, together with the rights and remedies of the Pledgee
hereunder, to the benefit of the Pledgee, the other Secured Creditors and their
respective successors, transferees and assigns. 
The headings of the several sections and subsections in this Agreement
are for purposes of reference only and shall not limit or define the meaning
hereof.  This Agreement may be executed
in any number of counterparts, each of which shall be an original, but all of
which together shall constitute one instrument. 
In the event that any provision of this Agreement shall prove to be
invalid or unenforceable, such provision shall be deemed to be severable from
the other provisions of this Agreement which shall remain binding on all
parties hereto.

 

23.                                 GOVERNING
LAW, ETC.  (a)  THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS
OF THE SECURED CREDITORS AND OF THE UNDERSIGNED HEREUNDER SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK WITHOUT
REGARD TO PRINCIPLES OF CONFLICT OF LAWS. 
Any legal action or proceeding with respect to this Agreement or any
other Credit Document may be brought in the courts of the State of New York or
of the United States of America for the Southern District of New York, and, by
execution and delivery of this Agreement, each NSG Pledgor hereby irrevocably
accepts for

 

21

 

itself and in respect of its property, generally and unconditionally,
the jurisdiction of the aforesaid courts. 
Each NSG Pledgor further irrevocably consents to the service of process
out of any of the aforementioned courts in any such action or proceeding by the
mailing of copies thereof by registered or certified mail, postage prepaid, to
each NSG Pledgor at its address set forth opposite its signature below, such
service to become effective 30 days after such mailing.  Nothing herein shall affect
the right of any of the Secured Creditors to serve process in any other manner
permitted by law or to commence legal proceedings or otherwise proceed against
any Pledgor in any other jurisdiction.

 

(b)                                 Each NSG Pledgor hereby
irrevocably waives any objection which it may now or hereafter have to the
laying of venue of any of the aforesaid actions or proceedings arising out of
or in connection with this Agreement or any other Credit Document brought in
the courts referred to in clause (a) above and hereby further irrevocably
waives and agrees not to plead or claim in any such court that such action or
proceeding brought in any such court has been brought in an inconvenient forum.

 

(c)                                  Each Pledgor and the Pledgee
hereby irrevocably waive all right to a trial by jury in any action, proceeding
or counterclaim arising out of or relating to this Agreement, the other Credit
Documents or the transactions contemplated hereby or thereby.

 

24.                                 ADDITIONAL
PLEDGORS.  It is understood and
agreed that any Subsidiary of the Borrower that is required to execute a
counterpart of this Agreement pursuant to the Credit Agreement shall become a
Pledgor hereunder by executing a counterpart hereof and delivering the same to
the Pledgee and Annexes A, B, C and D will be modified at such time in a manner
acceptable to the Pledgee to give effect to such additional Pledgor.

 

25.                                 COUNTERPARTS.  This Agreement may be executed in any number
of counterparts and by the different parties hereto on separate counterparts,
each of which when so executed and delivered shall be an original, but all of
which shall together constitute one and the same instrument.  A set of counterparts executed by all the
parties hereto shall be lodged with each Pledgor and the Pledgee.

 

26.  CONTRIBUTION.  At any time a payment is made by any Pledgor
(other than the Borrower) (each, a “Subsidiary Pledgor”) in respect of
the Obligations from the proceeds of any sale or other disposition of
Collateral owned by such Subsidiary Pledgor (each, a “Relevant Payment”),
the right of contribution of each Subsidiary Pledgor hereunder against each
other such Subsidiary Pledgor shall be determined as provided in the
immediately following sentence, with the right of contribution of each
Subsidiary Pledgor to be revised and restated as of each date on which a
Relevant Payment is made.  At any time
that a Relevant Payment is made by a Subsidiary Pledgor that results in the
aggregate payments made by such Subsidiary Pledgor hereunder in respect of the
Obligations to and including the date of the Relevant Payment exceeding such
Subsidiary Pledgor’s Contribution Percentage (as defined below) of the
aggregate payments made by all Subsidiary Pledgors hereunder in respect of the
Obligations from the proceeds of any sale or other disposition of Collateral
owned by the Subsidiary Pledgors to and including the date of the Relevant
Payment (such excess, the “Aggregate Excess Amount”), each such
Subsidiary Pledgor shall have a right of contribution against each other
Subsidiary Pledgor who either has not made any payments or has made (or whose
Collateral has

 

22

 

been used to make) payments hereunder in respect of the Obligations to
and including the date of the Relevant Payment in an aggregate amount less than
such other Subsidiary Pledgor’s Contribution Percentage of the aggregate
payments made to and including the date of the Relevant Payment by all
Subsidiary Pledgors hereunder in respect of the Obligations from the proceeds
of any sale or other disposition of Collateral owned by the Subsidiary Pledgors
(the aggregate amount of such deficit, the “Aggregate Deficit Amount”) in
an amount equal to (x) a fraction the numerator of which is the Aggregate
Excess Amount of such Subsidiary Pledgor and the denominator of which is the
Aggregate Excess Amount of all Subsidiary Pledgors multiplied by (y) the
Aggregate Deficit Amount of such other Subsidiary Pledgor.  A Subsidiary Pledgor’s right of contribution
pursuant to the preceding sentences shall arise at the time of each
computation, subject to adjustment to the time of any subsequent computation; provided,
that no Subsidiary Pledgor may take any action to enforce such right until the
Obligations have been paid in full and the Total Commitment has been
terminated, it being expressly recognized and agreed by all parties hereto that
any Subsidiary Pledgor’s right of contribution arising pursuant to this
Agreement against any other Subsidiary Pledgor shall be expressly junior and
subordinate to such other Subsidiary Pledgor’s obligations and liabilities in
respect of the Obligations and any other obligations owing under this
Agreement.  As used in this Section 26:  (i) each Subsidiary Pledgor’s “Contribution
Percentage” shall mean the percentage obtained by dividing (x) the Adjusted
Net Worth (as defined below) of such Subsidiary Pledgor by (y) the aggregate
Adjusted Net Worth of all Subsidiary Pledgors; (ii) the “Adjusted Net Worth”
of each Subsidiary Pledgor shall mean the greater of (x) the Net Worth (as
defined below) of such Subsidiary Pledgor and (y) zero; and (iii) the “Net
Worth” of each Subsidiary Pledgor shall mean the amount by which the fair
salable value of such Subsidiary Pledgor’s assets on the date of any Relevant
Payment exceeds its existing debts and other liabilities (including contingent
liabilities, but without giving effect to any obligations arising under this
Agreement, any Guaranteed Obligations under, and as defined in, the Subsidiary
Guaranty or any guaranteed obligations arising under any guaranty of the
Permitted Senior Subordinated Notes or the Permitted Senior Unsecured Notes) on
such date.  All parties hereto recognize
and agree that, except for any right of contribution arising pursuant to this Section 26,
each Subsidiary Pledgor who makes (or whose Collateral has been used to make)
any payment in respect of the Obligations shall have no right of contribution or
subrogation against any other Subsidiary Pledgor in respect of such
payment.  Each of the Subsidiary Pledgors
recognizes and acknowledges that the rights to contribution arising hereunder
shall constitute an asset in favor of the party entitled to such contribution.  In this connection, each Subsidiary Pledgor
has the right to waive its contribution right against any Subsidiary Pledgor to
the extent that after giving effect to such waiver such Subsidiary Pledgor would
remain solvent, in the determination of the Required Lenders.

 

27.                                 LEGAL
NAMES; TYPE OF ORGANIZATION (AND WHETHER A REGISTERED ORGANIZATION AND/OR A
TRANSMITTING UTILITY); JURISDICTION OF ORGANIZATION; LOCATION; ORGANIZATIONAL
IDENTIFICATION NUMBERS; CHANGES THERETO; ETC. 
No Pledgor shall change its legal name, its type of organization, its
status as a Registered Organization (in the case of a Registered Organization),
its status as a Transmitting Utility or as a Person which is not a Transmitting
Utility, as the case may be, its jurisdiction of organization, its Location, or
its organizational identification number (if any), except that any such changes
shall be permitted (so long as not in violation of the applicable requirements
of the Secured Debt Agreements and so long as same do not involve (x) a
Registered Organization ceasing to constitute same or (y) any Pledgor changing
its jurisdiction

 

23

 

of organization or Location from the United States or a State thereof
to a jurisdiction of organization or Location, as the case may be, outside the
United States or a State thereof) if (i) it shall have given to the Collateral
Agent not less than 10 days’ prior written notice of each change to its legal
name, its type of organization, whether or not it is a Registered Organization,
its jurisdiction of organization, its Location, its organizational
identification number (if any), and whether or not it is a Transmitting
Utility, and (ii) in connection with the respective such change or changes, it
shall have taken all action reasonably requested by the Collateral Agent to
maintain the security interests of the Collateral Agent in the Collateral
intended to be granted hereby at all times fully perfected and in full force
and effect.  In addition, to the extent
that any Pledgor does not have an organizational identification number on the
date hereof and later obtains one, such Pledgor shall promptly thereafter
deliver a notification of the Collateral Agent of such organizational
identification number and shall take all actions reasonably satisfactory to the
Collateral Agent to the extent necessary to maintain the security interest of
the Collateral Agent in the Collateral intended to be granted hereby fully
perfected and in full force and effect.

 

28.                                 CHANGE
OF CONTROL.  The Pledgee acknowledges
that, under existing law, a change of control of a Subsidiary whose equity
interests are pledged hereunder as a result of a proposed exercise of remedies
hereunder may require the prior approval of the FCC and/or a PUC.  The Pledgee further acknowledges that,
notwithstanding the provisions of Section 5 and Sections 7(a)(ii), (iv)
and (vi), with respect to any Collateral constituting Securities issued by a
Person organized under the laws of any State of the United States, to the
extent (and only to the extent) that the laws of such State specifically
require that regulatory approval be obtained prior to such Pledgee enforcing
its rights hereunder with respect to such Collateral, the Pledgee shall not be
entitled to enforce its rights hereunder with respect to such Collateral
without first obtaining such required regulatory approval.

 

29.                                 SEVERABILITY.  Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

 

30.                                 HEADINGS
DESCRIPTIVE.  The headings of the several
Sections of this Agreement are inserted for convenience only and shall not in
any way affect the meaning or construction of any provision of this Agreement.

