Document:

Prepared by MERRILL CORPORATION

QuickLinks
 -- Click here to rapidly navigate through this document
AMENDED AND RESTATED CREDIT AGREEMENT  

Dated as of October 12, 2001 

among

LONGS DRUG STORES CALIFORNIA, INC.,
  as the Borrower, 

BANK OF AMERICA, N.A.,

as Administrative Agent and Swing Line Lender, 

FLEET NATIONAL BANK,
  as Syndication Agent and L/C Issuer, 

and

The
Other Lenders Party Hereto 

BANC OF AMERICA SECURITIES LLC,
  as

Sole Lead Arranger and Sole Book Manager 

  

 
 

TABLE OF CONTENTS    
  

	Section
	 	 
	 	Page

	ARTICLE I.	 	DEFINITIONS AND ACCOUNTING TERMS	 	1
	 	1.01	 	Defined Terms	 	1
	 	1.02	 	Other Interpretive Provisions	 	13
	 	1.03	 	Accounting Terms	 	13
	 	1.04	 	Rounding	 	14
	 	1.05	 	References to Agreements and Laws	 	14
	ARTICLE II.	 	THE COMMITMENTS AND CREDIT EXTENSIONS	 	14
	 	2.01	 	Committed Loans	 	14
	 	2.02	 	Borrowings, Conversions and Continuations of Committed Loans	 	14
	 	2.03	 	Letters of Credit	 	15
	 	2.04	 	Swing Line Loans	 	20
	 	2.05	 	Prepayments	 	22
	 	2.06	 	Reduction or Termination of Commitments	 	23
	 	2.07	 	Repayment of Loans	 	23
	 	2.08	 	Interest	 	23
	 	2.09	 	Fees	 	23
	 	2.10	 	Computation of Interest and Fees	 	24
	 	2.11	 	Evidence of Debt	 	24
	 	2.12	 	Payments Generally	 	24
	 	2.13	 	Sharing of Payments	 	26
	 	2.14	 	Increase in Commitments	 	27
	ARTICLE III.	 	TAXES, YIELD PROTECTION AND ILLEGALITY	 	27
	 	3.01	 	Taxes	 	27
	 	3.02	 	Illegality	 	28
	 	3.03	 	Inability to Determine Rates	 	29
	 	3.04	 	Increased Cost and Reduced Return; Capital Adequacy; Reserves on Eurodollar Rate Loans	 	29
	 	3.05	 	Funding Losses	 	30
	 	3.06	 	Matters Applicable to all Requests for Compensation	 	30
	 	3.07	 	Survival	 	30
	ARTICLE IV.	 	CONDITIONS PRECEDENT TO CREDIT EXTENSIONS	 	31
	 	4.01	 	Conditions of Initial Credit Extension	 	31
	 	4.02	 	Conditions to all Credit Extensions and Conversions and Continuations	 	32

i

 

	ARTICLE V.	 	REPRESENTATIONS AND WARRANTIES	 	32
	 	5.01	 	Existence, Qualification and Power; Compliance with Laws	 	32
	 	5.02	 	Authorization; No Contravention	 	32
	 	5.03	 	Governmental Authorization	 	33
	 	5.04	 	Binding Effect	 	33
	 	5.05	 	Financial Statements; No Material Adverse Effect	 	33
	 	5.06	 	Litigation	 	33
	 	5.07	 	No Default	 	33
	 	5.08	 	Ownership of Property; Liens	 	33
	 	5.09	 	Environmental Compliance	 	33
	 	5.10	 	Insurance	 	34
	 	5.11	 	Taxes	 	34
	 	5.12	 	ERISA Compliance	 	34
	 	5.13	 	Subsidiaries	 	34
	 	5.14	 	Margin Regulations; Investment Company Act; Public Utility Holding Company Act	 	34
	 	5.15	 	Disclosure	 	35
	ARTICLE VI.	 	AFFIRMATIVE COVENANTS	 	35
	 	6.01	 	Financial Statements	 	35
	 	6.02	 	Certificates; Other Information	 	36
	 	6.03	 	Notices	 	36
	 	6.04	 	Payment of Obligations	 	37
	 	6.05	 	Preservation of Existence, Etc	 	37
	 	6.06	 	Maintenance of Properties	 	37
	 	6.07	 	Maintenance of Insurance	 	37
	 	6.08	 	Compliance with Laws	 	37
	 	6.09	 	Books and Records	 	37
	 	6.10	 	Inspection Rights	 	38
	 	6.11	 	Compliance with ERISA	 	38
	 	6.12	 	Use of Proceeds	 	38
	 	6.13	 	Guarantors	 	38
	ARTICLE VII.	 	NEGATIVE COVENANTS	 	38
	 	7.01	 	Liens and Negative Pledges	 	38
	 	7.02	 	Indebtedness	 	39
	 	7.03	 	Fundamental Changes	 	40
	 	7.04	 	Dispositions	 	40
	 	7.05	 	Restricted Payments	 	41
	 	7.06	 	ERISA	 	41
	 	7.07	 	Change in Nature of Business	 	41
	 	7.08	 	Transactions with Affiliates	 	41
	 	7.09	 	Burdensome Agreements	 	41
	 	7.10	 	Use of Proceeds	 	41
	 	7.11	 	Hostile Acquisitions	 	41
	 	7.12	 	Limitations on Upstreaming	 	42
	 	7.13	 	Acquisitions	 	42
	 	7.14	 	Financial Covenants	 	42
	ARTICLE VIII.	 	EVENTS OF DEFAULT AND REMEDIES	 	42
	 	8.01	 	Events of Default	 	42
	 	8.02	 	Remedies Upon Event of Default	 	44

ii

 

	ARTICLE IX.	 	ADMINISTRATIVE AGENT	 	44
	 	9.01	 	Appointment and Authorization of Administrative Agent	 	44
	 	9.02	 	Delegation of Duties	 	45
	 	9.03	 	Liability of Administrative Agent	 	45
	 	9.04	 	Reliance by Administrative Agent	 	45
	 	9.05	 	Notice of Default	 	46
	 	9.06	 	Credit Decision; Disclosure of Information by Administrative Agent	 	46
	 	9.07	 	Indemnification of Administrative Agent	 	47
	 	9.08	 	Administrative Agent in its Individual Capacity	 	47
	 	9.09	 	Successor Administrative Agent	 	47
	 	9.10	 	Other Agents	 	48
	ARTICLE X.	 	MISCELLANEOUS	 	48
	 	10.01	 	Amendments, Etc.	 	48
	 	10.02	 	Notices and Other Communications; Facsimile Copies	 	49
	 	10.03	 	No Waiver; Cumulative Remedies	 	50
	 	10.04	 	Attorney Costs, Expenses and Taxes	 	50
	 	10.05	 	Indemnification by the Borrower	 	50
	 	10.06	 	Payments Set Aside	 	51
	 	10.07	 	Successors and Assigns	 	51
	 	10.08	 	Confidentiality	 	53
	 	10.09	 	Set-off	 	54
	 	10.10	 	Interest Rate Limitation	 	55
	 	10.11	 	Counterparts; Facsimile Signatures; Effectiveness	 	55
	 	10.12	 	Integration	 	55
	 	10.13	 	Survival of Representations and Warranties	 	55
	 	10.14	 	Severability	 	55
	 	10.15	 	Tax Forms	 	56
	 	10.16	 	Removal and Replacement of Lenders	 	56
	 	10.17	 	Governing Law	 	57
	 	10.18	 	Waiver of Right to Trial by Jury	 	57
	
SCHEDULES	
 	

 
	 	

2.01	
 	

Commitments and Pro Rata Shares	
 	

 
	 	5.13	 	Subsidiaries and Other Equity Investments	 	 
	 	7.01	 	Existing Liens	 	 
	 	7.02	 	Existing Indebtedness	 	 
	 	10.02	 	Eurodollar and Domestic Lending Offices, Addresses for Notices	 	 
	
EXHIBITS	
 	

 
	

 	
 	
Form of	
 	

 
	 	

A	
 	

Committed Loan Notice	
 	

 
	 	B	 	Swing Line Loan Notice	 	 
	 	C-1	 	Committed Loan Note	 	 
	 	C-2	 	Swing Line Note	 	 
	 	D	 	Compliance Certificate	 	 
	 	E	 	Assignment and Assumption	 	 
	 	F	 	Guaranty	 	 

iii

  

    This
AMENDED AND RESTATED CREDIT AGREEMENT ("Agreement"), dated as of October 12, 2001, is among LONGS DRUG STORES
CALIFORNIA, INC., a California Corporation (the "Borrower"), each lender from time to time party hereto (collectively, the
"Lenders" and individually, a "Lender"), BANK OF AMERICA,
N.A., as Administrative Agent and Swing Line Lender, and FLEET NATIONAL BANK, as Syndication Agent and L/C Issuer. 

    The
Borrower has requested that the Lenders provide a revolving credit facility, and the Lenders are willing to do so on the terms and conditions set forth herein. 

    In
consideration of the mutual covenants and agreements herein contained, the parties hereto covenant and agree as follows: 

 
 

ARTICLE I.
  DEFINITIONS AND ACCOUNTING TERMS    
  

    1.01  Defined Terms.  As used in this Agreement, the following terms shall have the meanings set forth
below: 

    "Administrative Agent" means Bank of America in its capacity as administrative agent under any of the Loan Documents, or any successor
administrative agent. 

    "Administrative Agent's Office" means the Administrative Agent's address and, as appropriate, account as set forth
on Schedule 10.02, or such other address or account as the Administrative Agent may from time to time notify to the Borrower and
the Lenders. 

    "Affiliate" means, with respect to any Person, another Person that directly, or indirectly through one or more intermediaries, Controls
or is Controlled by or is under common Control with the Person specified. "Control" means the possession, directly or indirectly, of the power to direct
or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise.
"Controlling" and "Controlled" have meanings correlative thereto. 

    "Agent-Related Persons" means the Administrative Agent (including any successor administrative agent), together with its Affiliates
(including, in the case of Bank of America in its capacity as the Administrative Agent, the Arranger), and the officers, directors, employees, agents and attorneys-in-fact of
such Persons and Affiliates. 

    "Aggregate Commitments" has the meaning set forth in the definition of "Commitment." 

    "Agreement" means this Amended and Restated Credit Agreement. 

    "Applicable Rate" means the following percentages per annum, based upon the Consolidated Adjusted Total Debt to Consolidated EBITDAR
Ratio as set forth in the most recent Compliance Certificate received by the Administrative Agent pursuant to Section 6.02(b): 

 
 

Applicable Rate    
  

	Pricing

Level
 
	 	Consolidated

Adjusted Total Debt

to Consolidated

EBITDAR Ratio
	 	Commitment

Fee
	 	Eurodollar

Rate
	 	Base Rate
	 
	1	 	> 3.00:1	 	0.350	%	1.500	%	0.250	%
	2	 	> 2.50:1 but < 3.00:1	 	0.300	%	1.250	%	0.000	%
	3	 	> 2.00:1 but < 2.50:1	 	0.250	%	1.000	%	0.000	%
	4	 	> 1.50 but < 2.00	 	0.225	%	0.875	%	0.000	%
	5	 	< 1.50:1	 	0.200	%	0.750	%	0.000	%

1

 

    The
Applicable Rate shall be in effect from the date the most recent Compliance Certificate is received by Administrative Agent to but excluding the date the next Compliance
Certificate is received; provided that if the Borrower fails to timely deliver the next Compliance Certificate, the Applicable Rate from
the date such Compliance Certificate was due to but excluding the date such Compliance Certificate is received by Administrative Agent shall be pricing level 1 set forth above, and, thereafter, the
pricing level indicated by such Compliance Certificate when received; and provided further that the Applicable Rate in
effect from the Closing Date to the date the Administrative Agent receives the
Compliance Certificate for the period ending January 31, 2002, shall be determined based upon pricing level 2. 

    "Arranger" means Banc of America Securities LLC, in its capacity as sole lead arranger and sole book manager. 

    "Assignment and Assumption" means an Assignment and Assumption substantially in the form of  Exhibit E. 

    "Attorney Costs" means and includes all fees and disbursements of any law firm or other external counsel and the allocated cost of
internal legal services and all disbursements of internal counsel. 

    "Attributable Indebtedness" means, on any date, (a) in respect of any capital lease of any Person, the capitalized amount
thereof that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP, and (b) in respect of any Synthetic Lease Obligation, the capitalized amount of the
remaining lease payments under the relevant lease that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP if such lease were accounted for as a capital
lease. 

    "Audited Financial Statements" means the audited consolidated balance sheet of the Borrower and its Subsidiaries for the fiscal year
ended January 25, 2001, and the related consolidated statements of income or operations, shareholders' equity and cash flows for such fiscal year of the Borrower and its Subsidiaries. 

    "Bank of America" means Bank of America, N.A. 

    "Base Rate" means for any day a fluctuating rate per annum equal to the higher of (a) the Federal Funds Rate plus 1/2 of 1% and
(b) the rate of interest in effect for such day as publicly announced from time to time by Bank of America as its "prime rate." Such rate is a rate set by Bank of America based upon various
factors including Bank of America's costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above, or
below such announced rate. Any change in such rate announced by Bank of America shall take effect at the opening of business on the day specified in the public announcement of such change. 

    "Base Rate Committed Loan" means a Committed Loan that is a Base Rate Loan. 

    "Base Rate Loan" means a Loan that bears interest based on the Base Rate. 

    "Borrower" has the meaning set forth in the introductory paragraph hereto. 

    "Borrowing" means a Committed Borrowing or a Swing Line Borrowing, as the context may require. 

    "Business Day" means any day other than a Saturday, Sunday or other day on which commercial banks are authorized to close under the
Laws of, or are in fact closed in, the state where the Administrative Agent's Office is located (and, if different, the State of California) and, if such day relates to any Eurodollar Rate Loan, means
any such day on which dealings in Dollar deposits are conducted by and between banks in the London interbank eurodollar market. 

2

 

    "Cash Collateralize" means to pledge and deposit with or deliver to the Administrative Agent, for the benefit of the L/C Issuer and the
Lenders, as collateral for the L/C Obligations, cash or deposit account balances pursuant to documentation in form and substance satisfactory to the Administrative Agent and the L/C Issuer (which
documents are hereby consented to by the Lenders). Derivatives of such term shall have corresponding meaning. The Borrower hereby grants the Administrative Agent, for the benefit of the L/C Issuer and
the Lenders, a Lien on all such cash and deposit account balances. Cash collateral shall be maintained in blocked, non-interest bearing deposit accounts at Bank of America or other
institutions satisfactory to the L/C Issuer. 

    "Change of Control" means that (a) any Person or two or more Persons acting in concert (other than (i) R.M. Long or the
descendants of V.M. Long or R.M. Long, (ii) any trustee, personal representative, attorney-in-fact, proxyholder or other representative or agent acting for the
descendants of either, (iii) the Thomas J. Long Foundation, (iv) the J.M. Long Foundation, and (v) any deferred compensation plan or other employee benefit plan established by the
Borrower or the Parent, including, without limitation, the Borrower's existing Employee Profit Sharing Plan and the Borrower's existing 401(k) plan) shall have acquired beneficial ownership (within
the meaning of Rule 13d-3 of the Securities and Exchange Commission under the Securities Exchange Act of 1934) of 50% or more of the outstanding shares of voting stock of Parent,
(b) the Borrower shall cease to be a wholly-owned Subsidiary of Parent, or (c) the consolidated total assets of the Borrower and its Subsidiaries shall constitute less than 95% of the
consolidated total assets of the Parent and its Subsidiaries. 

    "Closing Date" means the first date all the conditions precedent
in Section 4.01 are satisfied or waived in accordance
with Section 4.01 (or, in the case
of Section 4.01(b), waived by the Person entitled to receive the applicable payment). 

    "Code" means the Internal Revenue Code of 1986. 

    "Commitment" means, as to each Lender, its obligation to (a) make Committed Loans to the Borrower pursuant
to Section 2.01, (b) purchase participations in L/C Obligations, and (c) purchase participations in
Swing Line Loans, in an aggregate principal amount at any one time outstanding not to exceed the amount set forth opposite such Lender's name
on Schedule 2.01, as such amount may be reduced or adjusted from time to time in accordance with this Agreement
(collectively, the "Aggregate Commitments"). 

    "Committed Borrowing" means a borrowing consisting of simultaneous Committed Loans of the same Type and having the same Interest Period
made by each of the Lenders pursuant to Section 2.01. 

    "Committed Loan" has the meaning specified in Section 2.01. 

    "Committed Loan Note" means a promissory note made by the Borrower in favor of a Lender evidencing Committed Loans made by such Lender,
substantially in the form of Exhibit C-1. 

    "Committed Loan Notice" means a notice of (a) a Committed Borrowing, (b) a conversion of Committed Loans from one Type to
the other, or (c) a continuation of Committed Loans as the same Type, pursuant to Section 2.02(a), which, if
in writing, shall be substantially in the form of Exhibit A. 

    "Compliance Certificate" means a certificate substantially in the form
of Exhibit D. 

    "Consolidated Adjusted Total Capitalization" means, as of any date of determination, for the Parent and its Subsidiaries on a
consolidated basis, the sum of (a) Consolidated Funded Indebtedness, (b) Consolidated Shareholders' Equity, and (c) an amount equal to (i) Consolidated Rental Expense for
the most recent four fiscal quarter period ending on or before such date multiplied by (ii) six. 

    "Consolidated Adjusted Total Debt" means, as of any date of determination, for the Parent and its Subsidiaries on a consolidated basis,
the sum of (a) Consolidated Funded Indebtedness and (b) an 

3

 

amount equal to (i) Consolidated Rent Expense for the most recent four fiscal quarter period ending on or before such date multiplied by (ii) six. 

    "Consolidated Adjusted Total Debt to Consolidated Adjusted Total Capitalization Ratio" means, as of any date of determination, the
ratio of (a) Consolidated Adjusted Total Debt to (b) Consolidated Adjusted Total Capitalization. 

    "Consolidated Adjusted Total Debt to Consolidated EBITDAR Ratio" means, for any four fiscal quarter period, the ratio of
(a) Consolidated Adjusted Total Debt as at the end of such period to (b) Consolidated EBITDAR for such period. 

    "Consolidated EBITDAR" means, for any period, for the Parent and its Subsidiaries on a consolidated basis, an amount equal to
Consolidated Net Income, plus or minus (as indicated) the following, without duplication, to the extent used or included in the determination of such Consolidated Net Income: (a) plus
Consolidated Interest Charges, plus (b) Consolidated Rent Expense, plus (c) the amount of taxes, based on or measured by income, plus (d) the amount of depreciation and
amortization expense, plus (e) non-cash, non-recurring charges, minus (f) non-recurring gains, minus (g) undistributed earnings from joint
ventures, minus (h) any benefit in connection with the reserve established for the Parent's "2001 Closure Plan" as described in the Parent's SEC Form 10-Q for the quarterly
period ended July 26, 2001, and plus (i) any charge in connection with such 2001 Closure Plan reserve to the extent that (x) the aggregate amount of all reserves established in
connection with such 2001 Closure Plan shall not exceed $32,000,000 and (y) such charge is made during any fiscal quarter ending during or after January 2001 and during or before
January 2002. 

    "Consolidated Funded Indebtedness" means, as of any date of determination, for the Parent and its Subsidiaries on a consolidated basis,
the sum of (a) the outstanding principal amount of all obligations, whether current or long-term, for borrowed money (including the outstanding principal amount of Obligations
hereunder) and the outstanding principal amount of all obligations evidenced by bonds, debentures, notes, loan agreements or other similar instruments, (b) Attributable Indebtedness in respect
of capital leases and Synthetic Lease Obligations, and (c) without duplication, all Guaranty Obligations with respect to Indebtedness of the types specified in subsections (a) and
(b) above of Persons other than the Parent or any Subsidiary. 

    "Consolidated Interest Charges" means, for any period, for the Parent and its Subsidiaries on a consolidated basis, the sum of
(a) all interest, premium payments, fees, charges and related expenses of the Parent and its Subsidiaries in connection with borrowed money (including capitalized interest) or in connection
with the deferred purchase price of assets, in each case to the extent treated as interest in accordance with GAAP, and (b) the portion of rent expense of the Parent and its Subsidiaries with
respect to such period under capital leases that is treated as interest in accordance with GAAP. 

    "Consolidated Net Income" means, for any period, for the Parent and its Subsidiaries on a consolidated basis, the net income of the
Parent and its Subsidiaries in accordance with GAAP. 

    "Consolidated Rent Expense" means, for any period, for the Parent and its Subsidiaries on a consolidated basis, all rental expense in
respect of operating leases deducted in determining Consolidated Net Income for such period. 

    "Consolidated Shareholders' Equity" means, as of any date of determination for the Parent and its Subsidiaries on a consolidated basis,
shareholders' equity as of that date determined in accordance with GAAP. 

    "Contractual Obligation" means, as to any Person, any provision of any security issued by such Person or of any agreement, instrument
or other undertaking to which such Person is a party or by which it or any of its property is bound. 

4

 

    "Credit Extension" means each of the following: (a) a Committed Borrowing, (b) a borrowing of a Swing Line Loan, and
(c) an L/C Credit Extension. 

    "Debtor Relief Laws" means the Bankruptcy Code of the United States of America, and all other liquidation, conservatorship, bankruptcy,
assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the United States of America or other applicable
jurisdictions from time to time in effect and affecting the rights of creditors generally. 

    "Default" means any Event of Default or any event that, with the giving of any notice, the passage of time, or both, would be an Event
of Default. 

    "Default Rate" means an interest rate equal to (a) the Base
Rate plus (b) the Applicable Rate, if any, applicable to Base Rate
Loans plus (c) 2% per
annum; provided that with respect to a Eurodollar Rate Loan, the Default Rate shall be an interest rate equal to the
interest rate (including any Applicable Rate) otherwise applicable to such Loan plus 2% per annum, in each case to the fullest extent permitted by applicable Laws. 

    "Disposition" or "Dispose" means the sale, transfer, license or other disposition
(including any sale and leaseback transaction) of any property by any Person, including any sale, assignment, transfer or other
disposal, with or without recourse, of any notes or accounts receivable or any rights and claims associated therewith. 

    "Dollar" and "$" means lawful money of the United States of America. 

    "Eligible Assignee" has the meaning specified
in Section 10.07(g). 

    "Environmental Laws" means all Laws relating to environmental, health, safety and land use matters applicable to any property of the
Borrower or its Subsidiaries. 

    "ERISA" means the Employee Retirement Income Security Act of 1974 and any regulations issued pursuant thereto. 

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

    "ERISA Event" means (a) a Reportable Event with respect to a Pension Plan; (b) a withdrawal by the Borrower or any ERISA
Affiliate from a Pension Plan subject to Section 4063 of ERISA during a plan year in which it was a substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation of
operations that is treated as such a withdrawal under Section 4062(e) of ERISA; (c) a complete or partial withdrawal by the Borrower or any ERISA Affiliate from a Multiemployer Plan or
notification that a Multiemployer Plan is in reorganization; (d) the filing of a notice of intent to terminate, the treatment of a Plan amendment as a termination under Sections 4041 or 4041A
of ERISA, or the commencement of proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e) an event or condition which might reasonably be expected to constitute grounds
under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan or Multiemployer Plan; or (f) the imposition of any liability under
Title IV of ERISA, other than PBGC premiums due but not delinquent under Section 4007 of ERISA, upon the Borrower or any ERISA Affiliate. 

5

 

    "Eurodollar Rate" means for any Interest Period with respect to any Eurodollar Rate Loan: 

    (a) the
rate per annum equal to the rate determined by the Administrative Agent to be the offered rate that appears on page 3750 of the Telerate screen (or any
successor thereto) that displays an average British Bankers Association LIBOR Rate for deposits in Dollars (for delivery on the first day of such Interest Period) with a term equivalent to such
Interest Period, determined as of approximately 11:00 a.m. (London time) two Business Days prior to the first day of such Interest Period, or 

    (b) if
the rate referenced in the preceding subsection (a) does not appear on such page or service or such page or service shall cease to be available, the rate
per annum equal to the rate determined by the Administrative Agent to be the offered rate on such other page or other service that displays an average British Bankers Association Interest Settlement
Rate for deposits in Dollars (for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period, determined as of approximately 11:00 a.m. (London time) two
Business Days prior to the first day of such Interest Period, or 

    (c) if
the rates referenced in the preceding subsections (a) and (b) are not available, the rate per annum determined by the Administrative Agent as the
rate of interest at which deposits in Dollars for delivery on the first day of such Interest Period in same day funds in the approximate amount of the Eurodollar Rate Loan being made, continued or
converted by Bank of America and with a term equivalent to such Interest Period would be offered by Bank of America's London Branch to major banks in the London interbank eurodollar market at their
request at approximately 4:00 p.m. (London time) two Business Days prior to the first day of such Interest Period. 

    "Eurodollar Rate Committed Loan" means a Committed Loan that bears interest at a rate based on the Eurodollar Rate. 

    "Eurodollar Rate Loan" means a Eurodollar Rate Committed Loan. 

    "Event of Default" means any of the events or circumstances specified in  Article VIII. 

    "Existing Credit Agreement" means that certain Credit Agreement, dated as of October 14, 1999, among the Borrower, each lender
from time to time party thereto, and Bank of America, N.A., as administrative agent. 

    "Existing Letters of Credit" means the letters of credit outstanding under the Existing Credit Agreement on the Closing Date. 

    "Federal Funds Rate" means, for any day, the rate per annum equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by
Federal funds brokers on such day, as published by the Federal Reserve Bank on the Business Day next succeeding such
day; provided that (a) if such day is not a Business Day, the Federal Funds Rate for such day shall be such rate on
such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (b) if no such rate is so published on such next succeeding Business Day, the
Federal Funds Rate for such day shall be the average rate charged to Bank of America on such day on such transactions as determined by the Administrative Agent. 

    "Fee Letter" has the meaning set forth in Section 2.09(b). 

    "Fixed Charge Coverage Ratio" means for any four fiscal quarter period the ratio of (a) Consolidated EBITDAR to (b) the
sum, without duplication, of Consolidated Interest Charges plus Consolidated Rental Expense. 

    "Foreign Lender" has the meaning specified in Section 10.15(a). 

6

 

    "FRB" means the Board of Governors of the Federal Reserve System of the United States of America. 

    "Fund" has the meaning set forth in Section 10.07(g). 

    "GAAP" means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board
and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or such other principles as may be approved by a significant
segment of the accounting profession, that are applicable to the circumstances as of the date of determination, consistently applied. 

    "Governmental Authority" means any nation or government, any state or other political subdivision thereof, any agency, authority,
instrumentality, regulatory body, court, administrative tribunal, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of
or pertaining to government, and any corporation or other entity owned or controlled, through stock or capital ownership or otherwise, by any of the foregoing. 

    "Guarantor" means any Person now or hereafter obligated as a guarantor under the Guaranty. 

    "Guaranty" means the Guaranty in the form of Exhibit F with such changes as the
Administrative Agent may approve. 

    "Guaranty Obligation" means, as to any Person, any (a) any obligation, contingent or otherwise, of such Person guarantying or
having the economic effect of guarantying any Indebtedness or other obligation payable or performable by another Person (the "primary obligor") in any manner, whether directly or indirectly, and
including any obligation of such Person, direct or indirect, (i) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation,
(ii) to purchase or lease property, securities or services for the purpose of assuring the obligee in respect of such Indebtedness or other obligation of the payment or performance of such
Indebtedness or other obligation, (iii) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary
obligor to pay such Indebtedness or other obligation, or (iv) entered into for the purpose of assuring in any other manner the obligee in respect of such Indebtedness or other obligation of the
payment or performance thereof or to protect such obligee against loss in respect thereof (in whole or in part), or (b) any Lien on any assets of such Person securing any Indebtedness or other
obligation of any other Person, whether or not such Indebtedness or other obligation is assumed by such Person; provided that the term "Guaranty
Obligation" shall not include endorsement of instruments for deposit or collection in the ordinary course of business. The amount of any Guaranty Obligation shall be deemed to be an amount equal to
the stated or determinable amount of the related primary obligation, or portion thereof, in respect of which such Guaranty Obligation is made or, if not stated or determinable, the maximum reasonably
anticipated liability in respect thereof as determined by the guarantying Person in good faith. 

    "Indebtedness" means, as to any Person at a particular time, all of the following, whether or not included as indebtedness or
liabilities in accordance with GAAP: 

    (a) all
obligations of such Person for borrowed money and all obligations of such Person evidenced by bonds, debentures, notes, loan agreements or other similar
instruments; 

    (b) all
direct or contingent obligations of such Person arising under letters of credit (including standby and commercial), bankers' acceptances, bank guaranties,
surety bonds and similar instruments; 

7

  

    (c) net
obligations under any Swap Contract in an amount equal to the Swap Termination Value thereof; 

    (d) all
obligations of such Person to pay the deferred purchase price of property or services (other than trade accounts payable in the ordinary course of business); 

    (e) indebtedness
(excluding prepaid interest thereon) secured by a Lien on property owned or being purchased by such Person (including indebtedness arising under
conditional sales or other title retention agreements), whether or not such indebtedness shall have been assumed by such Person or is limited in recourse; 

    (f)  capital
leases and Synthetic Lease Obligations; and 

    (g) all
Guaranty Obligations of such Person in respect of any of the foregoing. 

    For
all purposes hereof, the Indebtedness of any Person shall include the Indebtedness of any partnership or joint venture (other than a joint venture that is itself a corporation or
limited liability company) in which such Person is a general partner or a joint venturer, unless such Indebtedness is expressly made non-recourse to such Person (subject only to customary
exceptions acceptable to the Administrative Agent). The amount of any capital lease or Synthetic Lease Obligation as of any date shall be deemed to be the amount of Attributable Indebtedness in
respect thereof as of such date. 

    "Indemnified Liabilities" has the meaning set forth in Section 10.05. 

    "Indemnitees" has the meaning set forth in Section 10.05. 

    "Information" has the meaning set forth in Section 10.08. 

    "Interest Payment Date" means, (a) as to any Loan other than a Base Rate Loan, the last day of each Interest Period applicable
to such Loan; provided, that if any Interest Period for a Eurodollar Rate
Loan exceeds three months, the respective dates that fall every three months after the beginning of such Interest Period shall also be Interest Payment Dates; and (b) as to any Base Rate Loan
(including a Swing Line Loan), the last Business Day of each March, June, September and December and the Maturity Date. 

    "Interest Period" means as to each Eurodollar Rate Loan, the period commencing on the date such Eurodollar Rate Loan is disbursed or
converted to or continued as a Eurodollar Rate Loan and ending on the date one, two, three or six months thereafter, as selected by the Borrower in its Committed Loan Notice, as the case may;  provided
that: 

     (i) any
Interest Period that would otherwise end on a day that is not a Business Day shall be extended to the next succeeding Business Day unless, in the case of a
Eurodollar Rate Loan, such Business Day falls in another calendar month, in which case such Interest Period shall end on the next preceding Business Day; 

    (ii) any
Interest Period pertaining to a Eurodollar Rate Loan that begins on the last Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of the calendar month at the end of such Interest Period; and 

    (iii) no
Interest Period shall extend beyond the scheduled Maturity Date. 

