Document:

<PAGE>   1
                                                                  Exhibit 4.6

                 FORM OF AMENDED AND RESTATED PLEDGE AGREEMENT

                  This AMENDED AND RESTATED PLEDGE AGREEMENT (this "Pledge
Agreement") is made and entered into as of _________, 2000 by PATHNET, INC., a
Delaware corporation (the "Pledgor"), THE BANK OF NEW YORK, a New York banking
corporation, having an office at 101 Barclay Street, Floor 21 West, New York,
New York 10286, as trustee (the "Trustee") for the holders from time to time
(the "Holders") of the Notes (as defined herein) issued by the Pledgor under the
Indenture referred to below and THE BANK OF NEW YORK, as securities intermediary
(the "Pathnet Securities Intermediary").

                               W I T N E S S E T H

                  WHEREAS, the Pledgor and the Trustee have entered into that
certain indenture dated as of April 8, 1998 (the " Original Indenture"),
pursuant to which the Pledgor issued on April 8, 1998 $350,000,000 in aggregate
principal amount of 12-1/4 % Senior Notes due 2008 (and along with such notes
that may from time to time be issued in substitution therefor, the "Notes"); and

                  WHEREAS, the Pledgor agreed, pursuant to the Original
Indenture, to (i) purchase or cause the purchase of Pledged Securities (as
defined in the Original Indenture) in an amount that would be sufficient upon
receipt of scheduled interest and principal payments in respect thereof to
provide for the payment of the first four scheduled interest payments due on the
Notes and (ii) place such Pledged Securities (or cause them to be placed) in an
account maintained by the Trustee with the Pathnet Securities Intermediary for
the benefit of Holders of the Notes; and

                  WHEREAS, the Pledgor agreed to purchase United States Treasury
securities in an amount sufficient, in the opinion of a nationally recognized
firm of independent public accountants selected by the Pledgor and delivered to
the Trustee, upon receipt of scheduled interest and principal payments of such
securities, to provide for payment in full of each of the first four scheduled
interest payment due on the Notes and interest on the Notes in the event that
the Notes become due and payable prior to such time as the first four scheduled
interest payments thereon shall have been paid in full (the "Original
Obligations"); and

                  WHEREAS, the Pledgor agreed to (i) pledge to the Trustee for
its benefit and the ratable benefit of the Holders of the Notes a security
interest in the Pledged Securities and related collateral and (ii) execute and
deliver the Pledge Agreement dated as of April 8, 1998 by and between the
Pledgor and the Trustee in order to secure the payment and performance by the
Pledgor of all the Original Obligations (the "Original Pledge Agreement"); and
<PAGE>   2
                                       2

                  WHEREAS, pursuant to the Original Pledge Agreement the Trustee
opened an account (the "Escrow Account") with the Pathnet Securities
Intermediary, at its office at 101 Barclay Street, New York, New York 10286,
Account No. 281251, in the name of The Bank of New York, as Trustee, for the
benefit of the Holders of the 12-1/4% Senior Notes due 2008 of Pathnet, Inc.
(along with such notes that may from time to time be issued in substitution
therefor), with respect to which the Trustee is the sole entitlement holder and
which is under the sole dominion and control of the Trustee but subject to the
terms of the Original Pledge Agreement.

                  WHEREAS, the first three scheduled interest payments on the
Notes have been paid in accordance with the terms of the Original Indenture; and

                  WHEREAS, Pathnet has entered into a Contribution and
Reorganization transaction (the "Transaction") as at the date hereof, as more
particularly described in the Registration Statement of Pathnet
Telecommunications, Inc., and filed with the SEC with Registration No.
333-91469; and

                  WHEREAS, in connection with the Transaction, the Original
Indenture has been supplemented by that Supplemental Indenture of even date
herewith by and among the Pledgor, Pathnet Telecommunications Inc., and the
Trustee (the "Supplemental Indenture"); and

                  WHEREAS, pursuant to the Supplemental Indenture Pathnet has
agreed to (i) purchase and pledge to the Trustee additional United States
Treasury securities as security for the benefit of the holders of the Notes with
respect to the fifth scheduled interest payment on the Notes on the same terms
as the Original Pledge Agreement; and (ii) execute and deliver this Amended and
Restated Pledge Agreement in order to secure the payment in full of the fourth
and fifth scheduled interest payments due on the Notes and interest on the Notes
in the event that the Notes become due and payable prior to such time as the
fourth and fifth scheduled interest payments thereon shall have been paid in
full (the "Outstanding Obligations").

                  Capitalized terms used herein and not otherwise defined herein
shall have the meanings given to them in the Indenture. References herein to the
"Indenture" shall be deemed to be references to the Original Indenture as
amended by the Supplemental Indenture unless expressly stated to the contrary.

                  NOW THEREFORE, in consideration of the mutual promises herein
contained and in order to induce the Holders of the Notes to consent to the
amendments to the Original Indenture contained in the Supplemental Indenture,
the Pledgor hereby agrees with the Trustee, for the benefit of the Trustee and
for the ratable benefit of the Holders of the Notes, as follows:

                  SECTION 1. Pledge and Grant of Security Interest. As security
for the prompt and complete payment and performance when due of the Outstanding
Obligations (whether at the stated maturity or otherwise), the Pledgor hereby
pledges to the Trustee for its benefit and for the ratable benefit of the
Holders of the Notes, and grants to the Trustee for its benefit and for the
ratable benefit of the Holders of the Notes, a continuing
<PAGE>   3
                                       3

first priority security interest in and to all of the Pledgor's right, title and
interest in, to and under the following (wherever located), whether investment
property, general intangibles, other rights, interests, claims and remedies or
proceeds or otherwise (collectively, the "Pledged Collateral"): (a) the United
States Treasury securities identified by CUSIP Number in Exhibit A to this
Pledge Agreement (the "Pledged Securities"), (b) any and all applicable Security
Entitlements to the Pledged Securities, (c) the Escrow Account and all funds,
certificates, instruments, assets and properties, if any, from time to time
carried therein or representing or evidencing the Escrow Account (d) any and all
related accounts in which Security Entitlements to the Pledged Securities are
carried and (e) all proceeds of any and all of the Pledged Collateral
(including, without limitation, proceeds that constitute property of the types
described in clauses (a) - (d) of this Section 1).

                  SECTION 2. Security for Outstanding Obligation. This Pledge
Agreement secures the prompt and complete payment and performance when due
(whether at stated maturity, by acceleration or otherwise) of all the
Outstanding Obligations.

         SECTION 3. Delivery of New Pledged Securities; Escrow Account;
         Interest. (a) The Pledged Securities shall, if and to the extent that
         they have not previously been pledged and transferred to the Trustee
         pursuant to the Original Pledge Agreement (such unpledged and
         untransferred securities being hereinafter referred to as the "New
         Pledged Securities" and the Pledged Collateral, in so far as it relates
         to the New Pledged Securities being referred to as the New Pledged
         Collateral) be pledged and transferred to the Trustee and the Trustee
         shall become the holder of a Security Entitlement to the New Pledged
         Securities through action by the Pathnet Securities Intermediary, as
         confirmed (in writing or electronically or otherwise in accordance with
         standard industry practice) to the Trustee by the Pathnet Securities
         Intermediary (i) indicating by book-entry that the New Pledged
         Securities and all Security Entitlements thereto have been credited to
         the Escrow Account, or (ii) acquiring the New Pledged Securities or a
         Security Entitlement thereto for the Trustee and accepting the same for
         credit to the Escrow Account.

                  (b) The Trustee has pursuant to the Original Pledge Agreement,
         established with the Pathnet Securities Intermediary the Escrow Account
         on the books of the Pathnet Securities Intermediary as a Securities
         Account segregated from all other custodial or collateral accounts,
         such Escrow Account to be maintained at the offices of the Pathnet
         Securities Intermediary at 101 Barclay Street, Floor 21 West, New York,
         New York 10286, and the Pathnet Securities Intermediary has established
         and maintained a Securities Account at the Federal Reserve Bank of New
         York ("FRBNY"). Upon transfer of the New Pledged Securities to the
         Pathnet Securities Intermediary (or the Pathnet Securities
         Intermediary's acquisition of the Security Entitlements thereto), as
         confirmed to the Pathnet Securities Intermediary by FRBNY or another
         securities intermediary, the Pathnet Securities Intermediary shall make
         appropriate book entries indicating that the New Pledged Securities
         and/or such Security Entitlement have been credited to the Trustee and
         the Escrow Account and that all of the Pledged
<PAGE>   4
                                       4

         Securities are therefore credited to the Trustee and the Escrow
         Account. Subject to the other terms and conditions of this Pledge
         Agreement, all funds or other property held by the Trustee pursuant to
         this Pledge Agreement and the Original Pledge Agreement shall be held
         in the Escrow Account subject (except as expressly provided in Section
         4(a), (b) and (c) hereof) to the exclusive dominion and control
         (including "control" as defined in Section 9-115(l)(e) of the UCC) of
         the Trustee and exclusively for the benefit of the Trustee and for the
         ratable benefit of the Holders of the Notes and segregated from all
         other funds or other property otherwise held by the Trustee.

                  (c) The Trustee shall, in accordance with all applicable laws,
         have sole dominion and control (including "control" as defined in UCC
         Section 9-115(l)(e)) over the Escrow Account, and it shall be a term
         and condition of the Escrow Account and the Pledgor irrevocably
         instructs the Trustee, notwithstanding any other term or condition to
         the contrary in any other agreement, that no Pledged Collateral shall
         be released to or for the account of, or withdrawn by or for the
         account of, the Pledgor or any other Person except as expressly
         provided in this Pledge Agreement.

                  (d) The Trustee shall, in accordance with and subject to all
         applicable laws, be the sole entitlement holder of, and have the sole
         power to originate "Entitlement Orders" (as defined in UCC Section
         8-102(a)(8)) with respect to, the Escrow Account and all United States
         Treasury securities held therein, and it shall be a term and condition
         of the Escrow Account that the Trustee shall have the right to issue
         such Entitlement Orders with respect to the Escrow Account and all
         assets and properties from time to time carried in the Escrow Account,
         including such securities, Security Entitlements and other "Financial
         Assets" (as defined in UCC Section 8-102(a)(9)) without further consent
         of the Pledgor or any other Person (except, to the extent required
         under the Indenture, of the Holders), and that no Pledged Collateral
         shall be released to or for the account of, or withdrawn by or for the
         account of, the Pledgor or any other Person except as expressly
         provided in this Pledge Agreement.

                  (e) All Pledged Collateral shall be retained in the Escrow
         Account pending disbursement pursuant to the terms hereof.

                  (f) Concurrently with the execution and delivery of this
         Pledge Agreement the Trustee and the Pathnet Securities Intermediary
         are delivering to the Pledgor a duly executed certificate, in the form
         of Exhibit A hereto, of an officer of the Trustee, confirming the
         Trustee's receipt and holding of the Pledged Securities or a Security
         Entitlement thereto and the crediting of the Pledged Securities or such
         Security Entitlement to the Escrow Account, all in accordance with this
         Pledge Agreement.

                  (g) Concurrently with the execution and delivery of this
         Pledge Agreement, the Pledgor shall deliver to the Trustee
         acknowledgement copies or stamped receipt copies of proper financing
         statements, duly filed under the UCC
<PAGE>   5
                                       5

         of the State of New York, covering the New Pledged Collateral described
         in this Pledge Agreement.