 

*   *  
*   *

 

24

 

 

IN WITNESS WHEREOF, each
Pledgor and the Pledgee have caused this Agreement to be executed and delivered
by their duly authorized officers as of the date first above written.

 

	
  Address:

  	
  FAIRPOINT COMMUNICATIONS, INC.,

  
	
  521 East
  Morehead Street, Suite 250

  	
   

  	
  as a Pledgor

  
	
  Charlotte, NC
  28202

  	
   

  
	
   

  	
  By:

  	
   /s/ Timothy W. Henry

  	
   

  
	
   

  	
   

  	
    Title: Vice
  President of Finance

  & Treasurer

  
	
   

  	
   

  
	
  Address:

  	
  ST ENTERPRISES, LTD.,

  
	
  c/o Fairpoint
  Communications, Inc.

  	
   

  	
  as a Pledgor

  
	
  521 East Morehead
  Street, Suite 250

  	
   

  
	
  Charlotte, NC
  28202

  	
   

  
	
   

  	
  By:

  	
   /s/ Timothy W. Henry

  	
   

  
	
   

  	
   

  	
    Title: Vice
  President of Finance

  & Treasurer

  
	
   

  	
   

  
	
  Address:

  	
  FAIRPOINT BROADBAND, INC.,

  
	
  c/o Fairpoint
  Communications, Inc.

  	
   

  	
  as a Pledgor

  
	
  521 East
  Morehead Street, Suite 250

  	
   

  
	
  Charlotte, NC
  28202

  	
   

  
	
   

  	
  By:

  	
   /s/ Timothy W. Henry

  	
   

  
	
   

  	
   

  	
    Title: Vice
  President of Finance

  & Treasurer

  
	
   

  	
   

  
	
  Address:

  	
  MJD SERVICES CORP.,

  
	
  c/o Fairpoint
  Communications, Inc.

  	
   

  	
  as a Pledgor

  
	
  521 East
  Morehead Street, Suite 250

  	
   

  
	
  Charlotte, NC
  28202

  	
   

  
	
   

  	
  By:

  	
   /s/ Timothy W. Henry

  	
   

  
	
   

  	
   

  	
    Title: Vice
  President of Finance

  & Treasurer

  
	
   

  	
   

  
	
  Address:

  	
  MJD VENTURES, INC.,

  
	
  c/o Fairpoint
  Communications, Inc.

  	
   

  	
  as a Pledgor

  
	
  521 East
  Morehead Street, Suite 250

  	
   

  
	
  Charlotte, NC
  28202

  	
   

  
	
   

  	
  By:

  	
   /s/ Timothy W. Henry

  	
   

  
	
   

  	
   

  	
    Title: Vice
  President of Finance

  & Treasurer

  
					

 

25

 

	
  Address:

  	
  C-R COMMUNICATIONS, INC.,

  
	
  c/o Fairpoint
  Communications, Inc.

  	
   

  	
  as a Pledgor

  
	
  521 East
  Morehead Street, Suite 250

  	
   

  
	
  Charlotte, NC
  28202

  	
   

  
	
   

  	
  By:

  	
   /s/ Timothy W. Henry

  	
   

  
	
   

  	
   

  	
    Title: Vice
  President of Finance

  & Treasurer

  
	
   

  	
   

  
	
  Address:

  	
  COMERCO, INC.,

  
	
  c/o Fairpoint
  Communications, Inc.

  	
   

  	
  as a Pledgor

  
	
  521 East
  Morehead Street, Suite 250

  	
   

  
	
  Charlotte, NC
  28202

  	
   

  
	
   

  	
  By:

  	
   /s/ Timothy W. Henry

  	
   

  
	
   

  	
   

  	
    Title: Vice
  President of Finance

  & Treasurer

  
	
   

  	
   

  
	
  Address:

  	
  GTC COMMUNICATIONS, INC.,

  
	
  c/o Fairpoint
  Communications, Inc.

  	
   

  	
  as a Pledgor

  
	
  521 East
  Morehead Street, Suite 250

  	
   

  
	
  Charlotte, NC
  28202

  	
   

  
	
   

  	
  By:

  	
   /s/ Timothy W. Henry

  	
   

  
	
   

  	
   

  	
    Title: Vice
  President of Finance

  & Treasurer

  
	
   

  	
   

  
	
  Address:

  	
  RAVENSWOOD COMMUNICATIONS, INC.,

  
	
  c/o Fairpoint
  Communications, Inc.

  	
   

  	
  as a Pledgor

  
	
  521 East
  Morehead Street, Suite 250

  	
   

  
	
  Charlotte, NC
  28202

  	
   

  
	
   

  	
  By:

  	
   /s/ Timothy W. Henry

  	
   

  
	
   

  	
   

  	
    Title: Vice
  President of Finance

  & Treasurer

  
	
   

  	
   

  
	
  Address:

  	
  UTILITIES, INC.,

  
	
  c/o Fairpoint
  Communications, Inc.

  	
   

  	
  as a Pledgor

  
	
  521 East
  Morehead Street, Suite 250

  	
   

  
	
  Charlotte, NC
  28202

  	
   

  
	
   

  	
  By:

  	
   /s/ Timothy W. Henry

  	
   

  
	
   

  	
   

  	
    Title: Vice
  President of Finance

  & Treasurer

  
	
   

  	
   

  
	
  Address:

  	
  FAIRPOINT CARRIER SERVICES, INC.,

  
	
  c/o Fairpoint
  Communications, Inc.

  	
   

  	
  as a Pledgor

  
	
  521 East
  Morehead Street, Suite 250

  	
   

  
	
  Charlotte, NC
  28202

  	
   

  
	
   

  	
  By:

  	
   /s/ Timothy W. Henry

  	
   

  
	
   

  	
   

  	
    Title: Vice
  President of Finance

  & Treasurer

  
							

 

26

 

	
  Address:

  	
  ST. JOE
  COMMUNICATIONS, INC.,

  
	
  c/o FairPoint
  Communications, Inc.

  	
   

  	
  as a Pledgor

  
	
  521 East
  Morehead Street, Suite 250

  	
   

  
	
  Charlotte, NC
  28202

  	
   

  
	
   

  	
  By:

  	
   /s/ Timothy W. Henry

  	
   

  
	
   

  	
   

  	
    Title: Vice
  President of Finance

  & Treasurer

  
	
   

  	
   

  
	
  Accepted and
  Agreed to:

  	
   

  
	
   

  	
   

  
	
  DEUTSCHE BANK
  TRUST COMPANY AMERICAS,

  
	
   

  	
  as Collateral
  Agent and Pledgee

  
	
   

  
	
  By:

  	
   /s/ Anca Trifan

  	
   

  
	
   

  	
    Title:  Director

  
						

 

27

 

ANNEX A

 

LIST OF PLEDGED SUBSIDIARIES OF FAIRPOINT COMMUNICATIONS, INC.

 

	
  A.

  	
   

  	
  ST
  Enterprises, Ltd.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  1.

  	
   

  	
  Sunflower
  Telephone Company, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  2.

  	
   

  	
  STE/NE
  Acquisition Corp., d/b/a/ Northland Telephone Company of Vermont

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  3.

  	
   

  	
  Northland
  Telephone Company of Maine, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  4.

  	
   

  	
  ST Computer
  Resources, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  5.

  	
   

  	
  ST Long
  Distance, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  B.

  	
   

  	
  MJD
  Ventures, Inc.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  1.

  	
   

  	
  The Columbus
  Grove Telephone Company

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  2.

  	
   

  	
  C-R
  Communications, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  a.

  	
   

  	
  C-R
  Telephone Company

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  3.

  	
   

  	
  Taconic
  Telephone Corp.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  4.

  	
   

  	
  Ellensburg
  Telephone Company

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  5.

  	
   

  	
  Sidney
  Telephone Company

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  6.

  	
   

  	
  Utilities,
  Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  a.

  	
   

  	
  Standish
  Telephone Company

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  b.

  	
   

  	
  China
  Telephone Company

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  c.

  	
   

  	
  Maine
  Telephone Company

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  7.

  	
   

  	
  Telephone
  Service Company

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  8.

  	
   

  	
  Chouteau
  Telephone Company

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  9.

  	
   

  	
  Chautauqua and
  Erie Telephone Corporation

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  10.

  	
   

  	
  The Orwell
  Telephone Company

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  11.

  	
   

  	
  GTC
  Communications, Inc. (f/k/a TPG Communications, Inc.)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  a.

  	
   

  	
  St. Joe
  Communications, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  i.

  	
   

  	
  GTC, Inc.

  
															

 

 

	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  12.

  	
   

  	
  Peoples
  Mutual Telephone Company

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  13.

  	
   

  	
  Fremont
  Telcom Co.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  14.

  	
   

  	
  Comerco,
  Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  a.

  	
   

  	
  YCOM
  Networks, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  15.

  	
   

  	
  Community
  Service Telephone Co.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  16.

  	
   

  	
  Marianna and
  Scenery Hill Telephone Company

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  C.

  	
   

  	
  MJD
  Services Corp.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  1.

  	
   

  	
  Bluestem Telephone
  Company

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  2.

  	
   

  	
  Big Sandy
  Telecom, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  3.

  	
   

  	
  Odin
  Telephone Exchange, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  4.

  	
   

  	
  Columbine
  Telecom Company (f/k/a Columbine Acquisition Corp.)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  5.

  	
   

  	
  Ravenswood
  Communications, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  a.

  	
   

  	
  The El Paso
  Telephone Company

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  6.

  	
   

  	
  Yates City
  Telephone Company

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  D.

  	
   

  	
  FairPoint
  Broadband, Inc. (f/k/a MJD Holdings Corp.)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  E.

  	
   

  	
  FairPoint Carrier Services, Inc.

  
								

 

2

 

ANNEX B

 

LIST OF PLEDGED STOCK

 

I.              FAIRPOINT
COMMUNICATIONS, INC. (F/K/A MJD COMMUNICATIONS, INC.)(1)

 

	
   

  	
   

  	
  Name of Issuing

  Corporation

  	
   

  	
  Type of

  Shares

  	
   

  	
  Number of

  Shares

  	
   

  	
  Percentage

  Owned

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
   

  	
  FairPoint Broadband, Inc.