    "Investment" means, as to any Person, any acquisition or investment by such Person, whether by means of (a) the purchase or
other acquisition of capital stock or other securities of another Person, (b) a loan, advance or capital contribution to, guaranty of debt of, or purchase or other acquisition of any other debt
or equity participation or interest in, another Person, including any partnership or joint venture interest in such other Person, or (c) the purchase or other acquisition (in one transaction or
a series of transactions) of assets of another Person that constitute a business unit. For purposes of 

8

 

covenant compliance, the amount of any Investment shall be the amount actually invested, without adjustment for subsequent increases or decreases in the value of such Investment. 

    "IRS" means the United States Internal Revenue Service. 

    "Laws" means, collectively, all international, foreign, Federal, state and local statutes, treaties, rules, guidelines, regulations,
ordinances, codes and administrative or judicial precedents or authorities, including the interpretation or administration thereof by any Governmental Authority charged with the enforcement,
interpretation or administration thereof, and all applicable administrative orders, directed duties, requests, licenses, authorizations and permits of, and agreements with, any Governmental Authority,
in each case whether or not having the force of law. 

    "L/C Advance" means, with respect to each Lender, such Lender's participation in any L/C Borrowing in accordance with its Pro Rata
Share. 

    "L/C Borrowing" means an extension of credit resulting from a drawing under any Letter of Credit which has not been reimbursed on the
date when made or refinanced as a Committed Borrowing. 

    "L/C Credit Extension" means, with respect to any Letter of Credit, the issuance thereof or extension of the expiry date thereof, or
the renewal or increase of the amount thereof. 

    "L/C Issuer" means Fleet National Bank, in its capacity as issuer of Letters of Credit hereunder, or any successor issuer of Letters of
Credit hereunder. 

    "L/C Obligations" means, as at any date of determination, the aggregate undrawn face amount of all outstanding Letters of Credit  plus the aggregate of all Unreimbursed
Amounts, including all L/C Borrowings. 

    "Lender" has the meaning specified in the introductory paragraph hereto and, as the context requires, includes the L/C Issuer and the
Swing Line Lender. 

    "Lending Office" means, as to any Lender, the office or offices of such Lender described as such on  Schedule 10.02, or such other office or offices as a Lender may
from time to time notify the Borrower and the Administrative Agent. 

    "Letter of Credit" means any letter of credit issued hereunder. 

    "Letter of Credit Application" means an application and agreement for the issuance or amendment of a letter of credit in the form from
time to time in use by the L/C Issuer. 

    "Letter of Credit Sublimit" means an amount equal to the lesser of the Aggregate Commitments and $20,000,000. The Letter of Credit
Sublimit is part of, and not in addition to, the Aggregate Commitments. 

    "Lien" means any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge, or
preference, priority or other security interest or preferential arrangement of any kind or nature whatsoever (including any conditional sale or other title retention agreement, any financing lease
having substantially the same economic effect as any of the foregoing, and the filing of any financing statement under the Uniform Commercial Code or comparable Laws of any jurisdiction), including
the interest of a purchaser of accounts receivable. 

    "Loan" means an advance of funds by a Lender to the Borrower under Article II in
the form of a Committed Loan or a Swing Line Loan. 

    "Loan Documents" means this Agreement, each Note, the Fee Letter, each Request for Credit Extension, each Compliance Certificate and
the Guaranty. 

    "Loan Parties" means, collectively, the Borrower and each Guarantor. 

9

 

    "Material Adverse Effect" means (a) a material adverse change in, or a material adverse effect upon, the operations, business,
properties, condition (financial or otherwise) or financial prospects of the Borrower or the Borrower and its Subsidiaries taken as a whole; (b) a material impairment of the ability of any Loan
Party to perform its obligations under any Loan Document to which it is a party; or (c) a material adverse effect upon the legality, validity, binding effect or enforceability against any Loan
Party of any Loan Document to which it is a party. 

    "Material Subsidiary" means at any time any Subsidiary which accounts for more than (i) 5% of the consolidated assets of
Borrower and its Subsidiaries or (ii) 5% of consolidated revenue of Borrower and its Subsidiaries. 

    "Maturity Date" means (a) October 12, 2004, or (b) such earlier date upon which the Aggregate Commitments may be
terminated in accordance with the terms hereof. 

    "Multiemployer Plan" means any employee benefit plan of the type described in Section 4001(a)(3) of ERISA, to which the Borrower
or any ERISA Affiliate makes or is obligated to make contributions, or during the preceding three calendar years, has made or been obligated to make contributions. 

    "Negative Pledge" means a Contractual Obligation that restricts Liens on property. 

    "Notes" means, collectively, the Committed Loan Notes and the Swing Line Note. 

    "Obligations" means all advances to, and debts, liabilities, obligations, covenants and duties of, any Loan Party arising under any
Loan Document, whether direct or indirect (including those acquired by assumption), absolute or contingent, due or to become due, now existing or hereafter arising and including interest that accrues
after the commencement by or against any Loan Party or any Affiliate thereof of any proceeding under any Debtor Relief Laws naming such Person as the debtor in such proceeding. 

    "Other Taxes" has the meaning set forth in Section 3.01(b). 

    "Organization Documents" means, (a) with respect to any corporation, the certificate or articles of incorporation and the
bylaws; (b) with respect to any limited liability company, the articles of formation and operating agreement; and (c) with respect to any partnership, joint venture, trust or other form
of business entity, the partnership, joint venture or other applicable agreement of formation and any agreement, instrument, filing or notice with respect thereto filed in connection with its
formation with the secretary of state or other department in the state of its formation, in each case as amended from time to time. 

    "Outstanding Amount" means (i) with respect to Committed Loans and Swing Line Loans on any date, the aggregate outstanding
principal amount thereof after giving effect to any borrowings and prepayments or repayments of Committed Loans and Swing Line Loans, as the case may be, occurring on such date; and (ii) with
respect to any L/C Obligations on any date, the amount of such L/C Obligations on such date after giving effect to any L/C Credit Extension occurring on such date and any other changes in the
aggregate amount of the L/C Obligations as of such date, including as a result of any reimbursements of outstanding unpaid drawings under any Letters of Credit or any reductions in the maximum amount
available for drawing under Letters of Credit taking effect on such date. 

    "Parent" means Longs Drug Stores Corporation, a Maryland corporation. 

    "Participant" has the meaning specified in Section 10.07(d). 

    "PBGC" means the Pension Benefit Guaranty Corporation. 

    "Pension Plan" means any "employee pension benefit plan" (as such term is defined in Section 3(2) of ERISA), other than a
Multiemployer Plan, that is subject to Title IV of ERISA and is sponsored or maintained by the Borrower or any ERISA Affiliate or to which the Borrower or any 

10

 

ERISA Affiliate contributes or has an obligation to contribute, or in the case of a multiple employer plan (as described in Section 4064(a) of ERISA) has made contributions at any time during
the immediately preceding five plan years. 

    "Person" means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership,
Governmental Authority or other entity. 

    "Plan" means any "employee benefit plan" (as such term is defined in Section 3(3) of ERISA) established by the Borrower or any
ERISA Affiliate. 

    "Pro Rata Share" means, with respect to each Lender, the percentage (carried out to the ninth decimal place) of the Aggregate
Commitments set forth opposite the name of such Lender on Schedule 2.01, as such share may be adjusted as contemplated herein. 

    "Register" has the meaning set forth in Section 10.07(c). 

    "Reportable Event" means any of the events set forth in Section 4043(c) of ERISA, other than events for which the 30 day
notice period has been waived. 

    "Request for Credit Extension" means (a) with respect to a Borrowing, conversion or continuation of Committed Loans, a Committed
Loan Notice, (b) with respect to an L/C Credit Extension, a Letter of Credit Application, and (c) with respect to a Swing Line Loan, a Swing Line Loan Notice. 

    "Required Lenders" means, as of any date of determination, Lenders whose Voting Percentages aggregate more than 50%. 

    "Responsible Officer" means as to any Person the president, chief financial officer, treasurer or controller of such Person. Any
document delivered hereunder that is signed by a Responsible Officer of a Loan Party shall be conclusively presumed to have been authorized by all necessary corporate, partnership and/or other action
on the part of such Loan Party and such Responsible Officer shall be conclusively presumed to have acted on behalf of such Loan Party. Unless otherwise stated, a reference to a Responsible Officer is
to a Responsible Officer of the Borrower. 

    "Restricted Payment" means any dividend or other distribution (whether in cash, securities or other property) with respect to any
capital stock of the Borrower or any Subsidiary, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit on account of the purchase, redemption,
retirement, acquisition, cancellation or termination of any such capital stock or of any option, warrant or other right to acquire any such capital stock. 

    "Subsidiary" of a Person means a corporation, partnership, joint venture, limited liability company or other business entity of which a
majority of the shares of securities or other interests having ordinary voting power for the election of directors or other governing body (other than securities or interests having such power only by
reason of the happening of a contingency) are at the time beneficially owned, or the management of which is otherwise controlled, directly, or indirectly through one or more intermediaries, or both,
by such Person. Unless otherwise specified, all references herein to a "Subsidiary" or to "Subsidiaries" shall refer to a Subsidiary or Subsidiaries of the Borrower. A reference to the Subsidiaries of
the Parent includes the Borrower. 

    "Swap Contract" means (a) any and all rate swap transactions, basis swaps, credit derivative transactions, forward rate
transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward
bond price or forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions,
cross-currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of any of the foregoing (including any options to enter into any of the
foregoing), whether or not any such transaction is governed by or subject to any master 

11

 

agreement, and (b) any and all transactions of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement published
by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master agreement (any such master agreement, together with any
related schedules, a "Master Agreement"), including any such obligations or liabilities under any Master Agreement. 

    "Swap Termination Value" means, in respect of any one or more Swap Contracts, after taking into account the effect of any legally
enforceable netting agreement relating to such Swap Contracts, (a) for any date on or after the date such Swap Contracts have been closed out and termination value(s) determined in accordance
therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a) the amount(s) determined as the mark-to-market value(s) for
such Swap Contracts, as determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Swap Contracts (which may include any
Lender). 

    "Swing Line" means the revolving credit facility made available by the Swing Line Lender pursuant to  Section 2.04. 

    "Swing Line Borrowing" means a borrowing of a Swing Line Loan pursuant to  Section 2.04. 

    "Swing Line Lender" means Bank of America in its capacity as provider of Swing Line Loans, or any successor swing line lender
hereunder. 

    "Swing Line Loan" has the meaning specified in Section 2.04(a). 

    "Swing Line Note" means a promissory note made by the Borrower in favor of the Swing Line Lender evidencing Swing Line Loans made by
such Lender, substantially in the form of Exhibit C-2. 

    "Swing Line Loan Notice" means a request for a Swing Line Borrowing pursuant to  Section 2.04(b), which, if in writing, shall be substantially in the form of
Exhibit B. 

    "Swing Line Sublimit" means an amount equal to the lesser of (a) $15,000,000 and (b) the Aggregate Commitments. The Swing
Line Sublimit is part of, and not in addition to, the Aggregate Commitments. 

    "Synthetic Lease Obligation" means the monetary obligation of a Person under (a) a so-called synthetic,
off-balance sheet or tax retention lease, or (b) an agreement for the use or possession of property creating obligations that do not appear on the balance sheet of such Person but
which, upon the insolvency or bankruptcy of such Person, would be characterized as the indebtedness of such Person (without regard to accounting treatment). 

    "Threshold Amount" means $25,000,000. 

    "Type" means with respect to a Committed Loan, its character as a Base Rate Loan or a Eurodollar Rate Loan. 

    "UCP" has the meaning set forth in Section 2.03(h). 

    "Unfunded Pension Liability" means the excess of a Pension Plan's benefit liabilities under Section 4001(a)(16) of ERISA, over
the current value of that Pension Plan's assets, determined in accordance with the assumptions used for funding the Pension Plan pursuant to Section 412 of the Code for the applicable plan
year. 

    "Unreimbursed Amount" has the meaning set forth in Section 2.03(c)(i). 

    "Voting Percentage" means, as to any Lender, (a) at any time when the Aggregate Commitments are in effect, such Lender's Pro
Rata Share and (b) at any time after the termination of the Aggregate Commitments, the percentage (carried out to the ninth decimal place) which (i) the sum of (A) the 

12

 

Outstanding Amount of such Lender's Committed Loans, plus (B) such Lender's Pro Rata Share of the Outstanding Amount of L/C Obligations,  plus
(C) such Lender's Pro Rata Share of the Outstanding Amount of Swing Line Loans, then comprises of (ii) the Outstanding Amount of all
Loans and L/C Obligations; provided that if any Lender has failed to fund any portion of the Committed Loans, participations in L/C Obligations or
participations in Swing Line Loans required to be funded by it hereunder, such Lender's Voting Percentage shall be deemed to be zero, and the respective Pro Rata Shares and Voting Percentages of the
other Lenders shall be recomputed for purposes of this definition and the definition of "Required Lenders" without regard to such Lender's Commitment or the outstanding amount of its Committed Loans,
L/C Advances and funded participations in Swing Line Loans, as the case may be. 

    1.02  Other Interpretive Provisions.  With reference to this Agreement and each other Loan Document,
unless otherwise specified herein or in such other Loan Document: 

    (a) The
meanings of defined terms are equally applicable to the singular and plural forms of the defined terms. 

    (b) (i)  The
words "herein" and "hereunder" and words of
similar import when used in any Loan Document shall refer to such Loan Document as a whole and not to any particular provision thereof. 

    (ii) Article,
Section, Exhibit and Schedule references are to the Loan Document in which such reference appears. 

    (iii) The
term "including" is by way of example and not limitation. 

    (iv) The
term "documents" includes any and all instruments, documents, agreements, certificates, notices, reports,
financial statements and other writings, however evidenced, whether in physical or electronic form. 

    (c) In
the computation of periods of time from a specified date to a later specified date, the word "from" means
"from and including;" the words "to" and "until" each
mean "to but excluding;" and the word "through" means "to and
including." 

    (d) Section
headings herein and in the other Loan Documents are included for convenience of reference only and shall not affect the interpretation of this Agreement or
any other Loan Document. 

    1.03  Accounting Terms.  (a) All accounting terms not specifically or completely defined herein
shall be construed in conformity with, and all financial data required to be submitted pursuant to this Agreement shall be prepared in conformity with, GAAP applied on a consistent basis, as in effect
from time to time, applied in a manner consistent with that used in preparing the Audited Financial Statements, except as otherwise specifically
prescribed herein. 

    (b) If
at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth in any Loan Document, and either the Borrower or the
Required Lenders shall so request, the Administrative Agent, the Lenders and the Borrower shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in
light of such change in GAAP (subject to the approval of the Required Lenders); provided that, until so amended, (i) such ratio or requirement
shall continue to be computed in accordance with GAAP prior to such change therein and (ii) the Borrower shall provide to the Administrative Agent and the Lenders financial statements and other
documents required under this Agreement or as reasonably requested hereunder setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to
such change in GAAP. 

13

  

    1.04  Rounding.  Any financial ratios required to be maintained by the Borrower pursuant to this
Agreement shall be calculated by dividing the appropriate component by the other component, carrying the result to one place more than the number of places by which such ratio is expressed herein and
rounding the result up or down to the nearest number (with a rounding-up if there is no nearest number). 

    1.05  References to Agreements and Laws.  Unless otherwise expressly provided herein,
(a) references to agreements (including the Loan Documents) and other contractual instruments shall be deemed to include all subsequent amendments, restatements, extensions, supplements and
other modifications thereto, but only to the extent that such amendments, restatements, extensions, supplements and other modifications are not prohibited by any Loan Document; and
(b) references to any Law shall include all statutory and regulatory provisions consolidating, amending, replacing, supplementing or interpreting such Law. 

 
 

ARTICLE II.
  THE COMMITMENTS AND CREDIT EXTENSIONS    
  

    2.01  Committed Loans.  Subject to the terms and conditions set forth herein, each Lender severally
agrees to make loans (each such loan, a "Committed Loan") to the Borrower from time to time on any Business Day during the period from the Closing Date
to the Maturity Date, in an aggregate amount not to exceed at any time outstanding the amount of such Lender's Commitment; provided that after giving
effect to any Committed Borrowing, (i) the aggregate Outstanding Amount of all Loans and L/C Obligations shall not exceed the Aggregate Commitments, and (ii) the aggregate Outstanding
Amount of the Committed Loans of any Lender, plus such Lender's Pro Rata Share of the Outstanding Amount of all L/C Obligations,  plus such Lender's Pro
Rata Share of the Outstanding Amount of all Swing Line Loans shall not exceed such Lender's Commitment. Within the limits of each
Lender's Commitment, and subject to the other terms and conditions hereof, the Borrower may borrow under this Section 2.01, prepay under  Section 2.05, and reborrow under this Section 2.01. Committed Loans may be Base Rate Loans
or Eurodollar Rate Loans, as further provided herein. 

    2.02  Borrowings, Conversions and Continuations of Committed Loans.  

    (a) Each
Committed Borrowing, each conversion of Committed Loans from one Type to the other, and each continuation of Committed Loans as the same Type shall be made
upon the Borrower's irrevocable notice to the Administrative Agent, which may be given by telephone. Each such notice
must be received by the Administrative Agent not later than 10:00 a.m., California time, (i) three Business Days prior to the requested date of any Borrowing of, conversion to or
continuation of Eurodollar Rate Committed Loans or of any conversion of Eurodollar Rate Committed Loans to Base Rate Committed Loans, and (ii) on the requested date of any Borrowing of Base Rate
Committed Loans. Each such telephonic notice must be confirmed promptly by delivery to the Administrative Agent of a written Committed Loan Notice, appropriately completed and signed by a Responsible
Officer of the Borrower or by any other Person designated in writing by such a Responsible Officer. Each Committed Borrowing of, conversion to or continuation of Eurodollar Rate Committed Loans shall
be in a principal amount of $5,000,000 or a whole multiple of $1,000,000 in excess thereof. Each Committed Borrowing of or conversion to Base Rate Committed Loans shall be in a principal amount of
$500,000 or a whole multiple of $100,000 in excess thereof. Each Committed Loan Notice (whether telephonic or written) shall specify (i) whether the Borrower is requesting a Committed
Borrowing, a conversion of Committed Loans from one Type to the other, or a continuation of Committed Loans as the same Type, (ii) the requested date of the Borrowing, conversion or
continuation, as the case may be (which shall be a Business Day), (iii) the principal amount of Committed Loans to be borrowed, converted or continued, (iv) the Type of Committed Loans
to be borrowed or to which existing Committed Loans are to be converted, and (v) if applicable, the duration of the Interest Period with respect thereto. If the Borrower fails to specify a Type
of Committed Loan in a Committed Loan Notice or if the Borrower fails to give a timely notice requesting a conversion or continuation, then the 

14

 

applicable Committed Loans shall be made or continued as, or converted to, Base Rate Loans. Any such automatic conversion to Base Rate Loans shall be effective as of the last day of the Interest
Period then in effect with respect to the applicable Eurodollar Rate Committed Loans. If the Borrower requests a Committed Borrowing of, conversion to, or continuation of Eurodollar Rate Committed
Loans in any such Committed Loan Notice, but fails to specify an Interest Period, it will be deemed to have specified an Interest Period of one month. 

    (b) Following
receipt of a Committed Loan Notice, the Administrative Agent shall promptly notify each Lender of its Pro Rata Share of the applicable Committed Loans,
and if no timely notice of a conversion or continuation is provided by the Borrower, the Administrative Agent shall notify each Lender of the details of any automatic conversion to Base Rate Loans
described in the preceding subsection. In the case of a Committed Borrowing, each Lender shall make the amount of its Committed Loan available to the Administrative Agent in immediately available
funds at the Administrative Agent's Office not later than 11:00 a.m., California time, on the Business Day specified in the applicable Committed Loan Notice. Upon satisfaction of the applicable
conditions set forth in Section 4.02 (and, if such Borrowing is the initial Credit Extension,  Section 4.01), the Administrative Agent shall make
all funds so received available to the Borrower in like funds as received by the
Administrative Agent by crediting the account of the Borrower on the books of Bank of America with the amount of such funds; provided that if, on the date of the Committed Borrowing there are L/C
Borrowings outstanding, then the proceeds of such Borrowing shall be applied, first, to the payment in full of any such L/C Borrowings and  second, to the
Borrower as provided above. 

    (c) Except
as otherwise provided herein, a Eurodollar Rate Committed Loan may be continued or converted only on the last day of the Interest Period for such Eurodollar
Rate Committed Loan.
During the existence of a Default, no Loans may be requested as, converted to or continued as Eurodollar Rate Committed Loans without the consent of the Required Lenders. 

    (d) The
Administrative Agent shall promptly notify the Borrower and the Lenders of the interest rate applicable to any Eurodollar Rate Committed Loan upon determination
of such interest rate. The determination of the Eurodollar Rate by the Administrative Agent shall be conclusive in the absence of manifest error. The Administrative Agent shall notify the Borrower and
the Lenders of any change in Bank of America's prime rate used in determining the Base Rate promptly following the public announcement of such change. 

    (e) After
giving effect to all Committed Borrowings, all conversions of Committed Loans from one Type to the other, and all continuations of Committed Loans as the same
Type, there shall not be more than seven Interest Periods in effect with respect to Committed Loans. 

    2.03  Letters of Credit.  

    (a) The Letter of Credit Commitment.

     (i) Subject
to the terms and conditions set forth herein, (A) the L/C Issuer agrees, in reliance upon the agreements of the other Lenders set forth in this
Section 2.03, (1) from time to time on any Business Day during the period from the Closing Date until the Maturity Date, to issue Letters of Credit for the account of the Borrower or
certain Subsidiaries, and to amend or renew Letters of Credit previously issued by it, in accordance with subsection (b) below, and (2) to honor drafts under the Letters of Credit; and (B) the
Lenders severally agree to participate in Letters of Credit issued for the account of the Borrower; provided that the L/C Issuer shall not be obligated
to make any L/C Credit Extension with respect to any Letter of Credit, and no Lender shall be obligated to participate in any Letter of Credit, if as of the date of such L/C Credit Extension,
(x) the Outstanding Amount of all L/C Obligations and all Loans would exceed the Aggregate Commitments, (y) the aggregate Outstanding Amount of the Committed Loans of any Lender,  plus such
Lender's Pro Rata Share of the Outstanding Amount of all L/C Obligations, plus such Lender's
Pro Rata Share of the Outstanding Amount of all Swing Line Loans would exceed 

15

 

such Lender's Commitment, or (z) the Outstanding Amount of the L/C Obligations would exceed the Letter of Credit Sublimit. Within the foregoing limits, and subject to the terms and conditions
hereof, the Borrower's ability to obtain Letters of Credit shall be fully revolving, and accordingly the Borrower may, during the foregoing period, obtain Letters of Credit to replace Letters of
Credit that have expired or that have been drawn upon and reimbursed. 

    (ii) The
L/C Issuer shall be under no obligation to issue any Letter of Credit if: 

    (A) any
order, judgment or decree of any Governmental Authority or arbitrator shall by its terms purport to enjoin or restrain the L/C Issuer from issuing such Letter
of Credit, or any Law applicable to the L/C Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over the L/C Issuer shall
prohibit, or request that the L/C Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon the L/C Issuer with respect to such
Letter of Credit any restriction, reserve or capital requirement (for which the L/C Issuer is not otherwise compensated hereunder) not in effect on the Closing Date, or shall impose upon the L/C
Issuer any unreimbursed loss, cost or expense which was not applicable on the Closing Date and which the L/C Issuer in good faith deems material to it; 

    (B) subject
to Section 2.03(b)(iii), the expiry date of such requested Letter of Credit would occur more than twelve months after the date of issuance or last
renewal, unless the Required Lenders have approved such expiry date; 

    (C) the
expiry date of such requested Letter of Credit would occur after the Maturity Date, unless all the Lenders have approved such expiry date; 

    (D) the
issuance of such Letter of Credit would violate one or more policies of the L/C Issuer; or 

    (E) such
Letter of Credit is not a commercial Letter of Credit, is in an amount less than $100,000, or is denominated in a currency other than Dollars. 

    (iii) The
L/C Issuer shall be under no obligation to amend any Letter of Credit if (A) the L/C Issuer would have no obligation at such time to issue such Letter
of Credit in its amended form under the terms hereof, or (B) the beneficiary of such Letter of Credit does not accept the proposed amendment to such Letter of Credit. 

    (b) Procedures for Issuance and Amendment of Letters of Credit.

     (i) Each
Letter of Credit shall be issued or amended, as the case may be, upon the request of the Borrower delivered to the L/C Issuer in the form of a Letter of Credit
Application, appropriately completed and signed by a Responsible Officer of the Borrower. In the case of a request for an initial issuance of a Letter of Credit, such Letter of Credit Application
shall specify in form and detail satisfactory to the L/C Issuer: (A) the proposed issuance date of the requested Letter of Credit (which shall be a Business Day); (B) the amount thereof;
(C) the expiry date thereof; (D) the name and address of the beneficiary thereof; (E) the documents to be presented by such beneficiary in case of any drawing
thereunder; (F) the full text of any certificate to be presented by such beneficiary in case of any drawing thereunder; and (G) such other matters as the L/C Issuer may require. In the
case of a request for an amendment of any outstanding Letter of Credit, such Letter of Credit Application shall specify in form and detail satisfactory to the L/C Issuer (A) the Letter of
Credit to be amended; (B) the proposed date of amendment thereof (which shall be a Business Day); (C) the nature of the proposed amendment; and (D) such other matters as the L/C
Issuer may require. 

    (ii) Immediately
upon the issuance of each Letter of Credit, each Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the L/C
Issuer a risk 

16

 

participation in such Letter of Credit in an amount equal to the product of such Lender's Pro Rata Share times the amount of such Letter of Credit. On
the first Business Day of each week, or upon request of the Administrative Agent, the L/C Issuer shall provide the Administrative Agent with a list of all outstanding Letters of Credit. 

    (iii) Promptly
after its delivery of any Letter of Credit or any amendment to a Letter of Credit to an advising bank with respect thereto or to the beneficiary thereof,
the L/C Issuer will also deliver to the Borrower and the Administrative Agent a true and complete copy of such Letter of Credit or amendment. 

    (c) Drawings and Reimbursements; Funding of Participations.

     (i) Upon
any drawing under any Letter of Credit, the L/C Issuer shall notify the Borrower thereof at least one Business Day prior to the date of any payment by the L/C
Issuer under such Letter of Credit (each such date, an "Honor Date"). Unless the Borrower has reimbursed the L/C Issuer in an amount equal to the amount of such drawing not later than
10:00 a.m., California time, on each Honor Date, the L/C Issuer shall notify the Administrative Agent not later than 10:30 a.m.,
California time, on such date, of Borrower's failure to reimburse, and the Administrative Agent shall promptly notify each Lender of the Honor Date, the amount of the unreimbursed drawing (the
"Unreimbursed Amount"), and such Lender's Pro Rata Share thereof. In such event, the Borrower shall be deemed to have requested a Committed Borrowing of
Base Rate Loans to be disbursed on the Honor Date in an amount equal to the Unreimbursed Amount, without regard to the minimum and multiples specified in  Section 2.02 for the principal amount of
Base Rate Loans, but subject to the amount of the unutilized portion of the Aggregate Commitments and
the conditions set forth in Section 4.02 (other than the delivery of a Committed Loan Notice). Any notice given by the L/C Issuer or the
Administrative Agent pursuant to this Section 2.03(c)(i) may be given by telephone if immediately confirmed in writing;  provided that the lack of such
an immediate confirmation shall not affect the conclusiveness or binding effect of such notice.
 

    (ii) Each
Lender (including the Lender acting as L/C Issuer) shall upon any notice pursuant to  Section 2.03(c)(i) make funds available to the Administrative Agent for the account of the L/C Issuer at
the Administrative Agent's Office
in an amount equal to its Pro Rata Share of the Unreimbursed Amount not later than 11:30 a.m., California time, on the Business Day specified in such notice by the Administrative Agent,
whereupon, subject to the provisions of Section 2.03(c)(iii), each Lender that so makes funds available shall be deemed to have made a Committed
Base Rate Loan to the Borrower in such amount. The Administrative Agent shall remit the funds so received to the L/C Issuer. 

    (iii) With
respect to any Unreimbursed Amount that is not fully refinanced by a Committed Borrowing of Base Rate Loans, because the conditions set forth in  Section 4.02 cannot be satisfied or for any other
reason, the Borrower shall be deemed to have incurred from the L/C Issuer an L/C Borrowing in
the amount of the Unreimbursed Amount that is not so refinanced, which L/C Borrowing shall be due and payable on demand (together with interest) and shall bear interest at the Default Rate. In such
event, each Lender's payment to the Administrative Agent for the account of the L/C Issuer pursuant to Section 2.03(c)(ii) shall be deemed
payment in respect of its participation in such L/C Borrowing and shall constitute an L/C Advance from such Lender in satisfaction of its participation obligation under this  Section 2.03.

    (iv) Until
each Lender funds its Committed Loan or L/C Advance pursuant to this Section 2.03(c) to
reimburse the L/C Issuer for any amount drawn under any Letter of Credit, interest in respect of such Lender's Pro Rata Share of such amount shall be solely for the account of the L/C Issuer. 

17

 

    (v) Each Lender's obligation to make Committed Loans or L/C Advances to reimburse the L/C Issuer for amounts drawn under Letters of Credit, as contemplated by this  Section 2.03(c)
, shall be absolute and unconditional and shall not be affected by any circumstance, including (A) any set-off,
counterclaim, recoupment, defense or other right which such Lender may have against the L/C Issuer, the Borrower or any other Person for any reason whatsoever; (B) the occurrence or continuance
of a Default, or (C) any other occurrence, event or condition, whether or not similar to any of the foregoing; provided that each Lender's
obligation to make Committed Loans pursuant to this Section 2.03(c) is subject to the conditions set forth in  Section 4.02. Any such
reimbursement shall not relieve or otherwise impair the obligation of the Borrower to reimburse the L/C Issuer for the
amount of any payment made by the L/C Issuer under any Letter of Credit, together with interest as provided herein. 

    (vi) If
any Lender fails to make available to the Administrative Agent for the account of the L/C Issuer any amount required to be paid by such Lender pursuant to the
foregoing provisions of this Section 2.03(c) by the time specified in  Section 2.03(c)(ii), the L/C Issuer shall be entitled to recover from
such Lender (acting through the Administrative Agent), on demand, such
amount with interest thereon for the period from the date such payment is required to the date on which such payment is immediately available to the L/C Issuer at a rate per annum equal to the Federal
Funds Rate from time to time in effect. A certificate of the L/C Issuer submitted to any Lender (through the
Administrative Agent) with respect to any amounts owing under this clause (vi) shall be conclusive absent manifest error. 

    (d) Repayment of Participations.

     (i) At
any time after the L/C Issuer has made a payment under any Letter of Credit and has received from any Lender such Lender's L/C Advance in respect of such payment
in accordance with Section 2.03(c), if the Administrative Agent receives for the account of the L/C Issuer any payment related to such Letter of
Credit (whether directly from the Borrower or otherwise, including proceeds of Cash Collateral applied thereto by the Administrative Agent), or any payment of interest thereon, the Administrative
Agent will distribute to such Lender its Pro Rata Share thereof in the same funds as those received by the Administrative Agent. 

    (ii) If
any payment received by the Administrative Agent for the account of the L/C Issuer pursuant to  Section 2.03(c)(i) is required to be returned, each Lender shall pay to the Administrative Agent
for the account of the L/C Issuer its Pro
Rata Share thereof on demand of the Administrative Agent, plus interest thereon from the date of such demand to the date such amount is returned by such Lender, at a rate per annum equal to the
Federal Funds Rate from time to time in effect. 