                  (h) Concurrently with the execution and delivery of this
         Pledge Agreement, the Pledgor shall deliver to the Trustee an opinion
         of a nationally recognized firm of independent public accountants,
         selected by the Pledgor, substantially in the form of Exhibit B
         hereto.]

                  SECTION 4. Disbursements.

                  (a) At least three Business Days prior to the due date of each
         of the fourth or the fifth scheduled interest payments on the Notes,
         the Pledgor may, pursuant to written instructions given by the Pledgor
         to the Trustee (a "Company Order"), direct the Trustee to release from
         the Escrow Account and pay to the Holders of the Notes on behalf of the
         Issuer proceeds sufficient to provide for payment in full of such
         interest then due on the Notes. Upon receipt of a Company Order, the
         Trustee will take any action necessary to provide for the payment of
         the interest on the Notes in accordance with the Company Order and the
         payment provisions of the Indenture to the Holders of the Notes from
         (and to the extent of) proceeds of the Pledged Securities in the Escrow
         Account. Nothing in this Section 4 shall affect the Trustee's rights to
         apply the Pledged Collateral to the payments of amounts due on the
         Notes upon acceleration thereof.

                  (b) If the Pledgor makes any interest payment or portion of an
         interest payment for which the Pledged Collateral is security from a
         source of funds other than the Escrow Account ("Other Funds"), the
         Pledgor may, after payment in full of such interest payment, direct the
         Trustee pursuant to a Company Order to release to the Pledgor or to
         another party at the direction of the Pledgor (the "Pledgor's
         Designee") proceeds from the Escrow Account in an amount less than or
         equal to the amount of Other Funds applied to such interest payment.
         Upon receipt by the Trustee of such Company Order and provided the
         Trustee has received such interest payment, if no Default or Event of
         Default (as defined in the Indenture) shall have occurred and be
         continuing, the Trustee shall pay over to the Pledgor or the Pledgor's
         Designee, as the case may be, the requested amount from proceeds in the
         Escrow Account as soon as practicable. Concurrently with any release of
         funds to the Pledgor pursuant to this Section 4(b), the Pledgor shall
         deliver to the Trustee a certificate signed by an officer of the
         Pledgor stating that the Pledgor has made the interest payment from a
         source of funds other than the Escrow Account, and that such release
         has been duly authorized by the Pledgor and will not contravene any
         provision of applicable law or the Certificate of Incorporation or the
         By-laws of the Pledgor or any material agreement or other material
         instrument binding upon the Pledgor or any of its subsidiaries or any
         judgment, order or decree of any governmental body, agency or court
         having jurisdiction over the Pledgor or any of its subsidiaries or
         result in the creation or imposition of any Lien on any assets of the
         Pledgor, except for the security interest granted under the Pledge
         Agreement.
<PAGE>   6
                                       6

                  (c) If at any time the principal of and interest on the
         Pledged Securities exceeds 100% of the amount sufficient, in the
         written opinion of a nationally recognized firm of independent
         accountants selected by the Pledgor and delivered to the Trustee, to
         provide for payment in full of the remaining fourth and fifth scheduled
         interest payments due on all of the outstanding Notes, the Pledgor may
         direct the Trustee to release any such excess amount to the Pledgor or
         to any Pledgor's Designee. Upon receipt of a Company Order (which shall
         include a certificate from such nationally recognized firm of
         independent accountants stating the amount by which the Pledged
         Securities exceed the amount required to be held in the Escrow
         Account), if no Default or Event of Default (as defined in the
         Indenture) shall have occurred and be continuing, the Trustee shall pay
         over to the Pledgor or the Pledgor's Designee, as the case may be, any
         such excess amount.

                  (d) Upon payment in full of the Outstanding Obligations, or if
         the Company shall become obligated under the Indenture to redeem all of
         the outstanding Notes and such Notes shall have been redeemed, then, if
         no Default or Event of Default (as defined in the Indenture) shall have
         occurred and be continuing, the security interest in the Pledged
         Collateral evidenced by this Pledge Agreement will automatically
         terminate and be of no further force and effect and the Pledged
         Collateral shall promptly be paid over and transferred to the Pledgor.
         Furthermore, upon the release of any Pledged Collateral from the Escrow
         Account in accordance with the terms of this Pledge Agreement, whether
         upon release of Pledged Collateral to Holders as payment of interest or
         otherwise, the security interest evidenced by this Pledge Agreement in
         such released Pledged Collateral will automatically terminate and be of
         no further force and effect.

                  (e) At least three Business Days prior to the due date of each
         of the fourth and fifth scheduled interest payments on the Notes, the
         Pledgor shall give the Trustee notice (by Company Order) as to whether
         such interest payment will be made pursuant to Section 4(a) or 4(b) and
         the respective amounts of interest that will be paid from the Escrow
         Account and from Other Funds. Any Other Funds to be used to make any
         interest payment shall be delivered to the Trustee, in immediately
         available funds, prior to 10:00 a.m. (New York City time) on such
         interest payment date. If no such notice is given or such Other Funds
         have not been so delivered, the Trustee will act pursuant to Section
         4(a) as if it had received a Company Order pursuant thereto for the
         payment in full of the interest then due from the Escrow Account.

                  (f) The Trustee shall liquidate Pledged Collateral in the
         Escrow Account (pursuant to written instructions from Pledgor) in order
         to make any scheduled payment of interest unless there are sufficient
         funds in the Escrow Account on such interest payment date.

                  (g) Nothing contained in Section 1, Section 3, this Section 4,
         Section 11 or any other provision of this Pledge Agreement shall (i)
         afford the Pledgor any right to issue Entitlement Orders with respect
         to any Security Entitlement to
<PAGE>   7
                                       7

         the Pledged Securities or any Securities Account in which any such
         Security Entitlement may be carried, or otherwise afford the Pledgor
         rights to of any such Security Entitlement or (ii) except as otherwise
         specified under this Agreement (or required by applicable law) give
         rise to any other rights of the Pledgor with respect to the Pledged
         Securities, any Security Entitlement thereto or any Securities Account
         in which any such Security Entitlement may be carried (except as
         expressly provided in Sections 4(a), (b) and (c) hereof) of the Trustee
         in its capacity as such (and not as a securities intermediary).

                  SECTION 5. Representations and Warranties. The Pledgor hereby
represents and warrants that, as of the date hereof.

                  (a) The execution and delivery by the Pledgor of, and the
         performance by the Pledgor of its obligations under, this Pledge
         Agreement will not contravene any provision of applicable law or
         statute or the organization documents of the Pledgor or any material
         agreement or other material instrument binding upon the Pledgor or any
         of its subsidiaries or any judgment, order or decree of any
         governmental body, agency or court having jurisdiction over the Pledgor
         or any of its subsidiaries, or result in the creation or imposition of
         any Lien on any assets of the Pledgor, except for the security
         interests granted under this Pledge Agreement; no consent, approval,
         authorization or order of, or qualification with, or other action by,
         any governmental or regulatory body or agency or any third party is
         required (i) for the execution, delivery or performance by the Pledgor
         of this Pledge Agreement, (ii) for the grant by the Pledgor of the
         security interest granted hereby, for the pledge by the Pledgor of the
         Pledged Collateral pursuant to this Pledge Agreement, (iii) for the
         perfection and maintenance of the pledge and security interest created
         hereby (including the first-priority nature of such pledge and security
         interest, assuming compliance by the Pathnet Securities Intermediary
         with all obligations contained in this Pledge Agreement or (iv) except
         for any such consents, approvals, authorizations or orders required to
         be obtained by the Trustee (or the Holders) for reasons other than the
         consummation of this transaction, for the exercise by the Trustee of
         the rights provided for in this Pledge Agreement or the remedies in
         respect of the Pledged Collateral pursuant to this Pledge Agreement.

                  (b) Immediately before the depositing the New Pledged
         Securities into the Escrow Account, the Pledgor is the legal and
         beneficial owner of the New Pledged Collateral free and clear of any
         Lien or claims of any person or entity (except for the security
         interests granted under this Pledge Agreement). No financing statement
         or other instrument similar in effect covering the Pledgor's interest
         in the Pledged Securities is on file in any public office, other than
         any financing statements filed pursuant to this Pledge Agreement.

                  (c) This Pledge Agreement has been duly authorized, validly
         executed and delivered by the Pledgor and assuming the due
         authorization, execution and delivery thereof by the Trustee,
         constitutes a valid and binding agreement of the Pledgor, enforceable
         against the Pledgor in accordance with its terms, except as
<PAGE>   8
                                       8

         (i) the enforceability hereof may be limited by bankruptcy, insolvency,
         fraudulent conveyance, preference, reorganization, moratorium or
         similar laws now or hereafter in effect relating to or affecting
         creditors' rights or remedies generally, (ii) the availability of
         equitable remedies may be limited by equitable principles of general
         applicability, (iii) the exculpation provisions and rights to
         indemnification hereunder may be limited by U.S. federal and state
         securities laws and public policy considerations and (iv) the waiver of
         rights and defenses contained in Section 11(b), Section 15.11 and
         Section 15.15 hereof may be limited by applicable law.

                  (d) Upon the transfer to the Trustee of the New Pledged
         Securities and the acquisition by the Trustee of a Security Entitlement
         thereto in accordance with Section 3, and the compliance by the Pathnet
         Securities Intermediary with the provisions of this Pledge Agreement,
         the pledge of and grant of a security interest in the Pledged
         Collateral securing the payment of the Outstanding Obligations for the
         benefit of the Trustee and the Holders of the Notes will constitute a
         valid first priority perfected security interest in such Pledged
         Collateral, enforceable as such against all creditors of the Pledgor
         (and any persons purporting to purchase any of the Pledged Collateral
         from the Pledgor) and all filings and actions (other than the transfer
         to the Trustee of the Pledged Securities) necessary or desirable to
         perfect and protect such security interest have been duly taken.

                  (e) There are no legal or governmental proceedings pending or,
         to the best of the Pledgor's knowledge, threatened to which the Pledgor
         or any of its subsidiaries is a party or to which any of the properties
         of the Pledgor or any such subsidiary is subject that would materially
         adversely affect the power or ability of the Pledgor to perform its
         obligations under this Pledge Agreement or to consummate the
         transactions contemplated hereby.

                  (f) The pledge of the Pledged Collateral pursuant to this
         Pledge Agreement is not prohibited by law or governmental regulation
         (including, without limitation, Regulations G, T, U and X of the Board
         of Governors of the Federal Reserve System) applicable to the Pledgor.

                  (g) No Event of Default (as defined herein) exists.

                  SECTION 6. Further Assurances. The Pledgor will, promptly upon
request by the Trustee, execute and deliver or cause to be executed and
delivered, or use its reasonable best efforts to procure, all assignments,
instruments and other documents, all in form and substance reasonably
satisfactory to the Trustee, execute and deliver any instruments to the Trustee
and take any other actions that are necessary or desirable, to perfect, continue
the perfection of, or protect the first priority of the Trustee's security
interest in and to the Pledged Collateral, to protect the Pledged Collateral
against the rights, claims, or interests of third persons (other than any such
rights, claims or interests created by or arising through the Trustee), to
enable the Trustee to enforce its rights and remedies hereunder, or to effect
the purposes of this Pledge Agreement. A photocopy or other reproduction of this
Agreement or any financing statement covering the Pledged
<PAGE>   9
                                       9

Collateral or any part thereof shall be sufficient as a financing statement
where permitted by law. The Pledgor will promptly pay all reasonable costs
incurred in connection with any of the foregoing. The Pledgor also agrees to
take all actions that are necessary to perfect or continue the perfection of, or
to protect the first priority of, the Trustee's security interest in and to the
Pledged Collateral, including the filing of all necessary financing and
continuation statements, and to protect the Pledged Collateral against the
rights, claims or interests of third persons (other than any such rights, claims
or interests created by or arising through the Trustee).

