Document:

EXHIBIT 4.5

EXECUTION COPY

VSOURCE, INC.

CONVERTIBLE SECURITIES EXCHANGE AGREEMENT

         THIS CONVERTIBLE SECURITIES EXCHANGE AGREEMENT (this "Agreement") is
made as of October 23, 2002 by and among the security holders set forth on Exhibit A attached
hereto (the "Security Holders") and Vsource, Inc., a company organized under the laws of the State
of Delaware (the "Company").

         WHEREAS, the Company has entered into a Series 4-A Convertible Preferred Stock
Purchase Agreement (the "Purchase Agreement") dated as of October 23, 2002 with Capital
International Asia CDPQ Inc. and Quilvest Asian Equity Ltd. (the "Investors"), pursuant to
which the Investors have agreed, subject to the terms and conditions set forth in the Purchase
Agreement, to purchase certain shares of Series 4-A Convertible Preferred Stock, par value
U.S.$0.01 per share (the "Series 4-A Preferred Stock"), and Warrants (as defined in the Purchase
Agreement) of the Company;

         WHEREAS, each of the Security Holders beneficially owns one or more of the following
which have been issued by the Company: Series 2-A Convertible Preferred Stock, par value
U.S.$0.01 per share (the "Series 2-A Preferred Stock"), Series 3-A Convertible Preferred Stock,
par value U.S.$0.01 per share (the "Series 3-A Preferred Stock" and together with the Series 2-A
Preferred Stock, the "Convertible Securities"), Series A Convertible Notes, Series B-1
Exchangeable Notes (the Series A Convertible Notes and the Series B-1 Exchangeable Notes,
collectively, the "Notes") and Series B Warrants and Series B-1 Warrants (the Series B Warrants
and Series B-1 Warrants, collectively, the "Series B Warrants"; the Convertible Securities, Notes
and Series B Warrants are sometimes herein referred to collectively as the "Preferred
Securities"); and

         WHEREAS, Section 4.14 of the Purchase Agreement provides that it is a condition to
the First Closing (as defined in the Purchase Agreement) that the Company and the Security
Holders enter into this Agreement and effect: (i) an exchange of all of the Convertible Securities
and Series B Warrants held by the Security Holders for shares of Series 4-A Preferred Stock and
(ii) a conversion of all of the Notes held by the Security Holders into shares of Series 3-A
Preferred Stock, and an immediate exchange of such Series 3-A Preferred Stock for shares of
Series 4-A Preferred Stock, subject to the terms and conditions set forth herein;

         NOW, THEREFORE, the parties hereby agree as follows:

         1.       Exchange of Preferred Securities for Shares of Series 4-A Preferred Stock.  

                  1.1         Exchange of Convertible Securities and Series B Warrants.  Upon the terms
and subject to the conditions of this Agreement, each of the Security Holders who beneficially owns
Convertible Securities and/or Series B Warrants, as set forth in Exhibit B hereto, shall fully

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and
irrevocably assign, transfer and convey to the Company all of such Convertible Securities and Series
B Warrants, and the Company shall (i) take all actions reasonably necessary to cancel such
Convertible Securities and Series B Warrants, including, without limitation, updating the Company's
stock record books to reflect such cancellation and making any necessary filings before any
governmental or regulatory agencies relating to such cancellation and (ii) issue to each such Security
Holder as full and complete consideration for such cancellation the number of shares of Series 4-A
Preferred Stock set forth beside the Security Holder's name on Exhibit B hereto.  The conversion
ratio for the Convertible Securities and Series B Warrants is as follows:

                  (a)         One (1) share of Series 4-A Preferred Stock for each 480.01 shares of Series
2-A Preferred Stock being exchanged; 

                  (b)         One (1) share of Series 4-A Preferred Stock for each 11.83 shares of Series
3-A Preferred Stock being exchanged; and

                  (c)         For the Series B Warrants, the Security Holders who own such warrants shall
be entitled to one (1) share of Series 4-A Preferred Stock for each 100,000 shares of common stock
of the Company, par value U.S.$0.01 per share (the "Common Stock"), which are issuable upon the
exercise of the Series B Warrants.

                  1.2         Exchange of Notes.  (a)  Upon the terms and subject to the conditions of this
Agreement, each of the Security Holders who beneficially owns Series A Convertible Notes, as set
forth in Exhibit B hereto, shall deliver a duly executed Notice of Election (as defined in the Series
A Convertible Notes) to the Company and thereby irrevocably convert such notes (including all
accrued and unpaid interest payable thereon through October 22, 2002) into shares of Series 3-A
Preferred Stock in accordance with their terms.  	

                  (b)         Upon the terms and subject to the conditions of this Agreement, each of
the Security Holders who beneficially owns Series B-1 Exchangeable Notes, as set forth in Exhibit
B hereto, shall deliver a duly executed Notice of Election (as defined in the Series B-1 Exchangeable
Notes) to the Company and thereby irrevocably exchange such notes (including all accrued and
unpaid interest payable thereon through October 22, 2002) for Series A Convertible Notes in
accordance with their terms.  In addition, in conjunction with the delivery of the Notice of the
Election for the Series B-1 Exchangeable Notes, each of the Security Holders who beneficially
owned Series B-1 Exchangeable Notes shall deliver a duly executed Notice of Election with respect
to the Series A Convertible Notes they receive in the foregoing exchange and thereby convert such
notes into shares of Series 3-A Preferred Stock in accordance with their terms.  	

                  (c)         Immediately following the conversions and exchanges set forth in
Sections 1.2(a) and (b), such Security Holders shall exchange their shares of Series 3-A Preferred
Stock for shares of Series 4-A Preferred Stock in accordance with Section 1.1.

                  1.3         Closing Deliveries by the Security Holders.  The Security Holders shall
deliver or cause to be delivered to the Company in accordance with Section 1.5:

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                  (a)         for Security Holders who are exchanging Series 2-A Preferred Stock
and/or Series 3-A Preferred Stock, share certificates evidencing such shares with a duly executed
instrument of transfer in favor of the Company, in the form attached hereto as Exhibit C; 

                  (b)         for Security Holders converting and/or exchanging Notes prior to
exchanging Series 3-A Preferred Stock, the applicable duly executed Notices of Election and the
original copy of each Note; and

                  (c)         for Security Holders exchanging Series B Warrants, a duly executed
instrument of transfer in favor of the Company, in the form attached hereto as Exhibit D, and the
original copy of each Warrant.

                  Notwithstanding the foregoing, a Security Holder shall not be obligated to deliver the
original copy of a Security to the Company if such Security Holder executes and delivers to the
Company a properly completed Indemnity Agreement in the form attached hereto as Exhibit F.  In
any such case, the Company shall not reissue such Security upon conversion or exchange pursuant
to this Agreement.

                  1.4         Closing Deliveries by the Company.  The Company shall deliver or cause
to be delivered to each Security Holder at the Closing (as defined below):

                  (a)         a share certificate evidencing the shares of Series 4-A Preferred Stock
to be issued to such Security Holder, duly completed and registered in the name of such Security
Holder; and 

                  (b)         a cash payment for any fractional shares in accordance with Section
1.6.

                  1.5         Timing of Deliveries; Closing.  The stock certificates, warrants, notes, Notices
of Election and other deliverables of the Security Holders to the Company described in Sections 1.3
and 1.4 (collectively, the "Security Holder Deliverables") shall be provided to the Company at least
five Business Days prior to the date scheduled for the First Closing, but the Company and the
Security Holders hereby agree that the respective conversions and exchanges of each Security Holder
pursuant to Sections 1.1 and 1.2 (the "Conversions and Exchanges") shall not be deemed effective
until the actual consummation of the First Closing.  The closing of the Conversions and Exchanges
is referred to herein as a "Closing" and shall take place at the offices of Morrison & Foerster at 21/F,
Entertainment Building, Queen's Road Central, Hong Kong or at such other place as the First
Closing occurs pursuant to the terms of the Purchase Agreement.  In the event that, for whatever
reason, the First Closing and the Closing do not occur by October 31, 2002 or by such later date as
mutually agreed to in writing by the parties hereto, the Company shall promptly return the relevant
Security Holder Deliverables to each Security Holder, and their respective interests in the Preferred
Securities, and the nature of the Preferred Securities, shall be deemed unaltered as if the Security
Holder Deliverables had not been so provided to the Company.  In this Agreement, "Business Day"
means any day except a Saturday, Sunday, a statutory public holiday in Hong Kong or other day on
which commercial banks in Hong Kong are authorized or permitted by law to close.  

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                  1.6         Fractional Shares.  If an exchange of Preferred Securities by a Security Holder
into Series 4-A Preferred Stock would result in the issuance of a fractional share, the Company shall
pay to such Security Holder cash equal to such fraction multiplied by U.S.$2,000, in lieu of any
fractional share to which the Holder would otherwise be entitled.  Such cash payment will be made
by check or wire transfer on the date of the Closing.  For the avoidance of doubt, in no other
circumstance shall the Company pay any cash to any Security Holder pursuant to this Agreement or
in connection with the transactions contemplated by this Agreement.