    (e) Obligations Absolute. The obligation of the Borrower to reimburse the L/C Issuer for each drawing under each Letter
of Credit, and to repay each L/C Borrowing and each drawing under a Letter of Credit that is refinanced by a Borrowing of Committed Loans, shall be absolute, unconditional and irrevocable, and shall
be paid strictly in accordance with the terms of this Agreement under all circumstances, including the following: 

     (i) any
lack of validity or enforceability of such Letter of Credit, this Agreement, or any other agreement or instrument relating thereto; 

    (ii) the
existence of any claim, counterclaim, set-off, defense or other right that the Borrower may have at any time against any beneficiary or any
transferee of such Letter of Credit (or any Person for whom any such beneficiary or any such transferee may be acting), the L/C Issuer or any other Person, whether in connection with this Agreement,
the transactions contemplated hereby or by such Letter of Credit or any agreement or instrument relating thereto, or any unrelated transaction; 

18

 

    (iii) any draft, demand, certificate or other document presented under such Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect
(other than any insufficiencies manifest on its face) or any statement therein being untrue or inaccurate in any respect; or any loss or delay in the transmission or otherwise of any document required
in order to make a drawing under such Letter of Credit; 

    (iv) any
payment by the L/C Issuer under such Letter of Credit against presentation of a draft or certificate that does not strictly comply with the terms of such
Letter of Credit; or any payment made by the L/C Issuer under such Letter of Credit to any Person purporting to be a trustee in bankruptcy, debtor-in-possession, assignee for
the benefit of creditors, liquidator, receiver or other representative of or successor to any beneficiary or any transferee of such Letter of Credit, including any arising in connection with any
proceeding under any Debtor Relief Law; or 

    (v) any
other circumstance or happening whatsoever, whether or not similar to any of the foregoing, including any other circumstance that might otherwise constitute a
defense available to, or a discharge of, the Borrower. 

    The
Borrower shall promptly examine a copy of each Letter of Credit and each amendment thereto that is delivered to it and, in the event of any claim of noncompliance with the
Borrower's instructions or other irregularity, the Borrower will promptly notify the L/C Issuer. The Borrower shall be conclusively deemed to have waived any such claim against the L/C Issuer and its
correspondents unless such notice is given as aforesaid. 

    (f)  Role of L/C Issuer. Each Lender and the Borrower agree that, in paying any drawing under a Letter of Credit, the
L/C Issuer shall not have any responsibility to obtain any document (other than any sight draft, certificates and documents expressly required by the Letter of Credit) or to ascertain or inquire as to
the validity or accuracy of any such document or the authority of the Person executing or delivering any such document. No Agent-Related Person nor any of the respective correspondents, participants
or assignees of the L/C Issuer shall be liable to any Lender for (i) any action taken or omitted in connection herewith at the request or with the approval of the Lenders or the Required
Lenders, as applicable; (ii) any action taken or omitted in the absence of gross negligence or willful misconduct; or (iii) the due execution, effectiveness, validity or enforceability
of any document or instrument related to any Letter of Credit or Letter of Credit Application. The Borrower hereby assumes all risks of the acts or omissions of any beneficiary or transferee with
respect to its use of any Letter of Credit; provided that this assumption is not intended to, and shall not, preclude the Borrower's pursuing such
rights and remedies as it may have against the beneficiary or transferee at law or under any other agreement. No Agent-Related Person, nor any of the respective correspondents, participants or
assignees of the L/C Issuer, shall be liable or responsible for any of the matters described in clauses (i) through (v) of  Section 2.03(e); provided that anything in such clauses to the contrary notwithstanding, the
Borrower may have a claim against the L/C Issuer, and the L/C Issuer may be liable to the Borrower, to the extent, but only to the extent, of any direct, as opposed to consequential or exemplary,
damages suffered by the Borrower which the Borrower proves were caused by the L/C Issuer's willful misconduct or gross negligence or the L/C Issuer's willful failure to pay under any Letter of Credit
after the presentation to it by the beneficiary of a sight draft and certificate(s) strictly complying with the terms and conditions of a Letter of Credit. In furtherance and not in limitation of the
foregoing, the L/C Issuer may accept documents that appear on their face to be
in order, without responsibility for further investigation, regardless of any notice or information to the contrary, and the L/C Issuer shall not be responsible for the validity or sufficiency of any
instrument transferring or assigning or purporting to transfer or assign a Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid
or ineffective for any reason. 

19

 
    (g) Cash Collateral. Upon the request of the Administrative Agent, (i) if the L/C Issuer has honored any full or
partial drawing request under any Letter of Credit and such drawing has resulted in an L/C Borrowing, or (ii) if, as of the Maturity Date, any Letter of Credit may for any reason remain
outstanding and partially or wholly undrawn, the Borrower shall immediately Cash Collateralize the then Outstanding Amount of all L/C Obligations (in an amount equal to such Outstanding Amount
determined as of the date of such L/C Borrowing or the Maturity Date, as the case may be). 

    (h) Applicability of UCP. Unless otherwise expressly agreed by the L/C Issuer and the Borrower when a Letter of Credit
is issued (including any such agreement applicable to an Existing Letter of Credit), the rules of the Uniform Customs and Practice for Documentary Credits, as most recently published by the
International Chamber of Commerce (the "ICC") at the time of issuance (including the ICC decision published by the Commission on Banking Technique and
Practice on April 6, 1998 regarding the European single currency (euro)) shall apply to each commercial Letter of Credit. 

    (i)  Documentary and Processing Charges Payable to L/C Issuer. Borrower shall pay directly to L/C Issuer, upon demand,
for its sole account its customary documentary and processing charges in accordance with its standard schedule, as from time to time in effect, for the issuance, renewal, or amendment of a Letter of
Credit or other occurrence relating to a Letter of Credit for which such charges are customarily made. Such fees and charges are nonrefundable. 

    (j)  Conflict with Letter of Credit Application. In the event of any conflict between the terms hereof and the terms of
any Letter of Credit Application, the terms hereof shall control. 

    2.04  Swing Line Loans.  

    (a) The Swing Line. Subject to the terms and conditions set forth herein, the Swing Line Lender agrees to make loans
(each such loan, a "Swing Line Loan") to the Borrower from time to time on any Business Day during the period from the Closing Date to the Maturity Date
in an aggregate amount not to exceed at any time outstanding the amount of the Swing Line Sublimit, notwithstanding the fact that such Swing Line Loans, when aggregated with the Outstanding Amount of
Committed Loans of the Swing Line Lender in its capacity as a Lender of Committed Loans, may exceed the amount of such Lender's Commitment; provided  that after giving effect to any Swing Line Loan,
(i) the aggregate Outstanding Amount of all Loans and L/C Obligations shall not exceed the Aggregate Commitments, and
(ii) the aggregate Outstanding Amount of the Committed Loans of any Lender, plus such Lender's Pro Rata Share of the Outstanding Amount of all
L/C Obligations, plus such Lender's Pro Rata Share of the Outstanding Amount of all Swing Line Loans shall not exceed such Lender's Commitment, and  provided
further, that the Swing Line Lender shall not make any Swing Line Loan to refinance any outstanding Swing Line Loan. Within the foregoing
limits, and subject to the other terms and
conditions hereof, the Borrower may borrow under this Section 2.04, prepay under  Section 2.05, and reborrow under this Section 2.04; provided  that the Swing Line Lender may terminate or suspend the Swing Line at any time in its sole discretion upon two Business Days' notice to the
Borrower. Each Swing Line Loan shall
be a Base Rate Loan. Immediately upon the making of a Swing Line Loan, each Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the Swing Line Lender a risk
participation in such Swing Line Loan in an amount equal to the product of such Lender's Pro Rata Share times the amount of such Swing Line Loan. 

    (b) Borrowing Procedures. Unless the Swing Line Lender has notified the Borrower that the Swing Line has been terminated
or suspended as provided in Section 2.04(a), each Swing Line Borrowing shall be made upon the Borrower's irrevocable notice to the Swing Line
Lender and the Administrative Agent, which may be given by telephone. Each such notice must be received by the Swing Line Lender and the Administrative Agent not later than 12:00 noon, California
time, on the requested borrowing date, and shall specify (i) the amount to be borrowed, which shall be a minimum of $100,000, and (ii) the requested borrowing date, which shall be a
Business Day. Each such telephonic notice must be confirmed promptly by delivery to the Swing Line Lender and the Administrative Agent of a written Swing Line Loan Notice, appropriately completed and
signed by a Responsible Officer of the Borrower. 

20

 

Promptly after receipt by the Swing Line Lender of any telephonic Swing Line Loan Notice, the Swing Line Lender will confirm with the Administrative Agent (by telephone or in writing) that the
Administrative Agent has also received such Swing Line Loan Notice and, if not, the Swing Line Lender will notify the Administrative Agent (by telephone or in writing) of the contents thereof. Unless
the Swing Line Lender has received notice (by telephone or in writing) from the Administrative Agent (including at the request of any Lender) prior to 1:00 p.m., California time, on the date of
the proposed Swing Line Borrowing (A) directing the Swing Line Lender not to make such Swing Line Loan as a result of the limitations set forth in the proviso to the first sentence of  Section 2.04(a), or (B) that one or more of the applicable conditions specified in Article IV  is not then satisfied, then, subject to the terms and conditions hereof, the Swing Line Lender will, not
later than 2:00 p.m., California time, on the borrowing date
specified in such Swing Line Loan Notice, make the amount of its Swing Line Loan available to the Borrower at its office by crediting the account of the Borrower on the books of the Swing Line Lender
in immediately available funds. 

    (c) Refinancing of Swing Line Loans.

     (i) The
Swing Line Lender at any time in its sole and absolute discretion may request, on behalf of the Borrower (which hereby irrevocably requests the Swing Line
Lender to so request on its behalf), that each Lender make a Committed Base Rate Loan in an amount equal to such Lender's Pro Rata Share of the amount of Swing Line Loans then outstanding. Such
request shall be made in accordance with the requirements of Section 2.02, without regard to the minimum and multiples specified therein for the
principal amount of Base Rate Loans, but subject to the unutilized portion of the Aggregate Commitments and the conditions set forth in  Section 4.02. The Swing Line Lender shall furnish the
Borrower with a copy of the applicable Committed Loan Notice submitted in connection with
such request promptly after delivering such notice to the Administrative Agent. Each Lender shall make an
amount equal to its Pro Rata Share of the amount specified in such Committed Loan Notice available to the Administrative Agent in immediately available funds for the account of the Swing Line Lender
at the Administrative Agent's Office not later than 11:00 a.m., California time, on the day specified in such Committed Loan Notice, whereupon, subject to  Section 2.04(c)(ii), each Lender that
so makes funds available shall be deemed to have made a Base Rate Committed Loan to the Borrower in such
amount. The Administrative Agent shall remit the funds so received to the Swing Line Lender. 

    (ii) If
for any reason any Committed Borrowing cannot be requested in accordance with  Section 2.04(c)(i) or any Swing Line Loan cannot be refinanced by such a Committed Borrowing, the Committed Loan
Notice submitted by the
Swing Line Lender shall be deemed to be a request by the Swing Line Lender that each of the Lenders fund its risk participation in the relevant Swing Line Loan and each Lender's payment to the
Administrative Agent for the account of the Swing Line Lender pursuant to Section 2.04(c)(i) shall be deemed payment in respect of such
participation. 

    (iii) If
any Lender fails to make available to the Administrative Agent for the account of the Swing Line Lender any amount required to be paid by such Lender pursuant
to the foregoing provisions of this Section 2.04(c) by the time specified in  Section 2.04(c)(i), the Swing Line Lender shall be entitled to
recover from such Lender (acting through the Administrative Agent), on demand,
such amount with interest thereon for the period from the date such payment is required to the date on which such payment is immediately available to the Swing Line Lender at a rate per annum equal to
the Federal Funds Rate from time to time in effect. A certificate of the Swing Line Lender submitted to any Lender (through the Administrative Agent) with respect to any amounts owing under this
clause (iii) shall be conclusive absent manifest error. 

    (iv) Each
Lender's obligation to make Committed Loans or to purchase and fund risk participations in Swing Line Loans pursuant to this  Section 2.04(c) shall be absolute and unconditional and shall not
be affected by any circumstance, including (A) any
set-off, 

21

 

counterclaim, recoupment, defense or other right which such Lender may have against the Swing Line Lender, the Borrower or any other Person for any reason whatsoever, (B) the occurrence or
continuance of a Default, or (C) any other occurrence, event or condition, whether or not similar to any of the foregoing; provided that each
Lender's obligation to make Committed Loans pursuant to this Section 2.04(c) is subject to the conditions set forth in  Section 4.02. Any
such purchase of participations shall not relieve or otherwise impair the obligation of the Borrower to repay Swing Line Loans,
together with interest as provided herein. 

    (d) Repayment of Participations.

     (i) At
any time after any Lender has purchased and funded a participation in a Swing Line Loan, if the Swing Line Lender receives any payment on account of such Swing
Line Loan, the Swing Line Lender will distribute to such Lender its Pro Rata Share of such payment (appropriately adjusted, in the case of interest payments, to reflect the period of time during which
such Lender's participation was outstanding and funded) in the same funds as those received by the Swing Line Lender. 

    (ii) If
any payment received by the Swing Line Lender in respect of principal or interest on any Swing Line Loan is required to be returned by the Swing Line Lender,
each Lender shall pay to the Swing Line Lender its Pro Rata Share thereof on demand of the Administrative Agent, plus interest thereon from the date of such demand to the date such amount is returned,
at a rate per annum equal to the Federal Funds Rate. The Administrative Agent will make such demand upon the request of the Swing Line Lender. 

    (e) Interest for Account of Swing Line Lender. The Swing Line Lender shall be responsible for invoicing the Borrower for
interest on the Swing Line Loans. Until each Lender funds its Committed Base Rate Loan or participation pursuant to this Section 2.04 to
refinance such Lender's Pro Rata Share of any Swing Line Loan, interest in respect of such Pro Rata Share shall be solely for the account of the Swing Line Lender. 

    (f)  Payments Directly to Swing Line Lender. The Borrower shall make all payments of principal and interest in respect
of the Swing Line Loans directly to the Swing Line Lender. 

    2.05  Prepayments.  

    (a) The
Borrower may, upon notice to the Administrative Agent, at any time or from time to time voluntarily prepay Committed Loans in whole or in part without premium
or penalty; provided that (i) such notice must be received by the Administrative Agent not later than 10:00 a.m., California time,
(A) three Business Days prior to any date of prepayment of Eurodollar Rate Committed Loans, and (B) on the date of prepayment of Base Rate Committed Loans; (ii) any prepayment of
Eurodollar Rate Committed Loans shall be in a principal amount of $5,000,000 or a whole multiple of $1,000,000 in excess thereof; and (iii) any prepayment of Base Rate Committed Loans shall be
in a principal amount of $500,000 or a whole multiple of $100,000 in excess thereof. Each such notice shall specify the date and amount of such prepayment and the Type(s) of Committed Loans to be
prepaid. The Administrative Agent will promptly notify each Lender of its receipt of each such notice, and of such Lender's Pro Rata Share of such prepayment. If such notice is given by the Borrower,
the Borrower shall make such prepayment and the payment amount specified in such notice shall be due and payable on the date specified therein. Any prepayment of a Eurodollar Rate Loan shall be
accompanied by all accrued interest thereon, together with any additional amounts required pursuant to Section 3.05. Each such prepayment shall
be applied to the Committed Loans of the Lenders in accordance with their respective Pro Rata Shares. 

    (b) The
Borrower may, upon notice to the Swing Line Lender (with a copy to the Administrative Agent), at any time or from time to time, voluntarily prepay Swing Line
Loans in whole or in part
without premium or penalty; provided that (i) such notice must be received by the Swing Line Lender and the Administrative Agent not later than
11:00 a.m., California time, on the date of the prepayment, 

22

 

and (ii) any such prepayment shall be in a minimum principal amount of $100,000. Each such notice shall specify the date and amount of such prepayment. If such notice is given by the Borrower,
the Borrower shall make such prepayment and the payment amount specified in such notice shall be due and payable on the date specified therein. 

    (c) If
for any reason the Outstanding Amount of all Loans and L/C Obligations at any time exceeds the Aggregate Commitments then in effect, the Borrower shall
immediately prepay Loans and/or Cash Collateralize the L/C Obligations in an aggregate amount equal to such excess. 

    2.06  Reduction or Termination of Commitments.  The Borrower may, upon notice to the Administrative
Agent, terminate the Aggregate Commitments, or permanently reduce the Aggregate Commitments to an amount not less than the then Outstanding Amount of all Loans and L/C Obligations;  provided that
(i) any such notice shall be received by the Administrative Agent not later than 10:00 a.m., California time, five Business
Days prior to the date of termination or reduction, and (ii) any such partial reduction shall be in an aggregate amount of $10,000,000 or any whole multiple of $1,000,000 in excess thereof. The
Administrative Agent shall promptly notify the Lenders of any such notice of reduction or termination of the Aggregate Commitments. Once reduced in accordance with this Section, the Aggregate
Commitments may not be increased. Any reduction of the Aggregate Commitments shall be applied to the Commitment of each Lender according to its Pro Rata Share. All fees accrued until the effective
date of any termination of the Aggregate Commitments shall be paid on the effective date of such termination. 

    2.07  Repayment of Loans.  

    (a) The
Borrower shall repay to the Lenders on the Maturity Date the aggregate principal amount of Committed Loans outstanding on such date. 

    (b) The
Borrower shall repay each Swing Line Loan on the earlier to occur of (i) the date five Business Days after such Loan is made and (ii) the Maturity
Date. 

    2.08  Interest.  

    (a) Subject
to the provisions of subsection (b) below, (i) each Eurodollar Rate Committed Loan shall bear interest on the outstanding principal amount
thereof for each Interest Period at a rate per annum
equal to the Eurodollar Rate for such Interest Period plus the Applicable Rate; (ii) each Base Rate Committed Loan shall bear interest on the
outstanding principal amount thereof from the applicable borrowing date at a rate per annum equal to the Base Rate plus the Applicable Rate; and
(iii) each Swing Line Loan shall bear interest on the outstanding principal amount thereof from the applicable borrowing date at a rate per annum equal to the Base Rate  plus the Applicable Rate.

    (b) If
any amount payable by the Borrower under any Loan Document is not paid when due (without regard to any applicable grace periods), such amount shall thereafter
bear interest at a fluctuating interest rate per annum at all times equal to the Default Rate to the fullest extent permitted by applicable Law. Accrued and unpaid interest on past due amounts
(including interest on past due interest) shall be due and payable upon demand. 

    (c) Interest
on each Loan shall be due and payable in arrears on each Interest Payment Date applicable thereto and at such other times as may be specified herein.
Interest hereunder shall be due and payable in accordance with the terms hereof before and after judgment, and before and after the commencement of any proceeding under any Debtor Relief Law. 

    2.09  Fees.  In addition to certain fees described in subsection (i) of Section 2.03: 

    (a) Commitment Fee. The Borrower shall pay to the Administrative Agent for the account of each Lender in accordance with
its Pro Rata Share, a commitment fee equal to the Applicable Rate times the actual daily amount by which the Aggregate Commitments exceed the
Outstanding Amount of Committed Loans. The commitment fee shall accrue at all times from the Closing Date until the Maturity Date and shall be due and payable quarterly in arrears on the last Business
Day of each 

23

 

March, June, September and December, commencing with the first such date to occur after the Closing Date, and on the Maturity Date. The commitment fee shall be calculated quarterly in arrears, and if
there is any change in the Applicable Rate during any quarter, the actual daily amount shall be computed and multiplied by the Applicable Rate separately for each period during such quarter that such
Applicable Rate was in effect. The commitment fee shall accrue at all times, including at any time during which one or more of the conditions in Article IV  is not met. 

    (b) Arrangement and Agency Fees. The Borrower shall pay an arrangement fee to the Arranger for the Arranger's own
account, and shall pay an agency fee to the Administrative Agent for the Administrative Agent's own account, in the amounts and at the times specified in the letter agreement, dated August 28,
2001 (the "Fee Letter"), between the Borrower, the Arranger and the Administrative Agent. Such fees shall be fully earned when paid and shall be
nonrefundable for any reason whatsoever. 

    (c) Lenders' Upfront Fee. On the Closing Date, the Borrower shall pay to the Administrative Agent, for the account of
the Lenders in accordance with their respective Pro Rata Shares, an upfront fee in an amount set forth in the Fee Letter. Such upfront fees are for the credit facilities committed by the Lenders under
this Agreement and are fully earned on the date paid. The upfront fee paid to each Lender is solely for its own account and is nonrefundable for any reason whatsoever. 

    2.10  Computation of Interest and Fees.  Interest on Base Rate Loans shall be calculated on the basis of
a year of 365 or 366 days, as the case may be, and the actual number of days elapsed. Computation of all other types of interest and all fees shall be calculated on the basis of a year of
360 days and the actual number of days elapsed, which results in a higher yield to the payee thereof than a method based on a year of 365 or 366 days. Interest shall accrue on each Loan
for the day on which the Loan is made, and shall not accrue on a Loan, or any portion thereof, for the day on which the Loan or such portion is paid, provided  that any Loan that is repaid on the same
day on which it is made shall bear interest for one day. 

    2.11  Evidence of Debt.  

    (a) The
Credit Extensions made by each Lender shall be evidenced by one or more accounts or records maintained by such Lender and by the Administrative Agent in the
ordinary course of business. The accounts or records maintained by the Administrative Agent and each Lender shall be conclusive absent manifest error of the amount of the Credit Extensions made by the
Lenders to the Borrower and the interest and payments thereon. Any failure to so record or any error in doing so shall not, however, limit or otherwise affect the obligation of the Borrower hereunder
to pay any amount owing with respect to the Loans or L/C Obligations. In the event of any conflict between the accounts and records maintained by any Lender and the accounts and records of the
Administrative Agent in respect of such matters, the accounts and records of the Administrative Agent shall control in the absence of manifest error. Upon the request of any Lender made through the
Administrative Agent, such Lender's Loans may be evidenced by a Committed Loan Note and/or a Swing Line Note, as applicable, in addition to such accounts or records. Each Lender may attach schedules
to its Note(s) and endorse thereon the date, Type (if applicable), amount and maturity of the applicable Loans and payments with respect thereto. 

    (b) In
addition to the accounts and records referred to in subsection (a), each Lender and the Administrative Agent shall maintain in accordance with its usual practice
accounts or records evidencing the purchases and sales by such Lender of participations in Letters of Credit and Swing Line Loans. In the event of any conflict between the accounts and records
maintained by the Administrative Agent and the accounts and records of any Lender in respect of such matters, the accounts and records of the Administrative Agent shall control. 

    2.12  Payments Generally.  

24

 

    (a) All payments to be made by the Borrower shall be made without condition or deduction for any counterclaim, defense, recoupment or setoff. Except as otherwise
expressly provided herein, all payments by the Borrower hereunder shall be made to the Administrative Agent, for the account of the respective Lenders to which such payment is owed, at the
Administrative Agent's Office in Dollars and in immediately available funds not later than 10:00 a.m., California time, on the date specified herein. The Administrative Agent will promptly
distribute to each Lender its Pro Rata Share (or other applicable share as provided herein) of such payment in like funds as received by wire transfer to such Lender's Lending Office. All payments
received by the Administrative Agent after 10:00 a.m., California time, shall be deemed received on the next succeeding Business Day and any applicable interest or fee shall continue to accrue. 

    (b) Subject
to the definition of "Interest Period," if any payment to be made by the Borrower shall come due on a day other than a Business Day, payment shall be made
on the next following Business Day, and such extension of time shall be reflected in computing interest or fees, as the case may be. 

    (c) If
at any time insufficient funds are received by and available to the Administrative Agent to pay fully all amounts of principal, L/C Borrowings, interest and fees
then due hereunder, such funds shall be applied (i) first, toward costs and expenses (including Attorney Costs and amounts payable under  Article III) incurred by the Administrative Agent and each Lender and payable by the Borrower hereunder,
(ii) second, toward repayment of interest and fees then due hereunder, ratably among the parties entitled thereto in accordance with the amounts
of interest and fees then due to such parties, and (iii) third, toward repayment of principal and L/C Borrowings then due hereunder, ratably
among the parties entitled thereto in accordance with the amounts of principal and L/C Borrowings then due to such parties. 

    (d) Unless
the Borrower or any Lender has notified the Administrative Agent prior to the date any payment is required to be made by it to the Administrative Agent
hereunder, that the Borrower or such Lender, as the case may be, will not make such payment, the Administrative Agent may assume that the Borrower or such Lender, as the case may be, has timely made
such payment and may (but shall not be so required to), in reliance thereon, make available a corresponding amount to the Person entitled thereto. If and to the extent that such payment was not in
fact made to the Administrative Agent in immediately available funds, then: 

     (i) if
the Borrower failed to make such payment, each Lender shall forthwith on demand repay to the Administrative Agent the portion of such assumed payment that was
made available to such Lender in immediately available funds, together with interest thereon in respect of each day from and including the date such amount was made available by the Administrative
Agent to such Lender to the date such amount is repaid to the Administrative Agent in immediately available funds, at the Federal Funds Rate from time to time in effect; and 

    (ii) if
any Lender failed to make such payment, such Lender shall forthwith on demand pay to the Administrative Agent the amount thereof in immediately available funds,
together with interest thereon for the period from the date such amount was made available by the Administrative Agent to the Borrower to the date such amount is recovered by the Administrative Agent
(the "Compensation Period") at a rate per annum equal to the Federal Funds Rate from time to time in effect. If such Lender pays such amount to the
Administrative Agent, then such amount shall constitute such Lender's Committed Loan, as the case may be, included in the applicable Borrowing. If such Lender does not pay such amount forthwith upon
the Administrative Agent's demand therefor, the Administrative Agent may make a demand therefor upon the Borrower, and the Borrower shall pay such amount to the Administrative Agent, together with
interest thereon for the Compensation Period at a rate per annum equal to the rate of interest applicable to the applicable Borrowing. Nothing herein shall be deemed to relieve any Lender from its
obligation to fulfill its Commitment or to prejudice any rights which the Administrative 

25

 

Agent or the Borrower may have against any Lender as a result of any default by such Lender hereunder. 

    A
notice of the Administrative Agent to any Lender with respect to any amount owing under this subsection (d) shall be conclusive, absent manifest error. 

    (e) If
any Lender makes available to the Administrative Agent funds for any Loan to be made by such Lender as provided in the foregoing provisions of this  Article II, and the conditions to the applicable
Credit Extension set forth in Article IV  are not satisfied or waived in accordance with the terms hereof, the Administrative Agent shall return such funds (in like funds as received from such
Lender) to such Lender,
without interest. 

    (f)  The
obligations of the Lenders hereunder to make Committed Loans and to fund participations in Letters of Credit and Swing Line Loans are several and not joint.
The failure of any Lender to make any Committed Loan or to fund any such participation on any date required hereunder shall not relieve any other Lender of its corresponding obligation to do so on
such date, and no Lender shall be responsible for the failure of any other Lender to so make its Committed Loan or purchase its participation. 

    (g) Nothing
herein shall be deemed to obligate any Lender to obtain the funds for any Loan in any particular place or manner or to constitute a representation by any
Lender that it has obtained or will obtain the funds for any Loan in any particular place or manner. 

    2.13  Sharing of Payments.  If, other than as expressly provided elsewhere herein, any Lender shall
obtain on account of the Committed Loans made by it, or the participations in L/C Obligations or in Swing
Line Loans held by it, any payment (whether voluntary, involuntary, through the exercise of any right of set-off, or otherwise) in excess of its ratable share (or other share contemplated
hereunder) thereof, such Lender shall immediately (a) notify the Administrative Agent of such fact, and (b) purchase from the other Lenders such participations in the Committed Loans
made by them and/or such subparticipations in the participations in L/C Obligations or Swing Line Loans held by them, as the case may be, as shall be necessary to cause such purchasing Lender to share
the excess payment in respect of such Committed Loans or such participations, as the case may be, pro rata with each of them; provided that if all or
any portion of such excess payment is thereafter recovered from the purchasing Lender, such purchase shall to that extent be rescinded and each other Lender shall repay to the purchasing Lender the
purchase price paid therefor, together with an amount equal to such paying Lender's ratable share (according to the proportion of (i) the amount of such paying Lender's required repayment to
(ii) the total amount so recovered from the purchasing Lender) of any interest or other amount paid or payable by the purchasing Lender in respect of the total amount so recovered. The Borrower
agrees that any Lender so purchasing a participation from another Lender may, to the fullest extent permitted by law, exercise all its rights of payment (including the right of set-off,
but subject to Section 10.09 with respect to such participation as fully as if such Lender were the direct creditor of the Borrower in the amount
of such participation. The Administrative Agent will keep records (which shall be conclusive and binding in the absence of manifest error) of participations purchased under this Section and will in
each case notify the Lenders following any such purchases or repayments. Each Lender that purchases a participation pursuant to this Section shall from and after such purchase have the right to give
all notices, requests, demands, directions and other communications under this Agreement with respect to the portion of the Obligations purchased to the same extent as though the purchasing Lender
were the original owner of the Obligations purchased. 

26

  

    2.14  Increase in Commitments.  

    (a) Provided
there exists no Default, upon notice to the Administrative Agent (which shall promptly notify the Lenders), the Borrower may on a one-time
basis within two and one-half years of the Closing Date, request an increase in the Aggregate Commitments up to an aggregate of $200,000,000. Following consultation with the Administrative
Agent, the Borrower shall specify the time period within which each Lender is requested to respond (which shall in no event be less than ten Business Days from the date of delivery of such notice to
the Lenders). Each Lender shall notify the Administrative Agent within such time period whether or not it agrees to increase its Commitment and, if so, whether by an amount equal to, greater than, or
less than its Pro Rata Share of such requested increase. Any Lender not responding within such time period shall be deemed to have declined to increase its Commitment. The Administrative Agent shall
notify the Borrower and each Lender of the Lenders' responses to each request made hereunder. To achieve the full amount of a requested increase, the Borrower may also invite additional Eligible
Assignees to become Lenders pursuant to a joinder agreement in form and substance satisfactory to the Administrative Agent and its counsel. 

    (b) If
the Aggregate Commitments are increased in accordance with this Section, the Administrative Agent and the Borrower shall determine the effective date (the
"Increase Effective Date") and the final allocation of such increase. The Administrative Agent shall promptly notify the Borrower and the Lenders of the
final allocation of such increase and the Increase Effective Date. As a condition precedent to such increase, the Borrower shall deliver to the Administrative Agent a certificate of each Loan Party
dated as of the Increase Effective Date (in sufficient copies for each Lender) signed by a Responsible Officer of such Loan Party (i) certifying and attaching the resolutions adopted by such
Loan Party approving or consenting to such increase, and, (ii) in the case of the Borrower, including a Compliance Certificate demonstrating pro forma compliance with this Agreement after
giving effect to such increase and (iii) certifying that, before and after giving effect to such increase, the representations and warranties contained in  Article V are true and correct on and
as of the Increase Effective Date and no Default exists. The Borrower shall deliver new or amended
Committed Loan Notes reflecting the increased Commitment of any Lender holding or requesting a Note. The Administrative Agent shall distribute an amended  Schedule 2.01 (which shall be deemed
incorporated into this Agreement), to reflect any changes therein resulting from such increase. The Borrower
shall prepay any Committed Loans outstanding on the Increase Effective Date (and pay any additional amounts required pursuant to Section 3.05) to
the extent necessary to keep the outstanding Committed Loans ratable with any revised Pro Rata Shares arising from any nonratable increase in the Commitments under this Section. 