                  SECTION 7. Covenants. The Pledgor covenants and agrees with
the Trustee and the Holders of the Notes that from and after the date of this
Pledge Agreement until the payment in full in cash of the Outstanding
Obligations:

                  (a) that (i) it will not (and will not purport to) sell or
         otherwise dispose of, or grant any option or warrant with respect to,
         any of the Pledged Collateral or its beneficial interest therein, and
         (ii) it will not create or permit to exist any Lien or other adverse
         interest in or with respect to its beneficial interest in any of the
         Pledged Collateral (except for the security interests granted under
         this Pledge Agreement) and at all times will be the sole beneficial
         owner of the Pledged Collateral; and

                  (b) that it will not (i) enter into any agreement or
         understanding that restricts or inhibits or purports to restrict or
         inhibit the Trustee's rights or remedies hereunder, including, without
         limitation, the Trustee's right to sell or otherwise dispose of the
         Pledged Collateral or (ii) fail to pay or discharge any tax, assessment
         or levy of any nature with respect to its beneficial interest in the
         Pledged Collateral not later than five days prior to the date of any
         proposed sale under any judgment, writ or warrant of attachment with
         respect to such beneficial interest.

                  SECTION 8. Power of Attorney. Upon the occurrence of an Event
of Default, in addition to all of the powers granted to the Trustee pursuant to
the Indenture, the Pledgor hereby appoints and constitutes the Trustee as the
Pledgor's attorney-in-fact, with full authority in the place and stead of the
Pledgor and in the name of the Pledgor or otherwise, from time to time in the
Trustee's discretion, to take any action and to execute any instrument that the
Trustee may deem necessary or advisable to accomplish the purposes of this
Pledge Agreement, including, without limitation, the following powers: (a)
collection of proceeds of any Pledged Collateral; (b) conveyance of any item of
Pledged Collateral to any purchaser thereof; (c) giving of any notices or
recording of any Liens under Section 6 hereof; and (d) paying or discharging
taxes or Liens levied or placed upon the Pledged Collateral, the legality or
validity thereof and the amounts necessary to discharge the same to be
determined by the Trustee in its sole reasonable discretion, and such payments
made by the Trustee to become part of the Outstanding Obligations of the Pledgor
to the Trustee, due and payable immediately upon demand. The Trustee's authority
under this Section 8 shall include, without limitation, the authority to endorse
and negotiate any checks or instruments representing proceeds of Pledged
Collateral in the name of the Pledgor, execute and give receipt for any
certificate
<PAGE>   10
                                       10

of ownership or any document constituting Pledged Collateral, transfer title to
any item of Pledged Collateral, sign the Pledgor's name on all financing
statements (to the extent permitted by applicable law) or any other documents
deemed necessary or appropriate by the Trustee to preserve, protect or perfect
the security interest in the Pledged Collateral and to file the same, prepare,
file and sign the Pledgor's name on any notice of Lien, and to take any other
actions arising from or incident to the powers granted to the Trustee in this
Pledge Agreement. This power of attorney is coupled with an interest and is
irrevocable by the Pledgor. Notwithstanding anything to the contrary stated
herein, the Trustee has no duty or obligation to exercise any of the powers
stated in this Section 8.

                  SECTION 9. No Assumption of Duties: Reasonable Care. The
rights and powers granted to the Trustee hereunder are being granted in order to
preserve and protect the security interest of the Trustee and the Holders of the
Notes in and to the Pledged Collateral granted hereby and shall not be
interpreted to, and shall not impose any duties on the Trustee in connection
therewith other than those expressly provided herein or imposed under applicable
law. Except as provided by applicable law or by the Indenture, the Trustee shall
be deemed to have exercised reasonable care in the custody and preservation of
the Pledged Collateral in its possession if the Pledged Collateral is accorded
treatment substantially equal to that which the Trustee accords similar property
held by the Trustee for similar accounts, it being understood that the Trustee
in its capacity as such shall not have any responsibility for (a) ascertaining
or taking action with respect to calls, conversions, exchanges, maturities or
other matters relative to any Pledged Collateral, whether or not the Trustee has
or is deemed to have knowledge of such matters or (b) investing or reinvesting
any of the Pledged Collateral or any loss on any investment; provided, however,
that nothing contained in this Pledge Agreement shall relieve the Trustee of any
responsibilities as a securities intermediary under applicable law.

                  SECTION 10. Indemnity. The Pledgor shall indemnify, hold
harmless and defend the Trustee and its directors, officers, agents and
employees from and against any and all claims, actions, obligations, liabilities
and expenses, including reasonable defense costs, reasonable investigative fees
and costs and reasonable legal fees and expenses and damages arising from the
Trustee's performance as Trustee under this Pledge Agreement, except to the
extent that such claim, action, obligation, liability or expense is directly
attributable to the gross negligence or wilful misconduct of such indemnified
person.

                  SECTION 11. Remedies Upon Event of Default. If any Event of
Default under the Indenture (any such Event of Default being referred to in this
Pledge Agreement as an "Event of Default") shall have occurred and be
continuing:

                  (a) The Trustee and the Holders of the Notes shall have, in
         addition to all other rights given by law or by this Pledge Agreement
         or the Indenture, all of the rights and remedies with respect to the
         Pledged Collateral of a secured party under the UCC. In addition, with
         respect to any Pledged Collateral that shall then be in or shall
         thereafter come into the possession or custody of the Trustee, the
         Trustee may sell or cause the same to be sold at any broker's board or
         at public or
<PAGE>   11
                                       11

         private sale, in one or more sales or lots, at such price or prices as
         the Trustee may deem best, for cash or on credit or for future
         delivery, without assumption of any credit risk. The purchaser of any
         or all Pledged Collateral so sold shall thereafter hold the same
         absolutely, free from any claim, encumbrance or right of any kind
         whatsoever created by or through the Pledgor. Unless any of the Pledged
         Collateral threatens, in the reasonable judgment of the Trustee, to
         decline speedily in value or is or becomes of a type sold on a
         recognized market, the Trustee will give the Pledgor reasonable notice
         of the time and place of any public sale thereof, or of the time after
         which any private sale or other intended disposition is to be made. To
         the extent permitted by applicable law, any sale of the Pledged
         Collateral conducted in conformity with reasonable commercial practices
         of banks, insurance companies, commercial finance companies, or other
         financial institutions disposing of property similar to the Pledged
         Collateral shall be deemed to be commercially reasonable. Any
         requirements of reasonable notice shall be met if such notice is mailed
         to the Pledgor as provided in Section 15.1 hereof at least 10 days
         before the time of the sale or disposition. The Trustee or any Holder
         of Notes may, in its own name or in the name of a designee or nominee,
         buy any of the Pledged Collateral at any public sale and, if permitted
         by applicable law, at any private sale. All expenses (including court
         costs and reasonable attorneys' fees, expenses and disbursements) of,
         or incident to, the enforcement of any of the provisions hereof shall
         be recoverable from the proceeds of the sale or other disposition of
         the Pledged Collateral.

                  (b) The Pledgor further agrees to use its reasonable best
         efforts to do or cause to be done all such other acts as may be
         necessary to make such sale or sales of all or any portion of the
         Pledged Collateral pursuant to this Section 11 valid and binding and in
         compliance with any and all other applicable requirements of law. The
         Pledgor further agrees that a breach of any of the covenants contained
         in this Section 11 will cause irreparable injury to the Trustee and the
         Holders of the Notes, that the Trustee and the Holders of the Notes
         have no adequate remedy at law in respect of such breach and, as a
         consequence, that each and every covenant contained in this Section 11
         shall be specifically enforceable against the Pledgor, and the Pledgor
         hereby waives and agrees not to assert any defenses against an action
         for specific performance of such covenants except for a defense that no
         Event of Default has occurred.

                  (c) The Trustee may, without notice to the Pledgor except as
         required by law and at any time or from time to time, charge, set-off
         and otherwise apply all or any part of the Outstanding Obligations
         against the Escrow Account or any part thereof.

                  SECTION 12. Expenses. The Pledgor will upon demand pay to the
Trustee the amount of any and all reasonable expenses, including, without
limitation, the reasonable fees, expenses and disbursements of its counsel,
experts and agents retained by the Trustee that the Trustee may incur in
connection with (a) the review, negotiation and administration of this Pledge
Agreement, (b) the custody or preservation of, or the sale of, collection from,
or other realization upon, any of the Pledged Collateral, (c) the
<PAGE>   12
                                       12

exercise or enforcement of any of the rights of the Trustee and the Holders of
the Notes hereunder or (d) the failure by the Pledgor to perform or observe any
of the provisions hereof.

                  SECTION 13. Security Interest Absolute. All rights of the
Trustee and the Holders of the Notes and security interests hereunder, and all
obligations of the Pledgor hereunder, shall be absolute and unconditional
irrespective of:

                  (a) any lack of validity or enforceability of the Indenture or
         any other agreement or instrument relating thereto;

                  (b) any change in the time, manner or place of payment of, or
         in any other term of, all or any of the Outstanding Obligations, or any
         other amendment or waiver of or any consent to any departure from the
         Indenture;

                  (c) any taking, exchange, surrender, release or non-perfection
         of any other collateral or any taking, release or amendment or waiver
         from any guaranty for all or any of the Outstanding Obligations;

                  (d) any change, restructuring or termination of the corporate
         structure or the existence of the Pledgor or any of its subsidiaries;
         or

                  (e) to the extent permitted by applicable law, any other
         circumstance which might otherwise constitute a defense available to,
         or a discharge of, the Pledgor in respect of the Outstanding
         Obligations or of this Pledge Agreement.