  	
   

  	
  Common

  	
   

  	
  100

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
  MJD Services Corp.

  	
   

  	
  Common

  	
   

  	
  100

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
   

  	
  MJD Ventures, Inc.

  	
   

  	
  Common

  	
   

  	
  100

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.

  	
   

  	
  FairPoint Carrier Services, Inc.

  	
   

  	
  Common

  	
   

  	
  100

  	
   

  	
  100

  	
  %

  

 

A.                                    MJD
SERVICES CORP.

 

	
   

  	
   

  	
  Name of Issuing

  Corporation

  	
   

  	
  Type of

  Shares

  	
   

  	
  Number of

  Shares

  	
   

  	
  Percentage

  Owned

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
   

  	
  Bluestem
  Telephone Company

  	
   

  	
  Common

  	
   

  	
  100

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
  Big Sandy
  Telecom, Inc.

  	
   

  	
  Common

  	
   

  	
  100

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
   

  	
  Odin
  Telephone Exchange, Inc.

  	
   

  	
  Common

  	
   

  	
  95.2857

  	
   

  	
  100

  	
  %(2)

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.

  	
   

  	
  Columbine
  Telecom Company

  	
   

  	
  Common

  	
   

  	
  100

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
   

  	
  Ravenswood
  Communications, Inc.

  	
   

  	
  Common

  	
   

  	
  405

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6.

  	
   

  	
  Yates City
  Telephone Company

  	
   

  	
  Common

  	
   

  	
  252

  	
   

  	
  100

  	
  %

  

 

B.                                    MJD
VENTURES, INC.

 

	
   

  	
   

  	
  Name of Issuing

  Corporation

  	
   

  	
  Type of

  Shares

  	
   

  	
  Number of

  Shares

  	
   

  	
  Percentage

  Owned

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
   

  	
  The Columbus
  Grove Telephone Company

  	
   

  	
  Common

  	
   

  	
  318

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
  C-R
  Communications, Inc.

  	
   

  	
  Common

  	
   

  	
  750

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
   

  	
  Taconic
  Telephone Corp.

  	
   

  	
  Common

  	
   

  	
  100

  	
   

  	
  100

  	
  %

  

 

(1)           FairPoint Communications, Inc. stock will not be pledged.

 

(2)           There are Warrants outstanding for the purchase of ST
Enterprises, LTD Common Stock.

 

 

	
  4.

  	
   

  	
  Ellensburg
  Telephone Company

  	
   

  	
  Common

  	
   

  	
  100

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
   

  	
  Sidney
  Telephone Company

  	
   

  	
  Common

  	
   

  	
  100

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6.

  	
   

  	
  Utilities,
  Inc.

  	
   

  	
  Common

  	
   

  	
  100

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.

  	
   

  	
  Chouteau
  Telephone Company

  	
   

  	
  Common

  	
   

  	
  100

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.

  	
   

  	
  Chautauqua
  and Erie Telephone Corporation

  	
   

  	
  Common

  	
   

  	
  100

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9.

  	
   

  	
  The Orwell
  Telephone Company

  	
   

  	
  Common

  	
   

  	
  4,795.7461

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  10.

  	
   

  	
  Telephone
  Service Company

  	
   

  	
  Common

  	
   

  	
  100

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11.

  	
   

  	
  GTC
  Communications, Inc.

  	
   

  	
  Common

  	
   

  	
  1,000,000

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12.

  	
   

  	
  Peoples
  Mutual Telephone Company

  	
   

  	
  Common

  	
   

  	
  9,832

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  13.

  	
   

  	
  Fremont
  Telcom Co.

  	
   

  	
  Common

  	
   

  	
  5,155.5

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  14.

  	
   

  	
  Comerco,
  Inc.

  	
   

  	
  Common

  	
   

  	
  31,250

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  15.

  	
   

  	
  Community
  Service Telephone Co.

  	
   

  	
  Common

  	
   

  	
  100

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16.

  	
   

  	
  Marianna and Scenery Hill Telephone Company

  	
   

  	
  Common

  	
   

  	
  306

  	
   

  	
  100

  	
  %

  

 

C.                                    ST
ENTERPRISES, LTD.(3)

 

	
   

  	
   

  	
  Name of Issuing

  Corporation

  	
   

  	
  Type of

  Shares

  	
   

  	
  Number of

  Shares

  	
   

  	
  Percentage

  Owned

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
   

  	
  Sunflower
  Telephone Company, Inc.

  	
   

  	
  Common

  	
   

  	
  684

  	
   

  	
  99.7

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
  STE/NE
  Acquisition Corp. (dba Northland Telephone Company of Vermont)

  	
   

  	
  Common

  	
   

  	
  1000

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
   

  	
  Northland
  Telephone Company of Maine, Inc.

  	
   

  	
  Common

  	
   

  	
  100

  	
   

  	
  100

  	
  %

  

 

(3)           There are Warrants outstanding for the purchase of ST
Enterprises, LTD Common Stock.

 

2

 

	
  4.

  	
   

  	
  ST Computer
  Resources, Inc.

  	
   

  	
  Common

  	
   

  	
  500

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
   

  	
  ST Long
  Distance, Inc.

  	
   

  	
  Common

  	
   

  	
  100

  	
   

  	
  100

  	
  %

  

 

D.                                    C-R
COMMUNICATIONS, INC.

 

	
   

  	
   

  	
  Name of Issuing

  Corporation

  	
   

  	
  Type of

  Shares

  	
   

  	
  Number of

  Shares

  	
   

  	
  Percentage

  Owned

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
   

  	
  C-R
  Telephone Company

  	
   

  	
  Common

  	
   

  	
  100

  	
   

  	
  100

  	
  %

  

 

E.                                      UTILITIES,
INC.

 

	
   

  	
   

  	
  Name of Issuing

  Corporation

  	
   

  	
  Type of

  Shares

  	
   

  	
  Number of

  Shares

  	
   

  	
  Percentage

  Owned

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
   

  	
  Standish
  Telephone Company

  	
   

  	
  Common

  	
   

  	
  23,560

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
  China
  Telephone Company

  	
   

  	
  Common

  	
   

  	
  20,000

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
   

  	
  Maine
  Telephone Company

  	
   

  	
  Common

  	
   

  	
  100

  	
   

  	
  100

  	
  %

  

 

F.                                      RAVENSWOOD
COMMUNICATIONS, INC.

 

	
   

  	
   

  	
  Name of Issuing

  Corporation

  	
   

  	
  Type of

  Shares

  	
   

  	
  Number of

  Shares

  	
   

  	
  Percentage

  Owned

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
   

  	
  The El Paso
  Telephone Company

  	
   

  	
  Common

  	
   

  	
  405

  	
   

  	
  100

  	
  %

  

 

G.                                    GTC
COMMUNICATIONS, INC.

 

	
   

  	
   

  	
  Name of Issuing

  Corporation

  	
   

  	
  Type of

  Shares

  	
   

  	
  Number of

  Shares

  	
   

  	
  Percentage

  Owned

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
   

  	
  St. Joe
  Communications, Inc.

  	
   

  	
  Common

  	
   

  	
  1,000

  	
   

  	
  100

  	
  %

  

 

H.                                    ST.
JOE COMMUNICATIONS, INC.

 

	
   

  	
   

  	
  Name of

  Issuing

  Corporation

  	
   

  	
  Type of

  Shares

  	
   

  	
  Number of

  Shares

  	
   

  	
  Percentage

  Owned

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
   

  	
  GTC, Inc.

  	
   

  	
  Common

  	
   

  	
  14,890

  	
   

  	
  100

  	
  %

  

 

I.                                         COMERCO,
INC.

 

	
   

  	
   

  	
  Name of

  Issuing

  Corporation

  	
   

  	
  Type of

  Shares

  	
   

  	
  Number of

  Shares

  	
   

  	
  Percentage

  Owned

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
   

  	
  YCOM
  Networks, Inc.

  	
   

  	
  Common

  	
   

  	
  294

  	
   

  	
  100

  	
  %

  

 

3

 

ANNEX C

 

LIST OF NOTES

 

None.

 

 

ANNEX D

 

PART
I

 

LIST OF PARTNERSHIP INTERESTS

 

A.                                   None.

 

PART
II

 

LIST OF MEMBERSHIP INTERESTS

 

A.                                   None.

 

4

 

ANNEX E

 

Form of Agreement Regarding Uncertificated Securities,
Membership Interests and Partnership Interests

 

AGREEMENT (as amended,
modified, restated and/or supplemented from time to time, this “Agreement”),
dated as of
[            
     , 20     ], among the
undersigned pledgor (the “Pledgor”),
[                  ],
not in its individual capacity but solely as Collateral Agent (the “Pledgee”),
and
[                  ],
as the issuer of the Uncertificated Securities, Membership Interests and/or
Partnership Interests (each as defined below) (the “Issuer”).

 

W I T N E S S E T H
:

 

WHEREAS, the Pledgor,
certain of its affiliates and the Pledgee have entered into a Pledge Agreement,
dated as of February 8, 2005 (as amended, modified, restated and/or
supplemented from time to time, the “Pledge Agreement”), under which,
among other things, in order to secure the payment of the Obligations (as
defined in the Pledge Agreement), the Pledgor has pledged or will pledge to the
Pledgee for the benefit of the Secured Creditors (as defined in the Pledge Agreement),
and grant a security interest in favor of the Pledgee for the benefit of the
Secured Creditors in, all of the right, title and interest of the Pledgor in
and to any and all [Uncertificated Securities (as defined in the Pledge
Agreement)] [Partnership Interests (as defined in the Pledge Agreement)]
[Membership Interests (as defined in the Pledge Agreement)], from time to time
by the Issuer, whether now existing or hereafter from time to time acquired by
the Pledgor (with all of such [Uncertificated Securities] [Partnership
Interests] [Membership Interests] being herein collectively called the “Issuer
Pledged Interests”); and

 

WHEREAS, the Pledgor
desires the Issuer to enter into this Agreement in order to perfect the
security interest of the Pledgee under the Pledge Agreement in the Issuer
Pledged Interests, to vest in the Pledgee control of the Issuer Pledge
Interests and to provide for the rights of the parties under this Agreement;

 

NOW THEREFORE, in
consideration of the premises and the mutual promises and agreements contained
herein, and for other valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto hereby agree as follows:

 

1.                                       The
Pledgor hereby irrevocably authorizes and directs the Issuer, and the Issuer
hereby agrees, to comply with any and all instructions and orders originated by
the Pledgee (and its successors and assigns) regarding any and all of the
Issuer Pledged Interests without the further consent by the registered owner
(including the Pledgor), and, following its receipt of a notice from the
Pledgee stating that the Pledgee is exercising exclusive control of the Issuer
Pledged Interests, not to comply with any instructions or orders regarding any
or all of the Issuer Pledged Interests originated by any person or entity other
than the Pledgee (and its successors and assigns) or a court of competent
jurisdiction.