         2.       Representations and Warranties of the Company.  As used herein, (i) any reference
to any event, change or effect being "material" with respect to the Company or any Subsidiary (as
defined herein) means an event, change or effect which is material in relation to the financial
condition, properties, business, operations, assets or results of operations of the Company and each
Subsidiary, taken as a whole, and (ii) the term "Material Adverse Effect" on the Company means
a material adverse effect on the financial condition, properties, business, operations, assets, results
of operations or prospects of the Company and its Subsidiaries, taken as a whole.  As of the Closing,
the Company hereby represents and warrants to, and covenants with, each Security Holder, except
as set forth on the Schedule of Exceptions attached as Schedule 1 (the "Schedule of Exceptions"),
which exceptions shall be deemed to be representations and warranties as if made hereunder, as
follows:

                  2.1         Organization and Standing.  The Company has been duly incorporated, is
validly existing and in good standing under the laws of the State of Delaware and has all necessary
corporate power and authority to own, lease and operate its properties and to conduct its business
in the manner presently conducted and to enter into and perform its obligations under this
Agreement, the Stockholders Agreement among the Company and the Security Holders in the form
attached hereto as Exhibit G (the "Stockholders Agreement"), the Registration Rights Agreement
among the Company and the Security Holders in the form attached hereto as Exhibit H (the
"Registration Rights Agreement") and the Certificate of Designation.  The Company and each of
the Subsidiaries is duly qualified as a foreign corporation to transact business and is in good standing
in each other jurisdiction in which such qualification is required, except where the failure to so
qualify or to be in good standing would not result in a Material Adverse Effect.  The Company is not
required to register as an "investment company" within the meaning of the Investment Company Act
of 1940.  The Company has made available to the Security Holders a true, complete and correct copy
of the Company's certificate of incorporation, certificates of designation and bylaws and the
constitution documents of each Subsidiary, each as amended to date (collectively, the
"Organizational Documents").  The Organizational Documents are in full force and effect.  

                  2.2         Capitalization.  	

                  (a)         Authorized Capital.  The authorized capital of the Company consists,
or will consist immediately prior to the Closing, of:

                           (i)         Preferred Stock.  5,000,000 shares of preferred stock, par value
U.S.$0.01 per share, of which (i) 2,802,000 shares have been designated Series 1-A Convertible
Preferred Stock, 1,436,055 of which are issued and outstanding, (ii) 1,672,328 shares have been
designated

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Series 2-A Convertible Preferred Stock, 1,127,867 of which are issued and outstanding,
(iii) 500,000 shares have been designated Series 3-A Convertible Preferred Stock, none of which is
issued and outstanding, and (iv) 25,000 shares have been designated Series 4-A Preferred Stock, all
of which may be sold pursuant to this Agreement, the Purchase Agreement and the Offer (as defined
in the Stockholders Agreement).  The rights, privileges and preferences of the Series 1-A Preferred
Stock, Series 2-A Preferred Stock and Series 3-A Preferred Stock are as stated in the Organizational
Documents, and the rights, privileges and preferences of the Series 4-A Preferred Stock are as stated
in the Certificate of Designation.

                           (ii)         Common Stock.  500,000,000 shares of Common Stock, of
which 35,056,373 shares are issued and outstanding, and the full number of shares of Common
Stock that shall be deliverable upon the conversion, in accordance with the Certificate of
Designation, of all shares of Series 4-A Preferred Stock that may be issued and outstanding from
time to time have been reserved to meet the obligations of the Company in respect of the shares
of common stock issuable upon the conversion of the Series 4-A Preferred Stock.  The chart
attached to this Agreement as Schedule 2 is a true representation of the authorized capital of the
Company immediately prior to the First Closing on a fully diluted basis.

                  (b)         Authorization.  All issued and outstanding shares of capital stock of
the Company have been duly authorized and validly issued and are fully paid and non-assessable;
none of the outstanding shares of capital stock of the Company have been issued in violation of the
preemptive or other similar rights of any person or in violation of any applicable securities laws or
regulations.  Except as described in the Schedule of Exceptions or as contemplated by this
Agreement, immediately prior to the First Closing there are no shares of capital stock or other
securities of the Company or any Subsidiary immediately prior to the First Closing (i) reserved for
issuance or (ii) subject to preemptive rights or any outstanding subscriptions, options, warrants, calls,
rights, convertible securities or other agreements or other instruments outstanding or in effect giving
any person the right to acquire any shares of capital stock or other securities of the Company or any
Subsidiary or any commitments of any character relating to the issued or unissued capital stock or
other securities of the Company or any Subsidiary.  Except as specified in the Schedule of
Exceptions or as contemplated by this Agreement, immediately prior to the First Closing on the date
hereof the Company does not have outstanding any bonds, debentures, notes or other obligations the
holders of which have the right to vote (or which are convertible into or exercisable for securities
having the right to vote) with the stockholders of Company.  The sale of the 4-A Securities are not
subject to any preemptive rights or rights of first refusal and, when issued and delivered in
compliance with the provisions of this Agreement and/or the Certificate of Designation, the 4-A
Securities will be duly and validly issued, fully paid and nonassessable, and will be free of any Liens
(as defined below), encumbrances or restrictions on transfer; provided, however, that (a) the 4-A
Securities may be subject to restrictions on transfer under applicable securities laws as set forth
herein or as otherwise required by such laws at the time a transfer is proposed, and (b) the 4-A
Securities may only be assigned in accordance with the Stockholders Agreement.

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                  2.3         Authorization of Agreements.  This Agreement, the Stockholders Agreement
and the Registration Rights Agreement have been duly authorized, executed and delivered by the
Company, and this Agreement, the Stockholders Agreement and the Registration Rights Agreement
constitute valid and legally binding obligations of the Company, enforceable in accordance with their
terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium and
other laws of general application affecting enforcement of creditors' rights generally, (ii) as limited
by laws relating to the availability of specific performance, injunctive relief or other equitable
remedies, and (iii) to the extent the indemnification and contribution provisions contained in this
Agreement, the Stockholders Agreement and the Registration Rights Agreement may be limited by
applicable securities laws.  The Board of Directors of the Company has duly approved the Certificate
of Designation.  

                  2.4         Absence of Defaults and Conflicts.  Except as set forth in the Schedule of Exceptions, the Company is not in violation
or default of any provision of its Organizational Documents or of any instrument, judgment, order,
writ, decree or contract to which it is a party or by which it is bound in writing, or, to the best of its
knowledge, of any provision of any statute, rule or regulation which is, to the best of the Company's
knowledge, applicable to the Company, except for such violations or defaults which would not result
in a Material Adverse Effect.  The execution, delivery and performance of this Agreement, the
Stockholders Agreement and the Registration Rights Agreement, and the consummation of the
transactions contemplated hereby and thereby will not result in any such violation or be in conflict
with or constitute, with or without the passage of time and giving of notice, either a default under
any such provision, instrument, judgment, order, writ, decree or contract or an event that results in
the creation of any lien, charge or encumbrance upon any assets of the Company or the suspension,
revocation, impairment, forfeiture or nonrenewal of any permit, license, authorization or approval
applicable to the Company, its business or operations or any of its assets or properties, except for
such results which would not result in a Material Adverse Effect.

                  2.5         Absence of Proceedings.  Except as described in the Company's Amendment
No. 2 to Annual Report on Form 10-K for the fiscal year ended January 31, 2002 (the "Form 10-K"),
Quarterly Reports on form 10-Q filed since the date of the Form 10-K and any amendments thereto
(the "Form 10-Qs") and Current Reports on Form 8-K filed since the date of the Form 10-K (the
"Form 8-Ks", and together with the Form 10-K and the Form 10-Qs, the "Public Filings"), there is
no action, suit, proceeding, inquiry or investigation before or brought by any court or governmental
agency or body, domestic or foreign, now pending, or, to the knowledge of the Company, threatened,
against or affecting the Company or any Subsidiary which might reasonably be expected individually
or in the aggregate to result in a Material Adverse Effect, or which might reasonably be expected to
materially and adversely affect the business, properties or assets of the Company or any Subsidiary
or the consummation of the transactions contemplated in this Agreement, the Stockholders
Agreement, the Registration Rights Agreement or the Certificate of Designation or the performance
by the Company of its obligations hereunder.

                  2.6         Intellectual Property.

                  (a)         Intellectual Property.  The term "Intellectual Property" means: 

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                           (i)         trademark and service mark registrations and applications
(collectively, "Marks"); 

                           (ii)         trade secrets of the Company, as defined in the U.S. Uniform
Trade Secrets Act (collectively, "Trade Secrets"); and 

                           (iii)         domain names and URL addresses for websites on the Internet
or the World Wide Web ("Domain Names"). 

                  (b)         Intellectual Property Necessary for the Company's Business.  To the
knowledge of the Company, except as set forth in the Schedule of Exceptions, the Company owns
or has a right to use all the Intellectual Property that is necessary for the operation of the business
of the Company and its Subsidiaries as it is currently conducted, subject only to such exceptions and
exclusions as in the aggregate are not material to the business, operations or prospects of the
Company.  Except as set forth in the Schedule of Exceptions, the Company has the right to use,
without any payment to any third party in excess of U.S.$50,000 per year, all of such Intellectual
Property.

                  (c)         Trademarks. To the knowledge of the Company,

                           (i)         The Company and/or one or more of the Subsidiaries is the
owner, licensor or licensee of all right, title, and interest in and to each of the Marks owned or
licensed by the Company, free and clear of all Liens, and other adverse claims. 

                           (ii)         No such Mark has been or is now involved in any
opposition, invalidation, or cancellation and no such action is threatened with respect to any of
such Marks. 

                           (iii)         There is no trademark or service mark registration of any
third party which potentially interferes with the use of such Marks. 

                           (iv)         No such Mark is infringed or has been challenged or
threatened in any way by any other person, nor does any such Mark used by the Company or any
Subsidiary infringe or is alleged to infringe any trademark or service mark of any third party. 

                  (d)         Trade Secrets.  To the knowledge of the Company, the Company
and/or one or more of the Subsidiaries has a right to use all Trade Secrets used in the conduct of the
business of the Company. To the knowledge of the Company, such Trade Secrets are not part of the
public knowledge or literature, and, to the knowledge of the Company, have not been used, divulged,
or appropriated for the benefit of any third party (other than the Company or any Subsidiary or
pursuant to a non-disclosure or license agreement).  To the knowledge of the Company, no such
Trade Secret is subject to any adverse claim or has been challenged or threatened in any way.