                  SECTION 14. Pathnet Securities Intermediary's Representations,
Warranties and Covenants. The Pathnet Securities Intermediary represents and
warrants that it is as of the date hereof, and it agrees that for so long as it
maintains the Escrow Account and acts as securities intermediary pursuant to
this Pledge Agreement it shall be a "Securities Intermediary" (as defined in the
UCC and in 31 C.F.R. Section 357.2) and shall be eligible to maintain, and does
maintain, a Participant's Securities Account (as defined in 31 C.F.R. Section
357.2) in the name of the Pathnet Securities Intermediary with the FRBNY (a
"FRBNY Member Securities Account"). In furtherance of the foregoing, the Pathnet
Securities Intermediary hereby:

                  (a) represents and warrants that it is a corporation that in
         the ordinary course of its business maintains Securities Accounts for
         others and is acting in that capacity hereunder and with respect to the
         Escrow Account;

                  (b) represents and warrants that it maintains the FRBNY Member
         Securities Account with the FRBNY and that the United Stated Treasury
         securities constituting the Pledged Securities transferred to the
         Pathnet Securities Intermediary pursuant to Section 3(b) have been
         credited to the FRBNY Member Securities Account;

                  (c) agrees that the Escrow Account shall be an account to
         which Financial Assets may be credited, and the Pathnet Securities
         Intermediary
<PAGE>   13
                                       13

         undertakes to treat the Trustee as the sole person entitled to exercise
         rights that comprise (and entitled to the benefits of) such Financial
         Assets, and entitled to exercise the rights of an entitlement holder
         and control in the manner contemplated by the UCC, and further agrees
         to identify the Trustee in the records of the Pathnet Securities
         Intermediary as the sole person having a Securities Entitlement against
         the Pathnet Securities Intermediary with respect to the Escrow Account
         and all Financial Assets credited thereto;

                  (d) hereby represents that it has not granted, and covenants
         that so long as it acts as Pathnet Securities Intermediary hereunder it
         shall not grant, control (including without limitation, "control" as
         defined in UCC Section 9-115(l)(e)) over or with respect to any Pledged
         Collateral credited to the Escrow Account from time to time to any
         other Person other than the Trustee;

                  (e) covenants that in its capacity as Pathnet Securities
         Intermediary hereunder and with respect to the Escrow Account, it shall
         not take any action inconsistent with, and represents and covenants
         that it is not and so long as this Pledge Agreement remains in effect
         will not become party to any agreement, the terms of which are
         inconsistent with the provisions of this Pledge Agreement;

                  (f) agrees, with the other parties to this Pledge Agreement,
         that any item of property credited to the Escrow Account shall be
         treated as a Financial Asset;

                  (g) agrees, with the other parties to this Pledge Agreement,
         so long as it serves as Pathnet Securities Intermediary pursuant to
         this Pledge Agreement, to maintain the Escrow Account as a Securities
         Account and maintain appropriate books and records in respect thereof
         in accordance with its usual procedures and subject to the terms of
         this Pledge Agreement;

                  (h) agrees, with the other parties to this Pledge Agreement,
         that the Pathnet Securities Intermediary's jurisdiction, for purposes
         of UCC Section 8-110(e) and 31 C.F.R. 357.11(b) as it pertains to this
         Pledge Agreement, the Escrow Account and Security Entitlements relating
         thereto, shall be the State of New York.

                  SECTION 15. Miscellaneous Provisions.

                  Section 15.1. Notices. Any notice or communication given
hereunder shall be sufficiently given if in writing and delivered in person or
mailed by first class mail, commercial courier service or telecopier
communication, addressed as follows:

                  if to the Pledgor:

                           PathNet, Inc.
                           1015 31st Street, N.W.
                           Washington, D.C.  20007
                           Telecopier: (202) 625-7369

<PAGE>   14
                                       14

                           Attention:  General Counsel

                  with a copy to:

                           Bruce Wilson, Esq.
                           Covington & Burling
                           1201 Pennsylvania Avenue, N.W.
                           Washington D.C. 20004

                  if to the Trustee:

                           The Bank of New York
                           101 Barclay Street
                           Floor 21 West
                           New York, New York 10286

                           Telecopier: (212) 815-5915
                           Attention: Corporate Trust Administration

                  Section 15.2. No Adverse Interpretation of Other Agreements.
This Pledge Agreement may not be used to interpret another pledge, security or
debt agreement of the Pledgor or any subsidiary thereof. No such pledge,
security or debt agreement (other than the Indenture) may be used to interpret
this Pledge Agreement.

                  Section 15.3. Severability. The provisions of this Pledge
Agreement are severable, and if any clause or provision shall be held invalid,
illegal or unenforceable in whole or in part in any jurisdiction, then such
invalidity or unenforceability shall affect in that jurisdiction only such
clause or provision, or part thereof, and shall not in any manner affect such
clause or provision in any other jurisdiction or any other clause or provision
of this Pledge Agreement in any jurisdiction.

                  Section 15.4. Headings. The headings in this Pledge Agreement
have been inserted for convenience of reference only, are not to be considered a
part hereof and shall in no way modify or restrict any of the terms or
provisions hereof.

                  Section 15.5. Counterpart Originals. This Pledge Agreement may
be signed in two or more counterparts, each of which shall be deemed an
original, but all of which shall together constitute one and the same agreement.

                  Section 15.6. Benefits of Pledge Agreement. Nothing in this
Pledge Agreement, express or implied, shall give to any person, other than the
parties hereto and their successors hereunder, and the Holders of the Notes, any
benefit or any legal or equitable right, remedy or claim under this Pledge
Agreement.

                  Section 15.7. Amendments, Waivers and Consents. Any amendment
or waiver of any provision of this Pledge Agreement and any consent to any
departure by the Pledgor from any provision of this Pledge Agreement shall be
effective only if made or duly given in compliance with all of the terms and
provisions of the Indenture, and
<PAGE>   15
                                       15

neither the Trustee nor any Holder of Notes shall be deemed, by any act, delay,
indulgence, omission or otherwise, to have waived any right or remedy hereunder
or to have acquiesced in any Default or Event of Default (as defined herein) or
in any breach of any of the terms and conditions hereof. Consistent with the
foregoing, this Pledge Agreement may be amended, its provisions may be waived
and departures from its provisions may be consented to by action of the Pledgor
and the Trustee, and (if applicable) the Holders of the Notes, as provided in
the Indenture, and no such amendment, waiver or consent shall require any action
or approval by the Initial Purchasers. Failure of the Trustee or any Holder of
Notes to exercise, or delay in exercising, any right, power or privilege
hereunder shall not preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. A waiver by the Trustee or any
Holder of Notes of any right or remedy hereunder on any one occasion shall not
be construed as a bar to any right or remedy that the Trustee or such Holder of
Notes would otherwise have on any future occasion. The rights and remedies
herein provided are cumulative, may be exercised singly or concurrently and are
not exclusive of any rights or remedies provided by law.

                  Section 15.8. Interpretation of Agreement. All terms not
defined herein or in the Indenture shall have the meaning set forth in the UCC,
except where the context otherwise requires. Acceptance of or acquiescence in a
course of performance rendered under this Pledge Agreement shall not be relevant
to determine the meaning of this Pledge Agreement even though the accepting or
acquiescing party had knowledge of the nature of the performance and opportunity
for objection.

         Section 15.9. Continuing Security Interest, Termination. (a) This
         Pledge Agreement shall create a continuing security interest in and to
         the Pledged Collateral and shall, unless otherwise provided in this
         Pledge Agreement, remain in full force and effect until the payment in
         full in cash of the Outstanding Obligations. This Pledge Agreement
         shall be binding upon the Pledgor, its transferees, successors and
         assigns, and shall inure, together with the rights and remedies of the
         Trustee hereunder, to the benefit of the Trustee, the Holders of the
         Notes and their respective successors, transferees and assigns.

                  (b) This Pledge Agreement (other than the Pledgor's
         obligations under Sections 10 and 12) shall terminate upon the payment
         in full in cash of the Outstanding Obligations or if the Company shall
         become obligated under the Indenture to redeem all of the outstanding
         Notes and such Notes shall have been redeemed, and if no Default or
         Event of Default (as defined in the Indenture shall have occurred and
         be continuing. At such time, the Trustee shall, pursuant to a Company
         Order, reassign and redeliver to the Pledgor all of the Pledged
         Collateral hereunder that has not been sold, disposed of, retained or
         applied by the Trustee in accordance with the terms of this Pledge
         Agreement and the Indenture and take all actions that are necessary to
         release the security interest created by this Pledge Agreement in and
         to the Pledged Collateral, including the execution and delivery of all
         termination statements necessary to terminate any financing or
         continuation statements filed with respect to the Pledged Collateral.
         Such reassignment and redelivery shall be without warranty by or
         recourse to the
<PAGE>   16
                                       16

         Trustee in its capacity as such, except as to the absence of any Liens
         on the Pledged Collateral created by or arising through the Trustee,
         and shall be at the reasonable expense of the Pledgor.

                  Section 15.10. Survival of Representations and Covenants. All
representations, warranties and covenants of the Pledgor contained herein shall
survive the execution and delivery of this Pledge Agreement, and shall terminate
only upon the termination of this Pledge Agreement.

                  Section 15.11. Waivers. The Pledgor waives presentment and
demand for payment of any of the Outstanding Obligations, protest and notice of
dishonor or default with respect to any of the Outstanding Obligations, and all
other notices to which the Pledgor might otherwise be entitled, except as
otherwise expressly provided herein or in the Indenture.

                  Section 15.12. Authority of the Trustee. (a) The Trustee shall
have the right to exercise all powers hereunder that are specifically granted to
the Trustee by the terms hereof, together with such powers as are reasonably
incident hereto. The Trustee may perform any of its duties hereunder or in
connection with the Pledged Collateral by or through agents or employees and
shall be entitled to retain counsel and to act in reliance upon the advice of
counsel concerning all such matters. Except as otherwise expressly provided in
this Pledge Agreement or the Indenture, neither the Trustee nor any director,
officer, employee, attorney or agent of the Trustee shall be liable to the
Pledgor for any action taken or omitted to be taken by the Trustee, in its
capacity as Trustee, hereunder, except for its own gross negligence or willful
misconduct, and the Trustee shall not be responsible for the validity,
effectiveness or sufficiency hereof or of any document or security furnished
pursuant hereto. The Trustee and its directors, officers, employees, attorneys
and agents may conclusively rely on any communication, instrument or document
believed by it or them to be genuine and correct and to have been signed or sent
by the proper person or persons.

                  (b) The Pledgor acknowledges that the rights and
         responsibilities of the Trustee under this Pledge Agreement with
         respect to any action taken by the Trustee or the exercise or
         non-exercise by the Trustee of any option, right, request, judgment or
         other right or remedy provided for herein or resulting or arising out
         of this Pledge Agreement shall, as between the Trustee and the Holders
         of the Notes, be governed by the Indenture and by such other agreements
         with respect thereto as may exist from time to time among them, but, as
         between the Trustee and the Pledgor, the Trustee shall be conclusively
         presumed to be acting as agent for the Holders of the Notes with full
         and valid authority so to act or refrain from acting, and the Pledgor
         shall not be obligated or entitled to make any inquiry respecting such
         authority.

                  (c) The Trustee undertakes to perform such duties and only
         such duties as are specifically set forth in this Pledge Agreement, and
         no implied covenants or obligations shall be read into this Pledge
         Agreement against the Trustee or the Pathnet Securities Intermediary.
<PAGE>   17
                                       17

                  (d) No provision of this Pledge Agreement shall require the
         Trustee or the Pathnet Securities Intermediary to expend or risk its
         own funds or otherwise incur any financial liability in the performance
         of any of its duties hereunder, or in the exercise of any of its rights
         and powers.

                  (e) The Trustee and the Pathnet Securities Intermediary may
         consult with counsel of its selection and the advice of such counsel or
         any Opinion of Counsel shall be full and complete authorization and
         protection in respect of any action taken, suffered or omitted by it
         hereunder in good faith and in reliance thereon.

                  (f) The Trustee and the Pathnet Securities Intermediary may
         execute any of the trusts or powers hereunder or perform any duties
         hereunder either directly or by or through agents or attorneys and the
         Trustee and the Pathnet Securities Intermediary shall not be
         responsible for any misconduct or negligence on the part of any agent
         or attorney appointed with due care by it hereunder.