    (c) This
Section shall supersede any provisions in Section 10.01 to the contrary. 

 
 

ARTICLE III.
  TAXES, YIELD PROTECTION AND ILLEGALITY    
  

    3.01  Taxes.  

    (a) Any
and all payments by the Borrower to or for the account of the Administrative Agent or any Lender under any Loan Document shall be made free and clear of and
without deduction for any and all present or future taxes, duties, levies, imposts, deductions, assessments, fees, withholdings or similar charges, and all liabilities with respect thereto,  excluding,
in the case of the Administrative Agent, the Swing Line Lender, and the L/C Issuer, and each Lender, taxes imposed on or measured by its net
income, and franchise taxes imposed on it (in lieu of net income taxes), by the jurisdiction (or any political subdivision thereof) under the Laws of which the Administrative Agent or such Lender, as
the case may be, is organized or maintains a lending office (all such non-excluded taxes, duties, levies, imposts, deductions, assessments, fees, withholdings or similar charges, and
liabilities being hereinafter referred to as "Taxes"). If the Borrower shall be required by any Laws to deduct any Taxes from or in respect of any sum
payable under any Loan Document to the Administrative Agent or any Lender, 

27

 

(i) the sum payable shall be increased as necessary so that after making all required deductions (including deductions applicable to additional sums payable under this Section), the
Administrative Agent and such Lender receives an amount equal to the sum it would have received had no such deductions been made, (ii) the Borrower shall make such deductions, (iii) the
Borrower shall pay the full amount deducted to the relevant taxation authority or other authority in accordance with applicable Laws, and (iv) within 30 days after the date of such
payment, the Borrower shall furnish to the Administrative Agent (which shall forward the same to such Lender) the original or a certified copy of a receipt evidencing payment thereof;  provided that the
Borrower shall not be required to pay any additional amounts with respect to amounts owing to a Lender that (x) is not
incorporated under the laws of the United States of America or a state thereof, and (y) has not delivered to the Administrative Agent the forms required by this Agreement. 

    (b) In
addition, the Borrower agrees to pay any and all present or future stamp, court or documentary taxes and any other excise or property taxes or charges or similar
levies which arise from any payment made under any Loan Document or from the execution, delivery, performance, enforcement or registration of, or otherwise with respect to, any Loan Document
(hereinafter referred to as "Other Taxes"). 

    (c) If
the Borrower shall be required to deduct or pay any Taxes or Other Taxes from or in respect of any sum payable under any Loan Document to the Administrative
Agent or any Lender, the Borrower shall also pay to the Administrative Agent (for the account of such Lender) or to such Lender, at the
time interest is paid, such additional amount that such Lender specifies is necessary to preserve the after-tax yield (after factoring in all taxes, including taxes imposed on or measured
by net income) such Lender would have received if such Taxes or Other Taxes had not been imposed. 

    (d) The
Borrower agrees to indemnify the Administrative Agent and each Lender for (i) the full amount of Taxes and Other Taxes (including any Taxes or Other
Taxes imposed or asserted by any jurisdiction on amounts payable under this Section) paid by the Administrative Agent and such Lender, (ii) amounts payable under  Section 3.01(c) and
(iii) any liability (including penalties, interest and expenses) arising therefrom or with respect thereto, in each
case whether or not such Taxes or Other Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. Payment under this subsection (d) shall be made within
30 days after the date the Lender or the Administrative Agent makes a demand therefor, which notice shall specify in reasonable detail the amounts demanded. 

    (e) If
a Lender or the Administrative Agent receives a refund or credit in respect of any Taxes as to which it has been indemnified by the Borrower or with respect to
which the Borrower has paid additional amounts pursuant to this Section 3.01, it shall, promptly after the date of such receipt, pay over the
amount of such refund or credit to the Borrower, net of all reasonable out-of-pocket expenses of such Lender or Administrative Agent in obtaining such refund (it being agreed
that if such expenses are expected by such Lender or Administrative Agent to be material, such Lender or Administrative Agent will attempt in good faith to consult with the Borrower prior to incurring
such expenses); provided that the Borrower, upon the written request of such Lender or Administrative Agent, agrees to repay to such Lender or Administrative Agent the amount paid over to the Borrower
in the event that such Lender or the Administrative Agent is required to repay such refund or credit to such taxation authority. 

    (f)  Each
Lender agrees to designate a different Lending Office if such designation will avoid the need for notice under this  Section 3.01 and will not, in the good faith judgment of such Lender, otherwise
be materially disadvantageous to such Lender. 

    3.02  Illegality.  If any Lender determines that any Law has made it unlawful, or that any Governmental
Authority has asserted that it is unlawful, for any Lender or its applicable Lending Office to make, maintain or fund Eurodollar Rate Loans, or to determine or charge interest rates based upon the
Eurodollar Rate, then, on notice thereof by such Lender to the Borrower through the 

28

 

Administrative Agent, any obligation of such Lender to make or continue Eurodollar Rate Loans or to convert Base Rate Committed Loans to Eurodollar Rate Committed Loans shall be suspended until such
Lender notifies the Administrative Agent and the Borrower that the circumstances giving rise to such determination no longer exist. Upon receipt of such notice, the Borrower shall, upon demand from
such Lender (with a copy to the Administrative Agent), prepay or, if applicable, convert all Eurodollar Rate Loans of such Lender to Base Rate Loans, either on the last day of the Interest Period
thereof, if such Lender may lawfully continue to maintain such Eurodollar Rate Loans to such
day, or immediately, if such Lender may not lawfully continue to maintain such Eurodollar Rate Loans. Upon any such prepayment or conversion, the Borrower shall also pay accrued interest on the amount
so prepaid or converted. Each Lender agrees to designate a different Lending Office if such designation will avoid the need for such notice and will not, in the good faith judgment of such Lender,
otherwise be materially disadvantageous to such Lender. 

    3.03  Inability to Determine Rates.  If the Administrative Agent determines in connection with any
request for a Eurodollar Rate Loan or a conversion to or continuation thereof that (a) Dollar deposits are not being offered to banks in the London interbank eurodollar market for the
applicable amount and Interest Period of such Eurodollar Rate Loan, (b) adequate and reasonable means do not exist for determining the Eurodollar Rate for such Eurodollar Rate Loan, or
(c) the Eurodollar Rate for such Eurodollar Rate Loan does not adequately and fairly reflect the cost to the Lenders of funding such Eurodollar Rate Loan, the Administrative Agent will promptly
notify the Borrower and all Lenders. Thereafter, the obligation of the Lenders to make or maintain Eurodollar Rate Loans shall be suspended until the Administrative Agent revokes such notice. Upon
receipt of such notice, the Borrower may revoke any pending request for a Borrowing, conversion or continuation of Eurodollar Rate Committed Loans or, failing that, will be deemed to have converted
such request into a request for a Committed Borrowing of Base Rate Loans in the amount specified therein. 

    3.04  Increased Cost and Reduced Return; Capital Adequacy; Reserves on Eurodollar Rate Loans.  

    (a) If
any Lender determines that as a result of the introduction of or any change in or in the interpretation of any Law, or such Lender's compliance therewith, there
shall be any increase in the cost to such Lender of agreeing to make or making, funding or maintaining Eurodollar Rate Loans or (as the case may be) issuing or participating in Letters of Credit, or a
reduction in the amount received or receivable by such Lender in connection with any of the foregoing (excluding for purposes of this subsection (a) any such increased costs or reduction in
amount resulting from (i) Taxes or Other Taxes (as to which Section 3.01 shall govern), (ii) changes in the basis of taxation of
overall net income or overall gross income by the United States or any foreign jurisdiction or any political subdivision of either thereof under the Laws of which such Lender is organized or has its
Lending Office, and (iii) reserve requirements contemplated by Section 3.04(c)), then from time to time upon demand of such Lender (with a
copy of such demand to the Administrative Agent), the Borrower shall pay to such Lender such additional amounts as will compensate such Lender for such increased cost or reduction. 

    (b) If
any Lender determines that the introduction of any Law regarding capital adequacy or any change therein or in the interpretation thereof, or compliance by such
Lender (or its Lending Office) therewith, has the effect of reducing the rate of return on the capital of such Lender or any corporation controlling such Lender as a consequence of such Lender's
obligations hereunder (taking into consideration its policies with respect to capital adequacy and such Lender's desired return on capital), then from time to time upon demand of such Lender (with a
copy of such demand to the Administrative Agent), the Borrower shall pay to such Lender such additional amounts as will compensate such Lender for such reduction. 

    (c) The
Borrower shall pay to each Lender, as long as such Lender shall be required to maintain reserves with respect to liabilities or assets consisting of or
including Eurocurrency funds or deposits
(currently known as "Eurocurrency liabilities"), additional interest on the unpaid principal amount of each Eurodollar Rate Loan equal to the actual costs of such reserves allocated to such Loan by
such 

29

 

Lender (as determined by such Lender in good faith, which determination shall be conclusive), which shall be due and payable on each date on which interest is payable on such Loan,  provided the Borrower
shall have received at least 15 days' prior notice (with a copy to the Administrative Agent) of such additional interest
from such Lender. If a Lender fails to give notice 15 days prior to the relevant Interest Payment Date, such additional interest shall be due and payable 15 days from receipt of such
notice; provided that the Borrower shall not be liable to any Lender or the Administrative Agent under this Section 3.04 for costs incurred more
than 180 days prior to the receipt by the Borrower of such demand for payment from such Lender or, as the case may be, the Administrative Agent, unless such costs were incurred prior to such
180-day period solely as a result of such change in present or future applicable law being retroactive to a date prior to such 180-day period. 

    (d) Each
Lender agrees to designate a different Lending Office if such designation will avoid the need for notice under this  Section 3.04 and will not, in the good faith judgment of such Lender, otherwise
be materially disadvantageous to such Lender. 

    3.05  Funding Losses.  Upon demand of any Lender (with a copy to the Administrative Agent) from time to
time, the Borrower shall promptly compensate such Lender for and hold such Lender harmless from any loss, cost or expense incurred by it as a result of: 

    (a) any
continuation, conversion, payment or prepayment of any Loan other than a Base Rate Loan on a day other than the last day of the Interest Period for such Loan
(whether voluntary, mandatory, automatic, by reason of acceleration, or otherwise); 

    (b) any
failure by the Borrower (for a reason other than the failure of such Lender to make a Loan) to prepay, borrow, continue or convert any Loan other than a Base
Rate Loan on the date or in the amount notified by the Borrower; or 

    (c) any
assignment of a Eurodollar Rate Loan on a day other than the last day of the Interest Period therefor as a result of a request by the Borrower pursuant to  Section 10.16; 

including
any loss or expense arising from the liquidation or reemployment of funds obtained by it to maintain such Loan or from fees payable to terminate the deposits from which such funds were
obtained. The Borrower shall also pay any customary administrative fees charged by such Lender in connection with the foregoing. 

    For
purposes of calculating amounts payable by the Borrower to the Lenders under this Section 3.05, each Lender shall be deemed
to have funded each Eurodollar Rate Committed Loan made by it at the Eurodollar Rate for such Loan by a matching deposit or other borrowing in the London interbank eurodollar market for a comparable
amount and for a comparable period, whether or not such Eurodollar Rate Committed Loan was in fact so funded. 

    3.06  Matters Applicable to all Requests for Compensation.  

    (a) A
certificate of the Administrative Agent or any Lender claiming compensation under this Article III and
setting forth the additional amount or amounts to be paid to it hereunder shall be conclusive in the absence of manifest error. In determining such amount, the Administrative Agent or such Lender may
use any reasonable averaging and attribution methods. 

    (b) Upon
any Lender's making a claim for compensation under Section 3.01 or  3.04, the Borrower may remove or replace such Lender in accordance with
Section 10.16. 

    3.07  Survival.  All of the Borrower's obligations under this  Article III shall survive termination of the
Aggregate Commitments and repayment of all other Obligations. 

30

 
 
 

ARTICLE IV.
  CONDITIONS PRECEDENT TO CREDIT EXTENSIONS    
  

    4.01  Conditions of Initial Credit Extension.  The obligation of each Lender to make its initial Credit
Extension hereunder is subject to satisfaction of the following conditions precedent: 

    (a) Unless
waived by all the Lenders (or by the Administrative Agent with respect to immaterial matters or items specified in clause (v) or (vi) below
with respect to which the Borrower has given assurances satisfactory to the Administrative Agent that such items shall be delivered promptly following the Closing Date), the Administrative Agent's
receipt of the following, each of which shall be originals or facsimiles (followed promptly by originals) unless otherwise specified, each properly executed by a Responsible Officer of the signing
Loan Party, each dated the Closing Date (or, in the case of
certificates of governmental officials, a recent date before the Closing Date) and each in form and substance satisfactory to the Administrative Agent and its legal counsel: 

     (i) executed
counterparts of this Agreement and, if there are Material Subsidiaries on the Closing Date, the Guaranty, sufficient in number for distribution to the
Administrative Agent, each Lender and the Borrower; 

    (ii) Committed
Loan Notes executed by the Borrower in favor of each Lender requesting such a Note, each in a principal amount equal to such Lender's Commitment; 

    (iii) a
Swing Line Note executed by the Borrower in favor of the Swing Line Lender (if it requests such a Note) in the principal amount of the Swing Line Sublimit; 

    (iv) such
certificates of resolutions or other action, incumbency certificates and/or other certificates of Responsible Officers of each Loan Party as the
Administrative Agent may require to establish the identities of and verify the authority and capacity of each Responsible Officer thereof authorized to act as a Responsible Officer in connection with
this Agreement and the other Loan Documents to which such Loan Party is a party; 

    (v) such
evidence as the Administrative Agent may reasonably require to verify that each Loan Party is duly organized or formed, validly existing, in good standing and
qualified to engage in business in each jurisdiction in which it is required to be qualified to engage in business, including certified copies of each Loan Party's Organization Documents, certificates
of good standing and/or qualification to engage in business and tax clearance certificates; 

    (vi) a
certificate signed by a Responsible Officer of the Borrower certifying (A) that the conditions specified in Sections
4.02(a) and (b) have been satisfied, and (B) that there has been no event or circumstance since the date of the
Audited Financial Statements which has or could be reasonably expected to have a Material Adverse Effect; 

   (vii) an
opinion of counsel to each Loan Party in form and substance satisfactory to the Administrative Agent; and 

   (viii) evidence
that all Loans, interest, fees and other accrued amounts under the Existing Credit Agreement have been or concurrently with the Closing Date are paid in
full; and 

    (ix) such
other assurances, certificates, documents, consents or opinions as the Administrative Agent, the L/C Issuer, the Swing Line Lender or the Required Lenders
reasonably may require. 

    (b) Any
fees required to be paid on or before the Closing Date shall have been paid. 

31

  

    (c) Unless
waived by the Administrative Agent, the Borrower shall have paid all Attorney Costs of the Administrative Agent payable under  Section 10.04 to the extent invoiced prior to or on the Closing Date,
plus such additional amounts of Attorney Costs as shall constitute its
reasonable estimate of Attorney Costs incurred or to be incurred by it through the closing proceedings (provided that such estimate shall not thereafter preclude a final settling of accounts between
the Borrower and the Administrative Agent). 

    4.02  Conditions to all Credit Extensions and Conversions and Continuations.  The obligation of each
Lender to honor any Request for Credit Extension is subject to the following conditions precedent: 

    (a) The
representations and warranties of the Borrower contained in Article V, or which are contained in any
document furnished at any time under or in connection herewith, shall be true and correct on and as of the date of such Credit Extension, conversion or continuation, except to the extent that such
representations and warranties specifically refer to an earlier date, in which case they shall be true and correct as of such earlier date. 

    (b) No
Default shall exist, or would result from such proposed Credit Extension, conversion or continuation. 

    (c) The
Administrative Agent and, if applicable, the L/C Issuer or the Swing Line Lender shall have received a Request for Credit Extension in accordance with the
requirements hereof. 

    (d) The
Administrative Agent shall have received, in form and substance satisfactory to it, such other assurances, certificates, documents or consents related to the
foregoing as the Administrative Agent or the Required Lenders reasonably may require. 

    Each
Request for Credit Extension submitted by the Borrower shall be deemed to be a representation and warranty that the conditions specified in Sections
4.02(a) and (b) have been satisfied on and as of the date of the applicable Credit Extension. 

 
 

ARTICLE V.
  REPRESENTATIONS AND WARRANTIES    
  

    The Borrower represents and warrants to the Administrative Agent and the Lenders that: 

    5.01  Existence, Qualification and Power; Compliance with Laws.  Each Loan Party and the Parent
(a) is a corporation, partnership or limited liability company duly organized or formed, validly existing and in good standing under the Laws of the jurisdiction of its incorporation or
organization, (b) has all requisite power and authority and all governmental licenses, authorizations, consents and approvals to own its assets, carry on its business and to execute, deliver,
and perform its obligations under the Loan Documents to which it is a party, (c) is duly qualified and is licensed and in good standing under the Laws of each jurisdiction where its ownership,
lease or operation of properties or the conduct of its business requires such qualification or license, and (d) is in compliance with all Laws, except in each case referred to in
clause (c) or this clause (d), to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect. 

    5.02  Authorization; No Contravention.  The execution, delivery and performance by each Loan Party of
each Loan Document to which such Person is party, have been duly authorized by all necessary corporate or other organizational action, and do not and will not (a) contravene the terms of any of
such Person's Organization Documents; (b) conflict with or result in any breach or contravention of, or the creation of any Lien under, any Contractual Obligation to which such Person is a
party or any order, injunction, writ or decree of any Governmental Authority to which such Person or its property is subject; or (c) violate any Law. 

32

 

    5.03  Governmental Authorization.  No approval, consent, exemption, authorization, or other action by, or
notice to, or filing with, any Governmental Authority is necessary or required in connection with the execution, delivery or performance by, or enforcement against, any Loan Party of this Agreement or
any other Loan Document. 

    5.04  Binding Effect.  This Agreement has been, and each other Loan Document, when delivered hereunder,
will have been, duly executed and delivered by each Loan Party that is party thereto. This Agreement constitutes, and each other Loan Document when so delivered will constitute, a legal, valid and
binding obligation of such Loan Party, enforceable against each Loan Party that is party thereto in accordance with its terms. 

    5.05  Financial Statements; No Material Adverse Effect.  

    (a) The
Audited Financial Statements (i) were prepared in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise
expressly noted therein; (ii) fairly present the financial condition of the Parent and its Subsidiaries as of the date thereof and their results of operations for the period covered thereby in
accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein; and (iii) show all material indebtedness and other liabilities,
direct or contingent, of the Parent and its consolidated Subsidiaries as of the date thereof, including liabilities for taxes, material commitments and Indebtedness. 

    (b) The
unaudited consolidated financial statements of the Parent and its Subsidiaries for the fiscal quarter ended July 26, 2001, and the related consolidated
statements of income or operations, shareholders' equity and cash flows for the fiscal quarter ended on that date (i) were prepared in accordance with GAAP consistently applied throughout the
period covered thereby, except as otherwise expressly noted therein, and subject to ordinary, good faith year end audit adjustments; (ii) fairly present the financial condition of the Parent
and its Subsidiaries as of the date thereof and their results of operations for the period covered thereby; and (iii) show all material indebtedness and other liabilities, direct or contingent,
of the Parent and its consolidated Subsidiaries as of the date thereof, including liabilities for taxes, material commitments and Indebtedness. 

    (c) Since
the date of the Audited Financial Statements, there has been no event or circumstance that has had or could reasonably be expected to have a Material Adverse
Effect. 

    5.06  Litigation.  Except as set forth in the Parent's Form 10-K for the fiscal year
ended January 25, 2001, and on file with the Securities and Exchange Commission, there are no actions, suits, proceedings, claims or disputes pending or, to the knowledge of the Borrower,
threatened or contemplated, at law, in equity, in arbitration or before any Governmental Authority, by or against the Borrower or any of its Subsidiaries or against any of their properties or revenues
that (a) purport to affect or pertain to this Agreement or any other Loan Document, or any of the transactions contemplated hereby, or (b) could reasonably be expected to have a Material
Adverse Effect. 

    5.07  No Default.  Neither the Borrower nor any Subsidiary is in default under or with respect to any
Contractual Obligation that could be reasonably expected to have a Material Adverse Effect. No Default has occurred and is continuing or would result from the consummation of the transactions
contemplated by this Agreement or any other Loan Document. 

    5.08  Ownership of Property; Liens.  Each of the Borrower and its Subsidiaries has good record and
marketable title in fee simple to, or valid leasehold interests in, all real property necessary or used in the ordinary conduct of its business, except for such defects in title as could not,
individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. As of the Closing Date, the property of the Borrower and its Subsidiaries is subject to no Liens, other than
Liens permitted by Section 7.01. 

    5.09  Environmental Compliance.  The Borrower and its Subsidiaries conduct in the ordinary course of
business a review of the effect of existing Environmental Laws and claims alleging potential 

33

 

liability or responsibility for violation of any Environmental Law on their respective businesses, operations and properties, and as a result thereof the Borrower has reasonably concluded that such
Environmental Laws and claims could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. 

    5.10  Insurance.  The properties of the Borrower and its Subsidiaries are insured with financially sound
and reputable insurance companies not Affiliates of the Borrower, in such amounts, with such deductibles and covering such risks as are customarily carried by companies engaged in similar businesses
and owning similar properties in localities where the Borrower or its Subsidiaries operate. 

    5.11  Taxes.  The Borrower and its Subsidiaries have filed all Federal, state and other material tax
returns and reports required to be filed, and have paid all Federal, state and other material taxes, assessments, fees and other governmental charges levied or imposed upon them or their properties,
income or assets otherwise due and payable, except those which are being contested in good faith by appropriate proceedings and for which adequate reserves have been provided in accordance with GAAP.
There is no proposed tax assessment against the Borrower or any Subsidiary that, if made, could reasonably be expected to have a Material Adverse Effect. 

    5.12  ERISA Compliance.  

    (a) Each
Plan is in compliance in all material respects with the applicable provisions of ERISA, the Code and other Federal or state Laws. Each Plan that is intended to
qualify under Section 401(a) of the Code has received a favorable determination letter from the IRS or an application for such a letter is currently being processed by the IRS with respect
thereto and, to the best knowledge of the Borrower, nothing has occurred which would prevent, or cause the loss of, such qualification. The Borrower and each ERISA Affiliate have made all required
contributions to each Plan subject to Section 412 of the Code, and no application for a funding waiver or an extension of any amortization period pursuant to Section 412 of the Code has
been made with respect to any Plan. 

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

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

    5.13  Subsidiaries.  As of the Closing Date, the Borrower has no Subsidiaries other than those
specifically disclosed in Part (a) of Schedule 5.13 and, except for de minimus shares held in publicly held companies, has no equity
investments in any other corporation or entity other than those specifically disclosed in Part(b) of Schedule 5.13. 

    5.14  Margin Regulations; Investment Company Act; Public Utility Holding Company Act.  

    (a) The
Borrower is not engaged and will not engage, principally or as one of its important activities, in the business of purchasing or carrying margin stock (within
the meaning of Regulation U issued by the FRB), or extending credit for the purpose of purchasing or carrying margin stock. 

34

 

    (b) None of the Borrower, any Person controlling the Borrower, or any Subsidiary (i) is a "holding company," or a "subsidiary company" of a "holding company," or
an "affiliate" of a "holding company" or of a "subsidiary company" of a "holding company," within the meaning of the Public Utility Holding Company Act of 1935, or (ii) is or is required to be
registered as an "investment company" under the Investment Company Act of 1940. 

    5.15  Disclosure.  No statement, information, report, representation, or warranty made by any Loan Party
in any Loan Document or furnished to the Administrative Agent or any Lender by or on behalf of any Loan Party in connection with any Loan Document contains any untrue statement of a material fact or
omits any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. 

 
 

ARTICLE VI.
  AFFIRMATIVE COVENANTS    
  

    So long as any Lender shall have any Commitment hereunder, any Loan or other Obligation shall remain unpaid or unsatisfied, or any Letter of Credit shall
remain outstanding, the Borrower shall, and shall (except in the case of the covenants set forth in Sections 6.01,  6.02, 6.03 and 6.11) cause each Subsidiary (and Parent
to the extent referenced therein) to: 

    6.01  Financial Statements.  Deliver to the Administrative Agent and each Lender, in form and detail
satisfactory to the Administrative Agent and the Required Lenders: 

    (a) as
soon as available, but in any event within 105 days after the end of each fiscal year of Parent, a consolidated balance sheet of Parent and its
Subsidiaries as at the end of such fiscal year, and the related consolidated statements of income and cash flows for such fiscal year, setting forth in each case in comparative form the figures for
the previous fiscal year, all in reasonable detail, audited and accompanied by a report and opinion of Deloitte & Touche LLP or another independent certified public accountant of nationally
recognized standing reasonably acceptable to the Required Lenders, which report and opinion shall be prepared in accordance with GAAP and shall not be subject to any qualifications or exceptions as to
the scope of the audit nor to any qualifications and exceptions not reasonably acceptable to the Required Lenders (provided that the delivery of such financial statements and audit report may be in
the form of Parent's Annual Report on Form 10-K for such fiscal year (together with the Parent's annual report to shareholders, if any, prepared pursuant to
Rule 14a-3 under the Exchange Act) prepared in accordance with the requirements therefor and filed with the Securities and Exchange Commission), together with a certificate of a
Responsible Officer that such financial statements of the Parent and its Subsidiaries fairly presents in all material respects the consolidated financial condition and results of operations of the
Parent and the Borrower and its Subsidiaries for the relevant period end and period; and 

    (b) as
soon as available, but in any event within 60 days after the end of each of the first three fiscal quarters of each fiscal year of Parent, a consolidated
balance sheet of Parent and its Subsidiaries as at the end of such fiscal quarter, and the related consolidated statements of income and cash flows for such fiscal quarter and for the portion of
Parent's fiscal year then ended, setting forth in each case in comparative form the figures for the corresponding fiscal quarter of the previous fiscal year and the corresponding portion of the
previous fiscal year, all in reasonable detail and certified by a Responsible Officer as fairly presenting the financial condition, results of operations and cash flows of Parent and its Subsidiaries
in accordance with GAAP, subject only to normal year-end audit adjustments and the absence of footnotes (provided that the delivery of such financial statements and certificate may be in
the form of Parent's Quarterly Report on Form 10-Q for such fiscal quarter prepared in accordance with the requirements therefor and filed with the Securities and Exchange
Commission), together with a certificate of a Responsible Officer of Parent and Borrower that such financial statements of the Parent and its Subsidiaries fairly presents in all material respects the
consolidated financial condition 

35

 

and results of operations of the Parent and the Borrower and its Subsidiaries for the relevant period end and period. 

    6.02  Certificates; Other Information.  Deliver to the Administrative Agent and each Lender, in form and
detail satisfactory to the Administrative Agent and the Required Lenders: 

    (a) concurrently
with the delivery of the financial statements referred to in Section 6.01(a), a certificate of
its independent certified public accountants certifying such financial statements and stating that in making the examination necessary therefor no knowledge was obtained of any Event of Default or, if
any such Event of Default shall exist, stating the nature and status of such event; 

    (b) concurrently
with the delivery of the financial statements referred to in Sections 6.01(a) and  (b), a duly completed Compliance Certificate signed by a Responsible
Officer; 

    (c) promptly
after any request by the Administrative Agent or Required Lenders, copies of any detailed audit reports, management letters or recommendations submitted to
the board of directors (or the audit committee of the board of directors) of the Parent by independent accountants in connection with the accounts or books of the Parent or any Subsidiary, or any
audit of any of them; 

    (d) promptly
after the same are available, copies of each annual report, proxy or financial statement or other report or communication sent to the stockholders of the
Parent, and copies of all annual, regular, periodic and special reports and registration statements which the Parent may file or be required to file with the Securities and Exchange Commission under
Section 13 or 15(d) of the Securities Exchange Act of 1934, and not otherwise required to be delivered to the Administrative Agent pursuant hereto; and 

    (e) promptly,
such additional information regarding the business, financial or corporate affairs of the Parent, Borrower or any Subsidiary as the Administrative Agent,
at the request of Required Lenders, may from time to time request. 

    Each
document required to be delivered pursuant to Section 6.01(a) or  (b) or Section 6.02(d) shall
be deemed to have been delivered on the earlier of the date
on which the Borrower posts such document on the Borrower's website on the Internet at the website address listed on Schedule 10.02 hereof, or
when such document is posted on the Securities and Exchange Commission's website at www.sec.gov or on IntraLinks; provided that (i) the Borrower
shall deliver paper copies of all such documents to the Administrative Agent or any Lender that requests the Borrower to deliver such paper copies until a request to cease delivering paper copies is
given by the Administrative Agent or such Lender and (ii) the Borrower shall notify by facsimile the Administrative Agent and each Lender of the posting of each such document. The
Administrative Agent shall have no obligation to request the delivery or to maintain copies of the documents referred to above in this paragraph, and in any event shall have no responsibility to
monitor compliance by the Borrower with any such request for delivery, and each Lender shall be solely responsible for requesting delivery to it or maintaining its copies of such documents. 

    6.03  Notices.  Promptly notify the Administrative Agent and each Lender: 

    (a) upon
a Responsible Officer becoming aware of the occurrence of any Default; 

    (b) of
any matter that has resulted or could reasonable be expected to result in a Material Adverse Effect, including (i) breach or non-performance
of, or any default under, a Contractual Obligation of the Borrower or any Subsidiary; (ii) any dispute, litigation, investigation, proceeding or suspension between the Borrower or any
Subsidiary and any Governmental Authority; or (iii) the commencement of, or any material development in, any litigation or proceeding affecting the Borrower or any Subsidiary, including
pursuant to any applicable Environmental Laws; 

36

 

    (c) of any litigation, investigation or proceeding affecting any Loan Party in which the amount involved exceeds the Threshold Amount, or in which injunctive relief or
similar relief is sought, which relief, if granted, could reasonably be expected to have a Material Adverse Effect; 

    (d) of
the occurrence of any ERISA Event; and 

    (e) of
any material change in accounting policies or financial reporting practices by the Parent, the Borrower or any Subsidiary. 

    Each
notice pursuant to this Section shall be accompanied by a statement of a Responsible Officer of the Borrower setting forth details of the occurrence referred to therein and
stating what action the Borrower has taken and proposes to take with respect thereto. Each notice pursuant to Section 6.03(a) shall describe with
particularity any and all provisions of this Agreement or other Loan Document that have been breached. 

    6.04  Payment of Obligations.  Pay and discharge as the same shall become due and payable, all its
obligations and liabilities, including (a) all tax liabilities, assessments and governmental charges or levies upon it or its properties or assets, unless the same are being contested in good
faith by appropriate proceedings and adequate reserves in accordance with GAAP are being maintained by the Borrower or such Subsidiary; (b) all lawful claims which, if unpaid, would by law
become a Lien upon its property (except a Lien permitted by Article VII); and (c) all Indebtedness, as and when due and payable, but
subject to any subordination provisions contained in any instrument or agreement evidencing such Indebtedness. 