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                  (e)         Domain Names.  To the knowledge of the Company, the Company
and/or one or more Subsidiaries is the owner of all right, title, and interest in and to, or is licensed
to use, all of the Domain Names used in the conduct of the business of the Company and its
Subsidiaries, free and clear of all Liens.  Such Domain Names are registered with Network Solutions
or such other agency or company duly authorized by relevant governmental entities to maintain such
registry, and all fees due in respect of such registration have been paid.

                  2.7         Subsidiaries.  Except as set forth in the Schedule of Exceptions, each
subsidiary of the Company, meaning any entity in which the Company, directly or indirectly,
beneficially owns more than 50% of the equity interest in, or the voting control of, such company
(each, a "Subsidiary"), is a corporation validly existing and in good standing under the laws of its
jurisdiction of incorporation and has full corporate power and authority to own, lease and operate
its properties, conduct its business as and to the extent now conducted.  All of the outstanding shares
of capital stock of each Subsidiary have been duly authorized and validly issued, are fully paid and
nonassessable, and are owned, beneficially and of record, by the Company or Subsidiaries wholly
owned by the Company free and clear of all liens, charges, encumbrances, options, rights of
preemption and third party rights whatsoever (collectively, "Liens").  

                  2.8         Liabilities.  Except as set forth in the Schedule of Exceptions and except for potential Liabilities
referred to in the Public Filings, neither the Company nor any Subsidiary has any debt, liability,
commitment or obligation of any kind, character or nature whatsoever, whether known or unknown,
choate or inchoate, secured or unsecured, accrued, fixed, absolute, contingent or otherwise, and
whether due or to become due ("Liability") (and, to the knowledge of the Company, there is no basis
for any present or future action against it giving rise to any Liability) except for (i) Liabilities or
obligations reflected or reserved against the balance sheet contained in the Financial Statements or
the Interim Financial Statements (as defined herein) and (ii) current Liabilities incurred in the
ordinary course of business not exceeding U.S.$2.1 million (none of which results from, arises out
of, relates to, is in the nature of, or was caused by any breach of contract, breach of warranty, tort,
infringement, or violation of Law) since the date thereof.

                  2.9         Brokers.  All negotiations relative to this Agreement and the transactions contemplated
hereby have been carried out by the Company directly without the intervention of any person on
behalf of the Company in such manner as to give rise to any valid claim by any person against the
Security Holders (or any of them), the Company or any Subsidiary for a finder's fee, brokerage
commission or similar payment.

                  2.10       SEC Filings.  Except as disclosed in the Schedule of Exceptions, the Public Filings (including any
financial statements or schedules included therein) and each other filing of the Company under the
U.S. Securities Exchange Act of 1934, as amended (the "1934 Act"), made since January 31, 2002
complied with the requirements of the 1933 Act, or the 1934 Act, as the case may be, in all material
respects.   To the Company's knowledge, except as disclosed in the Schedule of Exceptions, the
Company is in compliance in all material respects with (i) the 1933 Act, (ii) the 1934 Act, and (iii)
all applicable rules and regulations of the U.S. Securities and Exchange Commission under the 1933
Act and the 1934 Act.

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                  2.11       Financial Statements.  The restated audited consolidated financial statements of the Company as of and
for the years ended January 31, 2000, 2001 and 2002 and the audited consolidated financial
statements of NetCel360 Holdings Limited ("Holdings") as of and for the year ended December 31,
2000 (collectively, the "Financial Statements") and the unaudited consolidated financial statements
of the Company as of and for the three months ended April 30, 2002 and July 31, 2002 (collectively,
the "Interim Financial Statements"), which have been made available to the Security Holders, have
been prepared in accordance with US generally accepted accounting principles ("GAAP") applied
on a basis consistent throughout the periods indicated (except as may be indicated in the notes
thereto) and, except as set forth in the Schedule of Exceptions, present fairly in all material respects
the consolidated financial condition and consolidated operating results of the Company or Holdings,
as the case may be, of the dates and during the periods indicated therein in conformance with GAAP,
subject, in the case of the Interim Financial Statements, to normal year-end adjustments, consistent
with past practices.  Except as set forth in the Financial Statements, the Interim Financial Statements,
the Public Filings, the Schedule of Exceptions, or arising in the ordinary course of business since
July 31, 2002, as of the date hereof none of the Company nor any Subsidiary has (A) incurred any
material liabilities of any nature (matured or unmatured, fixed or contingent) or (B) made any
material disposal of assets, suffered any loss or material damage of any assets, waived any valuable
rights, made any material change in any material contract to which it is a party or declared or paid
any dividends.

                  2.12       Tax Returns, Payments and Elections.  The Company has filed all tax returns and reports as required by law except as set
forth in the Schedule of Exceptions.  These returns and reports are true and correct in all material
respects.  The Company has paid all taxes and other assessments due, except those contested by it
in good faith that are listed in the Schedule of Exceptions, if any.  The provision for taxes of the
Company as shown in the Financial Statements is adequate for taxes due or accrued as of the date
thereof.  The Company has not elected pursuant to the Internal Revenue Code of 1986, as amended
(the "Code"), to be treated as a Subchapter S corporation or a collapsible corporation pursuant to
Section 1362(a) or Section 341(f) of the Code.  

                  2.13       Non-Competition Agreements.  Neither the Company nor any of its Subsidiaries is a party to any non-competition
or other agreement or subject to any duty which prohibits or limits the ability of the Company or any
Subsidiary (i) to engage in any line of business, (ii) to compete with any person, (iii) to carry on or
expand the nature or geographical scope of the business of the Company or such Subsidiary
anywhere in the world or (iv) to disclose any confidential information in the possession of the
Company or any Subsidiary (any not otherwise generally available to the public), other than, in the
case of (iv) only, any contract for the sale or purchase of goods or services or any non-disclosure
agreement entered into in connection with the possible or actual sale or purchase of goods or services
in the ordinary course of business, investments into or by the Company or in connection with the
proposed or actual formation or operation of any joint venture, partnership, strategic alliance or
similar arrangement that does not meet any other of the criteria set forth in this Section 2.13.

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                  2.14       Offering.    Subject in part to the truth and accuracy of each Security Holder's representations
set forth in Section 3 of this Agreement, the offer, sale and issuance of the 4-A Securities as
contemplated by this Agreement are exempt from the registration requirements of the 1933 Act and
will not result in a violation of the qualification or registration requirements of the applicable U.S.
state securities laws, and neither the Company nor any authorized agent acting on its behalf will take
any action hereafter that would cause the loss of such exemption.

                  2.15       Certain Payments.  Since their incorporation or organization, neither the Company nor any Subsidiary
has, nor has any representative of Company or any Subsidiary, or to the knowledge of the Company
or any other person associated with or acting for or on behalf of the Company or any Subsidiary,
directly or indirectly (a) made any contribution, gift, bribe, rebate, payoff, influence payment,
kickback, or other payment to any person, private or public, regardless of form, whether in money,
property, or services (i) to obtain favorable treatment in securing business, (ii) to pay for favorable
treatment for business secured, or (iii) to obtain special concessions or for special concessions
already obtained, for or in respect of the Company or any Subsidiary or (b) established or maintained
any fund or asset that has not been recorded in the books and records of the Company or any
Subsidiary.

                  2.16       Government Consents.  No consent, approval, order or authorization of, or registration, qualification,
designation, declaration or filing with, any U.S. federal, state or local governmental authority on the
part of the Company is required in connection with the consummation of the transactions
contemplated by this Agreement, except (i) the filing of the Certificate of Designation with the
Secretary of State of the State of Delaware; and (ii) such other U.S. federal or state securities filings
as may be necessary, which filings will be timely effected after the Closing.

                  2.17       Compliance with Laws; Permits.  The Company is not in violation of any applicable statute, rule, regulation, order
or restriction of any domestic or foreign government or any instrumentality or agency thereof in
respect of the conduct of its business or the ownership of its properties which violation would have
a Material Adverse Effect.  No governmental orders, permissions, consents, approvals or
authorizations are required to be obtained and no registrations or declarations are required to be filed
in connection with the execution and delivery of this Agreement and the issuance of the 4-A
Securities, except such as has been duly and validly obtained or filed, or with respect to any filing
that must be made after the Closing, as will be filed in a timely manner.  

                  2.18         Absence of Stockholders Agreements.  Except as set forth in the Schedule of Exceptions, there are no agreements in effect
between the Company and any holders or class of holders of securities of the Company relating to
such securities.

                  2.19         Option Plans.  Except as set forth in the Schedule of Exceptions, the Company
has no plan, arrangement, scheme or agreement for the issuance of stock or options therefor to any
of its employees, directors, officers or consultants other than its Employee Stock Purchase Plan and
its 2001 Stock Options/Stock Issuance Plan.

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                  2.20         Maintenance of Insurance.  The Company has maintained all insurance
policies required by applicable law and by contractual obligation, including, without limitation, all
insurance policies required to be kept in place pursuant to the Master Services Agreement, dated
November 16, 2001, between Agilent Technologies Singapore (Sales) Ltd. and the Company's
Cayman subsidiary, Vsource (CI) Ltd. (the "Cayman Subsidiary"), which has subsequently been
novated to the Company's Malaysian subsidiary, Vsource (Malaysia) Sdn Bhd.

                  2.21         Gateway Contract. With respect to the Support Services Agreement, dated
October 24, 2001, among the Company, Gateway Japan Inc. ("Gateway") and the Cayman
Subsidiary (the "Gateway Contract"), the Company has not materially failed to achieve the Service
Levels (as such term is defined in the Gateway Contract) from June 1, 2002 to September 30, 2002
to an extent that would give Gateway the right to terminate the Gateway Contract pursuant to section
3.2(e)(ii) thereof.