                  Section 15.13. Final Expression. This Pledge Agreement,
together with the Indenture and any other agreement executed in connection
herewith, is intended by the parties as a final expression of this Pledge
Agreement and is intended as a complete and exclusive statement of the terms and
conditions thereof.

                  Section 15.14. Rights of Holders of the Notes. No Holder of
Notes shall have any independent rights hereunder other than those rights
granted to individual Holders of the Notes pursuant to Section 508 of the
Indenture; provided that nothing in this subsection shall limit any rights
granted to the Trustee under the Notes or the Indenture.

                  Section 15.15. GOVERNING LAW; SUBMISSION TO JURISDICTION;
WAIVER OF JURY TRIAL; WAIVER OF DAMAGES. (a) THIS PLEDGE AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
ANY DISPUTE ARISING OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO, THE
RELATIONSHIP ESTABLISHED BETWEEN THE PLEDGOR, THE TRUSTEE AND THE HOLDERS OF THE
NOTES IN CONNECTION WITH THIS PLEDGE AGREEMENT AND WHETHER ARISING IN CONTRACT,
TORT, EQUITY OR OTHERWISE, SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK. NOTWITHSTANDING THE FOREGOING, THE MATTERS
IDENTIFIED IN 31 C.F.R. PART 357, 61 FED. REG. 43626 (AUG. 23, 1996) SHALL BE
GOVERNED SOLELY BY THE LAWS SPECIFIED THEREIN.

                  (b) THE PLEDGOR AGREES THAT THE TRUSTEE SHALL, IN ITS CAPACITY
         AS TRUSTEE OR IN THE NAME AND ON BEHALF OF ANY HOLDER OF NOTES, HAVE
         THE RIGHT, TO THE EXTENT PERMITTED BY APPLICABLE LAW, TO PROCEED
         AGAINST THE PLEDGOR OR THE PLEDGED COLLATERAL IN A COURT IN ANY
<PAGE>   18
                                       18

         LOCATION REASONABLY SELECTED IN GOOD FAITH (AND HAVING PERSONAL OR IN
         REM JURISDICTION OVER THE PLEDGOR OR THE PLEDGED COLLATERAL, AS THE
         CASE MAY BE) TO ENABLE THE TRUSTEE TO REALIZE ON SUCH PLEDGED
         COLLATERAL, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER ENTERED IN
         FAVOR OF THE TRUSTEE. THE PLEDGOR AGREES THAT IT WILL NOT ASSERT ANY
         COUNTERCLAIMS, SET OFFS OR CROSSCLAIMS IN ANY PROCEEDING BROUGHT BY THE
         TRUSTEE TO REALIZE ON SUCH PROPERTY OR TO ENFORCE A JUDGMENT OR OTHER
         COURT ORDER IN FAVOR OF THE TRUSTEE, EXCEPT FOR SUCH COUNTERCLAIMS, SET
         OFFS OR CROSSCLAIMS WHICH, IF NOT ASSERTED IN ANY SUCH PROCEEDING,
         COULD NOT OTHERWISE BE BROUGHT OR ASSERTED. THE PLEDGOR WAIVES ANY
         OBJECTION THAT IT MAY HAVE TO THE LOCATION OF THE COURT IN THE CITY OF
         NEW YORK ONCE THE TRUSTEE HAS COMMENCED A PROCEEDING DESCRIBED IN THIS
         PARAGRAPH INCLUDING, WITHOUT LIMITATION, ANY OBJECTION TO THE LAYING OF
         VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS.

                  (c) THE PLEDGOR AGREES THAT NEITHER ANY HOLDER OF NOTES NOR
         (EXCEPT AS OTHERWISE PROVIDED IN THIS PLEDGE AGREEMENT OR THE
         INDENTURE) THE TRUSTEE IN ITS CAPACITY AS TRUSTEE SHALL HAVE ANY
         LIABILITY TO THE PLEDGOR (WHETHER ARISING IN TORT, CONTRACT OR
         OTHERWISE) FOR LOSSES SUFFERED BY THE PLEDGOR IN CONNECTION WITH,
         ARISING OUT OF, OR IN ANY WAY RELATED TO, THE TRANSACTIONS CONTEMPLATED
         AND THE RELATIONSHIP ESTABLISHED BY THIS PLEDGE AGREEMENT, OR ANY ACT,
         OMISSION OR EVENT OCCURRING IN CONNECTION THEREWITH, UNLESS IT IS
         DETERMINED BY A FINAL AND NONAPPEALABLE JUDGMENT OF A COURT THAT IS
         BINDING ON THE TRUSTEE OR SUCH HOLDER OF NOTES, AS THE CASE MAY BE,
         THAT SUCH LOSSES WERE THE RESULT OF ACTS OR OMISSIONS ON THE PART OF
         THE TRUSTEE OR SUCH HOLDERS OF NOTES, AS THE CASE MAY BE, CONSTITUTING
         BAD FAITH, GROSS NEGLIGENCE OR WILLFUL MISCONDUCT.

                  (d) TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE PLEDGOR
         WAIVES THE POSTING OF ANY BOND OTHERWISE REQUIRED OF THE TRUSTEE OR ANY
         HOLDER OF NOTES IN CONNECTION WITH ANY JUDICIAL PROCESS OR PROCEEDING
         TO ENFORCE ANY JUDGMENT OR OTHER COURT ORDER PERTAINING TO THIS PLEDGE
         AGREEMENT OR ANY RELATED AGREEMENT OR DOCUMENT ENTERED IN FAVOR OF THE
         TRUSTEE OR ANY HOLDER OF NOTES, OR TO ENFORCE BY SPECIFIC PERFORMANCE,
         TEMPORARY RESTRAINING ORDER OR PRELIMINARY OR PERMANENT INJUNCTION,
         THIS PLEDGE AGREEMENT OR ANY RELATED AGREEMENT OR DOCUMENT BETWEEN THE
         PLEDGOR ON
<PAGE>   19
                                       19

         THE ONE HAND AND THE TRUSTEE AND/OR THE HOLDERS OF THE NOTES ON THE
         OTHER HAND.

                  IN WITNESS WHEREOF, the Pledgor and the Trustee have each
caused this Amended and Restated Pledge Agreement to be duly executed and
delivered as of the date first above written.

                                       Pledgor:

                                       PATHNET, INC.

                                       By:____________________________
                                          Name:
                                          Title:

                                       Trustee:

                                       THE BANK OF NEW YORK, Trustee

                                       By:______________________________
                                          Name:
                                          Title:

                                       THE BANK OF NEW YORK,
                                            as Pathnet Securities Intermediary

                                       By:______________________________
                                          Name:
                                          Title:
<PAGE>   20
                                   CERTIFICATE

                  Pursuant to Section 3(f) of the Pledge Agreement (the "Pledge
Agreement") dated as of ___________, 2000 between Pathnet, Inc. (the "Pledgor")
and The Bank of New York, trustee (the "Trustee") for the holders of the 12 1/4%
Senior Notes due 2008 (the "Notes") of the Pledgor, and The Bank of New York, as
securities intermediary (the "Pathnet Securities Intermediary"), the undersigned
officer of the Trustee, on behalf of the Trustee, and the undersigned officer of
the Pathnet Securities Intermediary, on behalf of the Pathnet Securities
Intermediary, make the following certifications to the Pledgor and the Holders
of the Outstanding Notes. Capitalized terms used and not defined in this
Certificate have the meanings set forth or referred to in the Pledge Agreement.

                  1. The Trustee has previously established with the Pathnet
Securities Intermediary, as Securities Intermediary, the Escrow Account. The
Pathnet Securities Intermediary has acquired a Security Entitlement to the
United States Treasury securities identified in Annex 1 to this Certificate (the
"Pledged Securities") from the FRBNY and holds a Security Entitlement thereto in
the FRBNY's Security Account. The Pathnet Securities Intermediary has made
appropriate book entries in its records establishing that the Pledged Securities
and the Trustee's Securities Entitlement thereto have been credited to and are
held in the Escrow Account.

                  2. The Trustee has established and maintained and will
maintain the Escrow Account and all Securities Entitlements and other positions
carried in the Escrow Account solely in its capacity as Trustee and has not
asserted and will not assert any claim to or interest in the Escrow Account or
any such Securities Entitlements or other positions except in such capacity.

                  3. The Trustee and the Pathnet Securities Intermediary have
acquired their Security Entitlements to the Pledged Securities for value and
without notice of any adverse claim thereto. Without limiting the generality of
the foregoing, the Pledged Securities are not and the Pathnet Securities
Intermediary's and the Trustee's Security Entitlements to the Pledged Securities
are not, to their knowledge, subject to any Lien granted by either of them in
favor of any Securities Intermediary (including, without limitation, NFSC or the
FRBNY) through which the Trustee derives its Security Entitlement to the Pledged
Securities.

                  4. Neither the Pathnet Securities Intermediary nor the Trustee
has caused or permitted the Pledged Securities or any Security Entitlement
thereto to become subject to any Lien created by or arising through either of
the Trustee or the Pathnet Securities Intermediary.
<PAGE>   21
                                       2

                  IN WITNESS WHEREOF, the undersigned officers have executed
this Certificate on behalf of The Bank of New York, Trustee, and on behalf of
the Pathnet Securities Intermediary, respectively, this _________ day of
_________, 2000.

                                         THE BANK OF NEW YORK,
                                                  Trustee

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

                                         THE BANK OF NEW YORK,
                                                  As Pathnet Securities
                                                  Intermediary

                                         ------------------------------------
                                         Name:
                                         Title:
<PAGE>   22
                               PLEDGED SECURITIES

<TABLE>
<CAPTION>
                                                         Original Principal
                                                         ------------------
Description of Debt    Cusip No(s)     Final Maturity          Amount          Cost of Closing
-------------------    -----------     --------------          ------          ---------------
<S>                    <C>             <C>               <C>                   <C>

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

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

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

-------------------    -----------     --------------    ------------------    ---------------
</TABLE>
<PAGE>   23
                   INDEPENDENT ACCOUNTANTS' REPORT ON APPLYING
                             AGREED-UPON PROCEDURES

To the Board of Directors
Pathnet, Inc.
Washington, D.C,

We understand that $350,000,000 12-1/4% Senior Notes due 2008 ("Notes") of
Pathnet, Inc. (the "Issuer"), were issued on April 8, 1998. We also understand
that in connection with the payment of the fourth and fifth scheduled interest
payments on the Notes The Bank of New York (the "Trustee") will hold the
Securities listed on the attached schedule (Schedule 11) (the "Securities")
pursuant to Section 3(h) of the Pledge Agreement, between the Issuer and the
Trustee, dated as of ___________, 2000 (the "Pledge Agreement").

We have been requested by the Issuer and the Trustee (collectively the "Intended
Users") to prove the arithmetic accuracy of the computations shown on the
attached schedules, prepared by the Issuer.

We have performed the procedures enumerated below, which were agreed to by the
Intended Users, solely to assist you and the Trustee with respect to proving the
arithmetic accuracy of the computations shown on the attached schedules. This
agreed upon procedures engagement was performed in accordance with standards
established by the American Institute of Certified Public Accountants. The
sufficiency of the procedures is solely the responsibility of the specified
users of the report. Consequently, we make no representation regarding the
sufficiency of the procedures described below either for the purpose for which
this report was requested or for any other purpose. The procedures that we
performed and our findings are, as follows:

1.       We have proved the arithmetic accuracy of the computations of the
         fourth and fifth scheduled interest payments, as shown on the attached
         Schedule (Schedule I), which was prepared by the Issuer.