 

2.                                       The
Issuer hereby certifies that (i) no notice of any security interest, lien or
other encumbrance or claim affecting the Issuer Pledged Interests (other than
the security interest

 

 

of the Pledgee) has been received by it, and (ii) the security interest
of the Pledgee in the Issuer Pledged Interests has been registered in the books
and records of the Issuer.

 

3.                                       The
Issuer hereby represents and warrants that (i) the pledge by the Pledgor of,
and the granting by the Pledgor of a security interest in, the Issuer Pledged
Interests to the Pledgee, for the benefit of the Secured Creditors, does not
violate the charter, by-laws, partnership agreement, membership agreement or
any other agreement governing the Issuer or the Issuer Pledged Interests, and
(ii) the Issuer Pledged Interests consisting of capital stock of a corporation
are fully paid and nonassessable.

 

4.                                       All
notices, statements of accounts, reports, prospectuses, financial statements
and other communications to be sent to the Pledgor by the Issuer in respect of
the Issuer will also be sent to the Pledgee at the following address:

 

[                                    ]

[                                    ]

Attention: 
[                                    ]

Telephone
No.: 
[                                    ]

Telecopier No.: 
[                                    ]

 

5.                                       Following
its receipt of a notice from the Pledgee stating that the Pledgee is exercising
exclusive control of the Issuer Pledged Interests and until the Pledgee shall
have delivered written notice to the Issuer that all of the Obligations have
been paid in full and this Agreement is terminated, the Issuer will send any
and all redemptions, distributions, interest or other payments in respect of
the Issuer Pledged Interests from the Issuer for the account of the Pledgee
only by wire transfers to such account as the Pledgee shall instruct.

 

6.                                       Except
as expressly provided otherwise in Sections 4 and 5, all notices, instructions,
orders and communications hereunder shall be sent or delivered by mail,
telegraph, telex, telecopy, cable or overnight courier service and all such
notices and communications shall, when mailed, telexed, telecopied, cabled or
sent by overnight courier, be effective when deposited in the mails or
delivered to overnight courier, prepaid and properly addressed for delivery on
such or the next Business Day, or sent by telex or telecopier, except that
notices and communications to the Pledgee or the Issuer shall not be effective
until received.  All notices and other
communications shall be in writing and addressed as follows:

 

(a)                                  if
to the Pledgor, at:

 

 

 

 

 

Attention: 
                  

Telephone No.:  

Fax No.:

 

2

 

(b)                                 if
to the Pledgee, at the address given in Section 4 hereof;

 

(c)                                  if
to the Issuer, at:

 

 

 

 

or at such other address
as shall have been furnished in writing by any Person described above to the
party required to give notice hereunder. 
As used in this Section 6, “Business Day” means any day
other than a Saturday, Sunday, or other day in which banks in New York are
authorized to remain closed.

 

7.                                       This
Agreement shall be binding upon the successors and assigns of the Pledgor and
the Issuer and shall inure to the benefit of and be enforceable by the Pledgee
and its successors and assigns.  This
Agreement may be executed in any number of counterparts, each of which shall be
an original, but all of which shall constitute one instrument.  In the event that any provision of this
Agreement shall prove to be invalid or unenforceable, such provision shall be
deemed to be severable from the other provisions of this Agreement which shall
remain binding on all parties hereto. 
None of the terms and conditions of this Agreement may be changed,
waived, modified or varied in any manner whatsoever except in writing signed by
the Pledgee, the Issuer and the Pledgor.

 

8.                                       This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York, without regard to its principles of conflict of laws.

 

3

 

IN WITNESS WHEREOF, the
Pledgor, the Pledgee and the Issuer have caused this Agreement to be executed
by their duly elected officers duly authorized as of the date first above
written.

 

 

	
   

  	
  [                                               ],

  
	
   

  	
   

  	
  as Pledgor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  [                                               ],

  
	
   

  	
   

  	
  not in its
  individual capacity but solely as

  Collateral Agent and Pledgee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  [                                               ],

  
	
   

  	
   

  	
  as the Issuer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
						

 

4Exhibit 10.3

 

SUBSIDIARY GUARANTY

 

SUBSIDIARY GUARANTY (as amended, modified, restated
and/or supplemented from time to time, this “Guaranty”), dated as of
February 8, 2005, made by and among each of the undersigned guarantors (each, a
“Guarantor” and, together with any other entity that becomes a guarantor
hereunder pursuant to Section 23 hereof, collectively, the “Guarantors”)
in favor of DEUTSCHE BANK TRUST COMPANY AMERICAS, as Administrative Agent
(together with any successor administrative agent, the “Administrative Agent”),
for the benefit of the Secured Creditors (as defined below).  Except as otherwise defined herein, all
capitalized terms used herein and defined in the Credit Agreement (as defined
below) shall be used herein as therein defined.

 

W I T N E S S E T H
:

 

WHEREAS, FairPoint Communications, Inc. (the ”Borrower”),
the lenders from time to time party thereto (the “Lenders”), Bank of
America, N.A., as Syndication Agent, CoBank, ACB and General Electric Capital
Corporation, as Co-Documentation Agents, and the Administrative Agent have
entered into a Credit Agreement, dated as of February 8, 2005 (as amended,
modified, restated and/or supplemented from time to time, the “Credit
Agreement”), providing for the making of Loans to, and the issuance of, and
participation in, Letters of Credit for the account of the Borrower, all as
contemplated therein (the Lenders, each Letter of Credit Issuer, the Swingline
Lender, the Administrative Agent, the Collateral Agent, each other Agent and
the Pledgee referred to in the Pledge Agreement are herein called the “Lender
Creditors”);

 

WHEREAS, the Borrower may from time to time be a party
to one or more Interest Rate Agreements (each such Interest Rate Agreement with
an Interest Rate Creditor (as defined below), a “Secured Interest Rate
Agreement”) with Deutsche Bank Trust Company Americas, in its individual
capacity (“DBTCA”), any Lender, a syndicate of financial institutions
organized by DBTCA or such Lender or an affiliate of DBTCA or such Lender (even
if DBTCA or any such Lender ceases to be a Lender under the Credit Agreement
for any reason), and any institution that participates therein, and in each
case their subsequent assigns (collectively, the “Interest Rate Creditors,”
and together with the Lender Creditors, collectively, the “Secured Creditors”);

 

WHEREAS, each Guarantor is a direct or indirect
Subsidiary of the Borrower;

 

WHEREAS, it is a condition precedent to the making of
Loans to the Borrower and the issuance of, and participation in, Letters of Credit
for the account of the Borrower under the Credit Agreement that each Guarantor
shall have executed and delivered this Guaranty to the Administrative Agent;
and

 

WHEREAS, each Guarantor will obtain benefits from the
incurrence of Loans by the Borrower and the issuance of, and participation in,
Letters of Credit for the account of the Borrower under the Credit Agreement
and the entering into by the Borrower and/or one or more

 

 

of its Subsidiaries of
Secured Interest Rate Agreements and, accordingly, desires to execute this
Guaranty in order to satisfy the condition described in the preceding paragraph
and to induce the Lenders to make Loans to the Borrower and issue, and/or
participate in, Letters of Credit for the account of the Borrower and the Interest
Rate Creditors to enter into Secured Interest Rate Agreements with the Borrower
and/or one or more of its Subsidiaries;

 

NOW, THEREFORE, in consideration of the foregoing and
other benefits accruing to each Guarantor, the receipt and sufficiency of which
are hereby acknowledged, each Guarantor hereby makes the following
representations and warranties to the Administrative Agent for the benefit of
the Secured Creditors and hereby covenants and agrees with each other Guarantor
and the Administrative Agent for the benefit of the Secured Creditors as
follows:

 

1.  GUARANTY.            (a)        Each Guarantor, jointly and severally,
irrevocably, absolutely and unconditionally guarantees as a primary obligor and
not merely as surety:

 

(i)            to
the Lender Creditors the full and prompt payment when due (whether at the
stated maturity, by required prepayment, declaration, acceleration, demand or
otherwise) of (x) the principal of, premium, if any, and interest on the Notes
issued by, and the Loans made to, the Borrower under the Credit Agreement, and
all reimbursement obligations and Unpaid Drawings with respect to Letters of
Credit and (y) all other obligations (including, without limitation,
obligations which, but for the automatic stay under Section 362(a) of the
Bankruptcy Code, would become due), liabilities and indebtedness owing by the
Borrower to the Lender Creditors under the Credit Agreement and each other
Credit Document to which the Borrower is a party (including, without
limitation, indemnities, Fees and interest thereon (including, without
limitation, any interest accruing after the commencement of any bankruptcy,
insolvency, receivership or similar proceeding at the rate provided for in the
Credit Agreement, whether or not such interest is an allowed claim in any such proceeding)),
whether now existing or hereafter incurred under, arising out of or in
connection with the Credit Agreement and any such other Credit Document and the
due performance and compliance by the Borrower with all of the terms,
conditions, covenants and agreements contained in all such Credit Documents
(all such principal, premium, interest, liabilities, indebtedness and obligations
under this clause (i), except to the extent consisting of obligations or
liabilities with respect to Secured Interest Rate Agreements, being herein
collectively called the “Credit Document Obligations”); and

 

(ii)           to
each Interest Rate Creditor the full and prompt payment when due (whether at
the stated maturity, by required prepayment, declaration, acceleration, demand
or otherwise) of all obligations (including, without limitation, obligations
which, but for the automatic stay under Section 362(a) of the Bankruptcy Code,
would become due), liabilities and indebtedness (including, without limitation,
any interest accruing after the commencement of any bankruptcy, insolvency,
receivership or similar proceeding at the rate provided for in the respective
Secured Interest Rate Agreements, whether or not such interest is an allowed
claim in any such proceeding) owing by the Borrower under any Secured Interest
Rate Agreement to which it is a party, whether now in existence or hereafter
arising, and the due performance and compliance by the

 

2

 

Borrower with all
of the terms, conditions, covenants and agreements contained therein (all such
obligations, liabilities and indebtedness being herein collectively called the “Interest
Rate Obligations”, and together with the Credit Document Obligations are
herein collectively called the “Guaranteed Obligations”).