                  2.22       MSC Status.  The Company's Subsidiary Vsource (Malaysia) Sdn Bhd has been granted and retains full
Multimedia Super Corridor status.

                  2.23       No Other Representations.  Notwithstanding anything to the contrary contained in this Agreement, it is the
explicit intent of each party hereto that the Company is not making any representation or warranty
whatsoever, express or implied, except those representations, and warranties contained in this
Agreement. 

                  2.24       Reliance by Security Holders.  The Company understands that the representations, warranties, covenants and
acknowledgements set forth in this Section 2 constitute a material inducement to each Security
Holder entering into this Agreement.

         3.      Representations and Warranties of Each Security Holder.  Each Security Holder,
severally but not jointly, represents and warrants to the Company as of the date of the Closing
that:

                  3.1         Authorization.  Such Security Holder has full power and authority to enter into
this Agreement, and this Agreement constitutes its valid and legally binding obligation, enforceable
against it in accordance with its terms except (i) as limited by applicable bankruptcy, insolvency,
reorganization, moratorium and other laws of general application affecting enforcement of creditors'
rights generally and (ii) as limited by laws relating to the availability of specific performance,
injunctive relief or other equitable remedies.

                  3.2         Acquisition Entirely for Own Account.  The Series 4-A Preferred Stock and Common Stock issuable upon conversion thereof (collectively,
the "4-A Securities") are being acquired for investment for such Security Holder's own account not
as a nominee or agent, and not with a view to the resale or distribution of any part thereof, and that
such Security Holder has no present intention of selling, granting any participation in, or otherwise
distributing the same.  The acquisition by each Security Holder of the 4-A Securities shall constitute
confirmation of the representation by each such Security Holder that such Security Holder does not
have any contract, undertaking, agreement or arrangement with any person to sell, transfer or grant
participations to such person or to any third person, with respect to any of the 4-A Securities.

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                  3.3         Disclosure of Information.  Such Security Holder believes it has received all the information it considers necessary or
appropriate for deciding whether to engage in the Conversions and Exchanges and thereby acquire
the Series 4-A Preferred Stock.  Such Security Holder further represents that it has had an
opportunity to ask questions and receive answers from the Company regarding the terms and
conditions of the Conversions and Exchanges and the offering of the Series 4-A Preferred Stock and
the business, properties, prospects and financial condition of the Company.  The foregoing, however,
does not limit or modify the representations and warranties of the Company in Section 2 of this
Agreement or the right of the Security Holders to rely thereon.  Such Security Holder further
represents that it has such knowledge and experience in financial and business matters that it is
capable of evaluating the merits and risk of the Conversions and Exchanges and the acquisition of
the Series 4-A Preferred Stock.

                  3.4         Accredited Security Holder; Non-U.S. Persons.  If a Security Holder is a United States resident or incorporated or organized under the laws of the
United States, such Security Holder is an "accredited investor" within the meaning of Securities and
Exchange Commission ("SEC") Rule 501 of Regulation D, as presently in effect.  If a Security
Holder is neither a United States resident nor incorporated or organized under the laws of the United
States, such Security Holder (i) certifies that such Security Holder is not a "U.S. person" within the
meaning of SEC Rule 902 of Regulation S, as presently in effect, and that such Security Holder is
not acquiring the 4-A Securities for the account or benefit of any such U.S. person, (ii) agrees to
resell the 4-A Securities only in accordance with the provisions of Regulation S, pursuant to
registration under the 1933 Act, or pursuant to an available exemption from registration and agrees
not to engage in hedging transactions with regard to such 4-A Securities unless in compliance with
the Securities Act of 1933, as amended (the "1933 Act"), (iii) agrees that any certificates for any 4-A
Securities issued to such Security Holder shall contain a legend to the effect that transfer is
prohibited except in accordance with the provisions of Regulation S, pursuant to registration under
the 1933 Act or pursuant to an available exemption from registration and that hedging transactions
involving such 4-A Securities may not be conducted unless in compliance with the 1933 Act, and
(iv) agrees that the Company is hereby required to refuse to register any transfer of any 4-A
Securities issued to such Security Holder not made in accordance with the provisions of Regulation
S, pursuant to registration under the 1933 Act, or pursuant to an available exemption from
registration.

                  3.5         Restricted Securities.  Such Security Holder understands that the 4-A Securities it is acquiring are characterized as
"restricted securities" under the U.S. federal securities laws inasmuch as they are being acquired
from the Company in a transaction not involving a public offering and that under such laws and
applicable regulations such securities may be resold without registration under the 1933 Act only in
certain limited circumstances.  Such Security Holder has no immediate need for liquidity in
connection with this acquisition and does not anticipate that the Security Holder will be required to
sell his, her or its 4-A Securities in the foreseeable future.

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                  3.6         Liens and Restrictions.  The Preferred Securities, when sold and delivered to
the Company in accordance with the terms of this Agreement, will be free of any liens and
encumbrances and will be free of restrictions on transfer other than restrictions under applicable state
and federal securities laws.

                  3.7         Series 4-A Preferred Stock.  The rights, privileges and preferences of the
Series 4-A Preferred Stock are as stated in the Certificate of Designation which is attached hereto
as Exhibit E.

                  3.8         Legends.  It is understood that the certificates evidencing the 4-A Securities may bear the following legend:

	"THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED.  THEY MAY NOT BE SOLD,
OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF
A REGISTRATION STATEMENT IN EFFECT WITH RESPECT TO THE
SECURITIES UNDER SUCH ACT OR AN OPINION OF COUNSEL
SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT
REQUIRED OR UNLESS SOLD PURSUANT TO RULE 144 OF SUCH ACT."

         4.      Conditions to Obligations of the Security Holders.  The obligations of each of the
Security Holders to consummate the transactions contemplated by this Agreement shall be
subject to the fulfillment of the following conditions:

                  4.1         The representations and warranties of the Company contained in this
Agreement shall be true and correct in all material respects as of the Closing.

                  4.2         Each Security Holder (other than Phillip Kelly, Dennis Smith and John
Cantillon) shall have received from Morrison & Foerster, counsel for the Company, an opinion,
dated as of the Closing, in substantially the form attached hereto as Exhibit I.

                  4.3         The First Closing is consummated.

                  4.4         All obligations on the part of the Company that are to be performed at or prior
to the Closing have been performed.

         5.      Conditions to Obligations of the Company.  The obligations of the Company to
consummate the transactions contemplated by this Agreement shall be subject to the fulfillment
of the following conditions:

                  5.1         The representations and warranties of each of the Security Holders contained
in this Agreement shall be true and correct in all material respects as of the Closing.

                  5.2         The First Closing is consummated.

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                  5.3         All obligations on the part of each of the Security Holders that are to be
performed at or prior to the Closing have been performed.

         6.      Miscellaneous.

                  6.1         Survival of Representations, Warranties and Covenants.  The warranties, representations and covenants of the Company and Security Holders contained in
or made pursuant to this Agreement shall survive the execution and delivery of this Agreement and
the Closing and shall remain in full force and effect for a period of two years following the Closing.

                  6.2         Successors and Assigns.  Except as otherwise provided herein, the terms and conditions of this Agreement shall inure to the
benefit of and be binding upon the respective successors and assigns of the parties (including
transferees of any Preferred Securities and 4-A Securities).  Nothing in this Agreement, express or
implied, is intended to confer upon any party other than the parties hereto or their respective
successors and assigns any rights, remedies, obligations, or liabilities under or by reason of this
Agreement, except as expressly provided in this Agreement.

                  6.3         Governing Law; Venue.  This Agreement is to be construed in accordance with and governed by the internal laws of the
State of New York without giving effect to any choice of law rule that would cause the application
of the laws of any jurisdiction other than the internal laws of the State of New York to the rights and
duties of the parties.  Any controversy or claim arising out of or relating to this Agreement
(including, without limitation, the interpretation, performance, breach or termination thereof) will
be settled by arbitration in San Francisco, California, administered by the American Arbitration
Association ("AAA") in accordance with its then-current Commercial Arbitration Rules except
insofar as such rules conflict with this Section, and judgment on the award rendered by the
arbitrators may be entered in any court having jurisdiction thereof.  The arbitration will be conducted
by three arbitrators, one appointed by the party or parties commencing the proceeding, one appointed
by the party or parties in opposition, and the third by the two arbitrators so appointed, provided that
if such two arbitrators cannot agree on a chairman, he shall be appointed by the AAA, and provided,
further, that if the dispute is such that one or more of the parties to the dispute believes that the
dispute is such that the disputing parties cannot fairly be divided into two groups as above
contemplated, such party may make application to the AAA and if the AAA concurs in such
conclusion, the AAA shall appoint the chairman of the panel and the chairman shall appoint the other
two members of the panel after consultation with all of the parties to the dispute.  All papers,
documents, evidence (whether written or oral) and other information and materials filed with or
presented to the arbitrators will be in the English language and will constitute confidential
information, and neither the parties nor the arbitrators will disclose any such information or materials
except as necessary in connection with the arbitration or as required by applicable law.  Any demand
for arbitration, requests for discovery and other notices in connection with the arbitration may be
served in the English language in accordance with the notice provisions of this Agreement, and each
party waives any right to any other form of notice, other means of delivery or translation into any
other language.  The parties will be entitled to discover all information and materials reasonably
necessary for a full understanding of any issues reasonably raised in the arbitration.  They may use
all methods of discovery permitted under the U.S. federal rules

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as applied in the Northern District
of California, including, without limitation, depositions, requests for admissions, interrogatories and
requests for production of documents.  The time period for compliance will be set by the arbitrators.
The arbitrators will have the authority to award any remedy or relief that a U.S. federal court could
order or grant, including, without limitation, monetary damages, injunctive or other equitable relief,
and sanctions for abuse or frustration of the arbitration process, provided that the arbitrators shall
not have the authority to award punitive damages.  The arbitrators will issue a written explanation
of the reasons for the award, and a full statement of the facts found and rules of law applied in
reaching their decision.  Notwithstanding the foregoing, each party will have the right to a
preliminary injunction or other interim relief, pending a final award by the arbitrators, in any court
of competent jurisdiction in connection with any arbitrable claim or controversy, but only to the
extent that such interim relief is intended to preserve the adequacy or sufficiency of any final award
granted by the arbitrators.