    6.05  Preservation of Existence, Etc.  Preserve, renew and maintain in full force and effect its legal
existence and good standing under the Laws of the jurisdiction of its organization; take all reasonable action to maintain all rights, privileges, permits, licenses and franchises necessary or
desirable in the normal conduct of its business, except in a transaction permitted by Section 7.03 or  7.04; and preserve or renew all of its
registered patents, trademarks, trade names and service marks, the non-preservation of which could
reasonably be expected to have a Material Adverse Effect. 

    6.06  Maintenance of Properties.  (a) Maintain, preserve and protect all of its material properties and
equipment necessary in the operation of its business in good working order and condition, ordinary wear and tear excepted; and (b) make all necessary repairs thereto and renewals and
replacements thereof except where the failure to do so could not reasonably be expected to have a Material Adverse Effect. 

    6.07  Maintenance of Insurance.  Maintain with financially sound and reputable insurance companies not
Affiliates of the Borrower, insurance with respect to its properties and business against loss or damage of the kinds customarily insured against by Persons engaged in the same or similar business, of
such types and in such amounts as are customarily carried under similar circumstances by such other Persons. 

    6.08  Compliance with Laws.  Comply in all material respects with the requirements of all Laws applicable
to it or to its business or property, except in such instances in which (i) such requirement of Law is being contested in good faith or a bona fide dispute exists with respect thereto; or
(ii) the failure to comply therewith could not reasonably be expected to have a Material Adverse Effect. 

    6.09  Books and Records.  Maintain proper books of record and account, in which full, true and correct
entries in conformity with GAAP consistently applied shall be made of all financial transactions and matters involving the assets and business of the Borrower or such Subsidiary, as the case may be. 

37

 

    6.10  Inspection Rights.  Permit Administrative Agent or any Lender, or any employee, agent or
representative thereof: 

    (a) No Default.  If no Default then exists, at the expense of the Administrative Agent (subject to its
right of reimbursement from the Lenders) or such Lender and upon reasonable prior notice to Borrower, to visit the principal executive office of Borrower, to discuss the affairs, finances and accounts
of Borrower and its Subsidiaries with Borrower's officers and, with the consent of Borrower, which consent will not be unreasonably withheld, to visit the other offices and properties of Borrower and
each Subsidiary, all at such reasonable times and as often as may be reasonably requested in writing; and 

    (b) Default.  If a Default then exists, at the expense of Borrower, to visit and inspect any of the
offices or properties of Borrower or any Subsidiary, to examine all their respective books of account, records, reports and other papers, to make copies and extracts therefrom, and to discuss their
respective affairs, finances and accounts with their respective officers and, with the written consent of Borrower (which consent shall not be unreasonably withheld), independent public accountants at
Borrower's executive offices, all at such times and as often as may be requested. 

    6.11  Compliance with ERISA.  Do, and cause each of its ERISA Affiliates to do, each of the following:
(a) maintain each Plan in compliance in all material respects with the applicable provisions of ERISA, the Code and other Federal or state law; (b) cause each Plan which is qualified
under Section 401(a) of the Code to maintain such qualification; and (c) make all required contributions to any Plan subject to Section 412 of the Code. 

    6.12  Use of Proceeds.  Use the proceeds of the Credit Extensions for working capital and other general
corporate purposes not in contravention of any Law or of any Loan Document. 

    6.13  Guarantors.  (a) cause each Material Subsidiary in existence on the Closing Date to become a party
to the Guaranty on the Closing Date; and 

    (b) respect
to the period after the Closing Date, immediately upon any Person becoming a Material Subsidiary, (i) cause such Subsidiary to become a party to the
Guaranty as a Guarantor and (ii) deliver, or cause such Subsidiary to deliver, to the Agent items relating to such Subsidiary and of the type specified in Section 4.01(a)(iv), (v),
(vii) and (xi); and 

    (c) cause
sufficient Subsidiaries of the Borrower to be parties to the Guaranty so that the sum of the shareholders' equity of the Borrower and such Guarantors on an
unconsolidated basis at all times exceeds 90% of the shareholders' equity of the Parent and its Subsidiaries on a consolidated basis determined in accordance with GAAP. 

 
 

ARTICLE VII.
  NEGATIVE COVENANTS    
  

    So long as any Lender shall have any Commitment hereunder, any Loan or other Obligation shall remain unpaid or unsatisfied, or any Letter of Credit shall
remain outstanding, the Borrower shall not, nor shall it permit any Subsidiary to, directly or indirectly: 

    7.01  Liens and Negative Pledges.  Create, incur, assume or suffer to exist, any Lien or Negative Pledge
upon any of its property, assets or revenues, whether now owned or hereafter acquired, other than the following: 

    (a) Liens
pursuant to any of the Loan Documents; 

    (b) Liens
and Negative Pledges existing on the date hereof and listed on Schedule 7.01 and any renewals or
extensions thereof, provided that the property covered thereby is not increased and any renewal or extension of the obligations secured or benefited
thereby is permitted by Section 7.02(b); 

38

  

    (c) Liens
for taxes not yet due or which are being contested in good faith and by appropriate proceedings, if adequate reserves with respect thereto are maintained on
the books of the applicable Person in accordance with GAAP; 

    (d) carriers',
warehousemen's, mechanics', materialmen's, repairmen's or other like Liens arising in the ordinary course of business which are not overdue for a period
of more than 30 days or which are being contested in good faith and by appropriate proceedings, if adequate reserves with respect thereto are maintained on the books of the applicable Person; 

    (e) pledges
or deposits in the ordinary course of business in connection with workers' compensation, unemployment insurance and other social security legislation, other
than any Lien imposed by ERISA; 

    (f)  deposits
to secure the performance of bids, trade contracts (other than for borrowed money), leases, statutory obligations, surety and appeal bonds, performance
bonds and other obligations of a like nature incurred in the ordinary course of business; 

    (g) easements,
rights-of-way, restrictions and other similar encumbrances affecting real property which, in the aggregate, are not substantial
in amount, and which do not in any case materially detract from the value of the property subject thereto or materially interfere with the ordinary conduct of the business of the applicable Person; 

    (h) Liens
securing judgments for the payment of money in an aggregate amount not in excess of the Threshold Amount (except to the extent covered by independent
third-party insurance as to which the insurer has acknowledged in writing its obligation to cover), unless any such judgment remains undischarged for a period of more than 30 consecutive days during
which execution is not effectively stayed; 

    (i)  Liens
securing Indebtedness permitted under Section 7.02(e); provided that (i) such Liens do not at
any time encumber any property other than the property financed by such Indebtedness and (ii) the Indebtedness secured thereby does not exceed the cost or fair market value, whichever is lower,
of the property being acquired on the date of acquisition; and 

    (j)  Liens
of a consignor of merchandise to Borrower or a Subsidiary on such consignor's merchandise, and any Lien of a lessor of equipment to Borrower or a Subsidiary
on such lessor's leased equipment. 

    7.02  Indebtedness.  Create, incur, assume or suffer to exist any Indebtedness, except: 

    (a) Indebtedness
under any of the Loan Documents; 

    (b) Indebtedness
outstanding on the date hereof and listed on Schedule 7.02 and any refinancings, refundings,
renewals or extensions thereof; provided that the amount of such Indebtedness is not increased at the time of such refinancing, refunding, renewal or
extension except by an amount equal to a reasonable premium or other reasonable amount paid, and fees and expenses reasonably incurred, in connection with such refinancing and by an amount equal to
any existing commitments unutilized thereunder; 

    (c) Guaranty
Obligations of the Borrower or any Subsidiary in respect of Indebtedness otherwise permitted hereunder of the Borrower or any wholly-owned Subsidiary; 

    (d) obligations
(contingent or otherwise) of the Borrower or any Subsidiary existing or arising under any Swap Contract,  provided that (i) such obligations are (or were) entered into by such Person in the ordinary
course of business for the purpose of directly
mitigating risks associated with liabilities, commitments, investments, assets, or property held or reasonably anticipated by such Person, or changes in the value of securities issued by such Person
and not for purposes of speculation or taking a "market view;" and (ii) such Swap Contract does not contain any provision exonerating the 

39

 

non-defaulting party from its obligation to make payments on outstanding transactions to the defaulting party; 

    (e) Indebtedness
in respect of capital leases, Synthetic Lease Obligations and purchase money obligations for fixed or capital assets within the limitations set forth
in Section 7.01(i); provided that the aggregate amount of all such Indebtedness at any one time outstanding shall not exceed 5% of Consolidated
Shareholders' Equity; 

    (f)  Unsecured
Indebtedness in an aggregate principal amount not to exceed at any time outstanding the amount by which 15% of Consolidated Shareholders' Equity exceeds
the Indebtedness permitted to be outstanding under Section 7.02(e); and 

    (g) obligations
in respect of Existing Letters of Credit. 

    7.03  Fundamental Changes.  Merge or consolidate with or into any Person or liquidate,
wind-up or dissolve itself, or permit or suffer any liquidation or dissolution or sell all or substantially all of its assets, except, that so long as no Default exists or would result
therefrom: 

    (a) any
Subsidiary of Borrower may merge with (i) Borrower provided that Borrower shall be the continuing or
surviving corporation, (ii) with any one or more Subsidiaries of Borrower, and (iii) with any joint ventures, partnerships and other Persons, so long as such joint ventures, partnerships
and other Persons will, as a result of making such merger and all other contemporaneous related transactions, become a Subsidiary of Borrower; provided
that when any wholly-owned Subsidiary of Borrower is merging into another Subsidiary of Borrower, the wholly-owned Subsidiary of Borrower shall be the continuing or surviving Person; 

    (b) any
Subsidiary of Borrower may sell all or substantially all of its assets (upon voluntary liquidation or otherwise), to Borrower or any of its Subsidiaries;  provided that when any wholly-owned Subsidiary
of Borrower is selling all or substantially all of its assets to another Subsidiary of Borrower, the
Subsidiary acquiring such assets shall be a wholly-owned Subsidiary of Borrower; and 

    (c) a
Subsidiary may sell its assets, or the Borrower may dispose of its entire interest in a Subsidiary, in a Disposition permitted by  Section 7.04. 

    7.04  Dispositions.  Make any Disposition or enter into any agreement to make any Disposition, except: 

    (a) Dispositions
of obsolete or worn out property, whether now owned or hereafter acquired, in the ordinary course of business; 

    (b) Dispositions
of inventory in the ordinary course of business; 

    (c) Dispositions
of equipment or real property to the extent that (i) such property is exchanged for credit against the purchase price of similar replacement
property, (ii) the proceeds of such Disposition are reasonably promptly applied to the purchase price of such replacement property or (iii) the board of directors or senior management of
the Borrower or such Subsidiary has determined in good faith that the failure to replace such property will not be detrimental to the business of the Borrower or such Subsidiary; 

    (d) Dispositions
of property by any Subsidiary to the Borrower or to a wholly-owned Subsidiary; 

    (e) Sale
and leaseback transactions and other Dispositions not exceeding $100,000,000 in the aggregate for all such transactions in any fiscal year; and 

    (f)  Dispositions
permitted by Section 7.03;

provided that any Disposition pursuant to clauses (a) through (f) shall be for fair market value. 

40

 

    7.05  Restricted Payments.  Declare or make, directly or indirectly, any Restricted Payment, or incur any
obligation (contingent or otherwise) to do so, except that: 

    (a) each
Subsidiary may make Restricted Payments to the Borrower and to wholly-owned Subsidiaries (and, in the case of a Restricted Payment by a
non-wholly-owned Subsidiary, to the Borrower and any Subsidiary and to each other owner of capital stock of such Subsidiary on a pro rata basis based on their relative ownership
interests); 

    (b) the
Borrower and each Subsidiary may declare and make dividend payments or other distributions payable solely in the common stock of such Person; 

    (c) the
Borrower and each Subsidiary may purchase, redeem or otherwise acquire shares of its common stock or warrants or options to acquire any such shares with the
proceeds received from the substantially concurrent issue of new shares of its common stock; and 

    (d) So
long as no Default has occurred and is continuing (a) Borrower may make distributions to Parent not exceeding in any fiscal year 50% of Consolidated Net
Income for the preceding fiscal year and (b) Borrower may purchase, or make distributions to Parent for the purpose of purchasing, shares of capital stock of the Parent for a total
consideration not exceeding $30,000,000 for all such purchases in any fiscal year of the Parent. 

    7.06  ERISA.  At any time engage in a transaction which could be subject to Section 4069 or
4212(c) of ERISA, or permit any Plan to (a) engage in any non-exempt "prohibited transaction" (as defined in Section 4975 of the Code); (b) fail to comply with ERISA
or any other applicable Laws; or (c) incur any material "accumulated funding deficiency" (as defined in Section 302 of ERISA), which, with respect to each event listed above, could
reasonably be expected to have a Material Adverse Effect. 

    7.07  Change in Nature of Business.  Engage in any material line of business substantially different from
those lines of business conducted by the Borrower and its Subsidiaries on the date hereof. 

    7.08  Transactions with Affiliates.  Except as otherwise permitted hereunder, enter into any material
transaction (including without limitation the purchase, lease, sale or exchange of properties of any kind or the rendering of any service) with any Affiliate, except pursuant to the reasonable
requirements of the Borrower's business and upon fair and reasonable terms no less favorable to the Borrower than would be obtainable in a comparable arm's-length transaction with a Person not an
Affiliate; provided that, subject to the restrictions of Section 7.05, Borrower may purchase
shares of capital stock of the Parent from any Person (or their decedent's estate) listed in clauses (i) through (v) of the parenthesis in the definition of "Change of Control" so long
as the price at which any such shares are so purchased is not more than the then-current market price for the capital stock of the Parent. 

    7.09  Burdensome Agreements.  Enter into any Contractual Obligation that limits the ability (a) of
any Subsidiary to make Restricted Payments to the Borrower or to otherwise transfer property to the Borrower or (b) of the Borrower or any Subsidiary to create, incur, assume or suffer to exist
Liens on property of such Person. 

    7.10  Use of Proceeds.  Use the proceeds of any Credit Extension, whether directly or indirectly, and
whether immediately, incidentally or ultimately, to purchase or carry margin stock (within the meaning of Regulation U of the FRB) or to extend credit to others for the purpose of purchasing or
carrying margin stock or to refund indebtedness originally incurred for such purpose. 

    7.11  Hostile Acquisitions.  Use the proceeds of any Loan in connection with the acquisition of a voting
interest of five percent or more in any Person if such acquisition is opposed by the board of directors or management of such Person unless
(a) Borrower has given Administrative Agent (who shall 

41

 

promptly notify each Lender) five Business Days' prior notice thereof and (b) no Lender shall have, within that period, notified Administrative Agent (who shall promptly notify Borrower) that
such Lender does not consent to the use of the proceeds of such Loan for that purpose. 

    7.12  Limitations on Upstreaming.  Agree to any restriction or limitation on the making of Restricted
Payments or transferring of assets from any Subsidiary of Borrower to Borrower or from Parent to Borrower. 

    7.13  Acquisitions.  Acquire a business or its assets for a consideration, including assumption of direct
or contingent debt, in excess of $75,000,000 for any single acquisition or purchase transaction or in excess of $150,000,000 for all such transactions in any single fiscal year;  provided that no such
acquisition shall be made (a) during any period that a Default has occurred and is continuing, (b) if any Default
would result therefrom; (c) if any Person acquired as a result of any such acquisition is not a wholly-owned Subsidiary of the Borrower, or (d) unless prior to the consummation thereof,
Parent and Borrower have delivered to Administrative Agent a Compliance Certificate, in form and substance satisfactory to Required Lenders, demonstrating, on a pro forma basis, that after giving
effect to such acquisition, the Parent is in compliance with Section 7.14. 

    7.14  Financial Covenants.  Permit their financial condition, when taken together with the Parent and
its other Subsidiaries (if any) on a consolidated basis, to be such that any of the following financial tests will not be met: 

    (a) The
Fixed Charge Coverage Ratio (A) as of the end of any fiscal quarter ending on or after October 25, 2001 and on or prior to April 25, 2002,
shall be equal to or greater than 2.30 to 1.00, (B) as of the end of any fiscal quarter ending on or after July 26, 2002, and on or prior to October 26, 2003, shall be equal to or
greater than 2.40 to 1.00, and (C) as of the end of any fiscal quarter ending after October 26, 2003, shall be equal to or greater than 2.50 to 1.00. 

    (b) The
Consolidated Adjusted Total Debt to Consolidated Adjusted Total Capitalization Ratio shall be equal to or less than 0.55 to 1.00 as of the end of any fiscal
quarter. 

    (c) The
Consolidated Adjusted Total Debt to Consolidated EBITDAR Ratio (A) as of the end of any fiscal quarter ending on or after October 25, 2001, and on
or prior to October 26, 2003, shall be equal to or less than 3.50 to 1.00, and (B) as of the end of any fiscal quarter ending after October 26, 2003, shall be equal to or less
than 3.25 to 1.00. 

 
 

ARTICLE VIII.
  EVENTS OF DEFAULT AND REMEDIES    
  

    8.01  Events of Default.  Any of the following shall constitute an Event of Default: 

    (a) Non-Payment.  The Borrower fails to pay (i) when and as required to be paid
herein, any amount of principal of any Loan or any L/C Obligation, or (ii) within three days after the same becomes due, any interest on any Loan or on any L/C Obligation, or any commitment or
other fee due hereunder, or (iii) within five days after the same becomes due, any other amount payable hereunder or under any other Loan Document; or 

    (b) Specific Covenants.  The Borrower fails to perform or observe any term, covenant or agreement
contained in any of Section 6.01, 6.02, 6.03, 6.05, 6.10, 6.12, or 6.13 or  Article VII; provided
that in the case of any default under Section 6.01, 6.02, 6.03, 6.05, 6.10,
6.12, or 6.13, Borrower shall have five Business Days after notice or becoming aware of such default to cure such default; or 

    (c) Other Defaults.  Any Loan Party fails to perform or observe any other covenant or agreement (not
specified in subsection (a) or (b) above) contained in any Loan Document on its part to be performed or observed and such failure continues for 30 days; or 

42

 

    (d) Representations and Warranties.  Any representation or warranty made or deemed made by the Borrower
or any other Loan Party herein, in any other Loan Document, or in any document delivered in connection herewith or therewith proves to have been incorrect when made or deemed made; or 

    (e) Cross-Default.  (i) The Borrower or any Subsidiary (A) fails to make any payment when
due (whether by scheduled maturity, required prepayment, acceleration, demand, or otherwise) in respect of any Indebtedness or Guaranty Obligation (other than Indebtedness hereunder and Indebtedness
under Swap Contracts) having an aggregate principal amount (including undrawn committed or available amounts and including amounts owing to all creditors under any combined or syndicated credit
arrangement) of more than the Threshold Amount, or (B) fails to observe or perform any other agreement or condition relating to any such Indebtedness or Guaranty Obligation in excess of the
Threshold Amount or contained in any instrument or agreement evidencing, securing or relating thereto, or any other event occurs, the effect of which default or other event is to cause, or to permit
the holder or holders of such Indebtedness or the beneficiary or beneficiaries of such Guaranty Obligation (or a trustee or agent on behalf of such holder or holders or beneficiary or beneficiaries)
to cause, with the giving of notice if required, such Indebtedness to be demanded or to become due or to be repurchased or redeemed (automatically or otherwise) prior to its stated maturity, or such
Guaranty Obligation to become payable or cash collateral in respect thereof to be demanded; or (ii) there occurs under any Swap Contract an Early Termination Date (as defined in such Swap
Contract) resulting from (A) any event of default under such Swap Contract as to which the Borrower or any Subsidiary is the Defaulting Party (as defined in such Swap Contract) or
(B) any Termination Event (as so defined) under such Swap Contract as to which the Borrower or any Subsidiary is an Affected Party (as so defined) and, in either event, the Swap Termination
Value owed by the Borrower or such Subsidiary as a result thereof is greater than the Threshold Amount; or 

    (f)  Insolvency Proceedings, Etc.  Any Loan Party or any of its Subsidiaries institutes or consents to
the institution of any proceeding under any Debtor Relief Law, or makes an assignment for the benefit of creditors; or applies for or consents to the appointment of any receiver, trustee, custodian,
conservator, liquidator, rehabilitator or similar officer for it or for all or any material part of its property; or any receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar
officer is appointed without the application or consent of such Person and the appointment continues undischarged or unstayed for 60 calendar days; or any proceeding under any Debtor Relief Law
relating to any such Person or to all or any part of its property is instituted without the consent of such Person and continues undismissed or unstayed for 60 calendar days, or an order for relief is
entered in any such proceeding; or 

    (g) Inability to Pay Debts; Attachment.  (i) The Borrower or any Subsidiary becomes unable or
admits in writing its inability or fails generally to pay its debts as they become due, or (ii) any writ or warrant of attachment or execution or similar process is issued or levied against all
or any material part of the property of any such Person and is not released, vacated or fully bonded within 30 days after its issue or levy; or 

    (h) Judgments.  There is entered against the Borrower or any Subsidiary (i) a final judgment or
order for the payment of money in an aggregate amount exceeding the Threshold Amount (to the extent not covered by independent third-party insurance as to which the insurer does not dispute coverage
or by a contractual indemnity by a creditworthy party which does not dispute liability), or (ii) any non-monetary final judgment that has, or could reasonably be expected to have, a
Material Adverse Effect and, in either case, (A) enforcement proceedings are commenced by any creditor upon such judgment or order, or (B) there is a period of 30 consecutive days during
which a stay of enforcement of such judgment, by reason of a pending appeal or otherwise, is not in effect; or 

    (i)  ERISA.  (i) An ERISA Event occurs with respect to a Pension Plan or Multiemployer Plan which
has resulted or could reasonably be expected to result in liability of the Borrower under Title IV 

43

 

of ERISA to the Pension Plan, Multiemployer Plan or the PBGC in an aggregate amount in excess of the Threshold Amount, or (ii) the Borrower or any ERISA Affiliate fails to pay when due, after
the expiration of any applicable grace period, any installment payment with respect to its withdrawal liability under Section 4201 of ERISA under a Multiemployer Plan in an aggregate amount in
excess of the Threshold Amount; or 

    (j)  Invalidity of Loan Documents.  Any Loan Document, at any time after its execution and delivery and
for any reason other than the agreement of all the Lenders or satisfaction in full of all the Obligations, ceases to be in full force and effect, or is declared by a court of competent jurisdiction to
be null and void, invalid or unenforceable in any respect; or any Loan Party denies that it has any or further
liability or obligation under any Loan Document, or purports to revoke, terminate or rescind any Loan Document; or 

    (k) Change of Control.  There occurs any Change of Control; or 

    (l)  Material Adverse Effect.  There occurs any event or circumstance that has a Material Adverse Effect. 

    8.02  Remedies Upon Event of Default.  If any Event of Default occurs, the Administrative Agent shall, at
the request of, or may, with the consent of, the Required Lenders, 

    (a) declare
the commitment of each Lender to make Loans and any obligation of the L/C Issuer to make L/C Credit Extensions to be terminated, whereupon such commitments
and obligation shall be terminated; 

    (b) declare
the unpaid principal amount of all outstanding Loans, all interest accrued and unpaid thereon, and all other amounts owing or payable hereunder or under any
other Loan Document to be immediately due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by the Borrower; 

    (c) require
that the Borrower Cash Collateralize the L/C Obligations (in an amount equal to the then Outstanding Amount thereof); and 

    (d) exercise
on behalf of itself and the Lenders all rights and remedies available to it and the Lenders under the Loan Documents or applicable law; 

provided that upon the occurrence of any event specified in subsection (f) of  Section 8.01, the obligation of each Lender to make Loans and any
obligation of the L/C Issuer to make L/C Credit Extensions shall automatically
terminate, the unpaid principal amount of all outstanding Loans and all interest and other amounts as aforesaid shall automatically become due and payable, and the obligation of the Borrower to Cash
Collateralize the L/C Obligations as aforesaid shall automatically become effective, in each case without further act of the Administrative Agent or any Lender. 

 
 

ARTICLE IX.
  ADMINISTRATIVE AGENT    
  

    9.01  Appointment and Authorization of Administrative Agent.  

    (a) Each
Lender hereby irrevocably appoints, designates and authorizes the Administrative Agent to take such action on its behalf under the provisions of this Agreement
and each other Loan Document and to exercise such powers and perform such duties as are expressly delegated to it by the terms of this Agreement or any other Loan Document, together with such powers
as are reasonably incidental thereto. Notwithstanding any provision to the contrary contained elsewhere herein or in any other Loan Document, the Administrative Agent shall not have any duties or
responsibilities, except those expressly set forth herein, nor shall the Administrative Agent have or be deemed to have any fiduciary relationship with any Lender or participant, and no implied
covenants, functions, 

44

 

responsibilities, duties, obligations or liabilities shall be read into this Agreement or any other Loan Document or otherwise exist against the Administrative Agent. Without limiting the generality
of the foregoing sentence, the use of the term "agent" herein and in the other Loan Documents with reference to the Administrative Agent is not intended to connote any fiduciary or other implied (or
express) obligations arising under agency doctrine of any applicable law. Instead, such term is used merely as a matter of market custom, and is intended to create or reflect only an administrative
relationship between independent contracting parties. 

    (b) The
L/C Issuer shall act on behalf of the Lenders with respect to any Letters of Credit issued by it and the documents associated therewith until such time (and
except for so long) as the Administrative Agent may agree at the request of the Required Lenders to act for the L/C Issuer with respect thereto;  provided that the L/C Issuer shall have all of the
benefits and immunities (i) provided to the Administrative Agent in this  Article IX with respect to any acts taken or omissions suffered by the L/C Issuer in connection with Letters of Credit
issued by it or proposed
to be issued by it and the application and agreements for letters of credit pertaining to the Letters of Credit as fully as if the term "Administrative Agent" as used in this  Article IX included
the L/C Issuer with respect to such acts or omissions, and (ii) as additionally provided herein with respect to the
L/C Issuer. 

    9.02  Delegation of Duties.  The Administrative Agent may execute any of its duties under this Agreement
or any other Loan Document by or through agents, employees or attorneys-in-fact and shall be entitled to advice of counsel and other consultants or experts concerning all
matters pertaining to such duties. The Administrative Agent shall not be responsible for the negligence or misconduct of any agent or attorney-in-fact that it selects in the
absence of gross negligence or willful misconduct. 

    9.03  Liability of Administrative Agent.  No Agent-Related Person shall (a) be liable for any
action taken or omitted to be taken by any of them under or in connection with this Agreement or any other Loan
Document or the transactions contemplated hereby (except for its own gross negligence or willful misconduct in connection with its duties expressly set forth herein), or (b) be responsible in
any manner to any Lender or participant for any recital, statement, representation or warranty made by any Loan Party or any officer thereof, contained herein or in any other Loan Document, or in any
certificate, report, statement or other document referred to or provided for in, or received by the Administrative Agent under or in connection with, this Agreement or any other Loan Document, or the
validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement or any other Loan Document, or for any failure of any Loan Party or any other party to any Loan Document to
perform its obligations hereunder or thereunder. No Agent-Related Person shall be under any obligation to any Lender or participant to ascertain or to inquire as to the observance or performance of
any of the agreements contained in, or conditions of, this Agreement or any other Loan Document, or to inspect the properties, books or records of any Loan Party or any Affiliate thereof. 

    9.04  Reliance by Administrative Agent.  

    (a) The
Administrative Agent shall be entitled to rely, and shall be fully protected in relying, upon any writing, communication, signature, resolution, representation,
notice, consent, certificate, affidavit, letter, telegram, facsimile, telex or telephone message, statement or other document or conversation believed by it to be genuine and correct and to have been
signed, sent or made by the proper Person or Persons, and upon advice and statements of legal counsel (including counsel to any Loan Party), independent accountants and other experts selected by the
Administrative Agent. The Administrative Agent shall be fully justified in failing or refusing to take any action under any Loan Document unless it shall first receive such advice or concurrence of
the Required Lenders as it deems appropriate and, if it so requests, it shall first be indemnified to its satisfaction by the Lenders against any and all liability and expense which may be incurred by
it by reason of taking or continuing to take any such action. The Administrative Agent shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement or any other
Loan Document in accordance with a request or 

45

 

consent of the Required Lenders or all the Lenders, if required hereunder, and such request and any action taken or failure to act pursuant thereto shall be binding upon all the Lenders and
participants. Where this Agreement expressly permits or prohibits an action unless the Required Lenders otherwise determine, the Administrative Agent shall, and in all other instances, the
Administrative Agent may, but shall not be required to, initiate any solicitation for the consent or a vote of the Lenders. 

    (b) For
purposes of determining compliance with the conditions specified in Section 4.01, each Lender that has
signed this Agreement shall be deemed to have consented to, approved or accepted or to be satisfied with, each document or other matter either sent by the Administrative Agent to such Lender for
consent, approval, acceptance or satisfaction, or required thereunder to be consented to or approved by or acceptable or satisfactory to a Lender. 

    9.05  Notice of Default.  The Administrative Agent shall not be deemed to have knowledge or notice of the
occurrence of any Default, except with respect to defaults in the payment of principal, interest and fees required to be paid to the Administrative Agent for the account of the Lenders, unless the
Administrative Agent shall have received written notice from a Lender or the Borrower referring to this Agreement, describing such Default and stating that such notice is a "notice of default." The
Administrative Agent will notify the Borrower or the Lenders, as the case may be, of its receipt of any such notice. The Administrative Agent shall take such action with respect to such Default as may
be directed by the Required Lenders in accordance with Article VIII; provided that unless and until the Administrative Agent has received any
such direction, the Administrative Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default as it shall deem advisable or in the
best interest of the Lenders. 

    9.06  Credit Decision; Disclosure of Information by Administrative Agent.  Each Lender acknowledges that
no Agent-Related Person has made any representation or warranty to it, and that no act by the Administrative Agent hereafter taken, including any consent to and acceptance of any assignment or review
of the affairs of any Loan Party or any Affiliate thereof, shall be deemed to constitute any representation or warranty by any Agent-Related Person to any Lender as to any matter, including whether
Agent-Related Persons have disclosed material information in their possession. Each Lender represents to the Administrative Agent that it has, independently and without reliance upon any Agent-
Related Person and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, prospects, operations, property, financial and
other condition and creditworthiness of the Loan Parties and their respective Subsidiaries, and all applicable bank or other regulatory Laws relating to the transactions contemplated hereby, and made
its own decision to enter into this Agreement and to extend credit to the Borrower and the other Loan Parties hereunder. Each Lender also represents that it will, independently and without reliance
upon any Agent-Related Person and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis, appraisals and decisions in taking or not
taking action under this Agreement and the other Loan Documents, and to make such investigations as it deems necessary to inform itself as to the business, prospects, operations, property, financial
and other condition and creditworthiness of the Borrower and the other Loan Parties. Except for notices, reports and other documents expressly required to be furnished to the Lenders by the
Administrative Agent herein, the Administrative Agent shall not have any duty or responsibility to provide any Lender with any credit or other information concerning the business, prospects,
operations, property, financial and other condition or creditworthiness of any of the Loan Parties or any of their respective Affiliates which may come into the possession of any Agent-Related Person. 