 

Each
Guarantor understands, agrees and confirms that the Secured Creditors may
enforce this Guaranty up to the full amount of the Guaranteed Obligations
against such Guarantor without proceeding against any other Guarantor or the Borrower,
or against any security for the Guaranteed Obligations, or under any other
guaranty covering all or a portion of the Guaranteed Obligations.  This Guaranty is a guaranty of prompt payment
and performance and not of collection.

 

(b)           Additionally,
each Guarantor, jointly and severally, unconditionally, absolutely and
irrevocably, guarantees the payment of any and all Guaranteed Obligations
whether or not due or payable by the Borrower upon the occurrence in respect of
the Borrower of any of the events specified in Section 8.05 of the Credit
Agreement, and unconditionally, absolutely and irrevocably, jointly and
severally, promises to pay such Guaranteed Obligations to the Secured
Creditors, or order, on demand.

 

2.  LIABILITY
OF GUARANTORS ABSOLUTE.  The
liability of each Guarantor hereunder is primary, absolute, joint and several,
and unconditional and is exclusive and independent of any security for or other
guaranty of the indebtedness of the Borrower whether executed by such
Guarantor, any other Guarantor, any other guarantor or by any other party, and
the liability of each Guarantor hereunder shall not be affected or impaired by
any circumstance or occurrence whatsoever, including, without limitation:  (a) any direction as to application of
payment by the Borrower or any other party, (b) any other continuing or other
guaranty, undertaking or maximum liability of a Guarantor or of any other party
as to the Guaranteed Obligations, (c) any payment on or in reduction of any
such other guaranty or undertaking, (d) any dissolution, termination or
increase, decrease or change in personnel by the Borrower, (e) the failure of
any Guarantor to receive any benefit from or as a result of its execution,
delivery and performance of this Guaranty, (f) any payment made to any Secured
Creditor on the indebtedness which any Secured Creditor repays the Borrower
pursuant to court order in any bankruptcy, reorganization, arrangement,
moratorium or other debtor relief proceeding, and each Guarantor waives any
right to the deferral or modification of its obligations hereunder by reason of
any such proceeding, (g) any action or inaction by the Secured Creditors
as contemplated in Section 5 hereof or (h) any invalidity, rescission,
irregularity or unenforceability of all or any part of the Guaranteed
Obligations or of any security therefor.

 

3.  OBLIGATIONS OF GUARANTORS
INDEPENDENT.  The obligations of
each Guarantor hereunder are independent of the obligations of any other
Guarantor, any other guarantor or the Borrower, and a separate action or
actions may be brought and prosecuted against each Guarantor whether or not
action is brought against any other Guarantor, any other guarantor or the
Borrower and whether or not any other Guarantor, any other guarantor or the
Borrower be joined in any such action or actions.

 

3

 

4.  WAIVERS
BY GUARANTORS.  (a)            Each
Guarantor hereby waives notice of acceptance of this Guaranty and notice of the
existence, creation or incurrence of any new or additional liability to which
it may apply, and waives promptness, diligence, presentment, demand of payment,
demand for performance, protest, notice of dishonor or nonpayment of any such
liabilities, suit or taking of other action by the Administrative Agent or any
other Secured Creditor against, and any other notice to, any party liable
thereon (including such Guarantor, any other Guarantor, any other guarantor or
the Borrower) and each Guarantor further hereby waives any and all notice of
the creation, renewal, extension or accrual of any of the Guaranteed
Obligations and notice or proof of reliance by any Secured Creditor upon this
Guaranty, and the Guaranteed Obligations shall conclusively be deemed to have
been created, contracted or incurred, or renewed, extended, amended, modified,
supplemented or waived, in reliance upon this Guaranty.

 

(b)           Each
Guarantor waives any right to require the Secured Creditors to:  (i) proceed against the Borrower, any other
Guarantor, any other guarantor of the Guaranteed Obligations or any other
party; (ii) proceed against or exhaust any security held from the Borrower, any
other Guarantor, any other guarantor of the Guaranteed Obligations or any other
party; or (iii) pursue any other remedy in the Secured Creditors’ power
whatsoever.  Each Guarantor waives any
defense based on or arising out of any defense of the Borrower, any other
Guarantor, any other guarantor of the Guaranteed Obligations or any other party
other than payment in full in cash of the Guaranteed Obligations, including,
without limitation, any defense based on or arising out of the disability of
the Borrower, any other Guarantor, any other guarantor of the Guaranteed
Obligations or any other party, or the unenforceability of the Guaranteed
Obligations or any part thereof from any cause, or the cessation from any cause
of the liability of the Borrower other than payment in full in cash of the
Guaranteed Obligations.  The Secured
Creditors may, at their election and in accordance with the security documents governing
same, foreclose on any collateral serving as security held by the
Administrative Agent, the Collateral Agent or the other Secured Creditors by
one or more judicial or nonjudicial sales, whether or not every aspect of any
such sale is commercially reasonable (to the extent such sale is permitted by
applicable law), or exercise any other right or remedy the Secured Creditors
may have against the Borrower or any other party, or any security, without
affecting or impairing in any way the liability of any Guarantor hereunder
except to the extent the Guaranteed Obligations have been paid in full in
cash.  Each Guarantor waives any defense
arising out of any such election by the Secured Creditors, even though such election
operates to impair or extinguish any right of reimbursement, contribution,
indemnification or subrogation or other right or remedy of such Guarantor
against the Borrower, any other Guarantor, any other guarantor of the
Guaranteed Obligations or any other party or any security.

 

(c)           Each
Guarantor hereby waives the benefits of any statute of limitations affecting
its liability hereunder or the enforcement thereof.  Any payment by the Borrower or other
circumstance which operates to toll any statute of limitations as to the
Borrower shall operate to toll the statute of limitations as to each Guarantor.

 

(d)           Each
Guarantor has knowledge and assumes all responsibility for being and keeping
itself informed of the Borrower’s and each other Guarantor’s financial
condition, affairs and assets, and of all other circumstances bearing upon the
risk of nonpayment of the

 

4

 

Guaranteed
Obligations and the nature, scope and extent of the risks which such Guarantor
assumes and incurs hereunder, and has adequate means to obtain from the
Borrower and each other Guarantor on an ongoing basis information relating
thereto and to the Borrower’s and each other Guarantor’s ability to pay and
perform its respective Guaranteed Obligations, and agrees to assume the responsibility
for keeping, and to keep, so informed for so long as this Guaranty is in
effect.  Each Guarantor acknowledges and
agrees that (x) the Secured Creditors shall have no obligation to investigate
the financial condition or affairs of the Borrower or any other Guarantor for
the benefit of such Guarantor nor to advise such Guarantor of any fact
respecting, or any change in, the financial condition, assets or affairs of the
Borrower or any other Guarantor that might become known to any Secured Creditor
at any time, whether or not such Secured Creditor knows or believes or has
reason to know or believe that any such fact or change is unknown to such
Guarantor, or might (or does) increase the risk of such Guarantor as guarantor
hereunder, or might (or would) affect the willingness of such Guarantor to
continue as a guarantor of the Guaranteed Obligations hereunder and (y) the
Secured Creditors shall have no duty to advise any Guarantor of information
known to them regarding any of the aforementioned circumstances or risks.

 

(e)           Each
Guarantor hereby acknowledges and agrees that no Secured Creditor or any other
Person shall be under any obligation (a) to marshal any assets in favor of such
Guarantor or in payment of any or all of the liabilities of the Borrower under
the Credit Documents or the obligation of such Guarantor hereunder or (b) to
pursue any other remedy that such Guarantor may or may not be able to pursue
itself any right to which such Guarantor hereby waives.

 

(f)            Each
Guarantor warrants and agrees that each of the waivers set forth in Section 3
and in this Section 4 is made with full knowledge of its significance and
consequences and that if any of such waivers are determined to be contrary to
any applicable law or public policy, such waivers shall be effective only to
the maximum extent permitted by applicable law.

 

5.  RIGHTS
OF SECURED CREDITORS.  Subject to
Section 4, any Secured Creditor may (except as shall be required by applicable
law and cannot be waived) at any time and from time to time without the consent
of, or notice to, any Guarantor, without incurring responsibility to such
Guarantor, without impairing or releasing the obligations or liabilities of
such Guarantor hereunder, upon or without any terms or conditions and in whole
or in part:

 

(a)           change
the manner, place or terms of payment of, and/or change, increase or extend the
time of payment of, renew, increase, accelerate or alter, any of the Guaranteed
Obligations (including, without limitation, any increase or decrease in the rate
of interest thereon or the principal amount thereof), any security therefor, or
any liability incurred directly or indirectly in respect thereof, and the
guaranty herein made shall apply to the Guaranteed Obligations as so changed,
extended, increased, accelerated, renewed or altered;

 

(b)           take
and hold security for the payment of the Guaranteed Obligations and sell,
exchange, release, surrender, impair, realize upon or otherwise deal with in
any manner and in any order any property or other collateral by whomsoever at
any time

 

5

 

pledged or
mortgaged to secure, or howsoever securing, the Guaranteed Obligations or any
liabilities (including any of those hereunder) incurred directly or indirectly
in respect thereof or hereof, and/or any offset thereagainst;

 

(c)           exercise
or refrain from exercising any rights against the Borrower, any other Credit
Party, any Subsidiary thereof, any other guarantor of the Borrower or others or
otherwise act or refrain from acting;

 

(d)           release
or substitute any one or more endorsers, Guarantors, other guarantors, the
Borrower or other obligors;

 

(e)           settle
or compromise any of the Guaranteed Obligations, any security therefor or any
liability (including any of those hereunder) incurred directly or indirectly in
respect thereof or hereof, and may subordinate the payment of all or any part
thereof to the payment of any liability (whether due or not) of the Borrower to
creditors of the Borrower other than the Secured Creditors;

 

(f)            apply
any sums by whomsoever paid or howsoever realized to any liability or
liabilities of the Borrower to the Secured Creditors regardless of what
liabilities of the Borrower remain unpaid;

 

(g)           consent
to or waive any breach of, or any act, omission or default under, any of the
Secured Interest Rate Agreements, the Credit Documents or any of the
instruments or agreements referred to therein, or otherwise amend, modify or
supplement any of the Secured Interest Rate Agreements, the Credit Documents or
any of such other instruments or agreements;

 

(h)           act
or fail to act in any manner which may deprive such Guarantor of its right to
subrogation against the Borrower to recover full indemnity for any payments
made pursuant to this Guaranty; and/or

 

(i)            take
any other action or omit to take any other action which would, under otherwise
applicable principles of common law, give rise to a legal or equitable
discharge of such Guarantor from its liabilities under this Guaranty
(including, without limitation, any action or omission whatsoever that might
otherwise vary the risk of such Guarantor or constitute a legal or equitable
defense to or discharge of the liabilities of a guarantor or surety or that
might otherwise limit recourse against such Guarantor).