                  6.4         Acknowledgment; Waiver of Conflicts.  Each Security Holder acknowledges
that: (a) it has read this Agreement; (b) it has been represented in the preparation, negotiation and
execution of this Agreement by legal counsel of its own choice or has voluntarily declined to seek
such counsel; and (c) it understands the terms and consequences of this Agreement and is fully aware
of the legal and binding effect of this Agreement.  Each Security Holder understands that the
Company has been represented in the preparation, negotiation and execution of this Agreement by
Morrison & Foerster, counsel to the Company, and that Morrison & Foerster has not represented any
Security Holder or any stockholder, director or employee of the Company or any Security Holder in
the preparation, negotiation and execution of this Agreement. 

                  6.5         Counterparts.  This Agreement may be executed in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same instrument.

                  6.6         Facsimile Signatures.  Any signature page to this Agreement or any amendment thereto delivered by fax machine or
telecopy machine shall be binding to the same extent as an original signature page.  Any party who
delivers such a signature page agrees to later deliver an original counterpart to any party requesting
it.

                  6.7         Titles and Subtitles.  The titles and subtitles used in this Agreement are used for convenience only and are not to be
considered in construing or interpreting this Agreement.

                  6.8         Notices.  Any notice or other communication required or permitted to be delivered under this Agreement
shall be in writing and shall be deemed effectively given:  (i) upon personal delivery to the party to
be notified; (ii) when sent by confirmed telex or facsimile if sent during normal business hours of
the recipient, if not, then on the next business day; (iii) seven (7) days after having been sent by
registered or certified air mail, return receipt requested, postage prepaid; or (iv) three (3) days after
deposit with an internationally recognized express courier, specifying highest priority delivery, with
written verification of receipt, to the address or facsimile number set forth beneath the name of each
party below (or to such other address or facsimile number as such party may designate by ten (10)
days advance written

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notice to the other party hereto).  Each person making a communication
hereunder by facsimile shall promptly confirm by telephone to the person to whom such
communication was addressed each communication made by it by facsimile pursuant hereto but the
absence of such confirmation shall not affect the validity of any such communication.  

                  6.9         Expenses.  Unless the Company otherwise agrees with a party hereto in writing, irrespective of whether the
Closing is effected, the parties hereto shall each bear their own expenses in connection with the
negotiation, execution, delivery and performance of this Agreement.

                  6.10      Amendments and Waivers.  Any term of this Agreement may be amended and the observance of any term of this Agreement
may be waived (either generally or in a particular instance and either retroactively or prospectively),
only with the written consent of the Company and holders of a majority of the 4-A Securities issued
or issuable pursuant to this Agreement; provided, however, that the conversion and exchange ratios
set forth in this Agreement, including, without limitation, in Sections 1.1(a)-(d), Section 1.2 and
Exhibit B attached hereto, may not be amended, waived or modified without the unanimous written
consent of the Company and the Security Holders.  Any amendment or waiver effected in accordance
with this paragraph shall be binding upon each holder of any securities purchased under this
Agreement at the time outstanding (including securities into which such securities are convertible),
each future holder of all such securities, and the Company.

                  6.11      Severability.  If one or more provisions of this Agreement are held to be unenforceable under applicable law,
such provision shall be excluded from this Agreement and the balance of the Agreement shall be
interpreted as if such provision were so excluded and shall be enforceable in accordance with its
terms.

                  6.12      Further Assurances; Consents and Waivers.  Each Security Holder and the Company shall from time to time and at all times hereafter make,
do, execute, or cause or procure to be made, done and executed such further acts, deeds,
conveyances, consents, waivers and assurances without further consideration, which may reasonably
be required to effect the transactions contemplated by this Agreement.  Without limiting the
foregoing, each Security Holder hereby agrees that it shall be deemed to have provided any consents
or waivers, including consents or waivers requiring approval by more than one Security Holder,
regarding the Preferred Securities owned by such holder and its rights thereunder which are
necessary or appropriate to effectuate the transactions contemplated by this Agreement and the other
transactions contemplated by the Purchase Agreement.  Further, each Security Holder hereby fully
releases, relinquishes, and discharges the Company and its stockholders, representatives, partners,
agents, parents and subsidiary organisations, affiliates, assigns and successors from all rights, claims
and actions that each Security Holder now has or may have after the date of this Agreement arising
out of or in connection with such Security Holder's rights under Article VIII of the Acquisition
Agreement by and among the Company and NetCel360 Holdings Limited dated as of May 24, 2001,
as amended as of June 22, 2001, and under Section 3.3(e) and Exhibit F of the Amended and
Restated Bridge Loan Agreement by and among NetCel360.com Ltd (now named Vsource (CI) Ltd),
NetCel360 Sdn Bhd (now named Vsource (Malaysia) Sdn Bhd), NetCel360 Holdings Limited and
the Lenders set forth therein, dated as of May 24, 2001, as amended as of June 22, 2001.

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                  6.13      Taxes Generally. Each Security Holder has consulted with tax advisors of
its own choice regarding the tax consequences of the transactions contemplated in this
Agreement or has voluntarily declined to seek such advisors.  Further, except as specifically set
forth in Section 6.14 hereof, each Security Holder hereby acknowledges and agrees that it shall
bear its own tax liabilities arising out of or relating to the transactions contemplated in this
Agreement and that nothing contained herein shall be construed as constituting tax advice,
guidance or analysis by the Company or its advisors regarding a Security Holder's individual tax
status or the tax consequences to it from engaging in those transactions

                  6.14      Reimbursement of Taxes.  The Company agrees to reimburse each US Holder
for all U.S. Federal and California income and franchise taxes (the "Taxes") required to be paid by
the US Holder on any gain recognized on the exchange of Series B Warrants for shares of Series 4-A
Preferred Stock pursuant to this Agreement.  The amount of the reimbursement shall be an amount
that, after taking into account all current deductions in respect of Taxes on such amount, shall be
equal to the aggregate amount of additional Taxes payable by the US Holder as a result of such gain
and the reimbursement of Taxes hereunder; provided, that the aggregate amount paid or payable by
the Company to any US Holder under this Section 6.14 shall not in any case exceed U.S.$70,000.
The amount of the reimbursement shall not include any interest, penalties or additions to Taxes
caused by any act or failure to act of the U.S. Holder.  The Company shall pay the reimbursement
no later than 30 days after receipt of a written demand letter from the US Holder that is accompanied
by a signed statement by the U.S. Holder's accountant explaining in reasonable detail the basis for
such computation.  The Company may, in its sole discretion and at its own expense, employ a
nationally-known, independent accounting firm to verify such computation after consultation with
the US Holder's accountant.  The results of the verification procedure shall be final, binding and
conclusive upon the Company and the US Holder.  A "US Holder" is any Security Holder that is:
(1) an individual citizen or resident of the United States; (2) a corporation, partnership or other
business organized under the laws of the United States or any State thereof or the District of
Columbia; (3) an estate the income of which is subject to U.S. federal income tax without regard to
its source; or (4) a trust that is subject to the primary supervision of a U.S. court and the control of
one or more U.S. persons, or that has a valid election in effect under applicable Treasury regulations
to be treated as a U.S. person

                  6.15      Entire Agreement.  This Agreement and the documents referred to herein constitute the entire agreement among the
parties with respect to the subject matter hereof and no party shall be liable or bound to any other
party in any manner by any warranties, representations or covenants except as specifically set forth
herein or therein.

*         *         *

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         IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first
above written.

	COMPANY:

	VSOURCE, INC.

	By:	/S/ DENNIS SMITH

Name:   Dennis Smith

Title:     Chief Financial Officer

  

	Address:	Vsource, Inc.

16875 West Bernardo Drive

Suite 250

San Diego, California 92127 

USA 

Attn:  Chief Financial Officer

	Facsimile:	1 (858) 618-5904

	with a copy to:
	Address:	Vsource (Asia) Ltd

Unit 501, AXA Centre

151 Gloucester Road, Wanchai

Hong Kong 

Attn:  General Counsel

	Facsimile:	(852) 2523-1344

SIGNATURE PAGE TO CONVERTIBLE SECURITIES EXCHANGE AGREEMENT

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	SECURITY HOLDER:

	By:	/S/ PHILLIP KELLY

Phillip Kelly

	Address:	Phillip Kelly

Vsource, Inc.