46

  

    9.07  Indemnification of Administrative Agent.  Whether or not the transactions contemplated hereby are
consummated, the Lenders shall indemnify upon demand each Agent-Related Person (to the extent not reimbursed by or on behalf of any Loan Party and without limiting the obligation of any Loan Party to
do so), pro rata, and hold harmless each Agent-Related Person from and against any and all Indemnified Liabilities incurred by
it; provided  that no Lender shall be liable for the payment to any Agent-Related Person of any portion of such
Indemnified Liabilities to the extent determined in a final, nonappealable judgment by a court of competent jurisdiction to have resulted from such Person's own gross negligence or willful
misconduct; provided that no action taken in accordance with the directions of the Required Lenders shall be deemed to
constitute gross negligence or willful misconduct for purposes of this Section. Without limitation of the foregoing, each Lender shall reimburse the Administrative Agent upon demand for its ratable
share of any costs or out-of-pocket expenses (including Attorney Costs) incurred by the Administrative Agent in connection with the preparation, execution, delivery,
administration, modification, amendment or enforcement (whether through negotiations, legal proceedings or otherwise) of, or legal advice in respect of rights or responsibilities under, this
Agreement, any other Loan Document, or any document contemplated by or referred to herein, to the extent that the Administrative Agent is not reimbursed for such expenses by or on behalf of the
Borrower. The undertaking in this Section shall survive termination of the Aggregate Commitments, the payment of all Obligations hereunder and the resignation or replacement of the Administrative
Agent. 

    9.08  Administrative Agent in its Individual Capacity.  Bank of America and its Affiliates may make loans
to, issue letters of credit for the account of, accept deposits from, acquire equity interests in and generally engage in any kind of banking, trust, financial advisory, underwriting or other business
with each of the Loan Parties and their respective Affiliates as though Bank of America were not the Administrative Agent hereunder and without notice to or consent of the Lenders. The Lenders
acknowledge that, pursuant to such activities, Bank of America or its Affiliates may receive information regarding any Loan Party or its Affiliates (including information that may be subject to
confidentiality obligations in favor of such Loan Party or such Affiliate) and acknowledge that the Administrative Agent shall be under no obligation to provide such information to them. With respect
to its Loans, Bank of America shall have the same rights and powers under this Agreement as any other Lender and may exercise such rights and powers as though it were not the Administrative Agent, and
the terms "Lender" and "Lenders" include Bank of America in its individual capacity. 

    9.09  Successor Administrative Agent.  The Administrative Agent may resign as Administrative Agent upon
30 days' notice to the Lenders; provided that any such resignation by Bank of America shall also constitute its resignation as Swing Line Lender. If the Administrative Agent resigns under this
Agreement, the Required Lenders shall appoint from among the Lenders a successor administrative agent for the Lenders which successor administrative agent shall be consented to by the Borrower at all
times other than during the existence of an Event of Default (which consent of the Borrower shall not be unreasonably withheld or delayed). If no successor administrative agent is appointed prior to
the effective date of the resignation of the Administrative Agent, the Administrative Agent may appoint, after consulting with the Lenders and the Borrower, a successor administrative agent from among
the Lenders. Upon the acceptance of its appointment as successor administrative agent hereunder, the
Person acting as such successor administrative agent shall succeed to all the rights, powers and duties of the retiring Administrative Agent and Swing Line Lender and the respective terms
"Administrative Agent," and "Swing Line Lender" shall mean such successor administrative agent, Letter of Credit issuer and swing line lender, and the retiring Administrative Agent's appointment,
powers and duties as Administrative Agent shall be terminated and the retiring Swing Line Lender's rights, powers and duties as such shall be terminated, without any other or further act or deed on
the part of such retiring Swing Line Lender or any other Lender. After any retiring Administrative Agent's resignation hereunder as Administrative Agent, the provisions of
this Article IX and Sections
10.04 and 10.05 shall inure to its benefit as to any actions taken or 

47

 

omitted to be taken by it while it was Administrative Agent under this Agreement. If no successor administrative agent has accepted appointment as Administrative Agent by the date which is
30 days following a retiring Administrative Agent's notice of resignation, the retiring Administrative Agent's resignation shall nevertheless thereupon become effective and the Lenders shall
perform all of the duties of the Administrative Agent hereunder until such time, if any, as the Required Lenders appoint a successor agent as provided for above. 

    9.10  Other Agents.  No Lender identified on the facing page or signature pages of this Agreement as a
"syndication agent" shall have any right, power, obligation, liability, responsibility or duty under this Agreement other than those applicable to all Lenders as such. Without limiting the foregoing,
no Lender so identified shall have or be deemed to have any fiduciary relationship with any Lender. Each Lender acknowledges that it has not relied, and will not rely, on any of the Lenders so
identified in deciding to enter into this Agreement or in taking or not taking action hereunder. 

 
 

ARTICLE X.
  MISCELLANEOUS    
  

    10.01  Amendments, Etc.  No amendment or waiver of any provision of this Agreement or any other Loan
Document, and no consent to any departure by the Borrower or any other Loan Party therefrom, shall be effective unless in writing signed by the Required Lenders and the Borrower or the applicable Loan
Party, as the case may be, and acknowledged by the Administrative Agent, and each such waiver or consent shall be effective only in the specific instance and for the specific purpose for which
given; provided that no such amendment, waiver or consent shall, unless in writing and signed by each of the Lenders
directly affected thereby and by the Borrower, and acknowledged by the Administrative Agent, do any of the following: 

    (a) extend
or increase the Commitment of any Lender (or reinstate any Commitment terminated pursuant
to Section 8.02), except for any such increase made in accordance
with Section 2.14; 

    (b) postpone
any date fixed by this Agreement or any other Loan Document for any payment or mandatory prepayment of principal, interest, fees or other amounts due to
the Lenders (or any of them) hereunder or under any other Loan Document; 

    (c) reduce
the principal of, or the rate of interest specified herein on, any Loan or L/C Borrowing, or (subject to clause (iv) of the proviso below) any fees or
other amounts payable hereunder or under any other Loan Document, or change the manner of computation of any financial covenant used in determining the Applicable Rate that would result in a reduction
of any interest rate on any Loan; provided that only the consent of the Required Lenders shall be necessary to amend the
definition of "Default Rate" or to waive any obligation of the Borrower to pay interest at the Default Rate; 

    (d) change
the percentage of the Aggregate Commitments or of the aggregate unpaid principal amount of the Loans and L/C Obligations which is required for the Lenders or
any of them to take any action hereunder; 

    (e) change
the Pro Rata Share or Voting Percentage of any Lender (except for any change resulting
from Section 2.14 or 3.06(b)); 

    (f)  amend
this Section, or Sections
2.12 or 2.14, or any provision herein providing for consent or other action by all the Lenders; or 

    (g) release
any Guarantor from the Guaranty, except that Administrative Agent shall, on behalf of Lenders, release, in connection with any Disposition permitted by  Section 7.04; provided that such Guarantor is not a Material
Subsidiary at the time of such release and, after giving effect to such release, the sum of the shareholders' equity of the Borrower and the remaining Guarantors on an 

48

 

unconsolidated basis exceeds 90% of the shareholders' equity of the Parent and its Subsidiaries on a consolidated basis determined in accordance with GAAP; 

and, provided further that (i) no amendment, waiver or consent shall, unless in writing and signed by the L/C
Issuer in addition to the Required Lenders or each directly-affected Lender, as the case may be, affect the rights or duties of the L/C Issuer under this Agreement or any Letter of Credit Application
relating to any Letter of Credit issued or to be issued by it; (ii) no amendment, waiver or consent shall, unless in writing and signed by the Swing Line Lender in addition to the Required
Lenders or each directly-affected Lender, as the case may be, affect the rights or duties of the Swing Line Lender under this Agreement; (iii) no amendment, waiver or consent shall, unless in
writing and signed by the Administrative Agent in addition to the Required Lenders or each directly-affected Lender, as the case may be, affect the rights or duties of the Administrative Agent under
this Agreement or any other Loan Document; (iv) the Fee Letter may be amended, or rights or privileges thereunder waived, in a writing executed only by the respective parties thereto; and
(v) the amount to which the Aggregate Commitments may be increased under Section 2.14(a) may be changed with
the consent of the Borrower, Administrative Agent, and Required Lenders. Notwithstanding anything to the contrary herein, any Lender that has a Voting Percentage of zero shall not have any right to
approve or disapprove any amendment, waiver or consent hereunder, except that the Pro Rata Share of such Lender may not be increased (except for any such increase resulting
from Section 2.14 or 3.06(b)) without the consent of
such Lender. 

    10.02  Notices and Other Communications; Facsimile Copies.  

    (a)  General.  Unless otherwise
expressly provided herein, all notices and other communications provided for hereunder shall be in writing (including by facsimile transmission) and mailed, faxed or delivered, to the address,
facsimile number or (subject to subsection (c) below) electronic mail address specified for notices
on Schedule 10.02; or, in the case of the Borrower, the Administrative Agent, the L/C Issuer or the Swing Line
Lender, to such other address as shall be designated by such party in a notice to the other parties, and in the case of any other party, to such other address as shall be designated by such party in a
notice to the Borrower, the Administrative Agent, the L/C Issuer and the Swing Line Lender. All such notices and other communications shall be deemed to be given or made upon the earlier to occur of
(i) actual receipt by the intended recipient and (ii) (A) if delivered by hand or by courier, when signed for; (B) if delivered by mail, four Business Days after deposit in
the mails, postage prepaid; (C) if delivered by facsimile, when sent and receipt has been confirmed by telephone; and (D) if delivered by electronic mail (which form of delivery is
subject to the provisions of subsection (c) below), when delivered; provided that notices and other communications
to the Administrative Agent, the L/C Issuer and the Swing Line Lender pursuant to Article II shall not be effective
until actually received by such Person. Any notice or other communication permitted to be given, made or confirmed by telephone hereunder shall be given, made or confirmed by means of a telephone call
to the intended recipient at the number specified on Schedule 10.02, it being understood and agreed that a
voicemail message shall in no event be effective as a notice, communication or confirmation hereunder. 

    (b)  Effectiveness of Facsimile Documents and
Signatures.  Loan Documents may be transmitted and/or signed by facsimile. The effectiveness of any such documents and signatures shall, subject to applicable
Law, have the same force and effect as manually-signed originals and shall be binding on all Loan Parties, the Administrative Agent and the Lenders. The Administrative Agent may also require that any
such documents and signatures be confirmed by a manually-signed original thereof; provided that the failure to request or
deliver the same shall not limit the effectiveness of any facsimile document or signature. 

    (c)  Limited Use of Electronic
Mail.  Electronic mail and Internet and intranet websites may be used only to distribute routine communications, such as financial statements and other
information as 

49

 

provided in Section 6.02, and to distribute Loan Documents for execution by the parties thereto, and may not be
used for any other purpose. 

    (d)  Reliance by Administrative Agent and
Lenders.  The Administrative Agent and the Lenders shall be entitled to rely and act upon any notices (including telephonic Committed Loan Notices and Swing Line
Loan Notices) purportedly given by or on behalf of the Borrower even if (i) such notices were not made in a manner specified herein, were incomplete or were not preceded or followed by any
other form of notice specified herein, or (ii) the terms thereof, as understood by the recipient, varied from any confirmation thereof. The Borrower shall indemnify each Agent-Related Person
and each Lender from all losses, costs, expenses and liabilities resulting from the reliance by such Person on each notice purportedly given by or on behalf of the Borrower. All telephonic notices to
and other communications with the Administrative Agent may be recorded by the Administrative Agent, and each of the parties hereto hereby consents to such recording. 

    10.03  No Waiver; Cumulative Remedies.  No failure by any Lender or the Administrative Agent to exercise,
and no delay by any such Person in exercising, any right, remedy, power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power
or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges herein or therein
provided are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law. 

    10.04  Attorney Costs, Expenses and Taxes.  The Borrower agrees (a) to pay or reimburse the
Administrative Agent for all costs and expenses incurred in connection with the development, preparation, negotiation and execution of this Agreement and the other Loan Documents and any amendment,
waiver, consent or other modification of the provisions hereof and thereof (whether or not the transactions contemplated hereby or thereby are consummated), and the consummation and administration
(provided that expenses claimed in connection with administration shall only include out of pocket expenses and Attorney Costs incurred with respect to the Obligations) of the transactions
contemplated hereby and thereby, including all Attorney Costs, and (b) to pay or reimburse the Administrative Agent and each Lender for all costs and expenses incurred in connection with the
enforcement, attempted enforcement, or preservation of any rights or remedies under this Agreement or the other Loan Documents (including all such costs and expenses incurred during any "workout" or
restructuring in respect of the Obligations and during any legal proceeding, including any proceeding under any Debtor Relief Law), including all Attorney Costs. The foregoing costs and expenses shall
include all search, filing, recording, title insurance and appraisal charges and fees and taxes related thereto, and other out-of-pocket expenses incurred by the Administrative
Agent and the cost of independent public accountants and other outside experts retained by the Administrative Agent or any Lender. The agreements in this Section shall survive the termination of the
Aggregate Commitments and repayment of all other Obligations. 

    10.05  Indemnification by the Borrower.  Whether or not the transactions contemplated hereby are
consummated, the Borrower shall indemnify and hold harmless each Agent-Related Person, each Lender and their respective Affiliates, directors, officers, employees, counsel, agents and
attorneys-in-fact (collectively, the "Indemnitees"), from and against any and all liabilities, obligations, losses, damages,
penalties, claims, demands, actions, judgments, suits, costs, expenses and disbursements (including Attorney Costs) of any kind or nature whatsoever which may at any time be imposed on, incurred by or
asserted against any such Indemnitee in any way relating to or arising out of or in connection with (a) the execution, delivery, enforcement, performance or administration of any Loan Document
or any other agreement, letter or instrument delivered in connection with the transactions contemplated thereby or the consummation of the transactions contemplated thereby, (b) any Commitment,
Loan or Letter of Credit or the use or proposed use of the proceeds therefrom (including any refusal by the L/C Issuer to honor a demand for payment under a Letter of Credit if the 

50

 

documents presented in connection with such demand do not strictly comply with the terms of such Letter of Credit), or (c) any actual or prospective claim, litigation, investigation or
proceeding relating to any of the foregoing, whether based on contract, tort or any other theory (including any investigation of, preparation for, or defense of any pending or threatened claim,
investigation, litigation or proceeding) and regardless of whether any Indemnitee is a party thereto (all the foregoing, collectively, the "Indemnified
Liabilities"); provided that such indemnity shall not, as to any Indemnitee (and other
Indemnitee(s) liable under the laws of principal and agency for the acts of such Indemnitee), be available to the extent that such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the gross negligence or willful
misconduct of such Indemnitee. The agreements in this Section shall survive the resignation of the Administrative Agent, the replacement of any Lender, the termination of the Commitments and the
repayment, satisfaction or discharge of all the other Obligations. All amounts due under this Section 10.05 shall be payable
within ten Business Days after demand therefor. 

    10.06  Payments Set Aside.  To the extent that the Borrower makes a payment to the Administrative Agent
or any Lender, or the Administrative Agent or any Lender exercises its right of set-off, and such payment or the proceeds of such set-off or any part thereof is subsequently
invalidated, declared to be fraudulent or preferential, set aside or required (including pursuant to any settlement entered into by the Administrative Agent or such Lender in its discretion) to be
repaid to a trustee, receiver or any other party, in connection with any proceeding under any Debtor Relief Law or otherwise, then (a) to the extent of such recovery, the obligation or part
thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such set-off had not occurred, and
(b) each Lender severally agrees to pay to the Administrative Agent upon demand its applicable share of any amount so recovered from or repaid by the Administrative Agent, plus interest thereon
from the date of such demand to the date such payment is made at a rate per annum equal to the Federal Funds Rate from time to time in effect. 

    10.07  Successors and Assigns.  

    (a) The
provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby,
except that the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of each Lender (and any attempted assignment or transfer by
the Borrower without such consent shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their
respective successors and assigns permitted hereby, Participants to the extent provided in subsection (d) of this Section and, to the extent expressly contemplated hereby, the Indemnitees) any
legal or equitable right, remedy or claim under or by reason of this Agreement. 

    (b) Any
Lender may at any time assign to one or more Eligible Assignees all or a portion of its rights and obligations under this Agreement (including all or a portion
of its Commitment and the Loans (including for purposes of this subsection (b), participations in L/C Obligations and in Swing Line Loans) at the time owing to
it); provided that (i) except in the case of an assignment of the entire remaining amount of the assigning Lender's
Commitment and the Loans at the time owing to it or in the case of an assignment to a Lender or an Affiliate of a Lender or an Approved Fund with respect to a Lender, the aggregate amount of the
Commitment (which for this purpose includes Loans outstanding thereunder) subject to each such assignment, determined as of the date the Assignment and Assumption with respect to such assignment is
delivered to the Administrative Agent or, if "Trade Date" is specified in the Assignment and Assumption, as of the Trade Date, shall not be less than $5,000,000 unless each of the Administrative Agent
and, so long as no Event of Default has occurred and is continuing, the Borrower otherwise consents (each such consent not to be unreasonably withheld or delayed), (ii) each partial assignment
shall be made as an assignment of a proportionate part of all 

51

 

the assigning Lender's rights and obligations under this Agreement with respect to the Loans or the Commitment assigned, except that this clause (ii) shall not apply to rights in respect of
Swing Line Loans, and (iii) the parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Assumption, together with a processing and recordation fee of
$3,500. Subject to acceptance and recording thereof by the Administrative Agent pursuant to subsection (c) of this Section, from and after the effective date specified in each Assignment and
Assumption, the Eligible Assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a
Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement
(and, in the case of an Assignment and Assumption covering all of the assigning Lender's rights and obligations under this Agreement, such Lender shall cease to be a party hereto but shall continue to
be entitled to the benefits of Sections 3.01, 3.04 and  3.05 with respect to facts and
circumstances occurring prior to the effective date of such assignment). Upon request, the Borrower (at its expense)
shall execute and deliver new or replacement Notes to the assigning Lender and the assignee Lender. Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not
comply with this subsection shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with subsection (d) of this
Section. 

    (c) The
Administrative Agent, acting solely for this purpose as an agent of the Borrower, shall maintain at the Administrative Agent's Office a copy of each Assignment
and Assumption delivered to it and a
register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal amounts of the Loans and L/C Obligations owing to, each Lender pursuant to the terms
hereof from time to time (the "Register"). The entries in the Register shall be conclusive, and the Borrower, the Administrative Agent and the Lenders
may treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. The Register
shall be available for inspection by the Borrower and any Lender, at any reasonable time and from time to time upon reasonable prior notice. 

    (d) Any
Lender may at any time, without the consent of, or notice to, the Borrower or the Administrative Agent, sell participations to any Person (other than a natural
person or the Borrower or any of the Borrower's Affiliates or Subsidiaries (each, a "Participant") in all or a portion of such Lender's rights and/or
obligations under this Agreement (including all or a portion of its Commitment and/or the Loans (including such Lender's participations in L/C Obligations and/or Swing Line Loans) owing to
it); provided that (i) such Lender's obligations under this Agreement shall remain unchanged, (ii) such
Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii) the Borrower, the Administrative Agent and the other Lenders shall continue
to deal solely and directly with such Lender in connection with such Lender's rights and obligations under this Agreement. Any agreement or instrument pursuant to which a Lender sells such a
participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this
Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the
Participant, agree to any amendment, waiver or other modification that would (i) postpone any date upon which any payment of money is scheduled to be paid to such Participant,
(ii) reduce the principal, interest, fees or other amounts payable to such Participant, or (iii) release any Guarantor from the Guaranty except to the extent permitted
by Section 10.01(g). Subject to subsection (e) of this Section, the Borrower agrees that each Participant shall be entitled
to the benefits of Sections 3.01,  3.04 and 3.05 to the same extent as if it were a
Lender and
had acquired its interest by assignment pursuant to subsection (b) of this Section. To the extent permitted by law, each Participant also shall be entitled to the benefits
of Section 10.09 as though it were a
Lender, provided such Participant agrees to be subject
to Section 2.12 as though it were a Lender. 

52

 

    (e) A Participant shall not be entitled to receive any greater payment under  Section 3.01 or 3.04 than the
applicable Lender
would have been entitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to such Participant is made with the Borrower's prior written
consent. A Participant that would be a Foreign Lender if it were a Lender shall not be entitled to the benefits
of Section 3.01 unless the Borrower is notified of the participation sold to such Participant and such Participant
agrees, for the benefit of the Borrower, to comply with Section 10.15 as though it were a Lender. 

    (f)  Any
Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement (including under its Notes, if any) to
secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve
Bank; provided that no such pledge
or assignment shall release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto. 

    (g) As
used herein, the following terms have the following meanings: 

    "Eligible Assignee" means (a) a Lender; (b) an Affiliate of a Lender; (c) an Approved Fund; and (d) any
other Person (other than a natural person) approved by (i) the Administrative Agent, and (ii) unless an Event of Default has occurred and is continuing, the Borrower (each such approval
not to be unreasonably withheld or delayed); provided that notwithstanding the foregoing, "Eligible Assignee" shall not
include the Borrower or any of the Borrower's Affiliates or Subsidiaries 

    "Fund" means any Person (other than a natural person) that is (or will be) engaged in making, purchasing, holding or otherwise
investing in commercial loans and similar extensions of credit in the ordinary course of its business. 

    "Approved Fund" means any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or
(c) an entity or an Affiliate of an entity that administers or manages a Lender. 

    (h) Notwithstanding
anything to the contrary contained herein, if at any time the L/C Issuer or Swing Line Lender assigns all of its Commitment and Loans pursuant to
subsection (b) above, (i) L/C Issuer may upon 30 days' notice to the Borrower and the Lenders, resign as L/C Issuer and/or (ii) Swing Line Lender may upon five Business
Days' notice to the Borrower, terminate the Swing Line. In the event of any such resignation as L/C Issuer or termination of the Swing Line, the Borrower shall be entitled to appoint from among the
Lenders a successor L/C Issuer or Swing Line Lender hereunder; provided that no failure by the Borrower to appoint any
such successor shall affect the resignation of the resigning L/C Issuer or the termination of the Swing Line, as the case may be. The resigning L/C Issuer shall retain all the rights and obligations
of the L/C Issuer hereunder with respect to all Letters of Credit outstanding as of the effective date of its resignation as L/C Issuer and all L/C Obligations with respect thereto (including the
right to require the Lenders to make Base Rate Committed Loans or fund participations in Unreimbursed Amounts pursuant
to Section 2.03(c)). If Swing Line Lender terminates the Swing Line, it shall retain all the rights of the Swing Line Lender
provided for hereunder with respect to Swing Line Loans made by it and outstanding as of the effective date of such termination, including the right to require the Lenders to make Base Rate Committed
Loans or fund participations in outstanding Swing Line Loans pursuant to Section 2.04(c). 

    10.08  Confidentiality.  Each of the Administrative Agent and the Lenders agrees to maintain the
confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its and its Affiliates' directors, officers, employees and agents, including accountants,
legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such
Information confidential); (b) to the extent requested by any regulatory authority; (c) to the extent required by applicable laws or 

53

 

regulations or by any subpoena or similar legal process; (d) to any other party to this Agreement; (e) to the extent believed in good faith to be necessary in connection with the
exercise of any remedies hereunder or any suit, action or proceeding relating to this Agreement or the enforcement of rights hereunder; (f) subject to an agreement containing provisions
substantially the same as those of this Section, to (i) any Eligible Assignee of or Participant in, or any prospective Eligible Assignee of or Participant in, any of its rights or obligations
under this Agreement or (ii) any direct or indirect contractual counterparty or prospective counterparty (or such contractual counterparty's or prospective counterparty's professional advisor)
to any credit derivative transaction relating to obligations of the Borrower; (g) with the consent of the Borrower; (h) to the extent such Information (i) becomes publicly
available other than as a result of a breach of this Section or (ii) becomes available to the Administrative Agent or any Lender on a nonconfidential basis from a source other than the
Borrower; or (i) to the National Association of Insurance Commissioners or any other similar organization or any nationally recognized rating agency that requires access to information about a
Lender's or its Affiliates' investment portfolio in connection with ratings issued with respect to such Lender or its Affiliates. In addition, the Administrative Agent and the Lenders may disclose the
existence of this Agreement and information about this Agreement to market data collectors, similar service providers to the lending industry, and service providers to the Administrative Agent and the
Lenders in connection with the administration and management of this Agreement, the other Loan Documents, the Commitments, and the Credit Extensions. For the purposes of this Section,
"Information" means all information received from the Borrower relating to the Borrower or its business, other than any such information that is
available to the Administrative Agent or any Lender on a nonconfidential basis prior to disclosure by the
Borrower; provided that, in the case of information received from the Borrower after the date hereof, such information, if
not manifestly confidential, is identified at the time of delivery as confidential. Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered
to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own
confidential information. 

    10.09  Set-off.  In addition to any rights and remedies of the Lenders provided by law, upon
the occurrence and during the continuance of any Event of Default, each Lender is authorized at any time and from time to time, without prior notice to the Borrower or any other Loan Party, any such
notice being waived by the Borrower (on its own behalf and on behalf of each Loan Party) to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or
demand, provisional or final) at any time held by, and other indebtedness at any time owing by, such Lender to or for the credit or the account of the respective Loan Parties against any and all
Obligations owing to such Lender, now or hereafter existing, irrespective of whether or not the Administrative Agent or such Lender shall have made demand under this Agreement or any other Loan
Document and although such Obligations may be contingent or unmatured. Each Lender agrees promptly to notify the Borrower and the Administrative Agent after any such set-off and
application made by such Lender; provided that the failure to give such notice shall not affect the validity of such
set-off and application. 

54

       10.10  Interest Rate Limitation.  Notwithstanding anything to the contrary contained in any Loan
Document, the interest paid or agreed to be paid under the Loan Documents shall not exceed the maximum rate of non-usurious interest permitted by applicable Law (the
"Maximum Rate"). If the Administrative Agent or any Lender shall receive interest in an amount that exceeds the Maximum Rate, the excess interest shall
be applied to the principal of the Loans or, if it exceeds such unpaid principal, refunded to the Borrower. In determining whether the interest contracted for, charged, or received by the
Administrative Agent or a Lender exceeds the Maximum Rate, such Person may, to the extent permitted by applicable Law, (a) characterize any payment that is not principal as an expense, fee, or
premium rather than interest, (b) exclude voluntary prepayments and the effects thereof, and (c) amortize, prorate, allocate, and spread in equal or unequal parts the total amount of
interest throughout the contemplated term of the Obligations. 

    10.11  Counterparts; Facsimile Signatures; Effectiveness.  This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Delivery of an executed counterpart of the signature page to this
Agreement by facsimile shall be effective as delivery of a manually executed counterpart of this Agreement, and any party delivering an executed counterpart of the signature page to this Agreement by
facsimile to any other party shall thereafter also promptly deliver a manually executed counterpart of this Agreement to such other party, but the failure to deliver such manually executed counterpart
shall not affect the validity, enforceability, and binding effect of this Agreement. Until the Closing Date occurs, the Existing Credit Agreement shall remain in full force and effect in accordance
with the provisions thereof, and notwithstanding the occurrence of the Closing Date, any rights existing in favor of Administrative Agent or any Lender arising from any commitment or fees,
indemnification yield protection, taxes, and similar provisions of the Existing Credit Agreement, relating in each case to the period prior to the Closing Date, and any rights of the letter of credit
issuer under the Existing Credit Agreement with respect to the Existing Letters of Credit, shall survive the effectiveness of this Agreement. On the Closing Date, the Existing Credit Agreement shall
be amended and restated in its entirety hereby, and from and after the Closing Date, the rights, obligations, and remedies of the parties hereto shall be governed by this Agreement and the other Loan
Documents. 

    10.12  Integration.  This Agreement, together with the other Loan Documents, comprises the complete and
integrated agreement of the parties on the subject matter hereof and thereof and supersedes all prior agreements, written or oral, on such subject matter. In the event of any conflict between the
provisions of this Agreement and those of any other Loan Document, the provisions of this Agreement shall
control; provided that the inclusion of supplemental rights or remedies in favor of the Administrative Agent or the
Lenders in any other Loan Document shall not be deemed a conflict with this Agreement. Each Loan Document was drafted with the joint participation of the respective parties thereto and shall be
construed neither against nor in favor of any party, but rather in accordance with the fair meaning thereof. 

    10.13  Survival of Representations and Warranties.  All representations and warranties made hereunder and
in any other Loan Document or other document delivered pursuant hereto or thereto or in connection herewith or therewith shall survive the execution and delivery hereof and thereof. Such
representations and warranties have been or will be relied upon by the Administrative Agent and each Lender, regardless of any investigation made by the Administrative Agent or any Lender or on their
behalf and notwithstanding that the Administrative Agent or any Lender may have had notice or knowledge of any Default at the time of any Credit Extension, and shall continue in full force and effect
as long as any Loan or any other Obligation shall remain unpaid or unsatisfied or any Letter of Credit shall remain outstanding. 

    10.14  Severability.  Any provision of this Agreement and the other Loan Documents to which the Borrower
is a party that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the 

55

 

remaining provisions thereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. 

    10.15  Tax Forms.  (a) Each Lender that is not a "United States person" within the meaning of
Section 7701(a)(30) of the Code (a "Foreign Lender") shall deliver to the Administrative Agent, prior to receipt of any payment subject to
withholding under the Code (or upon accepting an assignment of an interest herein), two duly signed completed copies of either IRS Form W-8BEN or any successor thereto (relating to
such Person and entitling it to an exemption from withholding tax on all payments to be made to such Person by the Borrower pursuant to this Agreement) or IRS Form W-8ECI or any
successor thereto (relating to all payments to be made to such Person by the Borrower pursuant to this Agreement) or such other evidence satisfactory to the Borrower and the Administrative Agent that
such Person is entitled to an exemption from U.S. withholding tax. Thereafter and from time to time, each such Person shall (i) promptly submit to the Administrative Agent such additional duly
completed and signed copies of one of such forms (or such successor forms as shall be adopted from time to time by the relevant United States taxing authorities) as may then be available under then
current United States laws and regulations to avoid, or such evidence as is satisfactory to the Borrower and the Administrative Agent of any available exemption from United States withholding taxes in
respect of all payments to be made to such Person by the Borrower pursuant to this Agreement, (ii) promptly notify the Administrative Agent of any change in circumstances which would modify or
render invalid any claimed exemption, and (iii) take such steps as shall not be materially disadvantageous to it, in the reasonable judgment of such Lender, and as may be reasonably necessary
(including the re-designation of its Lending Office) to avoid any requirement of applicable Laws that the Borrower make any deduction or withholding for taxes from amounts payable to such
Person. If such Person fails to deliver the above forms or other documentation, then the Administrative Agent may withhold from any interest payment to such Person an amount equivalent to the
applicable withholding tax imposed by Sections 1441 and 1442 of the Code, without reduction. 

    (b) Upon
the request of the Administrative Agent, each Lender that is a "United States person" within the meaning of Section 7701(a)(30) of the Code shall
deliver to the Administrative Agent two duly
signed completed copies of IRS Form W-9. If such Lender fails to deliver such forms, then the Administrative Agent may withhold from any interest payment to such Lender an amount
equivalent to the applicable back-up withholding tax imposed by the Code, without reduction and the Borrower shall have no indemnification obligation with respect to the amounts so
withheld. 

    (c) If
any Governmental Authority asserts that the Administrative Agent did not properly withhold or backup withhold, as the case may be, any tax or other amount from
payments made to or for the account of any Lender, such Lender shall indemnify the Administrative Agent therefor, including all penalties and interest, any taxes imposed by any jurisdiction on the
amounts payable to the Administrative Agent under this Section, and costs and expenses (including Attorney Costs) of the Administrative Agent. The obligation of the Lenders under this Section shall
survive the termination of the Aggregate Commitments, repayment of all Obligations and the resignation of the Administrative Agent. 