 

No
invalidity, illegality, irregularity or unenforceability of all or any part of
the Guaranteed Obligations, the Credit Documents or any other agreement or
instrument relating to the Guaranteed Obligations or of any security or
guarantee therefor shall affect, impair or be a defense to this Guaranty, and
this Guaranty shall be primary, absolute and unconditional notwithstanding the
occurrence of any event or the existence of any other circumstances which might
constitute a legal or equitable discharge of a surety or guarantor except
payment in full in cash of the Guaranteed Obligations.

 

6

 

6.  CONTINUING
GUARANTY. 
This Guaranty is a continuing one and all liabilities to which it
applies or may apply under the terms hereof shall be conclusively presumed to
have been created in reliance hereon.  No
failure or delay on the part of any Secured Creditor in exercising any right,
power or privilege hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise of any right, power or privilege hereunder preclude
any other or further exercise thereof or the exercise of any other right, power
or privilege.  The rights and remedies
herein expressly specified are cumulative and not exclusive of any rights or
remedies which any Secured Creditor would otherwise have.  No notice to or demand on any Guarantor in
any case shall entitle such Guarantor to any other further notice or demand in
similar or other circumstances or constitute a waiver of the rights of any
Secured Creditor to any other or further action in any circumstances without
notice or demand.  It is not necessary
for any Secured Creditor to inquire into the capacity or powers of the Borrower
or the officers, directors, partners or agents acting or purporting to act on
its or their behalf, and any indebtedness made or created in reliance upon the
professed exercise of such powers shall be guaranteed hereunder.

 

7.  SUBORDINATION OF INDEBTEDNESS HELD BY
GUARANTORS. 
Any indebtedness of the Borrower now or hereafter held by any Guarantor
is hereby subordinated to the indebtedness of the Borrower to the Secured
Creditors; and such indebtedness of the Borrower to any Guarantor, if the
Administrative Agent or the Collateral Agent, after an Event of Default has
occurred and is continuing, so requests, shall be collected, enforced and
received by such Guarantor as trustee for the Secured Creditors and be paid
over to the Secured Creditors on account of the indebtedness of the Borrower to
the Secured Creditors, but without affecting or impairing in any manner the
liability of such Guarantor under the other provisions of this Guaranty.  Prior to the transfer by any Guarantor of any
note or negotiable instrument evidencing any indebtedness of the Borrower to
such Guarantor, such Guarantor shall mark such note or negotiable instrument
with a legend that the same is subject to this subordination.  Without limiting the generality of the
foregoing, each Guarantor hereby agrees with the Secured Creditors that it will
not exercise any right of subrogation which it may at any time otherwise have
as a result of this Guaranty (whether contractual, under Section 509 of the
Bankruptcy Code or otherwise) until all Guaranteed Obligations have been
irrevocably paid in full in cash; provided, that if any amount shall be
paid to any Guarantor on account of such subrogation rights at any time prior
to the irrevocable payment in full in cash of all the Guaranteed Obligations,
such amount shall be held in trust for the benefit of the Secured Creditors and
shall forthwith be paid to the Secured Creditors to be credited and applied to
the Guaranteed Obligations, whether matured or unmatured, in accordance with
the terms of the Credit Documents or, if the Credit Documents do not provide for
the application of such amount, to be held by the Secured Creditors as
collateral security for any Guaranteed Obligations thereafter existing.  Upon irrevocable payment in full in cash of
all of the Guaranteed Obligations, each Guarantor shall be subrogated to the
rights of the Secured Creditors to receive payments or distributions applicable
to the Guaranteed Obligations until all Indebtedness of the Borrower held by
such Guarantor shall be paid in full.

 

8.  GUARANTY ENFORCEABLE BY
ADMINISTRATIVE AGENT OR COLLATERAL AGENT.  Notwithstanding anything to the contrary
contained elsewhere in this Guaranty or any other Credit Document or Secured
Interest Rate Agreement, the Secured Creditors agree (by their acceptance of
the benefits of this Guaranty) that this Guaranty may be

 

7

 

enforced only by the action of the Administrative
Agent or the Collateral Agent, in each case acting upon the instructions of the
Required Lenders (or, after the date on which all Credit Document Obligations
have been paid in full, the holders of a majority of the outstanding Interest
Rate Obligations) and that no other Secured Creditor shall have any right
individually to seek to enforce or to enforce this Guaranty or to realize upon
the security to be granted by the Credit Documents, it being understood and
agreed that such rights and remedies may be exercised by the Administrative
Agent or the Collateral Agent or, after all the Credit Document Obligations
have been paid in full, by the holders of a majority of the outstanding
Interest Rate Obligations, as the case may be, for the benefit of the Secured
Creditors upon the terms of this Guaranty and the other Credit Documents.  The Secured Creditors further agree that this
Guaranty may not be enforced against any director, officer, employee, partner,
member or stockholder of any Guarantor (except to the extent such partner,
member or stockholder is also a Guarantor hereunder).  It is understood and agreed that the
agreement in this Section 8 is among and solely for the benefit of the Secured
Creditors and that, if the Required Lenders (or, after the date on which all
Credit Document Obligations have been paid in full, the holders of a majority
of the outstanding Interest Rate Obligations) so agree (without requiring the
consent of any Guarantor), this Guaranty may be directly enforced by any
Secured Creditor.

 

9.  REPRESENTATIONS, WARRANTIES
AND COVENANTS OF GUARANTORS.  In
order to induce the Lenders to make Loans to, and issue Letters of Credit for
the account of, the Borrower pursuant to the Credit Agreement, and in order to
induce the Interest Rate Creditors to execute, deliver and perform the Secured
Interest Rate Agreements to which they are a party, each Guarantor represents,
warrants and covenants that:

 

(a)           until
the termination of the Total Commitment and all Secured Interest Rate
Agreements and until such time as no Note or Letter of Credit remains
outstanding and all Guaranteed Obligations have been paid in full (other than
indemnities described in Section 11.01 of the Credit Agreement and analogous
provisions in the other Credit Documents which are not then due and payable),
such Guarantor will take, or will refrain from taking, as the case may be, all
actions that are necessary to be taken or not taken so that no violation of any
provision, covenant or agreement contained in Sections 6 and 7 of the Credit
Agreement, and so that no Event of Default, is caused by the actions of such
Guarantor or any of its Subsidiaries; and

 

(b)           an
executed (or conformed) copy of each of the Credit Documents and each of the
Secured Interest Rate Agreements has been made available to a senior officer of
such Guarantor and such officer is familiar with the contents thereof.

 

10.  EXPENSES.  The Guarantors hereby jointly and severally
agree to pay all reasonable out-of-pocket costs and expenses of the Collateral
Agent, the Administrative Agent and each other Secured Creditor in connection
with the enforcement of this Guaranty and the protection of the Secured
Creditors’ rights hereunder and of the Administrative Agent in connection with
any amendment, waiver or consent relating hereto (including, in each case,
without limitation, the reasonable fees and disbursements of counsel).

 

8

 

11.  BENEFIT
AND BINDING EFFECT.  This
Guaranty shall be binding upon each Guarantor and its successors and assigns
and shall inure to the benefit of the Secured Creditors and their successors
and assigns to the extent permitted under the Credit Agreement or the
respective Secured Interest Rate Agreement.

 

12.  AMENDMENTS;
WAIVERS.  Neither this Guaranty
nor any provision hereof may be changed, waived, discharged or terminated
except with the written consent of each Guarantor directly affected thereby (it
being understood that the addition or release of any Guarantor hereunder shall
not constitute a change, waiver, discharge or termination affecting any
Guarantor other than the Guarantor so added or released) and with the written
consent of either (x) the Required Lenders (or, to the extent required by
Section 11.12 of the Credit Agreement, with the written consent of each Lender)
at all times prior to the time at which all Credit Document Obligations have
been paid in full or (y) the holders of a majority of the outstanding Interest
Rate Obligations at all times after the time at which all Credit Document
Obligations have been paid in full; provided, that any change, waiver,
modification or variance affecting the rights and benefits of a single Class
(as defined below) of Secured Creditors (and not all Secured Creditors in a
like or similar manner) shall also require the written consent of the Requisite
Creditors (as defined below) of such Class of Secured Creditors.  For the purpose of this Guaranty, the term “Class”
shall mean each class of Secured Creditors, i.e., whether (x) the Lender
Creditors as the holders of the Credit Document Obligations or (y) the Interest
Rate Creditors as the holders of the Interest Rate Obligations.  For the purpose of this Guaranty, the term “Requisite
Creditors” of any Class shall mean (x) with respect to the Credit Document
Obligations, the Required Lenders (or, to the extent required by Section 11.12
of the Credit Agreement, each Lender) and (y) with respect to the Interest Rate
Obligations, the holders of a majority of all Interest Rate Obligations
outstanding from time to time under the Secured Interest Rate Agreements.