16875 West Bernardo Drive

Suite 250

San Diego, California 92127 

USA 

	Facsimile:	1 (858) 618-5904

	with a copy to:
	Address:	Vsource (Asia) Ltd

Unit 501, AXA Centre

151 Gloucester Road, Wanchai

Hong Kong 

Attn:  General Counsel

	Facsimile:	(852) 2523-1344

SIGNATURE PAGE TO CONVERTIBLE SECURITIES EXCHANGE AGREEMENT

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	SECURITY HOLDER:

	By:	/S/ JOHN CANTILLON

John Cantillon

	Address:	John Cantillon

Level 12, Menara HLA

No. 3, Jalan Kia Peng

50450 Kuala Lumpur, Malaysia

	Facsimile:	(60) 3 7490-8008

	with a copy to:

	Address:	Vsource (Asia) Ltd

Unit 501, AXA Centre

151 Gloucester Road, Wanchai

Hong Kong 

Attn:  General Counsel

	Facsimile:	(852) 2523-1344

SIGNATURE PAGE TO CONVERTIBLE SECURITIES EXCHANGE AGREEMENT

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	SECURITY HOLDER:

	By:	/S/ DENNIS SMITH

Dennis Smith

	Address:	Dennis Smith
Vsource (Asia) Ltd

Unit 501, AXA Centre

151 Gloucester Road, Wanchai

Hong Kong 

	
	Facsimile:	(852) 2523-1344

with a copy to General Counsel of Vsource at the same address

SIGNATURE PAGE TO CONVERTIBLE SECURITIES EXCHANGE AGREEMENT

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SECURITY HOLDER:

Mercantile Capital Partners I, L.P.

By: Mercantile Capital Group, LLC, its general partner

		By: Mercantile Capital Management Corp., its manager

			By:	/S/ I. STEVEN EDELSON

Name:   I. Steven Edelson

Title:     Managing Director

Asia Internet Investment Group I, LLC

By: Asia Investing Group, L.P., its managing member

         By: Asia Investors Group, LLC, its general partner

                  By: Mercantile Asia Investors, L.P., its managing member

					      By: Mercantile Asia, LLC, its general partner

						       By: 	/S/ I. STEVEN EDELSON

Name:   I. Steven Edelson

Title:     Managing Member

	Address for the foregoing Investors:

1372 Shermer Road
Northbrook, IL 60062 USA
Attn: I. Steven Edelson

Facsimile: 1 (847) 509-3715	with a copy to:

Michael Altman, Esq.

Altheimer & Gray

10 South Wacker Drive

Chicago, IL 60606	

Facsimile: 1 (312) 715-4800

SIGNATURE PAGE TO CONVERTIBLE SECURITIES EXCHANGE AGREEMENT

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SECURITY HOLDER:

BAPEF Investments XII Ltd.

	By:	/S/ P.L. GILLSON

Name:  P.L. Gillson as Alternate Director for A.W. Guille

Title:    Director

	Address:	BAPEF Investments XII Ltd.

PO Box 431

13-15 Victoria Road

St. Peter's Port

Guernsey GY1 3ZD

	Facsimile:	(44) 1481 715 219

	For the attention of:	Connie Helyar

	
	with a copy to:	Baring Private Equity Partners (Hong Kong) Ltd.

39th Floor

One International Finance Centre

1 Harbour View Street

Central, Hong Kong

	Facsimile:	(852) 2843 9372

	For the attention of:	Jean Salata/Gordon Shaw/Stuart Hong

	with a copy to:
	Address:	Scott Benner

Heller Ehrman White & McAuliffe, LLP

Room 6308-6309, 63rd Floor, The Center

99 Queen's Road Central, Hong Kong

	
	Facsimile:	(852) 2810-6242

SIGNATURE PAGE TO CONVERTIBLE SECURITIES EXCHANGE AGREEMENT

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EXHIBIT A

LIST OF SECURITY HOLDERS

	

1.	Phillip Kelly 

2.	John Cantillon

3.	Dennis Smith

4.   BAPEF Investments XII Ltd.

5.   Mercantile Capital Partners I, L.P.

6.   Asia Internet Investment Group I, LLC

	

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EXHIBIT B

CONVERSION AND EXCHANGE TABLE

	
Name of
Security
Holder	1. 

Number
of Shares
of Series
2-A 
	

Number of
Shares of
Series 4-A
Received in
Exchange
for No. 1	2. 

Number
of Shares
of Series
3-A(1) 
	
Number of
Shares of
Series 4-A
Received in
Exchange
for No. 2	3. 

Number of
Shares
Issuable -
Series B
Warrants(2) 
	
Number of
Shares of
Series 4-A
Received in
Exchange
for No. 3	4. 

Number of
Shares
Issuable -
Series B-1
Warrants(3)  
	
Number of
Shares of
Series 4-A
Received in
Exchange
for No. 4	Cash Payable
for Fractional
Shares	Total # of
Series 4-A
Issued
	Phillip Kelly
	0	0	21,855	1,847	3,843,750	38	2,013,145	20	US$957.41	1,905
	John
Cantillon
	0	0	23,849	2,015	2,562,500	25	1,342,100	13	US$2,161.86	2,053
	Dennis
Smith
	0	0	4,541	383	0	0	0	0	US$1,709.21	383
	BAPEF
Investments
XII Ltd.
	0	0	57,797	4,885	10,250,000	102	10,736,785	107	US$1,433.08	5,094
	Mercantile
Capital
Partners I,
L.P.
	624,025	1,300	24,700	2,087	0	0	0	0	US$1,874.17	3,387
	Asia Internet
Investment
Group I,
LLC	0	0	4,748	401	0	0	0	0	US$704.99	401
	  TOTALS:	624,025	1,300	136,927	11,570	16,656,250	165	14,092,030	140	US$8,840.72	13,175

___________________

1After giving effect to: (i) the conversion of the Series A Convertible Notes into shares of Series 3-A Preferred Stock and (ii) the exchange of the Series B-1 Exchangeable Notes for Series A Convertible Notes and conversion of such Series A Convertible Notes into shares of Series 3-A Preferred Stock.

2Represents the number of shares of Common Stock issuable upon the exercise of the Series B. Warrants.

3Represents the number of shares of Common Stock issuable upon the exercise of the Series B-1 Warrants.

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EXHIBIT C

INSTRUMENT OF TRANSFER FOR PREFERRED STOCK

VSOURCE, INC.

Incorporated in the State of Delaware, USA

I, ________________ of __________________________________ (the "Transferor"), for the full
and complete consideration of the issuance of ________ shares of Series 4-A Convertible Preferred
Stock and cash in the amount of U.S.$________, do hereby irrevocably transfer to Vsource, Inc. of
16875 West Bernardo Drive, Suite 250, San Diego, California  92127 (the "Transferee"), _____
shares of Series [2-A] [3-A] Convertible Preferred Stock, par value U.S.$0.01 per share, represented
by certificate number ___, each standing in the Transferor's name in the books of the Transferee to
hold unto the said Transferee and its administrators or assigns.

Dated as of ____________________, 2002

	Signed by the Transferor in the

presence of:

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -	 		
	Witness signature:

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

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

Transferor 	
	Signed by the Transferee in the

presence of:

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -	 		
	Witness signature:

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

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

Transferee	

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EXHIBIT D

INSTRUMENT OF TRANSFER FOR SERIES B WARRANTS

VSOURCE, INC.

Incorporated in the State of Delaware, USA

I, ________________ of __________________________________ (the "Transferor"), for the full
and complete consideration of the issuance of ________ shares of Series 4-A Convertible Preferred
Stock and cash in the amount of U.S.$________, do hereby irrevocably transfer to Vsource, Inc. of
16875 West Bernardo Drive, Suite 250, San Diego, California  92127 (the "Transferee"), that certain
Series [B] [B-1] Warrant issued by the Transferee dated ____________, which is beneficially owned
by the Transferor, to hold unto the said Transferee and its administrators or assigns.

Dated as of ____________________, 2002

	Signed by the Transferor in the

presence of:

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -	 		
	Witness signature:

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

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

Transferor 	
	Signed by the Transferee in the

presence of:

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -	 		
	Witness signature:

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

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

Transferee	

27NEXT PAGE

EXHIBIT E

CERTIFICATE OF DESIGNATION FOR SERIES 4-A PREFERRED STOCK

28NEXT PAGE

EXHIBIT F

INDEMNITY AGREEMENT

VSOURCE, INC.

LOST CERTIFICATE/NOTE/WARRANT

INDEMNITY AGREEMENT

         This Indemnity Agreement (this "Agreement") is entered into as of _________ ___, 2002 by
and between __________________ (the "Security Holder") and Vsource, Inc., a company organized
under the laws of the State of Delaware (the "Company").

         WHEREAS, the Security Holder beneficially owns one or more of the following classes of
securities which have been issued by the Company: Series 2-A Convertible Preferred Stock, Series
3-A Convertible Preferred Stock, Series A Convertible Notes, Series B-1 Exchangeable Notes, Series
B Warrants and/or Series B-1 Warrants;

         WHEREAS, the Company caused to be issued in the name of the Security Holder, to
evidence such ownership, the following certificate(s), note(s) and/or warrant(s):

	
Certificate Number
(for certificated shares)
	Number of Shares

(for shares and warrants) or

Original Outstanding

Principal Amount (for notes)
	Class of Security and

Date of Issuance

	________________	________________	_________________________
	________________	________________	_________________________
	________________	________________	_________________________
	________________	________________	_________________________
	________________	________________	_________________________
			

         WHEREAS, such certificate(s), note(s) and/or warrant(s) have, in some manner unknown,
become lost and are not now in the possession of the Security Holder (collectively, the "Lost
Instrument");

         WHEREAS, the Security Holder is desirous of participating in the relevant conversions and
exchanges contemplated by that certain Convertible Securities Exchange Agreement (the "Exchange
Agreement") dated as of October 23, 2002 among the Company, the Security Holder and the other
holders of the Company's securities named therein without the physical delivery of the Lost
Instrument; 

29NEXT PAGE

         WHEREAS, if the conversions and exchanges contemplated by the Exchange Agreement do
not occur for whatever reason, the Security Holder is desirous that the Company issue and deliver
to it a replacement certificate(s), note(s) or warrant(s) in lieu of the Lost Instrument (when so issued,
collectively, a "Replacement Instrument"); and

         WHEREAS, in connection with the foregoing, the Company requires that the Security Holder
enter into this Agreement.