2.       We have proved the arithmetic accuracy of the computation of the
         scheduled receipts of maturing principal and interest to be received
         from the Securities and cash on deposit as shown on Schedule II, which
         was prepared by the Issuer. Other than proving such arithmetic
         accuracy, we have not confirmed or otherwise verified the information
         on that schedule.

3.       We recomputed each amount in the net cash flow column on Schedule II by
         deducting each amount in the interest payment column from each amount
         in the total available column, individually and in total.

In performing the above calculations, we have relied solely on the data set
forth in the attached schedules prepared and provided to us by the Issuer. The
scope of our engagement did not include the verification of any underlying data,
assumptions or definitions necessary to derive the calculations. Such underlying
data, assumptions and definitions include, but are not limited to, the
following:
<PAGE>   24
         (i)   The principal amounts, coupon rates, and related maturities for
               the Securities and Notes; and

         (ii)  Interest start dates, maturity dates, and interest payment dates
               for the Securities and the Notes.

We were not engaged to, and did not, perform an examination, the objective of
which would be the expression of an opinion on the specified elements, accounts,
or items included in the attached schedules. Accordingly, we do not express such
an opinion. Had we performed additional procedures, other matters might have
come to our attention that would have been reported to you.

This report is intended solely for the use of the Intended Users listed above
and should not be used by those who have not agreed to the procedures and taken
responsibility for the sufficiency of the procedures for their purposes.

McLean, Virginia
April 8, 1998
<PAGE>   25
                                   SCHEDULE I

<TABLE>
<CAPTION>
 Interest Payment
 Date on the Notes   Principal   Annual Interest Rate   Interest Payment (1)
 -----------------   ---------   --------------------   --------------------
<S>                  <C>         <C>                    <C>
</TABLE>

(1) Interest payments for each period are calculated assuming a 180-day
semi-annual period and 360-day year.
<PAGE>   26
<TABLE>
<CAPTION>
                                                      Coupon                       Total        Interest     Net Cash
Security   Coupon Rate   Maturity Date   Par Amount   Interest(1)   Cash Flow   Available(2)   Payment(3)    Flow(4)
--------   -----------   -------------   ----------   -----------   ---------   ------------   ----------    --------
<S>        <C>           <C>             <C>          <C>           <C>         <C>            <C>           <C>
</TABLE>

--------------------------------------------------------------------------------
(1)  Coupon interest is calculated assuming a 180-day semi-annual period and a
     360-day year.
(2)  Total Available for each period is equal to the Cash Flow for the period
     plus Net Cash Flow from the previous period.
(3)  See SCHEDULE I attached hereto.
(4)  Net Cash Flow for each period is equal to Total Available for the period
     less the Interest Payment for each period.
--------------------------------------------------------------------------------<PAGE>   1
                                                                 Exhibit 10.21.1

                  FORM OF ASSIGNMENT AND ACCEPTANCE AGREEMENT

         THIS ASSIGNMENT AND ACCEPTANCE AGREEMENT (this "Agreement"), dated as
of _______________________, 2000, is by and between Pathnet, Inc., a Delaware
corporation (the "Seller") and Pathnet Telecommunications, Inc., a Delaware
corporation (the "Purchaser").

                                   WITNESSETH:

         WHEREAS, Seller currently holds certain assets relating to the fiber
portion of its digital network;

         WHEREAS, Purchaser desires to purchase, and Seller desires to sell,
such assets, and, as part of such purchase and sale, Seller desires to assign,
and the Purchaser desires to assume, all of the obligations and liabilities
relating to such assets, subject, in each case, to the exemptions, terms and
conditions set forth herein;

         NOW THEREFORE, in consideration of the premises and the mutual
representations, warranties and covenants and agreements hereinafter set forth,
and upon the terms and subject to the conditions hereinafter set forth, Seller
and Purchaser hereby agree as follows:

                                    ARTICLE I
                                   DEFINITIONS

         1.1 Certain Definitions. As used in this Agreement, the following terms
shall have the respective meanings set forth below (such meanings to be equally
applicable to both the singular and the plural forms of the terms defined).

         (a)      Affiliate: As defined in Section 8.1.

         (b)      Agreement: As defined in the preamble.

         (c)      Closing: As defined in Article VII.

         (d)      Colonial Contribution Agreement: Shall mean that certain
Contribution Agreement, dated as of November 2, 1999, by and among the
Purchaser, the Seller and Colonial Pipeline Company, a Delaware and Virginia
corporation.

         (e)      Contribution Agreements: Shall mean (i) that certain
Contribution Agreement, dated as of November 2, 1999, by and among the
Purchaser, the Seller and The Burlington Northern Santa Fe Railway Company, a
Delaware corporation, (ii) that certain Contribution Agreement, dated as of
November 2, 1999, by and among the Purchaser, the Seller and CSX Transportation,
Inc., a Virginia corporation, (iii) that certain Contribution Agreement, dated
as of November 2, 1999, by and among the Purchaser, the Seller and the preferred
stockholders of the Purchaser, (iv) that certain

                                      -1-
<PAGE>   2
Contribution Agreement, dated as of November 2, 1999, by and among the
Purchaser, the Seller and certain common stockholders of the Purchaser, and (v)
that certain Contribution Agreement, dated November 4, 1999, by and among the
Purchaser, the Seller and David Schaeffer.

         (f)      Contribution Agreement Closing: As defined in Section 6.1(e).

         (e)      Fiber Assets:     As defined in Section 2.1.

         (f)      Indemnified Persons:      As defined in Section 8.1

         (g)      Indemnifying Persons:     As defined in Section 8.1.

         (h)      Purchaser: As defined in the preamble.

         (i)      Purchased Assets: As defined in Section 2.1.

         (j)      Purchase Price:   As defined in Section 4.1.

         (k)      Seller: As defined in the preamble.

         (l)      Survival Date:    As defined in Section 8.4.

                                   ARTICLE II
                              ASSETS TO BE ACQUIRED

         2.1 Acquisition and Transfer of Assets. At the Closing (as hereinafter
defined), upon the terms and subject to the conditions hereinafter set forth,
Seller shall sell, assign, transfer, convey and deliver to Purchaser, and
Purchaser shall purchase, acquire and accept from Seller all right, title and
interest of Seller in and to the certain assets relating to the fiber portion of
Seller's digital network, including, without limitation, in and to all of the
assets, properties, rights, contracts and claims employed in connection with
such assets, wherever located, whether tangible or intangible, as the same shall
exist as of the Closing. The assets, properties, contracts and claims to be
purchased pursuant to this Agreement are hereinafter collectively referred to as
the "Fiber Assets." The Fiber Assets shall include, without limitation, all
right, title and interest of Seller and its Subsidiaries in and to the assets,
properties, rights, contracts and claims described in the following paragraphs
(a) through (g) but in each case, only to the extent exclusively used in, held
for exclusive use in or exclusively related to the Fiber Assets:

         (a) all rights in, to and under all contracts, commitments and other
agreements of Seller set forth below:

         (i)      Agreement between Pacific Fiber Link, LLC (A/K/A Worldwide
                  Fiber, Inc.) and Pathnet, Inc., dated March 31, 1999 as
                  amended by Letter, dated

                                      -2-
<PAGE>   3
                  June 28, 1999 and the Marketing Agreement between Pacific
                  Fiber Link, LLC (A/K/A Worldwide Fiber, Inc.) and Pathnet,
                  dated March 31, 1999.

         (ii)     Dark Fiber Network Agreement by and between Pathnet, Inc.,
                  Tri-State Generation and Transmission Association, Inc. and
                  other Participating Members Systems named therein, dated
                  August 5, 1999, Letter Agreement between Pathnet, Inc. and
                  Tri-State Generation and Transmission Association, Inc. dated
                  December 31, 1999 and Letter Agreement between Pathnet, Inc.
                  and Tri-State Generation and Transmission Association, Inc.
                  dated January 17, 2000, including the associated right of way
                  pursuant to Fiber Optic Cable Construction and Use Agreement
                  between Public Service Company of New Mexico and Pathnet, Inc.
                  dated June 9, 1999 and Fiber Optic Cable License Agreement
                  between Public Service Company of New Mexico and Pathnet, Inc.
                  dated December 23, 1999.

         (iii)    Agreement between CapRock Telecommunications Corp and Pathnet,
                  Inc. dated November 18, 1999 and Joint Marketing Agreement
                  between Pathnet, Inc. and CapRock Telecommunications, Corp,
                  dated November 18, 2999 and Letter Agreement between Pathnet,
                  Inc. and CapRock Telecommunications, Inc., dated January 17,
                  2000.

         (b)      all inventories of work-in-progress, raw materials, finished
products, supplies, spare parts and other materials relating to the fiber route
under construction between Chicago, Illinois and Aurora, Colorado;

         (c)      all rights in and to insurance and indemnity claims relating
to the Fiber Assets;

         (d)      all prepaid expenses, advances and deposits relating to the
Fiber Assets;

         (e)      all rights, choses in action and claims, (known or unknown,
matured or unmatured, accrued or contingent) against third parties relating to
the Fiber Assets;

         (f)      all goodwill and going concern rights associated with the
items listed above; and

         (h)      a license to the intellectual property of Seller as set forth
in the License of Marks attached hereto as Exhibit A.

For convenience of reference, the assets, properties, interests in properties
and rights that are to be sold, transferred, conveyed and assigned to Purchaser
pursuant to this Section 2.1 are collectively referred to herein as the
"Purchased Assets."

         2.2 Instrument of Conveyance and Transfer, Etc. At the Closing, Seller
shall deliver (or cause to be delivered) to Purchaser such deeds, bills of sale,
endorsements, assignments and other instruments of transfer, conveyance and
assignment as shall be

                                      -3-
<PAGE>   4
necessary to transfer, convey and assign the Purchased Assets to the Purchaser.
Simultaneously therewith, Seller shall take all steps as may be required to put
the Purchaser in possession of the Purchased Assets.

         2.3 Right of Endorsement, Etc. Effective upon the Closing, Seller
hereby constitutes and appoints Purchaser, its successors and assigns, the true
and lawful attorney of the Seller with full power of substitution, in the name
of Purchaser, or the name of Seller, on behalf of and for the benefit of
Purchaser, to collect all accounts and notes receivable and other items being
transferred, conveyed and assigned to Purchaser as provided herein, to endorse,
without recourse, checks, notes and other instruments in the name of Seller, to
institute and prosecute, in the name of Seller or otherwise, all proceedings
which Purchaser may deem proper in order to collect, assert or enforce any
claim, right or title of any kind in or to the Purchased Assets, to defend and
compromise any and all actions, suits or proceedings in respect of any of the
Purchased Assets, and to do all such acts and things in relation thereto as
Purchaser may deem advisable. Seller agrees that the foregoing powers are
coupled with an interest and shall be irrevocable by Seller, directly or
indirectly, whether by the dissolution of Seller or in any manner or for any
reason.