 

13.  SET OFF.  In addition to any rights now or hereafter
granted under applicable law (including, without limitation, Section 151 of the
New York Debtor and Creditor Law) and not by way of limitation of any such
rights, upon the occurrence and during the continuance of an Event of Default
(such term to mean and include any “Event of Default” as defined in the Credit
Agreement and any payment default under any Secured Interest Rate Agreement
continuing after any applicable grace period), each Secured Creditor is hereby
authorized, at any time or from time to time, without notice to any Guarantor
or to any other Person, any such notice being expressly waived, to set off and
to appropriate and apply any and all deposits (general or special) and any
other indebtedness at any time held or owing by such Secured Creditor to or for
the credit or the account of such Guarantor, against and on account of the
obligations and liabilities of such Guarantor to such Secured Creditor under
this Guaranty, irrespective of whether or not such Secured Creditor shall have
made any demand hereunder and although said obligations, liabilities, deposits
or claims, or any of them, shall be contingent or unmatured.  Each Secured Creditor (by its acceptance of
the benefits hereof) acknowledges and agrees (i) to promptly notify the
relevant Guarantor after any such set-off and application, provided that
the failure to give such notice shall not affect the validity of such set-off
and application, and (ii) that the provisions of this Section 13 are subject to
the sharing provisions set forth in Section 11.06 of the Credit Agreement.

 

9

 

14.  NOTICE.  Except as otherwise specified herein, all
notices, requests, demands or other communications to or upon the respective
parties hereto shall be sent or delivered by mail, telegraph, telex, telecopy,
cable or courier service and all such notices and communications shall, when
mailed, telegraphed, telexed, telecopied, or cabled or sent by courier, be
effective when deposited in the mails, delivered to the telegraph company,
cable company or overnight courier, as the case may be, or sent by telex or
telecopier, except that notices and communications to the Administrative Agent
or any Guarantor shall not be effective until received by the Administrative
Agent or such Guarantor, as the case may be. 
All notices and other communications shall be in writing and addressed
to such party at (i) in the case of any Lender Creditor, as provided in the
Credit Agreement, (ii) in the case of any Guarantor, at its address set forth
opposite its signature below, and (iii) in the case of any Interest Rate
Creditor, at such address as such Interest Rate Creditor shall have specified
in writing to the Guarantors; or in any case at such other address as any of
the Persons listed above may hereafter notify the others in writing.

 

15.  REINSTATEMENT.  If any claim is ever made upon any Secured
Creditor for repayment or recovery of any amount or amounts received in payment
or on account of any of the Guaranteed Obligations and any of the aforesaid
payees repays all or part of said amount by reason of (i) any judgment, decree
or order of any court or administrative body having jurisdiction over such
payee or any of its property or (ii) any settlement or compromise of any such
claim effected by such payee with any such claimant (including, without
limitation, the Borrower), then and in such event each Guarantor agrees that
any such judgment, decree, order, settlement or compromise shall be binding
upon such Guarantor, notwithstanding any revocation hereof or the cancellation
of any Note, any Secured Interest Rate Agreement or any other instrument
evidencing any liability of the Borrower, and such Guarantor shall be and
remain liable to the aforesaid payees hereunder for the amount so repaid or
recovered to the same extent as if such amount had never originally been
received by any such payee.

 

16.  CONSENT TO JURISDICTION;
SERVICE OF PROCESS; AND WAIVER OF TRIAL BY JURY.  (a)             THIS
GUARANTY AND THE RIGHTS AND OBLIGATIONS OF THE SECURED CREDITORS AND OF THE
UNDERSIGNED HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF
LAWS.  Any legal action or proceeding
with respect to this Guaranty or any other Credit Document to which any Guarantor
is a party may be brought in the courts of the State of New York or of the
United States of America for the Southern District of New York, in each case
located within the City of New York, and, by execution and delivery of this
Guaranty, each Guarantor hereby irrevocably accepts for itself and in respect
of its property, generally and unconditionally, the jurisdiction of the
aforesaid courts.  Each Guarantor hereby
further irrevocably waives any claim that any such courts lack jurisdiction
over such Guarantor, and agrees not to plead or claim, in any legal action or
proceeding with respect to this Guaranty or any other Credit Document to which
such Guarantor is a party brought in any of the aforesaid courts, that any such
court lacks jurisdiction over such Guarantor. 
Each Guarantor further irrevocably consents to the service of process
out of any of the aforementioned courts in any such action or proceeding by the
mailing of copies thereof by registered or certified mail, postage prepaid, to
each Guarantor at its address set forth opposite its signature below, such
service to become effective 30 days after such mailing.  Each

 

10

 

Guarantor hereby
irrevocably waives any objection to such service of process and further
irrevocably waives and agrees not to plead or claim in any action or proceeding
commenced hereunder or under any other Credit Document to which such Guarantor
is a party that such service of process was in any way invalid or ineffective. Nothing
herein shall affect the right of any of the Secured Creditors to serve process
in any other manner permitted by law or to commence legal proceedings or
otherwise proceed against each Guarantor in any other jurisdiction.

 

(b)           Each
Guarantor hereby irrevocably waives (to the full extent permitted by applicable
law) any objection which it may now or hereafter have to the laying of venue of
any of the aforesaid actions or proceedings arising out of or in connection
with this Guaranty or any other Credit Document to which such Guarantor is a
party brought in the courts referred to in clause (a) above and hereby further
irrevocably waives and agrees not to plead or claim in any such court that such
action or proceeding brought in any such court has been brought in an
inconvenient forum.

 

(c)           EACH
GUARANTOR AND EACH SECURED CREDITOR (BY ITS ACCEPTANCE OF THE BENEFITS OF THIS
GUARANTY) HEREBY IRREVOCABLY WAIVES ALL RIGHTS TO A TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS GUARANTY,
THE OTHER CREDIT DOCUMENTS TO WHICH SUCH GUARANTOR IS A PARTY OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

 

17.  TERMINATION.  After the Termination Date (as defined
below), but subject to Section 15, this Guaranty shall terminate (provided that
all indemnities set forth herein shall survive any such termination) and the
Administrative Agent, at the request and expense of the respective Guarantor,
will execute and deliver to such Guarantor a proper instrument or instruments
acknowledging the satisfaction and termination of this Guaranty as provided
above.  As used in this Guaranty, “Termination
Date” shall mean the date upon which the Total Commitment and all Secured
Interest Rate Agreements have been terminated, no Note or Letter of Credit
under the Credit Agreement is outstanding (and all Loans have been paid in
full) and all other Obligations (as defined in the Credit Agreement) have been
paid in full (other than arising from indemnities for which no request has been
made).

 

18.  RELEASE OF LIABILITY OF
GUARANTOR UPON SALE OR DISSOLUTION. 
In the event that all of the capital stock or other equity interests of
one or more Guarantors is sold or otherwise disposed of (including by way of
the merger or consolidation of such Guarantor with or into another Person) or
liquidated, in any such case in compliance with the requirements of Section
7.02 of the Credit Agreement (or such sale, other disposition or liquidation
has been approved in writing by the Required Lenders (or all the Lenders if
required by Section 11.12 of the Credit Agreement)) and the proceeds of such
sale, disposition or liquidation are applied in accordance with the provisions
of the Credit Agreement, to the extent applicable, such Guarantor shall, upon
consummation of such sale or other disposition (except to the extent that such
sale or disposition is to the Borrower or a Subsidiary thereof), be released
from this Guaranty automatically and without further action and this Guaranty
shall, as to each such Guarantor or Guarantors, terminate, and have no further
force or effect (it being understood

 

11

 

and agreed that the sale of one or more Persons that
own, directly or indirectly, all of the capital stock or other equity interests
of any Guarantor shall be deemed to be a sale of such Guarantor for the
purposes of this Section 18).

 

19.  CONTRIBUTION.  At any time a payment in respect of the
Guaranteed Obligations is made under this Guaranty, the right of contribution
of each Guarantor against each other Guarantor shall be determined as provided
in the immediately following sentence, with the right of contribution of each
Guarantor to be revised and restated as of each date on which a payment (a “Relevant
Payment”) is made on the Guaranteed Obligations under this Guaranty.  At any time that a Relevant Payment is made
by a Guarantor that results in the aggregate payments made by such Guarantor in
respect of the Guaranteed Obligations to and including the date of the Relevant
Payment exceeding such Guarantor’s Contribution Percentage (as defined below)
of the aggregate payments made by all Guarantors in respect of the Guaranteed
Obligations to and including the date of the Relevant Payment (such excess, the
“Aggregate Excess Amount”), each such Guarantor shall have a right of
contribution against each other Guarantor who either has not made any payments
or has made payments in respect of the Guaranteed Obligations to and including
the date of the Relevant Payment in an aggregate amount less than such other
Guarantor’s Contribution Percentage of the aggregate payments made to and
including the date of the Relevant Payment by all Guarantors in respect of the
Guaranteed Obligations (the aggregate amount of such deficit, the “Aggregate
Deficit Amount”) in an amount equal to (x) a fraction the numerator of
which is the Aggregate Excess Amount of such Guarantor and the denominator of
which is the Aggregate Excess Amount of all Guarantors multiplied by (y) the
Aggregate Deficit Amount of such other Guarantor.  A Guarantor’s right of contribution pursuant
to the preceding sentences shall arise at the time of each computation, subject
to adjustment at the time of each computation; provided that no
Guarantor may take any action to enforce such right until the Guaranteed
Obligations have been irrevocably paid in full in cash and the Total Commitment
and all Letters of Credit have been terminated, it being expressly recognized
and agreed by all parties hereto that any Guarantor’s right of contribution
arising pursuant to this Section 19 against any other Guarantor shall be
expressly junior and subordinate to such other Guarantor’s obligations and
liabilities in respect of the Guaranteed Obligations and any other obligations
owing under this Guaranty.  As used in
this Section 19:  (i) each Guarantor’s “Contribution
Percentage” shall mean the percentage obtained by dividing (x) the Adjusted
Net Worth (as defined below) of such Guarantor by (y) the aggregate Adjusted
Net Worth of all Guarantors; (ii) the “Adjusted Net Worth” of each
Guarantor shall mean the greater of (x) the Net Worth (as defined below) of
such Guarantor and (y) zero; and (iii) the “Net Worth” of each Guarantor
shall mean the amount by which the fair saleable value of such Guarantor’s assets
on the date of any Relevant Payment exceeds its existing debts and other
liabilities (including contingent liabilities, but without giving effect to any
Guaranteed Obligations arising under this Guaranty or any guaranteed
obligations arising under any guaranty of the Permitted Senior Subordinated
Notes or the Permitted Senior Unsecured Notes on such date.  Notwithstanding anything to the contrary
contained above, any Guarantor that is released from this Guaranty pursuant to
Section 18 hereof shall thereafter have no contribution obligations, or rights,
pursuant to this Section 19, and at the time of any such release, if the
released Guarantor had an Aggregate Excess Amount or an Aggregate Deficit
Amount, same shall be deemed reduced to $0, and the contribution rights and
obligations of the remaining Guarantors shall be recalculated on the respective
date of release (as otherwise provided above)

 

12

 

based on the payments made hereunder by the
remaining Guarantors.  All parties hereto
recognize and agree that, except for any right of contribution arising pursuant
to this Section 19, each Guarantor who makes any payment in respect of the
Guaranteed Obligations shall have no right of contribution or subrogation against
any other Guarantor in respect of such payment until all of the Guaranteed
Obligations have been irrevocably paid in full in cash.  Each of the Guarantors recognizes and
acknowledges that the rights to contribution arising hereunder shall constitute
an asset in favor of the party entitled to such contribution.  In this connection, each Guarantor has the
right to waive its contribution right against any Guarantor to the extent that
after giving effect to such waiver such Guarantor would remain solvent, in the
determination of the Required Lenders.