    10.16  Removal and Replacement of Lenders.  

    (a) Under
any circumstances set forth herein providing that the Borrower shall have the right to remove or replace a Lender as a party to this Agreement, the Borrower
may, upon notice to such Lender and the Administrative Agent, (i) remove such Lender by terminating such Lender's Commitment or (ii) replace such Lender by causing such Lender to assign
its Commitment (without payment of any assignment fee) pursuant to Section 10.07(b) to one or more other Lenders or
Eligible Assignees procured by the Borrower; provided that if the Borrower elects to exercise such right with respect to
any Lender pursuant to Section 3.06(b), it shall be obligated to remove or replace, as the case may be, all Lenders that have made
similar requests for compensation pursuant 

56

 

to Section 3.01 or 3.04. The Borrower shall
(x) pay in full all principal, interest, fees and other amounts owing to such Lender through the date of removal or replacement (including any amounts payable pursuant
to Section 3.05), (y) provide appropriate assurances and indemnities (which may include letters of credit) to the L/C
Issuer and the Swing Line Lender as each may reasonably require with respect to any continuing obligation to purchase participation interests in any L/C Obligations or any Swing Line Loans then
outstanding, and (z) release such Lender from its obligations under the Loan Documents. Any Lender being replaced shall execute and deliver an Assignment and Assumption with respect to such
Lender's Commitment and outstanding Credit Extensions. The Administrative Agent shall distribute an amended Schedule 2.01, which
shall be deemed incorporated into this Agreement, to reflect changes in the identities of the Lenders and adjustments of their respective Commitments and/or Pro Rata Shares resulting from any such
removal or replacement. 

    (b) In
order to make all the Lenders' interests in any outstanding Credit Extensions ratable in accordance with any revised Pro Rata Shares after giving effect to the
removal or replacement of a Lender, the Borrower shall pay or prepay, if necessary, on the effective date thereof, all outstanding Committed Loans of all Lenders, together with any amounts due
under Section 3.05. The Borrower may
then request Committed Loans from the Lenders in accordance with their revised Pro Rata Shares. The Borrower may net any payments required hereunder against any funds being provided by any Lender or
Eligible Assignee replacing a terminating Lender. The effect for purposes of this Agreement shall be the same as if separate transfers of funds had been made with respect thereto. 

    (c) This
section shall supersede any provision in Section 10.01 to the contrary. 

    10.17  Governing Law.  

    (a) THIS
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF CALIFORNIA APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY
WITHIN SUCH STATE; PROVIDED THAT THE ADMINISTRATIVE AGENT AND EACH LENDER SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL
LAW. 

    (b) ANY
LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF CALIFORNIA SITTING IN THE CITY
AND COUNTY OF SAN FRANCISCO OR OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF CALIFORNIA, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, THE BORROWER, THE ADMINISTRATIVE AGENT AND EACH LENDER
CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. THE BORROWER, THE ADMINISTRATIVE AGENT AND EACH LENDER IRREVOCABLY WAIVES ANY
OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF ANY LOAN DOCUMENT OR OTHER DOCUMENT RELATED THERETO. THE BORROWER, THE ADMINISTRATIVE AGENT AND EACH LENDER WAIVES PERSONAL
SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH STATE. 

    10.18  Waiver of Right to Trial by Jury.  EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT
TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF
THEM WITH RESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR 

57

 

OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY
FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY. 

    IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first above written. 

	BORROWER:	 	LONGS DRUG STORES CALIFORNIA, INC.
	

 	
 	

By	

/s/ STEVEN F. McCANN
 (One of Two Required and Authorized Signatures)
	 	 	Title:	Senior Vice President

Chief Financial Officer & Treasurer

	

 	
 	

And By	

/s/ GROVER L. WHITE   

	 	 	Title:	Assistant Secretary
	

ADMINISTRATIVE AGENT:	
 	
BANK OF AMERICA, N.A., as

Administrative Agent
	

 	
 	

By	

/s/ RONALD R. PARSONS   

	 	 	Name:	Ronald R. Parsons

	 	 	Title:	Vice President

	

LENDERS:	
 	
BANK OF AMERICA, N.A., as a Lender and

Swing Line Lender
	

 	
 	

By	

/s/ LISA M. THOMAS   

	 	 	Name:	Lisa M. Thomas

	 	 	Title:	Senior Vice President

	

 	
 	
FLEET NATIONAL BANK, as a Lender,

Syndication Agent, and L/C Issuer
	

 	
 	

By	

/s/ PETER L. GRISWOLD   

	 	 	Name:	Peter L. Griswold

	 	 	Title:	Managing Director

58

 

	

 	
 	
BANK OF HAWAII
	

 	
 	

By	

/s/ DANA TAKUSHI   

	 	 	Name:	Dana Takushi

	 	 	Title:	Vice President

	

 	
 	
WASHINGTON MUTUAL BANK
	

 	
 	

By	

/s/ TONY YEE   

	 	 	Name:	Tony Yee

	 	 	Title:	Assistant Vice President

	

 	
 	
UNION BANK OF CALIFORNIA, N.A.
	

 	
 	

By	

/s/ TIMOTHY P. STREB   

	 	 	Name:	Timothy P. Streb

	 	 	Title:	Vice President

	

 	
 	
U.S. BANK NATIONAL ASSOCIATION
	

 	
 	

By	

/s/ JANET JORDAN   

	 	 	Name:	Janet Jordan

	 	 	Title:	Vice President

	

 	
 	
WELLS FARGO BANK, NATIONAL ASSOCIATION
	

 	
 	

By	

/s/ KATRINA K. FLOWERS   

	 	 	Name:	Katrina K. Flowers

	 	 	Title:	Assistant Vice President

	

 	
 	
WELLS FARGO BANK, NATIONAL ASSOCIATION
	

 	
 	

By	

/s/ LAUREN DOWNUM   

	 	 	Name:	Lauren Downum

	 	 	Title:	Sr. Relationship Manager

59

QuickLinks

TABLE OF CONTENTS

ARTICLE I. DEFINITIONS AND ACCOUNTING TERMS

Applicable Rate

ARTICLE II. THE COMMITMENTS AND CREDIT EXTENSIONS

ARTICLE III. TAXES, YIELD PROTECTION AND ILLEGALITY

ARTICLE IV. CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

ARTICLE V. REPRESENTATIONS AND WARRANTIES

ARTICLE VI. AFFIRMATIVE COVENANTS

ARTICLE VII. NEGATIVE COVENANTS

ARTICLE VIII. EVENTS OF DEFAULT AND REMEDIES

ARTICLE IX. ADMINISTRATIVE AGENT

ARTICLE X. MISCELLANEOUS<Page>

                                                                    Exhibit 10.3

                         CONFIDENTIAL TREATMENT REQUESTED
================================================================================

                                     [LOGO]

                                CREDIT AGREEMENT

                          Dated as of October 24, 2001

                                      among

                          COGENT COMMUNICATIONS, INC.,
                                  as Borrower,

                              COGENT INTERNET, INC,
                             as Additional Borrower,

                       CISCO SYSTEMS CAPITAL CORPORATION,
                                    as Agent

                                       and

                         The Other Lenders Party Hereto

================================================================================

<Page>

                                TABLE OF CONTENTS

<Table>
<S>                                                                                                           <C>
SECTION 1.   DEFINITIONS AND ACCOUNTING TERMS...................................................................1
    1.1      Definitions........................................................................................1
    1.2      Interpretation.....................................................................................10
    1.3      Accounting Principles..............................................................................11

SECTION 2.   THE LOAN FACILITY..................................................................................12
    2.1      The Loans..........................................................................................12
    2.2      Use of Proceeds....................................................................................12
    2.3      Borrowing Procedure................................................................................12
    2.4      Evidence of Indebtedness...........................................................................13
    2.5      Interest and Fees..................................................................................14
    2.6      Computations.......................................................................................14
    2.7      Highest Lawful Rate................................................................................14
    2.8      Repayment of the Loans.............................................................................14
    2.9      Prepayments........................................................................................15
    2.10     Reduction or Termination of the Commitments........................................................15
    2.11     Increased Costs; Regulatory Changes................................................................15
    2.12     Funding Losses.....................................................................................16
    2.13     Rights of CSCC/Assignee............................................................................16
    2.14     Reserves on LIBOR Loans............................................................................17
    2.15     Illegality.........................................................................................17
    2.16     Obligation to Mitigate.............................................................................17
    2.17     Payments...........................................................................................17
    2.18     Set Off............................................................................................18
    2.19     Pro rata Treatment.................................................................................19
    2.20     Sharing............................................................................................19
    2.21     Taxes..............................................................................................19
    2.22     Substitute Basis for Determining Interest..........................................................21

SECTION 3.   CONDITIONS PRECEDENT...............................................................................21
    3.1      Conditions Precedent to the Initial Loan...........................................................21
    3.2      Conditions Precedent to All Loans..................................................................23

SECTION 4.   REPRESENTATIONS AND WARRANTIES.....................................................................24
    4.1      Representations and Warranties of Holdings and Borrower............................................24
    4.2      Representations and Warranties of Lenders..........................................................27

SECTION 5.   COVENANTS..........................................................................................27
    5.1      Covenants..........................................................................................27

SECTION 6.   EVENTS OF DEFAULT..................................................................................42
    6.1      Events of Default..................................................................................42
    6.2      Effect of Event of Default.........................................................................45
</Table>

<Page>

<Table>
<S>                                                                                                          <C>
SECTION 7.   THE AGENT..........................................................................................46
    7.1      Appointment and Authorization; "Agent".............................................................46
    7.2      Delegation of Duties...............................................................................46
    7.3      Liability of Agent.................................................................................46
    7.4      Reliance by Agent..................................................................................47
    7.5      Notice of Default..................................................................................47
    7.6      Credit Decisions...................................................................................47
    7.7      Indemnification of Agent...........................................................................48
    7.8      Agent in Individual Capacity.......................................................................48
    7.9      Collateral Matters.................................................................................49
    7.10     Successor Agent....................................................................................49

SECTION 8.   MISCELLANEOUS......................................................................................50
    8.1      Amendments.........................................................................................50
    8.2      Notices............................................................................................50
    8.3      No Waiver; Cumulative Remedies.....................................................................51
    8.4      Costs and Expenses; Indemnification................................................................51
    8.5      Survival...........................................................................................52
    8.6      Benefits of Agreement..............................................................................52
    8.7      Binding Effect; Successors and Assigns.............................................................53
    8.8      Confidentiality....................................................................................54
    8.9      Governing Law......................................................................................56
    8.10     Submission to Jurisdiction.........................................................................56
    8.11     Waiver of Jury Trial...............................................................................57
    8.12     Entire Agreement...................................................................................57
    8.13     Severability.......................................................................................57
    8.14     Counterparts.......................................................................................57
    8.15     Second Amended and Restated Credit Agreement.......................................................57
    8.16     Joint and Several Liability........................................................................57
</Table>

SCHEDULE OF INFORMATION

LENDER ANNEX

EXHIBITS

A      Form of Notice of Borrowing
B      Form of Compliance Certificate
C      Form of Amended and Restated Borrower Security Agreement
D      Form of Amended and Restated Holdings Security Agreement
E      Form of Amended and Restated Additional Borrower Security Agreement
F      Form of Amended and Restated Borrower Stock Pledge Agreement
G      Form of Amended and Restated Additional Borrower Stock Pledge Agreement
H      Form of Amended and Restated Holdings Guaranty
I      Form of Amended and Restated Additional Borrower Guaranty
J      Form of Borrower Guaranty

<Page>

K      Form of Stock Subscription Warrant
L      Form of Tranche A Note
M      Form of Tranche B Note
N      Form of Tranche X Note
O      Form of Assignment and Acceptance Agreement
P      Form of Confirmation of Position and Release Agreement

<Page>

                                CREDIT AGREEMENT

         THIS SECOND AMENDED AND RESTATED CREDIT AGREEMENT (this "Agreement") is
entered into as of October 24, 2001, among COGENT COMMUNICATIONS, INC., a
Delaware corporation ("Borrower"), COGENT INTERNET, INC. ("Additional
Borrower"), the several financial institutions from time to time party hereto
("Lenders") and CISCO SYSTEMS CAPITAL CORPORATION, as administrative agent for
itself and the other Lenders (in such capacity, "Agent").

         WHEREAS, Borrower has requested that Lenders provide Borrower with a
term loan credit facility, and Lenders are willing to do so on the terms and
conditions set forth herein;

         NOW THEREFORE, in consideration of the mutual covenants and agreements
herein contained, the parties hereto covenant and agree as follows:

     SECTION 1. DEFINITIONS AND ACCOUNTING TERMS.

     1.1 DEFINITIONS. As used in this Agreement, the following terms shall have
the following meanings:

         "ADDITIONAL BORROWER" means Cogent Internet, Inc. and any Additional
Borrower designated in the Schedule or any Subsidiary of Borrower acceding
hereto as an Additional Borrower as contemplated by the Schedule.

         "AFFECTED LENDER" has the meaning set forth in Section 2.11.

         "AFFILIATES" means, as to any Person, any other Person which, directly
or indirectly, is in control of, is controlled by, or is under common control
with, such Person. A Person shall be deemed to control another Person if the
controlling Person possesses, directly or indirectly, the power to direct or
cause the direction of the management and policies of the other Person, whether
through the ownership of voting securities, membership interests, by contract,
or otherwise.

         "AGENT-RELATED PERSONS" means CSCC and any successor agent arising
under Section 7.10, together with their respective Affiliates, and the officers,
directors, employees, agents and attorneys-in-fact of such Persons and
Affiliates.

         "AGENT'S PAYMENT INSTRUCTIONS" means the payment instructions of Agent
set forth on the Schedule or such other payment instructions as Agent may from
time to time specify.

         "AGGREGATE COMMITMENT" means the combined Commitments of Lenders, as
set forth in Section 1(c) of the Schedule.

         "AMENDED AND RESTATED AGREEMENT" means that certain Amended and
Restated Credit Agreement by and between CSCC, as lender, and Borrower, dated as
of March 14, 2001, which is being amended and restated in its entirety by this
Agreement.

         "ANNEX" means the Lender Annex attached hereto.

[*] Indicates confidential treatment requested.

<Page>

         "APPROVED FUND" means with respect to any Lender which is a fund
primarily engaged in making, purchasing or otherwise investing in commercial
loans, any other fund which is primarily engaged in making, purchasing or
otherwise investing in commercial loans or extending, or investing in extensions
of, credit for its own account in the ordinary course of its business and which
is managed or advised by the same investment advisor as such Lender or by an
Affiliate of such investment advisor; PROVIDED, HOWEVER, that Approved Fund
shall not include any Affiliate of Holdings.

         "ASSIGNEE" has the meaning set forth in Section 8.7(a).

         "ASSIGNMENT AND ACCEPTANCE" has the meaning set forth in Section
8.7(a).

         "AVAILABILITY PERIOD" has the meaning set forth in the Schedule.

         "BANKING DAY" has the meaning set forth in the Schedule.

         "BANKRUPTCY CODE" means Title 11 of the United States Code entitled
"Bankruptcy".

         "BORROWER" means Cogent Communications, Inc. (subject to Section 8.16).

         "BORROWING DATE" means any date on which a Loan is made to Borrower.

         "CASUALTY EVENT" has the meaning set forth in Section 2(c) of the
Schedule.

         "CHANGE OF CONTROL" means (i) the acquisition of beneficial ownership,
directly or indirectly, by any Person or group (within the meaning of the
Securities Exchange Act of 1934 and the rules of the Securities and Exchange
Commission thereunder as in effect on the date hereof) of shares representing
more than 35% of the aggregate ordinary voting power represented by the issued
and outstanding capital stock of Holdings; or (ii) occupation of a majority of
the seats (other than vacant seats) on the Board of Directors of Holdings by
Persons who were neither (A) nominated by the Board of Directors of Holdings nor
(B) appointed by directors so nominated; or (iii) Holdings shall cease to own
and control directly, of record and beneficially, 100% of each class of
outstanding capital stock of Borrower free and clear of all Liens (other than
any Liens under the Collateral Documents); provided that no Change of Control of
Holdings shall exist hereunder if resulting from an initial public offering of
Holdings' equity securities; and provided further, however, that the issuance of
securities of the Borrower to certain investors in accordance with Borrower's
Series C round of financing shall not constitute a Change of Control hereunder.

         "CISCO SYSTEMS" means Cisco Systems, Inc. or any subsidiary or
Affiliate thereof

         "CISCO PRODUCTS" means networking and telecommunications equipment and
other goods, spare parts, accessories, software and services which Cisco Systems
manufactures, assembles, sells, licenses or provides, including any such
equipment and other goods, spare parts, accessories, software and services
manufactured, assembled, sold, licensed or provided by Cisco Systems through a
Vendor other than Cisco Systems.

                                       2

[*] Indicates confidential treatment requested.

<Page>

         "CLOSING DATE" means the date occurring on or before the Closing
Deadline on which all conditions precedent set forth in Section 3.1 are
satisfied or waived by all Lenders (or, in the case of subsection 3.1(e), waived
by the Person entitled to receive such payment).

         "CLOSING DEADLINE" has the meaning set forth in the Schedule.

         "COLLATERAL" means the property described in the Collateral Documents,
and all other property now existing or hereafter acquired which may at any time
be or become subject to a Lien in favor of Agent or Lenders pursuant to the
Collateral Documents or otherwise, securing the payment and performance of the
Obligations.

         "COLLATERAL DOCUMENTS" means each Collateral Document identified in the
Schedule, any security agreement provided under Section 5.1(o) and any other
agreement pursuant to which any Loan Party or any other Person provides a Lien
on its assets in favor of Agent or Lenders and all filings, documents and
agreements made or delivered pursuant thereto.

         "COMMITMENT" means, (a) with respect to each Lender, the Dollar amount
set forth next-to such Lender's name in the Annex, which aggregate principal
amount shall be equal to such Lender's Pro Rata Share of the Aggregate
Commitment or (b) where the context so requires, the obligation of each Lender
to make Loans up to such aggregate principal amount on the terms and conditions
set forth in this Agreement.

         "COMPLIANCE CERTIFICATE" means a certificate of Borrower, in
substantially the form of EXHIBIT B, with such changes thereto as Agent may from
time to time reasonably request.

         "CSCC" means Cisco Systems Capital Corporation, a Nevada corporation.

         "CUSTOMER INFORMATION" has the meaning set forth in Section 8.8.

         "DEFAULT" means an Event of Default or an event or condition which with
notice or lapse of time or both would constitute an Event of Default.

         "DOLLARS" and the sign "$" each means lawful money of the United
States.

         "ELIGIBLE ASSIGNEE" means (a) a commercial bank organized under the
laws of the United States, or any state thereof, and having a combined capital
and surplus of at least $100,000,000; (b) a commercial bank organized under the
laws of any other country which is a member of the Organization for Economic
Cooperation and Development (the "OECD"), or a political subdivision of any such
country, and having a combined capital and surplus of at least $100,000,000,
PROVIDED that such bank is acting through a branch or agency located in the
United States; (c) a Person that is primarily engaged in the business of
commercial banking and having a combined capital and surplus of at least
$100,000,000 and that is (i) a Subsidiary of a Lender, (ii) a Subsidiary of a
Person of which a Lender is a Subsidiary, or (iii) a Person of which a Lender is
a Subsidiary; (d) any Approved Fund; (e) any other Person which is an
"accredited investor" (as defined in Regulation D under the Securities Exchange
Act of 1934) which extends credit or buys loans as one of its businesses,
including insurance companies, mutual funds and lease financing companies and
having a combined capital and surplus of at least $100,000,000; and (f) any
other Person approved by Agent as a Lender hereunder, provided that such Person,
if

                                       3

[*] Indicates confidential treatment requested.

<Page>

an individual, has a net worth of at least $50,000,000 (and Agent reasonably
believes that such individual has the ability to perform its obligations as a
Lender in accordance with the terms of this Agreement), and, if not an
individual, has a combined capital and surplus of at least $100,000,000;
PROVIDED that neither Holdings nor any Affiliate of Holdings shall be an
Eligible Assignee.

         "ENVIRONMENTAL LAWS" means all governmental laws, statutes, rules,
regulations, ordinances and codes, together with all administrative orders,
directives, requests, licenses, authorizations and permits of, and agreements
with (including consent decrees), any Governmental Authorities, in each case
relating to or imposing liability or standards of conduct concerning land use,
public health, safety and environmental protection matters and pertaining to any
property.

         "ERISA" means the Employee Retirement Income Security Act of 1974,
including (unless the context otherwise requires) any rules or regulations
promulgated thereunder.

         "EUROCURRENCY LIABILITIES" has the meaning set forth in Section 2.14.

         "EVENT OF DEFAULT" has the meaning set forth in Section 6.1.

         "EXCESS CASH FLOW" has the meaning set forth in Section 2(c) of the
Schedule.

         "FCC" means the Federal Communications Commission, or any successor
thereto, administering the Communications Act of 1934.

         "FRB" means the Board of Governors of the Federal Reserve System, and
any Governmental Authority succeeding to its principal functions.

         "FEE LETTER" means the letter agreement between Borrower and Agent
relating to certain fees payable by Borrower in connection with this Agreement.

         "FEDERAL FUNDS RATE" means, for any day, the rate set forth in the
weekly statistical release designated as H-15(519), or any successor
publication, published by the Federal Reserve Bank of New York with respect to
the preceding Banking Day opposite the caption "Federal Funds (Effective)"; or,
if for any relevant day such rate is not so published with respect to any such
preceding Banking Day, the rate for such day will be the arithmetic mean as
determined by Agent of the rates for the last transaction in overnight Federal
funds arranged prior to 9:00 a.m. (New York City time) on that day by each of
three leading brokers of Federal funds transactions in New York City selected by
Agent.

         "FINANCED PRODUCTS" means the Cisco Products and other goods, services
and other property the acquisition of which is financed by Lenders or with
respect to which any Lender is otherwise providing financing or extending credit
to enable Borrower to acquire.

         "FINANCING DOCUMENTS" has the meaning set forth in the Schedule.

                                       4

[*] Indicates confidential treatment requested.

<Page>

         "FUNDING PROCEDURES AND POLICIES" means Agent's "Funding Procedures and
Policies" as in effect from time to time, as communicated to Borrower.

         "GAAP" means generally accepted accounting principles as in effect from
time to time.

         "GOVERNMENTAL AUTHORITY" means any national government, or any state,
province or other political subdivision thereof or therein, or any governmental
ministry, department, body, commission, board, bureau, agency, central bank,
court, tribunal or other instrumentality or authority exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.

         "GUARANTOR" means Holdings or any direct or indirect Subsidiary of
Holdings becoming a guarantor as provided under Section 5.1(o) and any guarantor
identified in the Schedule.

         "GUARANTOR DOCUMENTS" means any Guaranty and all other documents,
agreements and instruments delivered to Agent and the Lenders by a Guarantor
under or in connection with any Guaranty.

         "GUARANTY" means the guaranty of any Guarantor, as provided under
Section 5.1(o), and any guaranty of any Guarantor identified in the Schedule.

         "HAZARDOUS SUBSTANCES" means any toxic or hazardous substances,
materials, wastes, contaminants or pollutants regulated under or forming the
basis for liability under any applicable Environmental Law.

         "HOLDINGS" means Cogent Communications Group, Inc., a corporation
organized and existing under the laws of the State of Delaware.

         "HOLDINGS PREPAYMENT DATE" has the meaning set forth in Section
2(c)(ii) of the Schedule.

         "INDEBTEDNESS" means, for any Person, (i) all indebtedness or other
obligations of such Person for borrowed money, or for the deferred purchase
price of property or services (acquired or obtained other than on normal trade
credit terms); (ii) all obligations evidenced by notes, bonds, debentures or
similar instruments, including obligations so evidenced incurred in connection
with the acquisition of property, assets or businesses; (iii) all non-contingent
reimbursement and other obligations of such Person in respect of letters of
credit and bankers acceptances and all net obligations in respect of interest
rate swaps, caps, floors and collars, currency swaps, or other similar financial
products; (iv) all obligations under leases which shall have been or should be,
in accordance with GAAP, recorded as capital leases; and (v) all indebtedness of
another Person of the types referred to in clauses (i) through (iv) guaranteed
directly or indirectly in any manner by the Person for whom Indebtedness is
being determined.

         "INDEMNIFIED LIABILITIES" has the meaning set forth in Section 8.4.

         "INDEMNIFIED PERSON" has the meaning set forth in Section 8.4.

                                        5

[*] Indicates confidential treatment requested.

<Page>

         "INSOLVENCY PROCEEDING" means (i) any case, action or proceeding before
any court or other Governmental Authority relating to bankruptcy,
reorganization, insolvency, liquidation, receivership, dissolution, winding-up
or relief of debtors, or (ii) any general assignment for the benefit of
creditors, composition, marshalling of assets for creditors, or other, similar
arrangement in respect of its creditors generally or any substantial portion of
its creditors, in each case undertaken under U.S. federal, state or foreign law,
including the Bankruptcy Code.

         "INTEREST PERIOD" has the meaning set forth in the Schedule.

         "LENDER" means each lending institution from time to time party to this
Agreement.

         "LIEN" means any mortgage, pledge, security interest, assignment,
deposit arrangement, charge or encumbrance, lien or other type of preferential
arrangement (other than a financing statement filed by a lessor in respect of an
operating lease not intended as security).

         "LOAN DOCUMENTS" means this Agreement, the Fee Letter, the Notes, any
Collateral Documents, any Guaranty, any Guarantor Documents and all other
certificates, documents, agreements and instruments delivered to Agent or
Lenders under or in connection with this Agreement.

         "LOAN PARTY" means Holdings, Borrower, each Additional Borrower and
each Guarantor.

         "LOANS" has the meaning set forth in Section 2.1.

         "MAJORITY LENDERS" means at any time Lenders then holding in excess of
50% of the then aggregate unpaid principal amount of the Loans or, if no such
principal amount is then outstanding, Lenders then having in excess of 50% of
the Aggregate Commitment.

         "MATERIAL ADVERSE CHANGE" means (i) a material adverse change in the
business, operations or financial condition of Holdings, Borrower and their
respective Subsidiaries taken as a whole, or (ii) any event, matter, condition
or circumstance which (A) would materially impair the ability of Holdings,
Borrower or their respective Subsidiaries or any other Person to perform or
observe its obligations under or in respect of the Loan Documents, or (B)
affects the legality, validity, binding effect or enforceability of any of the
Loan Documents.

         "MATERIAL CONTRACTS" means each Material Contract identified in the
Schedule and any other telecommunications service provider agreements or other
supply, purchase, service or other agreement to which Holdings, Borrower or any
of their respective Subsidiaries is a party (whether entered into before or
after the Closing Date) for which the aggregate amount or value of goods or
services to be supplied, provided or performed, or funds or property to be paid
or transferred, exceeds $5,000,000 (or its equivalent in another currency)
during any twelve-month period.

         "MAXIMUM RATE" has the meaning set forth in Section 2.7.

         "NOTE" means each Promissory Note referred to in the Schedule.

                                       6

[*] Indicates confidential treatment requested.

<Page>

         "OBLIGATIONS" means the indebtedness, liabilities and other obligations
of all Loan Parties to Agent and Lenders under or in connection with the Loan
Documents, including all Loans, all interest accrued thereon, all fees due under
this Agreement and all other amounts payable by any Loan Party to Agent or
Lenders thereunder or in connection therewith.

         "ORIGINAL CLOSING DATE" means March 24, 2000.

         "ORIGINAL CREDIT AGREEMENT" means that certain Credit Agreement dated
as of March 24, 2000, between Borrower and CSCC, as lender, as amended and
restated by the Amended and Restated Agreement.

         "OTHER CHARGES" has the meaning set forth in Section 2.21(b).

         "PARTICIPANT" has the meaning set forth in Section 8.7(d).

         "PERMITS AND LICENSES" has the meaning set forth in Section 4.1(i).

         "PERMITTED LIENS" means: (i) Liens in favor of Agent, Lenders or Cisco
Systems, (ii) the existing Liens disclosed in writing to Lenders on or prior to
the date hereof or incurred in connection with any extension, renewal or
refinancing of the Indebtedness secured by such existing Liens permitted
hereunder, provided that any extension, renewal or replacement Lien shall be
limited to the property encumbered by the existing Lien and the principal amount
of the Indebtedness being extended, renewed or refinanced does not increase;
(iii) Liens securing Indebtedness as permitted under the Schedule; (iv) Liens
for taxes, fees, assessments or other governmental charges or levies, either not
delinquent or being contested in good faith by appropriate proceedings and which
are adequately reserved for in accordance with GAAP, PROVIDED that such Liens do
not have automatic priority over the Liens of any Lender and no notice of tax
lien has been filed of record; (v) Liens of landlords, materialmen, mechanics,
warehousemen, carriers or employees or other similar Liens provided for by
mandatory provisions of law and securing obligations either not delinquent or
being contested in good faith by appropriate proceedings and which do not in the
aggregate materially impair the use or value of the property or risk the loss or
forfeiture thereof, (vi) Liens consisting of deposits or pledges to secure the
performance of bids, trade contracts, letters of credit, leases, public or
statutory obligations, including on account of workers compensation and
unemployment insurance, or other obligations of a like nature incurred in the
ordinary course of business, (other than for Indebtedness); (vii) Liens upon or
in any property acquired or held by Borrower or any of its Subsidiaries to
secure the purchase price of such property or Indebtedness incurred solely for
the purpose of financing the acquisition of such property; PROVIDED that (A) any
such Lien attaches to such property concurrently with or within 20 days after
the acquisition thereof, (B) such Lien attaches solely to the property so
acquired in such transaction, (C) the principal amount of the Indebtedness
secured thereby does not exceed 100% of the cost of such property, and (D) no
Default would occur hereunder as a result of the incurrence of such
Indebtedness; (viii) Liens on specific tangible assets of Persons which become
Subsidiaries after the date of this Agreement; PROVIDED, HOWEVER, that (A) such
Liens existed at the time the respective Persons became Subsidiaries and were
not created in anticipation thereof, (B) any such Lien does not by its terms
cover any assets after the time such Person becomes a Subsidiary which were not
covered immediately prior thereto, (C) any such Lien does not by its terms
secure any Indebtedness other

                                       7

[*] Indicates confidential treatment requested.

<Page>

than Indebtedness existing immediately prior to the time such Person becomes a
Subsidiary, (D) the acquisition of such Person is permitted hereby, and (E) no
Default would occur hereunder as a result of the incurrence of such
Indebtedness; (ix) Liens consisting of judgment or judicial attachment Liens,
PROVIDED that the enforcement of such Liens is effectively stayed and the
judgments or attachments secured by all such Liens in the aggregate at any time
outstanding for Borrower and its Subsidiaries do not exceed $1,000,000; (x)
easements, rights-of-way, restrictions and other similar encumbrances on the use
of real property which do not interfere with the ordinary conduct of the
business of such Person, or similar Liens incidental to the conduct of the
business of such Person or to the ownership of its properties which were not
incurred in connection with Indebtedness or other extensions of credit and which
do not in the aggregate materially detract from the value of such properties or
materially impair their use in the operation of the business of such Person; and
(xi) any Liens reflected by Uniform Commercial Code financing statements filed
in respect of true leases; PROVIDED that the term "Permitted Liens" shall not
include any Liens on any Collateral consisting of Cisco Products or any
identifiable proceeds thereof except to the extent that (1) Majority Lenders
have consented in writing to the existence of such Liens (or such Liens are in
favor of Agent, Lenders or Cisco Systems), and (2) such Liens are junior and
subordinate to the Liens of Agent in such Collateral pursuant to a lien
subordination agreement in form and substance satisfactory to Agent.