         2.4 Further Assurances; Etc. Seller shall pay to Purchaser promptly any
amounts which shall be received by Seller after the Closing which are, or are
received in connection with, Purchased Assets. Seller at any time and from time
to time after the Closing, upon the request of Purchaser and at the expense of
Seller, shall do, execute, acknowledge, deliver and file, or shall cause to be
done, executed, acknowledged, delivered or filed, all such further acts, deeds,
transfers, conveyances, assignments or assurance as may be required for the
better transferring, conveying, assigning and assuring to Purchaser, or for
aiding and assisting in the collection of or reducing to possession by
Purchaser, any of the assets, properties or rights being purchased hereunder.

         2.5 Assignment of Contracts, Rights, Etc. Anything contained in this
Agreement to the contrary notwithstanding, this Agreement shall not constitute
an agreement or attempted agreement to transfer, sublease or assign any
contract, license, lease, sales order, purchase order or other agreement or any
claim or right of any benefit arising thereunder or resulting therefrom or any
permit or operating authority if an attempted transfer, sublease or assignment
thereof, without the consent of any other party thereto, would constitute a
breach thereof or in any way affect the rights of Purchaser thereunder. Seller
and Purchaser shall use their respective best efforts, and shall cooperate with
each other, to obtain the consent of such third party to any of the foregoing to
the assignment or transfer thereof to Purchaser in all cases in which such
consent is required for assignment or transfer. If such consent is not obtained,
Seller shall cooperate with Purchaser in any arrangements necessary or desirable
to provide for Purchaser the benefits thereunder, including, without limitation,
enforcement for the benefit of Purchaser of any and all rights of Seller thereof
against the other party thereto arising out of the cancellation by such other
party or otherwise.

                                      -4-
<PAGE>   5
                                   ARTICLE III
                            ASSUMPTION OF LIABILITIES

         On the terms and subject to the conditions of this Agreement,
simultaneously with the transfer, conveyance and assignment to Purchaser of the
Purchased Assets, Purchaser shall assume all of the liabilities and obligations
relating to the Purchased Assets as such liabilities and obligations shall exist
immediately prior to the Closing.

                                   ARTICLE IV
                           PURCHASE PRICE OF PURCHASED
                               ASSETS; ALLOCATION

         4.1 Purchase Price. The aggregate purchase price to be paid for the
Purchased Assets shall be $70,000,000 (the "Purchase Price"). At the Closing,
against delivery to the Purchaser of appropriate instruments of transfer,
conveyance and assignment with respect to the Purchased Assets, the Purchaser
shall deliver to the Seller, a Promissory Note in the form attached hereto as
Exhibit B in the principal amount of $70,000,000.

                                    ARTICLE V
                         REPRESENTATIONS AND WARRANTIES

         5.1 Representations and Warranties of the Seller. The Seller hereby
represents and warrants to the Purchaser as follows:

             (a) Organization, Standing and Power. The Seller is a corporation
         duly organized, validly existing and in good standing under the laws of
         the State of Delaware and has all requisite corporate power and
         authority to own, lease and operate its properties and to carry on its
         business as now being conducted; and the Seller has all requisite
         corporate power and authority and to enter into this Agreement, to
         perform its obligations hereunder and to consummate the transactions
         contemplated hereby. Seller is duly qualified and in good standing to
         do business in every jurisdiction in which such qualification is
         necessary.

             (b) Authority. The execution and delivery of this Agreement and the
         consummation of the transactions contemplated hereby have been duly and
         validly authorized by all necessary corporate action and on the part of
         the Seller and this Agreement constitutes a valid and binding
         obligation of the Seller enforceable in accordance with its terms.
         Neither the execution, delivery and performance of this Agreement nor
         the consummation by the Seller of the transactions contemplated hereby
         nor compliance by the Seller with any of the provisions hereof will (i)
         conflict with or result in a breach of any provision of the Certificate
         of Incorporation or Bylaws of the Seller, (ii) cause a default (or give
         rise to any right of termination, cancellation or acceleration) under
         any of the terms, conditions or provisions of any note, bond, lease,
         mortgage, indenture, license or other instrument or agreement to which
         the Seller, or by which the Seller, or any of its properties or assets
         is or may be bound or (iii) violate any law,

                                      -5-
<PAGE>   6
         statute, rule or regulation or order, writ, judgment, injunction or
         decree applicable to the Seller, or any of its properties or assets.

         5.2 Representations and Warranties of the Purchaser. The Purchaser
hereby represents and warrants to the Seller as follows:

                  (a) Organization, Standing and Power. The Purchaser is a
         corporation duly organized, validly existing and in good standing under
         the laws of the State of Delaware and has all requisite corporate power
         and authority to own, lease and operate its properties, to carry on its
         business as now being conducted, to enter into this Agreement, to
         perform its obligations hereunder and to consummate the transactions
         contemplated hereby.

                  (b) Authority. The execution and delivery of this Agreement
         and the consummation of the transactions contemplated hereby have been
         duly and validly authorized by all necessary corporate action on the
         part of the Purchaser and this Agreement constitutes a valid and
         binding obligation of the Purchaser, enforceable in accordance with its
         terms. Neither the execution, delivery and performance of this
         Agreement nor the consummation of the transactions contemplated hereby
         nor compliance by the Purchaser with any of the provisions hereof will
         (i) conflict with or result in a breach of any provision of its
         Certificate of Incorporation or Bylaws, (ii) cause a default (or give
         rise to any right of termination, cancellation or acceleration) under
         any of the terms, conditions or provisions of any note, bond, lease,
         mortgage, indenture, license or other instrument or agreement to which
         the Purchaser is a party, or by which it or its properties or assets
         may be bound, or (iii) violate any law, statute, rule or regulation or
         order, writ, injunction or decree applicable to the Purchaser or any of
         its properties or assets.
                                   ARTICLE VI
                              CONDITIONS OF CLOSING

         6.1 Conditions of Obligations of the Purchaser. The obligations of the
Purchaser to perform this Agreement are subject to the satisfaction of the
following conditions unless waived by the Purchaser:

                  (a) Representations and Warranties. The representations and
         warranties of the Seller set forth in Section 5.1 hereof shall be true
         and correct in all material respects as of the date of this Agreement
         and as of the Closing Date (as hereinafter defined) as though made on
         and as of the Closing Date.

                  (b) Authorization. All action necessary to authorized the
         execution, delivery and performance of this Agreement by the Seller and
         the consummation of the transactions contemplated hereby shall have
         been duly and validly taken.

                                      -6-
<PAGE>   7
                  (c) Instruments of Transfer, Conveyance and Assignment. The
         Purchaser shall have received duly executed instruments of transfer,
         conveyance and assignment as contemplated by Section 2.2 hereof.

                  (d) Consents and Approvals. The Purchaser shall have received
         duly executed copies of all consents and approvals required for or in
         connection with the execution and delivery by the Seller of this
         Agreement and the consummation of the transactions contemplated hereby
         including the consent of the holders of the Seller's 12 -1/4% Senior
         Notes in accordance with the Indenture by and between Pathnet, Inc. and
         The Bank of New York, dated April 8, 1998.

                  (e) Closing under Contribution Agreements. The Closing (as
         defined in the Contribution Agreements) and the Initial Closing (as
         defined in the Colonial Contribution Agreement) shall have occurred
         (together, such occurrences, the "Contribution Agreement Closing").

         6.2 Conditions of Obligations of the Seller. The obligations of the
Seller to perform this Agreement are subject to the satisfaction of the
following conditions unless waived by the Seller:

                  (a) Representations and Warranties. The representations and
         warranties of the Purchaser set forth in Section 5.2 hereof shall be
         true and correct in all material respects as of the date of this
         Agreement and as of the Closing Date as though made on and as of the
         Closing Date.

                  (b) Authorization. All action necessary to authorize the
         execution, delivery and performance of this Agreement by the Purchaser
         and the consummation of the transactions contemplated hereby shall have
         been duly and validly taken by the Board of Directors of the Purchaser.

                  (c) Closing under Contribution Agreements. The Contribution
         Agreement Closing shall have occurred.

                                   ARTICLE VII
                                     CLOSING

         The closing (the "Closing") for the consummation of the transactions
contemplated by this Agreement shall take place immediately after the
Contribution Agreement Closing shall have occurred.

                                  ARTICLE VIII
                                 INDEMNIFICATION

         8.1 Definitions. As used in this Article VIII, the following terms
shall have the following respective meanings:

                                      -7-
<PAGE>   8
                  (a) "Affiliate" shall mean a person or entity that directly,
         or indirectly through one or more intermediaries, controls, or is
         controlled by, or is under common control with, any other person or
         entity.

                  (b) "Indemnified Persons" shall mean and include the
         Purchaser, all Affiliates of the Purchaser, and the successors and
         assigns of the foregoing; and

                  (c) "Indemnifying Persons" shall mean the Seller and its
         successors and assigns.

         8.2 Indemnification. The Indemnifying Persons shall, jointly and
severally, indemnify and save the Indemnified Persons, and each of them,
harmless from, against, for and in respect of the following:

                  (a) any and all liabilities and obligations of the Seller not
         assumed by the Purchaser pursuant to this Agreement;

                  (b) any liabilities and obligations of the Indemnifying
         Persons for fees, costs and expenses relating to or arising out of the
         execution, delivery and performance of this Agreement and the
         consummation of the transactions contemplated hereby, including,
         without limitation, legal and accounting fees and expenses and taxes
         incurred by the Indemnifying Persons;

                  (c) any damages, losses, obligations, liabilities, claims,
         actions or causes of action sustained or suffered by the Indemnified
         Persons, or any of them, and arising from a breach of any
         representation, warranty, covenant or agreement of the Indemnifying
         Persons contained in or made pursuant to this Agreement or in any
         certificate, instrument or agreement delivered by any of such parties
         pursuant hereto or in connection with the transactions contemplated
         hereby, or any facts or circumstances constituting such breach;

                  (d) all damages, losses, obligations, liabilities, claims,
         actions or causes of action sustained or suffered by the Indemnified
         Persons, or any of them, as a result of non-compliance by the Seller
         with the provisions of the "bulk sales laws" of any state which may be
         applicable to the transactions contemplated hereby;

                  (e) all damages, losses, obligations, liabilities, claims,
         actions or causes of action sustained or suffered by the Indemnified
         Persons, or any of them, as a result of the failure to obtain any
         consent or provide any benefit under any contract, license, lease,
         sales order, purchase order or other agreement, claim, right, permit or
         operating authority; and

                  (f) all reasonable costs and expenses (including, without
         limitation reasonable attorney's, accountants' and other professional
         fees and expenses)

                                      -8-
<PAGE>   9
         incurred by the Indemnified Persons, or any of them, in connection with
         any action, suit, proceeding, demand, assessment or judgment incident
         to any of the matters indemnified against under Section 8.2(a), Section
         8.2(b), Section 8.2 (c), Section 8.2 (d) and Section 8.2 (e) hereof.

No claim, demand, suit or cause of action shall be brought against the
Indemnifying Persons under or pursuant to this Section 8.2 unless the
Indemnified Persons, or any of them, at any time prior to the Survival Date (as
defined in Section 8.4 hereof), give the Indemnifying Persons written notice,
with reasonable specificity, of the existence of any such claim, demand, suit or
cause of action under this Agreement. Upon the giving of such written notice as
aforesaid, the Indemnified Persons, or any of them, shall have the right to
commence legal proceedings within one year subsequent to the Survival Date for
the enforcement of its or their rights under this Agreement.