 

20.  LIMITATION ON GUARANTEED
OBLIGATIONS.  Each Guarantor and
each Secured Creditor (by its acceptance of the benefits of this Guaranty)
hereby confirms that it is its intention that this Guaranty not constitute a
fraudulent transfer or conveyance for purposes of the Bankruptcy Code, the
Uniform Fraudulent Conveyance Act of any similar Federal or state law.  To effectuate the foregoing intention, each
Guarantor and each Secured Creditor (by its acceptance of the benefits of this
Guaranty) hereby irrevocably agrees that the Guaranteed Obligations guaranteed
by such Guarantor shall be limited to such amount as will, after giving effect
to such maximum amount and all other (contingent or otherwise) liabilities of
such Guarantor that are relevant under such laws (it being understood that it
is the intention of the parties to this Guaranty and the parties to any
guaranty of the Permitted Senior Subordinated Notes that, to the maximum extent
permitted under applicable laws, the liabilities in respect of the guarantees
of the Permitted Senior Subordinated Notes shall not be included for the
foregoing purposes and that, if any reduction is required to the amount guaranteed by any Guarantor hereunder and
with respect to the Permitted Senior Subordinated Notes that its
guarantee of amounts owing in respect of the Permitted Senior Subordinated
Notes shall first be reduced) and after giving effect to any rights to
contribution pursuant to any agreement providing for an equitable contribution
among such Guarantor and the other Guarantors, result in the Guaranteed
Obligations of such Guarantor in respect of such maximum amount not
constituting a fraudulent transfer or conveyance.  Notwithstanding the provisions of the two
preceding sentences, as between the Secured Creditors and the holders of the
Permitted Senior Subordinated Notes, unless the Agents otherwise agree in their
sole discretion, it is agreed (and upon execution and delivery of any Permitted
Senior Subordinated Notes Indentures, the provisions thereof shall so provide)
that any diminution (whether pursuant to court decree or otherwise) of any
Guarantor’s obligation to make any distribution or payment pursuant to this
Guaranty shall have no force or effect for purposes of the subordination
provisions contained in the Permitted Senior Subordinated Notes Indentures, and
that any payments received in respect of a Guarantor’s obligations with respect
to the Permitted Senior Subordinated Notes shall be turned over to the holders
of the “senior debt” of such Guarantor (or obligations which would have
constituted “senior debt” of such Guarantor if same had not been reduced or
disallowed and which “senior debt” shall be calculated as if there were no
diminution thereto pursuant to this Section 20 or for any other reason other
than the irrevocable payment in full in cash of the respective obligations
which would otherwise have constituted “senior debt” of such Guarantor) until
all such “senior debt” (or obligations which would have constituted “senior
debt” of such Guarantor if same had not been reduced or disallowed) has been
irrevocably paid in full in cash.

 

13

 

21.  COUNTERPARTS.  This Guaranty may be executed in any number
of counterparts and by the different parties hereto on separate counterparts,
each of which when so executed and delivered shall be an original, but all of
which shall together constitute one and the same instrument.  A set of counterparts executed by all the parties
hereto shall be lodged with the Borrower and the Administrative Agent.

 

22.  PAYMENTS.  All payments made by any Guarantor hereunder
will be made without setoff, counterclaim or other defense and on the same
basis as payments are made by the Borrower under Sections 3.03 and 3.04 of the
Credit Agreement.

 

23.  ADDITIONAL
GUARANTORS.  It is understood and
agreed that any Subsidiary of the Borrower that is required to execute a
counterpart of this Guaranty after the date hereof pursuant to the Credit Agreement
shall become a Guarantor hereunder by (x) executing and delivering a
counterpart hereof (or a satisfactory joinder agreement hereto) to the
Administrative Agent and (y) taking all actions as specified in this Guaranty
as would have been taken by such Guarantor had it been an original party to
this Guaranty, in each case with all documents and actions required to be taken
above to the reasonable satisfaction of the Administrative Agent.

 

24.  HEADINGS
DESCRIPTIVE.  The headings of the several
Sections of this Guaranty are inserted for convenience only and shall not in
any way affect the meaning or construction of any provision of this Guaranty.

 

* 
*  *

 

14

 

IN WITNESS WHEREOF, each Guarantor has caused this Guaranty to be
executed and delivered as of the date first above written.

 

Address:                

 

	
  c/o FAIRPOINT
  COMMUNICATIONS, INC.

  	
   

  	
  FAIRPOINT BROADBAND, INC.,

  
	
  521 East Morehead Street

  	
   

  	
  as a Guarantor

  
	
  Suite 250

  	
   

  	
   

  
	
  Charlotte, NC 28202

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   /s/ Timothy W. Henry

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Vice President of Finance

  & Treasurer

  
	
   

  	
   

  	
   

  
	
  c/o FAIRPOINT
  COMMUNICATIONS, INC.

  	
   

  	
  MJD VENTURES, INC.,

  
	
  521 East Morehead Street

  	
   

  	
  as a Guarantor

  
	
  Suite 250

  	
   

  	
   

  
	
  Charlotte, NC 28202

  	
   

  	
  By:

  	
   /s/ Timothy W. Henry

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Vice President of Finance

  & Treasurer

  
	
   

  	
   

  	
   

  
	
  c/o FAIRPOINT
  COMMUNICATIONS, INC.

  	
   

  	
  MJD SERVICES CORP.,

  
	
  521 East Morehead Street

  	
   

  	
  as a Guarantor

  
	
  Suite 250

  	
   

  	
   

  
	
  Charlotte, NC 28202

  	
   

  	
  By:

  	
   /s/ Timothy W. Henry

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Vice President of Finance

  & Treasurer

  
	
   

  	
   

  	
   

  
	
  c/o FAIRPOINT COMMUNICATIONS,
  INC.

  	
   

  	
  ST ENTERPRISES, LTD.,

  
	
  521 East Morehead Street

  	
   

  	
  as a Guarantor

  
	
  Suite 250

  	
   

  	
   

  
	
  Charlotte, NC 28202

  	
   

  	
  By:

  	
   /s/ Timothy W. Henry

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Vice President of Finance

  & Treasurer

  
	
   

  	
   

  	
   

  
	
  c/o FAIRPOINT
  COMMUNICATIONS, INC.

  	
   

  	
  FAIRPOINT CARRIER
  SERVICES, INC.,

  
	
  521 East Morehead Street

  	
   

  	
  as a Guarantor

  
	
  Suite 250

  	
   

  	
   

  
	
  Charlotte, NC 28202

  	
   

  	
  By:

  	
   /s/ Timothy W. Henry

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Vice President of Finance

  & Treasurer

  
							

 

	
  Accepted
  and Agreed to:

  
	
   

  
	
  DEUTSCHE
  BANK TRUST COMPANY AMERICAS,

  
	
  as
  Administrative Agent

  
	
   

  
	
  By:

  	
   /s/ Anca Trifan

  	
   

  
	
   

  	
  Title:

  	
  Director

  
				

 

15

 

Table of Contents

 

	
  1.

  	
  GUARANTY

  	
   

  
	
  2.

  	
  LIABILITY OF GUARANTORS ABSOLUTE

  	
   

  
	
  3.

  	
  OBLIGATIONS OF GUARANTORS INDEPENDENT

  	
   

  
	
  4.

  	
  WAIVERS BY GUARANTORS

  	
   

  
	
  5.

  	
  RIGHTS OF SECURED CREDITORS

  	
   

  
	
  6.

  	
  CONTINUING GUARANTY

  	
   

  
	
  7.

  	
  SUBORDINATION OF INDEBTEDNESS HELD BY
  GUARANTORS

  	
   

  
	
  8.

  	
  GUARANTY ENFORCEABLE BY ADMINISTRATIVE
  AGENT OR COLLATERAL AGENT

  	
   

  
	
  9.

  	
  REPRESENTATIONS, WARRANTIES AND COVENANTS
  OF GUARANTORS

  	
   

  
	
  10.

  	
  EXPENSES

  	
   

  
	
  11.

  	
  BENEFIT AND BINDING EFFECT

  	
   

  
	
  12.

  	
  AMENDMENTS; WAIVERS

  	
   

  
	
  13.

  	
  SET OFF

  	
   

  
	
  14.

  	
  NOTICE

  	
   

  
	
  15.

  	
  REINSTATEMENT

  	
   

  
	
  16.

  	
  CONSENT TO JURISDICTION; SERVICE OF
  PROCESS; AND WAIVER OF TRIAL BY JURY

  	
   

  
	
  17.

  	
  RELEASE OF LIABILITY OF GUARANTOR UPON SALE
  OR DISSOLUTION

  	
   

  
	
  18.

  	
  CONTRIBUTION

  	
   

  
	
  19.

  	
  LIMITATION ON GUARANTEED OBLIGATIONS

  	
   

  
	
  20.

  	
  COUNTERPARTS

  	
   

  
	
  21.

  	
  PAYMENTS

  	
   

  
	
  22.

  	
  ADDITIONAL GUARANTORS

  	
   

  
	
  23.

  	
  HEADINGS DESCRIPTIVE

  	
   

  

 

i

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