         NOW, THEREFORE, in consideration of the foregoing, the Security Holder and the
Company agree as follows:

         1.         Representations and Warranties.  The Security Holder hereby represents and warrants
to the Company as follows:

                  (a)         proper searches have been made for the Lost Instrument but the Security
Holder is unable to locate it;

                  (b)         the Lost Instrument is presumed lost, mislaid or accidentally destroyed

                  (c)         The Security Holder has not in any way pledged, sold or otherwise disposed
of the Lost Instrument.

         2.         Indemnity.  The Security Holder and its assigns shall defend, indemnify and hold
harmless the Company and its officers, directors, stockholders, affiliates, successors and stock
transfer agent from and against all actions, proceedings, claims and demands which may be brought
or made against the Company and its officers, directors, stockholders, affiliates, successors and stock
transfer agent and against all losses, damages, costs, charges and expenses that such parties may in
any way sustain, incur or become liable for in consequence of or in connection with the Lost
Instrument and, if necessary, the issuance of the Replacement Instrument in lieu thereof.

         3.         Discovery of Lost Instrument.  If and when the Lost Instrument is discovered, the
Security Holder shall immediately deliver the Lost Instrument to the Company for cancellation and
shall make no claims against the Company with respect to such Lost Instrument.

         4.         Governing Law.  This Agreement is to be construed in accordance with and governed
by the internal laws of the State of New York without giving effect to any choice of law rule that
would cause the application of the laws of any jurisdiction other than the internal laws of the State
of New York to the rights and duties of the parties.

SECURITY HOLDER

By:     _________________________

Name:

Title:

VSOURCE, INC.

By:     _________________________

Name:

Title:

30NEXT PAGE

EXHIBIT G

STOCKHOLDERS AGREEMENT

31NEXT PAGE

EXHIBIT H

REGISTRATION RIGHTS AGREEMENT

32NEXT PAGE

EXHIBIT I

FORM OF OPINION

33ENDFirst Amend dtd 10/25/2002 to Credit Agreement

 Exhibit 10.1 
  
 EXECUTION COPY 
 FIRST AMENDMENT 
  
 FIRST AMENDMENT, dated as of October 25, 2002 (this “Amendment”), to the Amended and Restated Credit Agreement, dated as of January 10, 2001 (as amended, supplemented or otherwise
modified from time to time, the “Credit Agreement”), among Time Warner Telecom Inc., a Delaware corporation (“TWTC”), Time Warner Telecom Holdings Inc., a Delaware corporation (the “Borrower”), the
several banks and other financial institutions or entities parties thereto on the date hereof (the “Lenders”), the documentation agent named therein (the “Documentation Agent”), the co-syndication agents named
therein (the “Co-Syndication Agents”), and JPMorgan Chase Bank, as administrative agent (in such capacity, the “Administrative Agent”). 
  
 W I T N E S S E T H: 
  
 WHEREAS, TWTC, the Borrower, the
Lenders, the Documentation Agent, the Co-Syndication Agents and the Administrative Agent are parties to the Credit Agreement; and 
  
 WHEREAS, TWTC and the Borrower have requested that the Lenders amend certain provisions of the Credit Agreement on the terms set forth herein, and the Lenders are willing to agree to such amendments; 
  
 NOW, THEREFORE, in consideration of the premises and mutual covenants contained herein, the parties hereby agree as follows: 

 
 1.    Defined Terms.    Unless otherwise defined herein,
capitalized terms that are defined in the Credit Agreement are used herein as therein defined. 
  
 2.    Amendment to Pricing.    Annex A to the Credit Agreement is hereby deleted in its entirety and replaced with the new Annex A attached hereto as Exhibit I. 
  
 3.    Amendment to Definition of “Consolidated EBITDA”.    The
definition of “Consolidated EBITDA” is hereby amended by deleting the word “and” from before “(e)” in the seventh line of the definition, and adding the following language after the word “Agreement” in the
fourteenth line of the definition: 
  
 “, (f) any non-cash asset impairment charges resulting from the
application of the statement on Accounting for the Impairment or Disposal of Long-Lived Assets (SFAS 144) or similar accounting rules or policies, provided, that the amounts referred to in this clause (f) shall not, in the aggregate, exceed
(i) $500,000,000 at any time up to and including December 31, 2003 and (ii) $30,000,000 for any fiscal year of TWTC thereafter; provided further, that (x) up to $30,000,000 of the fiscal year limit in clause (f)(ii), if not utilized in
the fiscal year for which it is permitted, may be carried over for use in the next succeeding fiscal year and (y) for purposes of applying the limit in clause (f)(ii), any amounts referred to in this clause (f) shall be deemed added to
“Consolidated EBITDA”, first, in respect of amounts permitted for such fiscal year as provided above and, second, in respect of amounts carried over from the prior fiscal year pursuant to clause (x) of this proviso, and (g)
any non-cash compensation expenses solely related to stock- 

  
 based compensation, provided, that, to the extent any non-cash expense
under this clause (g) subsequently requires any cash disbursement, such non-cash expense will be subtracted from Consolidated EBITDA;” 
  
 4.    Amendment to Section 2.1(b) of the Credit Agreement.    Section 2.1(b) of the Credit Agreement is hereby amended by adding the following language to
the end of such Section 2.1(b): 
  
 “Notwithstanding anything to the contrary in this Agreement:

  
 (i) at any time prior to January 1, 2004, the Total Revolving Extensions of Credit shall not
exceed $0 (other than in respect of Letter of Credit no. P-209151 originally issued on December 20, 2000 in an amount equal to $250,000); 
  
 (ii) at any time from (and including) January 1, 2004 to (and including) December 31, 2004, the Total Revolving Extensions of Credit shall not exceed $200,000,000; and 
  
 (iii) on any day on which a Revolving Loan or Swingline Loan is made, or a Letter of Credit is issued, the aggregate
amount of Revolving Loans and Swingline Loans made (excluding any Revolving Loans the proceeds of which are used to repay Swingline Loans), and Letters of Credit issued, in the period of three months ending on such day shall not exceed $100,000,000,
after giving effect to such new Revolving Loan, Swingline Loan or Letter of Credit.” 
  
 5.    Amendment to Section 2.4(a) of the Credit Agreement.    Section 2.4(a) of the Credit Agreement is hereby amended by adding the following language after the word “zero” in
the penultimate sentence of such Section 2.4(a): 
  
 “ or the provisions of the last sentence of
Section 2.1(b) would be violated.” 
  
 6.    Amendment to Section 3.1(a)
of the Credit Agreement.    Section 3.1(a) of the Credit Agreement is hereby amended by (i) deleting “ or” from the seventh line of such Section 3.1(a) and replacing it with “,” and (ii) adding the
following language after the word “zero” in the eighth line of such Section 3.1(a): 
  
 “ or (iii) the provisions of the last sentence of Section 2.1(b) would be violated.” 
  
 7.    Amendment to Section 7.1(b) of the Credit Agreement.    Section 7.1(b) is hereby amended by deleting such Section 7.1(b) in its entirety and replacing it with the following:

  
 “(b)  Consolidated Leverage Ratio.    Permit the
Consolidated Leverage Ratio as of the last day of any fiscal quarter of TWTC during the period set forth below to exceed the ratio set forth below opposite such period: 

 
 2 

  
 
	 Period
 
	    	 Consolidated
 Leverage
Ratio
 

	 10/01/02 – 12/31/02
 	    	 7.00 to 1.0
 
	 01/01/03 – 03/31/03
 	    	 7.00 to 1.0
 
	 04/01/03 – 06/30/03
 	    	 6.75 to 1.0
 
	 07/01/03 – 09/30/03
 	    	 6.75 to 1.0
 
	 10/01/03 – 12/31/03
 	    	 6.50 to 1.0
 
	 01/01/04 – 03/31/04
 	    	 6.25 to 1.0
 
	 04/01/04 – 06/30/04
 	    	 6.00 to 1.0
 
	 07/01/04 – 09/30/04
 	    	 5.75 to 1.0
 
	 10/01/04 – 12/31/04
 	    	 5.50 to 1.0
 
	 01/01/05 – 03/31/05
 	    	 5.50 to 1.0
 
	 04/01/05 – 06/30/05
 	    	 5.25 to 1.0
 
	 07/01/05 – thereafter
 	    	 5.00 to 1.0”
 

 
  
 8.    Amendment to Section
7.1(c) of the Credit Agreement.    Section 7.1(c) is hereby amended by deleting such Section 7.1(c) in its entirety and replacing it with the following: 
  
 “(c)  Consolidated Interest Coverage Ratio.    Permit the Consolidated Interest Coverage Ratio for any period of
four consecutive fiscal quarters of TWTC ending with any fiscal quarter during the period set forth below to be less than the ratio set forth below opposite such period: 
  
 
	 Period
 
	    	 Consolidated
 Interest Coverage
Ratio
 

	 10/01/02 – 12/31/02
 	    	 1.10 to 1.0
 
	 01/01/03 – 03/31/03
 	    	 1.10 to 1.0
 
	 04/01/03 – 06/30/03
 	    	 1.10 to 1.0
 
	 07/01/03 – 09/30/03
 	    	 1.25 to 1.0
 
	 10/01/03 – 12/31/03
 	    	 1.25 to 1.0
 
	 01/01/04 – 03/31/04
 	    	 1.25 to 1.0
 
	 04/01/04 – 06/30/04
 	    	 1.50 to 1.0
 

 

 
 3 

  
 