         8.3 Third Party Claims. The obligations and liabilities of the
Indemnifying Persons hereunder with respect to claims resulting from the
assertion of liability by third parties shall be subject to the following terms
and conditions:

                  (a) The Indemnified Persons shall give prompt written notice
         to the Indemnifying Persons of any assertion of liability by a third
         party which might give rise to a claim by the Indemnified Persons
         against the Indemnified Persons based on the indemnity agreements
         contained in Section 8.2 hereof, stating the nature and basis of said
         assertion and the amount thereof, to the extent known.

                  (b) In the event any action, suit or proceeding is brought
         against the Indemnified Persons, with respect to which the Indemnifying
         Persons may have liability under the indemnity agreement contained in
         Section 8.2 hereof, the action, suit or proceeding shall, upon the
         written agreement of the Indemnifying Persons that they are obligated
         to indemnify under the indemnity agreement contained in Section 8.2
         hereof, be defended (including all proceedings on appeal or for review
         which counsel for the defendant shall deem appropriate) by the
         Indemnifying Persons. The Indemnified Persons shall have the right to
         employ its or their own counsel in any such case, but the fees and
         expenses of such counsel shall be at the expense of such Indemnified
         Persons unless (i) the employment of such counsel shall have been
         authorized by the Indemnifying Persons in connection with the defense
         of such action, suit or proceeding, (ii) the Indemnifying Persons shall
         not have agreed, promptly after the notice to them provided in
         subsection (a) above, that they are obligated to indemnify under the
         indemnity agreement contained in Section 8.2 hereof or (iii) such
         Indemnified Person shall have reasonably concluded that such action,
         suit or proceeding involves to a significant extent matters beyond the
         scope of the indemnity agreement contained in Section 8.2 hereof, or
         that there may be defenses available to it (or them) which are
         different from or additional to those available to the Indemnifying
         Persons, in any of which events the Indemnifying Persons shall not have
         the right to direct the defense of such action, suit or proceeding on
         behalf of the Indemnified Persons and that portion of such fees and
         expenses reasonably

                                      -9-
<PAGE>   10
         related to matters covered by the indemnity agreement contained in
         Section 8.2 hereof shall be borne by the Indemnifying Persons. The
         Indemnified Persons shall be kept fully informed of such action, suit
         or proceeding at all stages thereof whether or not they are so
         represented. The Indemnifying Persons shall make available to the
         Indemnified Persons and their attorneys and accountants all books and
         records of the Indemnifying Persons relating to such proceedings or
         litigation and the parties hereto agree to render to each other such
         assistance as they may reasonably require of each other in order to
         ensure the proper and adequate defense of any such action, suit or
         proceeding.

                  (c) The Indemnifying Persons shall not make any settlement of
         any claims without the written consent of the Indemnified Persons.

         8.4 Survival. All representations and warranties contained in this
Agreement shall survive the Closing hereunder until the second anniversary (the
"Survival Date") of the date hereof, at which time such representations and
warranties shall expire and be terminated and extinguished.

         8.5 Remedies Cumulative. The remedies provided for in this Article VIII
shall be cumulative and shall not preclude assertion by the Indemnified Persons
of any other rights or the seeking of any other remedies against the
Indemnifying Persons.

                                   ARTICLE IX
                       AMENDMENT, MODIFICATION AND WAIVER

         This Agreement shall not be altered or otherwise amended except
pursuant to an instrument in writing signed by each of the parties hereto,
except that any party to this Agreement may waive any obligation owed to it by
another party under this Agreement. The waiver by any party hereto of a breach
of any provisions of this Agreement shall not operate or be construed as a
waiver of any subsequent breach.

                                    ARTICLE X
                                  MISCELLANEOUS

         10.1 Bulk Sales Compliance. Subject to Section 8.2(d), the Purchaser
hereby waives compliance by the Seller with the provisions of the "bulk sales
laws" (i.e., Article 6 of the Uniform Commercial Code) of any state which may be
applicable to the transactions contemplated hereby.

         10.2 Entire Agreement. This Agreement and the Exhibits and Schedules
attached hereto contain the entire agreement among the Purchaser and the Seller
with respect to the transactions contemplated hereby and supersede all prior
agreements or understandings among the parties with respect thereto.

                                      -10-
<PAGE>   11
         10.3 Descriptive Headings. Descriptive headings are for convenience
only and shall not control or affect the meaning or construction of any
provision of this Agreement.

         10.4 Counterparts. This Agreement may be executed in any number of
counterparts, and each such counterpart hereof shall be deemed to be an original
instrument, but all such counterparts together shall constitute but one
agreement.

         10.5 Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of Delaware.

         10.6 Benefits of Agreements. All the terms and provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns. Anything contained herein to the
contrary notwithstanding, this Agreement shall not be assignable by any party
hereto without the consent of the other party hereto.

         IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
executed on its behalf as of the day and year first above written.

                                PATHNET, INC.

                                By: ___________________________________
                                Name:
                                Title:

                                PATHNET TELECOMMUNICATIONS, INC.

                                By: ___________________________________
                                Name:
                                Title:

                                      -11-
<PAGE>   12
                                                                       EXHIBIT A

                                LICENSE OF MARKS

                  WHEREAS, Pathnet, Inc., a Delaware corporation having offices
at 1015 31st Street, N.W., Washington, D.C., 20007 ("Licensor"), has adopted,
used and is using trademarks, service marks, logos and designs including without
limitation the "A NETWORK OF OPPORTUNITIES" and "PATHNET" service marks and the
Pathnet logo (all such trademarks, service marks, logos and designs shall be
collectively referred to herein as the "Marks"); and

                  WHEREAS, Pathnet Telecommunications, Inc., a Delaware
corporation having offices at 1015 31st Street, N.W., Washington, D.C., 20007
("Licensee"), is desirous of a license to use the Marks;

                  NOW, THEREFORE, for good and valuable consideration, receipt
of which is hereby acknowledged, the parties hereto agree as follows:

         1. License. Licensor does hereby grant to Licensee the perpetual,
non-exclusive right and license to use the Marks on a royalty-free basis in
connection with Licensee's telecommunications business; provided, however, that
Licensee shall retain the right to use the Marks.

         2. Ownership of Marks. Licensee acknowledges and agrees that (a)
Licensor is the owner of the entire right, title and interest in and to the
Marks and the Marks, or any form or embodiment thereof (as well as the goodwill
now or hereafter attached to the same) are the property of and all use thereof
shall inure to the benefit of Licensor, and (b) Licensee shall have no rights to
the Marks other than those set forth in this License of Marks.

         3. Approvals/Quality Control. Licensee shall, upon request of Licensor,
submit representative samples of Licensee's use of the Marks to Licensor,
without charge to Licensor, and Licensor shall have a period of ten (10) days to
notify Licensee of their acceptance or rejection.

         4. Representations, Warranties and Covenants of Licensor. Licensor
represents and warrants that it is the owner of the Marks and the registrant
therefor, that Licensor has the full power and authority to license the right to
use the Marks, that Licensor has not entered into any agreements in conflict
with this License of Marks, and that there are no actions, suits or proceedings
pending or, to Licensor's knowledge, threatened against Licensor with respect to
the Marks. Licensor agrees to take all such further actions, and to execute any
and all such further documents and instruments, as may be necessary or desirable
to confirm the license executed hereby.

         5. Assignment. Neither party may assign any or all of its rights or
delegate any of its duties under this Agreement without the consent of the other
party, provided,

                                      -12-
<PAGE>   13
that either party hereto may assign its rights, but not its obligations, to any
Affiliate without the consent of the other party. For the purposes of this
Section 5, an "Affiliate" of a party shall mean a subsidiary of such party or
other entity under common ownership or control.

                  IN WITNESS WHEREOF, this LICENSE OF MARKS is made and
effective as of the ___ of ________________, 2000.

                                       PATHNET, INC.

                                       By: ___________________________________
                                       Name:
                                       Title:

                                       PATHNET TELECOMMUNICATIONS, INC.

                                       By: ___________________________________
                                       Name:
                                       Title:

                                      -13-
<PAGE>   14
                                                                       Exhibit B

                                     FORM OF
                                 PROMISSORY NOTE

$70,000,000.00                                                ____________, 2000

         FOR VALUE RECEIVED, PATHNET TELECOMMUNICATIONS, INC., a corporation
duly organized under the laws of the State of Delaware (the "Purchaser"),
promises to pay to Pathnet, Inc., a Delaware corporation, at 1015 31st Street,
Washington, DC 20007 ("Seller"), or at such other place as the holder of this
Note may from time to time designate in writing, the principal amount of SEVENTY
MILLION AND NO/100 DOLLARS ($70,000,000.00), together with interest on the
unpaid principal amount of this Note computed from the date of Closing as
defined in the Assignment and Acceptance Agreement (the "Assignment and
Acceptance") by and between Purchaser and Seller, dated the date hereof, as
amended from time to time, until the entire indebtedness is paid, at the rate of
twelve and one quarter percent (12-1/4%) per annum. The principal amount of this
Note shall be due and payable on March 31, 2010. Accrued interest calculated on
the outstanding principal amount as described above shall be payable yearly on
the last day of each year commencing with the year ended December 31, 2000. All
payments hereunder shall be made in lawful money of the United States of
America.

         The unpaid principal amount of this Note may be prepaid in whole or in
part at any time.

         The entire unpaid principal amount of this Note or any extension or
renewal hereof, together with accrued interest and all charges owing under this
Note or the Assignment and Acceptance, shall immediately become due and payable
at the option of the holder of this Note, without demand or notice, upon the
occurrence of any of the following Events of Default:

         (a) Purchaser fails to pay the principal amount of this Note when the
same becomes due and payable (whether on the date on which such principal
becomes due or upon acceleration or otherwise); or

         (b) Purchaser fails to pay any interest when the same becomes due and
payable hereunder and such failure to pay continues for ten (10) business days
after the date on which such payment of interest was due.

         If this Note, after maturity, whether by acceleration or otherwise, is
placed in the hands of an attorney for collection, whether suit is brought on
the same or not, Purchaser shall pay to the holder of this Note all attorneys'
fees as are incurred for the purposes of collection hereof.

                                      -14-
<PAGE>   15
         Each Obligor under this Note (which term shall include all makers,
guarantors, endorsers and other persons assuming obligations pursuant to this
Note) hereby waives presentment, protest, demand, notice of dishonor, and all
other notices, and all defenses and pleas on the grounds of any extensions of
the time of payments or the due dates of this Note, in whole or in part, before
or after maturity, with or without notice. No renewal or extension of this Note,
no release or surrender of any collateral given as security for this Note, no
release of any Obligor, and no delay in enforcement of this Note or in
exercising any right or power hereunder, shall affect the liability of any
Obligor.

         This Note may not be changed orally, but only by an agreement in
writing which is signed by the party against whom enforcement of any waiver,
change, modification or discharge is sought.

         IN WITNESS WHEREOF, Purchaser has caused this Note to be duly executed
on its behalf as of the date set forth at the beginning of this Note, as the act
and deed of Purchaser.

                                    PATHNET TELECOMMUNICATIONS, INC.

                                    By:     ____________________________________
                                            Name:
                                            Title:

                                      -15-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00002-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00002-of-00352.parquet"}]]