	 07/01/04 – 09/30/04
 	  	 1.50 to 1.0
 
	 10/01/04 – 12/31/04
 	  	 1.50 to 1.0
 
	 01/01/05 – 03/31/05
 	  	 1.50 to 1.0
 
	 04/01/05 – 06/30/05
 	  	 1.75 to 1.0
 
	 07/01/05 – 09/30/05
 	  	 1.75 to 1.0
 
	 10/01/05 – thereafter
 	  	 2.00 to 1.0”
 

 
  
 9.    Amendment to Section
7.1(d) of the Credit Agreement.    Section 7.1(d) is hereby amended by deleting such Section 7.1(d) in its entirety and replacing it with the following: 
  
 “(d)  Consolidated Debt Service Coverage Ratio.    Permit the Consolidated Debt Service Coverage Ratio determined
as of the last day of any fiscal quarter of TWTC during the period set forth below to be less than the ratio set forth below opposite such period: 
  
 
	 Period
 
	    	 Consolidated Debt Service Coverage Ratio
 

	 10/01/04 – 12/31/04
 	    	 1.40 to 1.0
 
	 01/01/05 – thereafter
 	    	 1.50 to 1.0”
 

 
  
 10.    Amendment to Section
7.7 of the Credit Agreement.    Section 7.7 is hereby amended by deleting such Section 7.7 in its entirety and replacing it with the following: 
  
 “7.7    Capital Expenditures.     Unless the ratio of Consolidated Total Debt to Annualized Consolidated
EBITDA as at the last day of the most recent complete fiscal quarter of TWTC is less than 5.00 to 1.0, make or commit to make any Capital Expenditure, except Capital Expenditures of TWTC and its Subsidiaries in the ordinary course of business not
exceeding for any fiscal year of TWTC set forth below the dollar amount set forth below opposite such fiscal year: 
  
 
	 Fiscal Year
 
	  	 Amount
 

	 2002
 	  	 $
 	 200,000,000
 
	 2003
 	  	 $
 	 300,000,000
 
	 2004
 	  	 $
 	 350,000,000
 
	 2005
 	  	 $
 	 350,000,000
 
	 2006
 	  	 $
 	 350,000,000
 
	 2007
 	  	 $
 	 350,000,000
 
	 2008
 	  	 $
 	 350,000,000
 
	 2009
 	  	 $
 	 350,000,000
 

 
  
 provided, that (i) up to $150,000,000 of any
such amount referred to above, if not so 

 
 4 

 expended in the fiscal year for which it is permitted, may be carried over for expenditure in the next succeeding fiscal
year, (ii) up to $25,000,000 of any such amount referred to above may be carried back for expenditure in the immediately preceding fiscal year and (iii) Capital Expenditures made pursuant to this Section 7.7 during any fiscal year shall be deemed
made, first, in respect of amounts carried over from the prior fiscal year pursuant to subclause (i) above, second, in respect of amounts permitted for such fiscal year as provided above and, third, in respect of amounts carried
back from the next succeeding fiscal year pursuant to subclause (ii) above.” 
  
 11.    Amendment to Section 7.8(g) of the Credit Agreement.    Section 7.8(g) is hereby amended by deleting such Section 7.8(g) in its entirety and replacing it with the following:

  
 “(g)  [Reserved]” 
  
 12.    Amendment to Section 8(l) of the Credit Agreement.    Section 8(l)
is hereby amended by adding the following language to the end of clause (iv) thereof: 
  
 “provided, that
no Event of Default shall occur under this clause (iv) if the failure of the board of directors of TWTC to consist of a majority of Continuing Directors results from a requirement (imposed by Nasdaq, another self-regulatory organization or any
regulatory body, and applicable to TWTC and other public companies) to implement a board of directors with a majority of independent directors;” 
  
 13.    Effectiveness.    This Amendment shall become effective as of the date hereof (the “Amendment
Closing Date”) when the following conditions precedent have been satisfied: 
  
 (a)  Amendment.    The Administrative Agent shall have received this Amendment, executed and delivered by the Administrative Agent, TWTC, the Borrower, and the Required Lenders. 

 
 (b)  Fees.    The Administrative Agent shall have received an amendment
fee, for the account of each Lender that has delivered an executed signature page to this Amendment to the Administrative Agent or its counsel no later than 4:00 p.m., New York City time, on October 25, 2002, in an amount equal to 0.25% of the sum
of such Lender’s Commitment (as in effect after the reductions in Section 13(c) below) plus the amount of any outstanding Term Loans held by such Lender (after giving effect to the prepayment in Section 13(c) below). 

 
 (c)  Reduction in Commitments; Prepayment of Tranche B Term Loans. 
  
 (i)  The Borrower shall have permanently reduced the Revolving Commitments by $95,000,000 (and prepaid
Revolving Loans as required) and permanently reduced the Delayed-Draw Term Commitments by $55,000,000, and each reduction shall have been done in accordance with Section 2.7 of the Credit Agreement. 

 
 5 

  
 (ii)  The Borrower shall have prepaid the Tranche B
Term Loans in an amount equal to $50,000,000 in accordance with Section 2.8 of the Credit Agreement. 
  
 14.    Representations and Warranties.    Each of TWTC and the Borrower hereby jointly and severally represents and warrants that each of the representations and warranties of each Loan
Party in or pursuant to any Loan Document is true and correct in all material respects, as if made on and as of the date hereof. 
  
 15.    Continuing Effect of Credit Agreement.    This Amendment shall not be construed as a waiver or consent to any further or future action on the part
of the Borrower or TWTC that would require a waiver or consent of the Administrative Agent and/or the Lenders. Except as amended hereby, the provisions of the Credit Agreement are and shall remain in full force and effect. 
 16.    Counterparts.    This Amendment may be executed in counterparts (including counterparts sent by
facsimile), and all of the said counterparts taken together shall be deemed to constitute one and the same instrument. 
  
 17.    GOVERNING LAW.    THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. 

 
 18.    Expenses.    The Borrower agrees to pay or reimburse the
Administrative Agent for all of its reasonable out-of-pocket costs and expenses incurred in connection with the preparation, negotiation and execution of this Amendment, including, without limitation, the reasonable fees and disbursements of counsel
to the Administrative Agent. 

 
 6 

  
 IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed and delivered by their respective proper and duly authorized officers as of the day and year first above written. 
  
 
	 TIME WARNER TELECOM INC.
 
	 
	 By:
 	 	 /s/    DAVID RAYNER
        
 

	  	 	 David Rayner
 Senior Vice
President and Chief Financial Officer
 

 
  
 
	 TIME WARNER TELECOM HOLDINGS INC.
 
	 
	 By:
 	 	 /s/    David Rayner        
 

	  	 	 David Rayner
 Senior Vice
President and Chief Financial Officer
 

 
  
 
	 JPMORGAN CHASE BANK, as Administrative Agent and as a Lender
 
	 
	 By:
 	 	  
 

	  	 	  

 

  
 
	 BANK OF AMERICA, N.A., as Co-Syndication Agent and as a Lender
 
	 
	 By:
 	 	  
 

	  	 	  

 

  
 
	 MORGAN STANLEY SENIOR FUNDING, INc., as Co-Syndication Agent and as a
Lender
 
	 
	 By:
 	 	  
 

	  	 	  

 

  
 
	 ABN AMRO BANK N.V., as Documentation Agent and as a Lender
 
	 
	 By:
 	 	  
 

	  	 	  

 

 EXHIBIT I 
 to the Amendment

  
 Annex A 
  
 PRICING GRID FOR DELAYED-DRAW TERM LOANS, REVOLVING LOANS, 
 SWINGLINE LOANS AND COMMITMENT FEES

  
 
	 Consolidated Leverage Ratio
 
	 	 Applicable Margin
 for
 Eurodollar Loans
 
	 	 Applicable Margin
 for ABR
Loans
 
	 	 Commitment Fee Rate
 

	 Greater than or equal
 to 7.00 to 1.0
 	 	 2.75%
 

 	 	  
 1.75%
 

 

 	 	 1.00% if 33 1/3% or less of the relevant Facility Commitments are utilized;
  
 0.75% if 66 2/3% or less but greater than 33 1/3% of the relevant Facility Commitments are utilized;
  
 0.50% if greater than 66 2/3% of the relevant Facility Commitments are utilized
 
	 
	 Greater than or equal
 to 6.00 to 1.0 but
 less than 7.00 to 1.0

	 	 2.50%
 	 	 1.50%
 	 	 same as above
 
	 
	 Greater than or equal
 to 5.00 to 1.0 but
 less than 6.00 to 1.0

	 	 2.25%
 	 	 1.25%
 	 	 same as above
 
	 
	 Greater than or equal
 to 4.00 to 1.0 but
 less than 5.00 or 1.0

	 	 2.00%
 	 	 1.00%
 	 	 same as above
 
	 
	 Less than 4.00 to 1.0
 	 	 1.75%
 	 	 0.75%
 	 	 same as above
 

 
  
 Changes in the Applicable Margin resulting from changes in the Consolidated Leverage Ratio
shall become effective on the date (the “Adjustment Date”) that is three Business Days after the date on which financial statements are delivered to the Lenders pursuant to Section 6.1, and shall remain in effect until the next
change to be effected pursuant to this paragraph. If any financial statements referred to above are not delivered within the time periods specified in Section 6.1, then, until the date that is three Business Days after the date on which such
financial statements are delivered, the highest rate set forth in each column of the Pricing Grid shall apply. Overdue interest, fees and other amounts shall bear interest at 2.00% above the rate applicable to ABR 

  
 Loans. Each determination of the Consolidated Leverage Ratio pursuant to the Pricing Grid shall be made
in a manner consistent with the determination thereof pursuant to Section 7.1. 
  
 Swingline Loans shall, for purposes of the commitment fee
calculations only, not be deemed to be a utilization of the Revolving Facility. 

 
 2

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