         "PERMITTED PERIOD" shall have the meaning set forth in Section 5.1(q).

         "PERMITTED PURCHASE" shall have the meaning set forth in Section
5.1(q).

         "PERMITTED TRANSACTION" means any transaction or series of related
transactions (the "Transaction") for the purpose of or resulting, directly or
indirectly, in (i) the acquisition of all or substantially all of the assets of
a Person, or of any business or division of a Person, (ii) the acquisition of
all or any of the capital stock, partnership interests, membership interests or
equity of any Person, or otherwise causing such Person to become a Subsidiary,
or (iii) a merger or consolidation or any other combination with another Person,
that in each case conforms to the following requirements: (A) Borrower or its
Subsidiary is the surviving Person or if Borrower or the Subsidiary, as
applicable, is not the surviving Person, the surviving Person takes all actions
reasonably required to assume and succeed to the rights and obligations of
Borrower or the Subsidiary, as applicable, under the Loan Documents and to grant
Agent a perfected security interest in such surviving Person's property (subject
to no Liens other than Permitted Liens); (B) after giving effect to such
Transaction, Borrower or such surviving Person remains in compliance with
Section 5.1(g), (C) Agent shall have received promptly, and in any event no less
than ten Banking Days prior to the consummation of such Transaction, (1)
financial information regarding the assets, Person or business which is the
subject of the Transaction, including pro forma projected financial statements
showing the effect of the Transaction on Borrower, and (2) a completed worksheet
in substantially the form of Schedule 1 to the Compliance Certificate
demonstrating Borrower's or such surviving Person's pro forma compliance with
the financial covenants set forth herein, measured as of the last day of the
fiscal quarter then most recently ended, after giving effect to such
Transaction, (D) the Transaction shall be consummated in accordance with
applicable Requirements of Law, (E) after giving effect to such Transaction: (1)
no Default or Event of Default shall have occurred and be continuing or would
result therefrom, (2) 100% of the capital stock, partnership interests,
membership interests or equity of any acquired or newly formed corporation,
partnership, limited liability company or other

                                       8

[*] Indicates confidential treatment requested.

<Page>

business entity is owned directly by Borrower or a Subsidiary of Borrower or
100% of the capital stock, partnership interests, membership interests or equity
is pledged to the Agent, and (3) all actions required to be taken with respect
to such acquired or newly formed Subsidiary under Section 5.1(o) or as otherwise
required under Section 5.1(o) shall have been taken, and (F) such Transaction
complies with either of the following: (1) the consideration for such
acquisition consists entirely of Holdings' equity securities, or (2) in the case
of any such Transaction including cash, cash equivalents and/or assumption of
Indebtedness by Borrower, (x) Borrower shall have received from Holdings as a
contribution to common equity total aggregate net proceeds of not less than
$80,000,000 from the sale of shares of Holdings' capital stock prior to the
consummation of such Transaction, and (y) none of the proceeds of any Loans
hereunder shall be used for funding any such Transaction.

         "PERSON" means an individual, corporation, partnership, joint venture,
trust, unincorporated organization or any other entity of whatever nature or any
Governmental Authority.

         "PRO RATA SHARE" means, as to any Lender at any time, the percentage
equivalent (expressed as a decimal, rounded to the ninth decimal place) at such
time of such Lender's Commitment divided by the Aggregate Commitment (or, if all
Commitments have been terminated, the aggregate principal amount of such
Lender's Loans divided by the aggregate principal amount of the Loans then held
by all Lenders). The initial Pro Rata Share of each Lender is set forth opposite
such Lender's name in the Annex.

         "PUBLIC DISCLOSURE" has the meaning set forth in Section 8.8(b).

         "QUARTERLY DATE" means, with respect to any fiscal quarter of Borrower,
the date occurring on the last day of such quarter.

         "REGULATORY CHANGE" has the meaning set forth in Section 2.11.

         "REPLACEMENT LENDER" has the meaning set forth in Section 2.11.

         "REQUIREMENT OF LAW" means, as to any Person, any law, treaty, rule or
regulation or determination of an arbitrator or of a Governmental Authority, in
each case applicable to or binding upon the Person or any of its property or to
which the Person or any of its property is subject.

         "RESPONSIBLE OFFICER" means, as to any Person, the chief financial
officer or treasurer of such Person (or any other senior officer of such Person
involved principally in the financial administration or controllership function
of such Person).

         "SCHEDULE" means the Schedule of Information attached hereto.

         "SECURITIES ACT" has the meaning set forth in Section 4.2.

         "SOLVENT" means, as to any Person at any time, that (i) the fair value
of the property of such Person is greater than the amount of such Person's
liabilities (whether subordinated, contingent, unmatured, unliquidated or
otherwise); (ii) the present fair saleable

                                       9

[*] Indicates confidential treatment requested.

<Page>

value of the property of such Person is not less than the amount that will be
required to pay the probable liability of such Person on its debts as they
become absolute and matured; (iii) such Person is able to realize upon its
property and pay its debts and other liabilities as they mature in the normal
course of business; (iv) such Person does not intend to, and does not believe
that it will, incur debts or liabilities beyond such Person's ability to pay as
such debts and liabilities mature; and (v) such Person is not engaged in
business or a transaction for which such Person's property would constitute
unreasonably small capital.

         "SUBORDINATED DEBT" means unsecured Indebtedness of Holdings in an
amount not to exceed $200,000,000 complying with each of the following
requirements: (i) Holdings shall, in a certificate provided on or immediately
prior to the date of the receipt of proceeds of any such unsecured Indebtedness,
demonstrate its pro forma compliance with the applicable financial covenants set
forth herein (after giving effect to the incurrence of any such unsecured
Indebtedness); (ii) the final maturity date of such unsecured Indebtedness shall
be after the first anniversary of the final maturity date of the last Loans
advanced to Borrower hereunder (the "Maturity Date"); (iii) the terms of such
Indebtedness shall specify that no principal repayments in respect thereof are
required until the Maturity Date; (iv) any such unsecured Indebtedness shall
contain no covenants or provisions materially more restrictive on Holdings and
its Subsidiaries than those contained herein; and (v) such unsecured
Indebtedness shall be subordinated to the payment of the Obligations on terms
that are usual and customary for unsecured Indebtedness issued under similar
circumstances and for similar amounts in the high yield subordinated debt
market.

         "SUBSIDIARY" means any corporation, limited liability company,
association, partnership, joint venture or other business entity of which more
than 50% of the voting stock or other equity interest is owned directly or
indirectly by any Person or one or more of the other Subsidiaries of such Person
or a combination thereof.

         "TAXES" has the meaning set forth in Section 2.21(a).

         "TRANSACTION" has the meaning set forth in the definition of "Permitted
Transaction."

         "TRANSFER" has the meaning set forth in Section 5.1(i)

         "UNITED STATES" and "U.S." each means the United States of America.

         "VENDOR" means Cisco Systems, or any distributor or other reseller or
provider of Cisco Products reasonably satisfactory to Cisco Systems.

         "WARRANTS" has the meaning set forth in Section 1(j) of the Schedule.

     1.2 INTERPRETATION.

         (a) In the Loan Documents, except to the extent the context otherwise
requires: (i) any reference to an Article, a Section, a Schedule or an Exhibit
is a reference to an article or section thereof, or a schedule or an exhibit
thereto, respectively, and to a subsection or a clause is, unless otherwise
stated, a reference to a subsection or a clause of the Section or subsection in

                                       10

[*] Indicates confidential treatment requested.

<Page>

which the reference appears; (ii) the words "hereof," "herein," "hereto,"
"hereunder" and the like mean and refer to this Agreement or any other Loan
Document as a whole and not merely to the specific Article, Section, subsection,
paragraph or clause in which the respective word appears; (iii) the meaning of
defined terms shall be equally applicable to both the singular and plural forms
of the terms defined; (iv) the words "including," "includes" and "include" shall
be deemed to be followed by the words "without limitation;" (v) references to
agreements and other contractual instruments shall be deemed to include all
subsequent amendments and other modifications thereto; (vi) references to
statutes or regulations are to be construed as including all statutory and
regulatory provisions consolidating, amending or replacing the statute or
regulation referred to; (vii) any table of contents, captions and headings are
for convenience of reference only and shall not affect the construction of this
Agreement or any other Loan Document; and (viii) in the computation of periods
of time from a specified date to a later specified date, the word "from" means
"from and including"; the words "to" and "until" each mean "to but excluding";
and the word "through" means "to and including."

         (b) This Agreement and the other Loan Documents may use several
different limitations, tests or measurements to regulate the same or similar
matters. All such limitations, tests and measurements are cumulative and shall
be performed in accordance with their terms. Unless otherwise expressly
provided, any reference to any action of Agent or Lender by way of consent,
approval or waiver shall be deemed modified by the phrase "in its/their
discretion."

         (c) This Agreement and the other Loan Documents are the product of
negotiations among and have been reviewed by counsel to Agent, Lenders,
Holdings, Borrower, each Additional Borrower (if any), each Guarantor and the
other parties hereto, and are the product of all such parties. Accordingly, this
Agreement and the other Loan Documents shall not be construed against Agent or
any other Lender merely because of Agent's or such Lender's involvement in their
preparation.

     1.3 ACCOUNTING PRINCIPLES. Unless the context otherwise clearly requires,
all accounting terms not expressly defined herein shall be construed, and all
financial computations required under this Agreement shall be made, in
accordance with GAAP, consistently applied; PROVIDED, HOWEVER, that, if GAAP
shall have been modified after the Closing Date and the application of such
modified GAAP shall have a material effect on such financial computations
(including the computations required for the purpose of determining compliance
with the financial covenants set forth herein), then such computations shall be
made and such financial statements, certificates and reports shall be prepared,
and all accounting terms not otherwise defined herein shall be construed, in
accordance with GAAP as in effect prior to such modification, unless and until
Majority Lenders, Holdings and Borrower shall have agreed upon the terms of the
application of such modified GAAP.

     SECTION 2. THE LOAN FACILITY.

     2.1 THE LOANS. Subject to the provisions hereof, including satisfaction of
all conditions precedent set forth in Sections 3.1 and 3.2, each Lender agrees,
on the terms and conditions hereinafter set forth, to make loans (each a "Loan"
and, collectively, the "Loans") to Borrower and Additional Borrower during the
Availability Period, in an aggregate principal amount up to but not exceeding
such Lender's Commitment; PROVIDED, HOWEVER, that after giving effect to any

                                       11

[*] Indicates confidential treatment requested.

<Page>

Loans made by any Lender hereunder, the aggregate principal amount of all such
outstanding Loans together shall not exceed the Aggregate Commitment. Any amount
of the Loans repaid may not be reborrowed.

     2.2 USE OF PROCEEDS. Borrower agrees to use the proceeds of any Loans made
hereunder solely for the purposes described in the Schedule.

     2.3 BORROWING PROCEDURE.

         (a) Each Loan to be made hereunder shall be in such minimum principal
amount and subject to such advance written notice to Agent as shall be specified
in the Schedule. Each such written notice of borrowing shall be in substantially
the form of EXHIBIT A (with appropriate completions). Each borrowing of Loans
hereunder shall be made from the Lenders through advances of their respective
Pro Rata Shares of such Loan. Agent will promptly notify each Lender of Agent's
receipt of any notice of borrowing and of the amount of such Lender's Pro Rata
Share of such requested borrowing. Each Lender will make the amount of its Pro
Rata Share of each such borrowing available to Agent for the account of Borrower
or Additional Borrower, as applicable, in accordance with Agent's Payment
Instructions by 11:00 a.m. (New York City time) on the proposed Borrowing Date,
as notified by Agent, in funds immediately available to Agent. Upon fulfillment
of the applicable conditions set forth in Section 3.1 and 3.2, and subject to
the Funding Procedures and Policies, Agent shall make the proceeds of the Loans
available to Borrower or Additional Borrower, as applicable, in accordance with
Borrower's payment instructions. Without limiting the generality of the
foregoing, in the case of any Loans made hereunder for the purpose of paying the
purchase price of Cisco Products, (i) Agent shall pay the proceeds of the Loans
directly to the applicable Vendor, and (ii) if such Vendor is Cisco Systems,
each such Loan shall be deemed to be outstanding hereunder and under the Notes
evidencing such Loans effective as of the date occurring 30 days after the
invoice date of the Cisco Products which are being financed by such Loans (or on
such date thereafter as Cisco Systems shall agree to in its sole discretion),
and Lenders are hereby authorized to make such Loans at the request of CSCC
(through Agent) without being required to receive a notice of borrowing with
respect thereto, PROVIDED that if Borrower provides written notice to Agent
within 25 days after the invoice date that payment or performance due Cisco
Systems is not then due because one or more conditions of payment or performance
has or have not been satisfied by Cisco Systems, then clause (ii) of this
section shall not apply and no such Loans shall be made until Borrower provides
a notice of borrowing with respect to such invoice. Borrower hereby authorizes
and directs Agent to make direct payment to any Vendor and any other intended
recipient, if any, of Loan proceeds. Notwithstanding anything in the Funding
Procedures and Policies to the contrary, Agent shall, subject to the provisions
of this Agreement, make Loan proceeds available to any Vendor or other recipient
thereof on or not later than five Banking Days after the requested Borrowing
Date. Notwithstanding anything in this Agreement to the contrary, on any date
after any amount of interest or fees becomes payable by Borrower to Agent or any
Lender under this Agreement or any other Loan Document, Borrower shall be deemed
to have submitted a notice of borrowing requesting Lenders to make Tranche X
Loans to Borrower in the aggregate amount of such interest and/or fees,
whereupon, provided no Default or Event of Default has occurred and is
continuing, Lenders shall make such Tranche X Loans, subject to the terms and
conditions set forth in this Agreement, the Schedule and the other Loan
Documents, and Agent shall retain the proceeds of such Tranche X Loans and shall
immediately apply such

                                       12

[*] Indicates confidential treatment requested.

<Page>

proceeds as payment by Borrower for such interest and/or fees. All borrowings of
Loans shall be subject to the Funding Procedures and Policies unless CSCC shall
no longer act as Agent hereunder.

         (b) Unless Agent receives notice from a Lender on or prior to the
Closing Date or, with respect to any borrowing after the Closing Date, at least
one Banking Day prior to the date of such borrowing, that such Lender will not
make available as and when required hereunder to Agent for the account of
Borrower the amount of that Lender's Pro Rata Share of the borrowing, Agent may
assume that each Lender has made such amount available to Agent in immediately
available funds on the Borrowing Date and Agent may (but shall not be so
required), in reliance upon such assumption, make available to Borrower on such
date a corresponding amount. If and to the extent any Lender shall not have made
its full amount available to Agent in immediately available funds and Agent in
such circumstances has made available to Borrower such amount, that Lender shall
on the Banking Day following such Borrowing Date make such amount available to
Agent, together with interest at the Federal Funds Rate for each day during such
period. A notice prepared by Agent submitted to any Lender with respect to
amounts owing under this subsection (b) shall be conclusive, absent manifest
error. If such amount is so made available, such payment to Agent shall
constitute such Lender's Loan on the date of borrowing for all purposes of this
Agreement. If such amount is not made available to Agent on the Banking Day
following the Borrowing Date, Agent will notify Borrower of such failure to fund
and, upon demand by Agent, Borrower shall pay such amount to Agent for Agent's
account, together with interest thereon for each day elapsed since the date of
such borrowing, at a rate per annum equal to the interest rate applicable at the
time to the Loans comprising such borrowing. (c) The failure of any Lender to
make any Loan on any Borrowing Date shall not relieve any other Lender of any
obligation hereunder to make a Loan on such Borrowing Date, but no Lender shall
be responsible for the failure of any other Lender to make the Loan to be made
by such other Lender on any Borrowing Date.

     2.4 EVIDENCE OF INDEBTEDNESS. As additional evidence of the Indebtedness of
Borrower and any Additional Borrowers to Lenders resulting from the Loans made
by Lenders hereunder, Borrower and any Additional Borrowers shall execute and
deliver the Notes required pursuant to the Schedule. Additionally, the Loans
made by Lenders shall be evidenced by the records of Agent and one or more loan
accounts maintained by each Lender in the ordinary course of business. The loan
accounts and records maintained by Agent and each Lender shall be conclusive
absent manifest error of the amount of the Loans made by Lenders to Borrower and
the interest and payments thereon. Any failure so to record or any error in
doing so shall not, however, limit or otherwise affect the obligation of
Borrower hereunder to pay any amount owing with respect to the Loans.

     2.5 INTEREST AND FEES.

         (a) INTEREST. Borrower shall pay interest on the unpaid principal
amount of the Loans and on other Obligations, including interest on overdue
payments, at the interest rate and on the dates set forth in the Schedule.

         (b) FEES. Borrower agrees to pay to Agent, for its own account or for
the account of Lenders or any other Person as provided in the Fee Letter, such
fees as may be specified in the

                                       13

[*] Indicates confidential treatment requested.

<Page>

Fee Letter, payable on the dates set forth therein. All fees payable under the
Fee Letter shall be fully-earned when paid and shall be nonrefundable for any
reason whatsoever.

         (c) DETERMINATIONS. Each determination by Agent of any applicable rate
of interest, and of any change therein, in the absence of manifest error shall
be conclusive and binding on the parties hereto.

     2.6 COMPUTATIONS. All computations of fees and interest hereunder shall be
made on the basis of a year of 360 days for the actual number of days occurring
in the period for which any such interest or fee is payable.

     2.7 HIGHEST LAWFUL RATE. Anything herein to the contrary notwithstanding,
if during any period for which interest is computed hereunder, the applicable
interest rate, together with all fees, charges and other payments which are
treated as interest under applicable law, as provided for herein or in any other
Loan Document, would exceed the maximum rate of interest which may be charged,
contracted for, reserved, received or collected by Agent or any Lender in
connection with this Agreement under applicable law (the "Maximum Rate"),
Borrower shall not be obligated to pay, and neither Agent nor any Lender shall
be entitled to charge, collect, receive, reserve or take, interest in excess of
the Maximum Rate, and during any such period the interest payable hereunder
shall be limited to the Maximum Rate.

     2.8 REPAYMENT OF THE LOANS. Borrower shall repay to Agent for the account
of Lenders the principal amount of each Loan on the repayment dates and in
accordance with the terms and conditions set forth in the Schedule.

     2.9 PREPAYMENTS. Borrower may prepay the outstanding amount of the Loans in
whole or in part, in a principal amount of at least $100,000 or any amount in
excess thereof. If any mandatory prepayments are required under the Schedule,
Borrower shall prepay the outstanding Loans in the amounts and at the times
specified in the Schedule. Any such prepayments shall not be subject to any fee,
premium, penalty or other charges except as provided in Section 2.12 and except
to the extent a prepayment fee is required under the Schedule. Borrower shall
give prior notice to Lenders (through Agent) of any such prepayment identifying
the Loan or Loans to be prepaid and specifying the date and amount of the
prepayment. Partial prepayments of any amortizing Loan shall be applied to the
installments of principal thereof in the inverse order of maturity. Accrued
interest on any such Loan prepaid shall be due on the prepayment date as to the
principal amount of such Loan prepaid.

     2.10 REDUCTION OR TERMINATION OF THE COMMITMENTS. Borrower may, upon prior
notice to Lenders (through Agent), terminate in whole or reduce in part, as of
the date specified by Borrower in such notice, any then unused portion of the
Aggregate Commitment. From the effective date of any reduction or termination,
any commitment fee payable pursuant to the Fee Letter shall be computed on the
basis of the Aggregate Commitment as so reduced or terminated. Except as
provided in the Schedule, once reduced or terminated, the Aggregate Commitment
may not be increased or otherwise reinstated.

     2.11 INCREASED COSTS; REGULATORY CHANGES. (a) If, due to either (i) the
adoption of, or any change in, any applicable law, rule or regulation, or any
change in the interpretation or

                                       14

[*] Indicates confidential treatment requested.

<Page>

administration thereof by any Governmental Authority charged with the
interpretation or administration thereof (a "Regulatory Change"), or (ii)
compliance by any Lender with any request, guideline or directive (whether or
not having the force of law) of any such Governmental Authority, there shall be
any increase in the cost to any Lender of agreeing to make or making, or funding
or maintaining, any Loan, or any reduction of any amount received or receivable
by such Lender under this Agreement or any Note with respect thereto (except for
changes in the rate or method of calculation of tax on the overall net income of
Lender), then from time to time, within 15 days after demand by such Lender
(through Agent), Borrower shall pay to such Lender such additional amounts as
shall compensate such Lender for such increased cost or reduction. The
applicable Lender will use reasonable efforts promptly to notify the Borrower if
such Lender becomes aware of any event occurring after the date hereof which
shall entitle it to compensation pursuant to this Section 2.11 and will take
commercially reasonable steps to reduce the amount of such compensation. (b) If
any Lender shall have determined that any Regulatory Change regarding capital
adequacy, or compliance by such Lender (or any Person controlling such Lender)
with any request, guideline or directive regarding capital adequacy (whether or
not having the force of law) of any Governmental Authority, has or shall have
the effect of reducing the rate of return on such Lender's or such Person's
capital as a consequence of such Lender's obligations hereunder to a level below
that which such Lender or such corporation would have achieved but for such
adoption, change or compliance (taking into consideration such Lender's or such
Person's policies with respect to capital adequacy), then from time to time,
within 15 days after demand by such Lender, through Agent, Borrower shall pay to
such Lender such additional amounts as shall compensate such Lender for such
reduction. (c) Any such request for compensation by any Lender under this
Section 2.11 shall set forth in reasonable detail the basis of calculation
thereof and shall, in the absence of manifest error, be conclusive and binding
for all purposes. In determining the amount of such compensation, Lender may use
any reasonable averaging and attribution methods. (d) Upon the receipt by
Borrower from any Lender (an "Affected Lender") of a claim for compensation
under this Section 2.11, Borrower may: (i) request one or more of the other
Lenders to acquire and assume all or part of such Affected Lender's Loans and
Commitment; or (ii) designate a replacement lending institution (which shall be
an Eligible Assignee) to acquire and assume all or a ratable part of such
Affected Lender's Loans and Commitment (a "Replacement Lender"). Any such
designation of a Replacement Lender under clause (i) or (ii) shall be effected
in accordance with, and subject to the terms and conditions of, the assignment
provisions contained in Section 8.7, and shall in any event be subject to the
prior written consent of Agent (which consent shall not be unreasonably withheld
or delayed).

     2.12 FUNDING LOSSES. In addition to such amounts as are required to be paid
by Borrower pursuant to the Schedule and any other indemnities provided by
Borrower in any other Loan Document, Borrower shall indemnify each Lender,
promptly upon receipt of such Lender's written request (made through Agent), for
all losses, costs, expenses and liabilities (including any loss, cost, expense
or liability sustained or incurred by any Lender in obtaining, liquidating or
re-employing deposits or other funds to fund or maintain the Loans), if any,
which such Lender sustains or incurs if. (i) Borrower repays or prepays any Loan
on a date other than the last day of an Interest Period for such Loan (whether
as a result of an optional prepayment, a mandatory prepayment, a payment as a
result of acceleration or otherwise) (except in the case of a scheduled payment
of an installment of principal on a principal payment date which does not fall

                                       15

[*] Indicates confidential treatment requested.

<Page>

on the last day of an Interest Period); (ii) Borrower fails to borrow a Loan
after giving its notice of borrowing under Section 2.3; (iii) Borrower fails to
prepay a Loan after giving its notice thereof; or (iv) any Loan shall be
acquired from a Lender under Section 2.11 other than on the last day of an
Interest Period for such Loan. For purposes of calculating amounts payable by
Borrower to Lenders under this Section, each Loan accruing interest at LIBOR
made by a Lender (and each related reserve, special deposit or similar
requirement) shall be conclusively deemed to have been funded at the rate used
in determining LIBOR for such Loan by a matching deposit or other borrowing in
the interbank eurodollar market for a comparable amount and for a comparable
period, whether or not such Loan is in fact so funded. Any such request for
compensation shall set forth the basis for requesting such compensation and
shall, in the absence of manifest error, be conclusive and binding for all
purposes. As used herein, "Interest Period" has the meaning set forth in the
Schedule.

     2.13 RIGHTS OF CSCC/ASSIGNEE. Notwithstanding anything to the contrary in
Sections 2.11, 2.12, 2.14 and 2.21, such Sections shall not apply to any Loans
held by CSCC (or an Affiliate thereof), as Lender, but shall be in full force
and effect with respect to any Loans held by a Lender other than CSCC (or an
Affiliate thereof) and shall inure to the benefit of any assignee receiving the
assignment of a Loan (or any portion thereof) under the terms of this Agreement.

     2.14 RESERVES ON LIBOR LOANS. Borrower shall pay to each Lender (other than
CSCC), as long as such Lender shall be required under regulations of the FRB to
maintain reserves with respect to liabilities or assets consisting of or
including Eurocurrency funds or deposits (currently known as "Eurocurrency
liabilities"), additional costs on the unpaid principal amount of each Loan
accruing interest at "LIBOR" (as defined in the Schedule) equal to the actual
costs of such reserves allocated to such Loan by such Lender (as determined by
such Lender in good faith, which determination shall be conclusive), payable on
each date on which interest is payable on such Loan, PROVIDED Borrower shall
have received at least 15 days' prior written notice (with a copy to Agent) of
such additional interest from such Lender. If a Lender fails to give notice 15
days prior to the relevant interest payment date, such additional interest shall
be payable 15 days from receipt of such notice. Any Lender claiming
reimbursement or compensation under this Section 2.14 shall deliver to Borrower
(with a copy to Agent) a certificate setting forth in reasonable detail the
amount payable to such Lender hereunder and such certificate shall be conclusive
and binding on Borrower in the absence of manifest error.

     2.15 ILLEGALITY. If any Lender shall reasonably determine that it has
become unlawful, as a result of any Regulatory Change, for such Lender to make
or maintain Loans as contemplated by this Agreement, such Lender shall promptly
give notice, through Agent, of such determination to Borrower, and (a) the
obligation of such Lender to make Loans shall be suspended until such Lender
gives notice that the circumstances causing such suspension no longer exist; and
(b) Borrower shall forthwith (or on such later day as shall, in the good faith
judgment of such Lender, be permitted by such Regulatory Change) prepay the
Loans of such Lender, without penalty, premium or other obligation, other than
as provided for in Section 2.14, together with all accrued interest thereon, if
so requested by such Lender.

     2.16 OBLIGATION TO MITIGATE. Each Lender agrees that as promptly as
practicable after it becomes aware of the occurrence of an event that would
entitle it to give notice pursuant to

                                       16

[*] Indicates confidential treatment requested.

<Page>

Section 2.11 or 2.15, and in any event if so requested by Borrower, each Lender
shall use reasonable efforts to make, fund or maintain its affected Loans
through another lending office if as a result thereof the increased costs would
be avoided or materially reduced or the illegality would thereby cease to exist
and if, in the reasonable opinion of such Lender, the making, funding or
maintaining of such Loans through such other lending office would not in any
material respect be disadvantageous to such Lender or contrary to such Lender's
normal lending practices.

     2.17 PAYMENTS.

         (a) Borrower shall make each payment under the Loan Documents
unconditionally in full and free and clear of, and without reduction for or on
account of, any present and future taxes or withholdings, and all liabilities
with respect thereto. Each such payment shall be made without set-off,
counterclaim or, to the extent permitted by applicable law, other defense,
including without any deduction or setoff arising out of or in connection with
the purchase of the Financed Products, all of which rights of Borrower are
hereby expressly waived by Borrower; PROVIDED, HOWEVER, that no payment
hereunder shall be deemed to be a waiver of any right or claim that Borrower may
have against Cisco Systems or other Vendor with respect to the Cisco Products.
Each such payment shall be made on the day when due to Agent in Dollars and in
immediately available funds, in accordance with Agent's Payment Instructions, no
later than 11:00 a.m. (New York City time) on the date specified herein. Agent
will promptly distribute to each Lender its Pro Rata Share (or other applicable
share as expressly provided herein) of such payment in like funds as received.
Any payment received by Agent later than 11:00 a.m. (New York City time) shall
be deemed to have been received on the following Banking Day and any applicable
interest or fee shall continue to accrue.

         (b) Except to the extent otherwise provided in the Schedule or any
other Loan Document, whenever any payment hereunder or under any other Loan
Document shall be stated to be due, or whenever any other date specified
hereunder or thereunder would otherwise occur, on a day other than a Banking
Day, then, except to the extent otherwise provided hereunder, such payment shall
be made, and such other date shall occur, on the next succeeding Banking Day.

         (c) Each payment by or on behalf of Borrower or any other Person under
the Loan Documents shall, unless a specific determination is made by Agent or
Majority Lenders with respect thereto, be applied in the following order: (i)
FIRST, to any fees, costs, expenses and other amounts due Agent; (ii) SECOND, to
any fees, costs, expenses and other amounts (other than principal and interest)
due Lenders; (iii) THIRD, to accrued and unpaid interest due Lenders; and (iv)
FOURTH, to principal due Lenders.

         (d) Unless Agent receives notice from Borrower prior to the date on
which any payment is due to Lenders that Borrower will not make such payment in
full as and when required, Agent may assume that Borrower has made such payment
in full to Agent on such date in immediately available funds and Agent may (but
shall not be so required), in reliance upon such assumption, distribute to each
Lender on such due date an amount equal to the amount then due such Lender. If
and to the extent Borrower has not made such payment in full to Agent, each
Lender shall repay to Agent on demand such amount distributed to such Lender,
together

                                       17

[*] Indicates confidential treatment requested.

<Page>

with interest thereon at the Federal Funds Rate for each day from the date such
amount is distributed to such Lender until the date repaid.

     2.18 SET OFF. In addition to any rights and remedies of Lenders provided by
law, if an Event of Default exists or the Loans have been accelerated, each
Lender is authorized at any time and from time to time, without prior notice to
Holdings, Borrower or any Guarantor (any such notice being expressly waived by
any such Person to the fullest extent permitted by law), to set off and apply
any and all deposits (general or special, time or demand, provisional or final)
at any time held by, and other Indebtedness at any time owed by, such Lender to
or for the credit or the account of any such Person against any and all
Obligations owing to such Lender, now or hereafter existing, irrespective of
whether or not Agent or such Lender shall have made demand under this Agreement
or any Loan Document and although such Obligations may be contingent or
unmatured. Each Lender agrees promptly to notify any such Person after any such
set-off and application made by such Lender; PROVIDED, HOWEVER, that the failure
to give such notice shall not affect the validity of such set-off and
application.

     2.19 PRO RATA TREATMENT. Except as otherwise provided in this Agreement,
each borrowing hereunder, each Commitment reduction, and each payment (including
each prepayment) by Borrower or any other Person on account of the Obligations,
shall be made ratably in accordance with the respective Pro Rata Shares of the
Lenders.

     2.20 SHARING. If, other than as expressly provided elsewhere herein, any
Lender shall obtain on account of the Obligations in its favor any payment
(whether voluntary, involuntary, through the exercise of any right of set-off,
or otherwise) in excess of its ratable share (or other share contemplated
hereunder), such Lender shall immediately (a) notify Agent of such fact, and (b)
purchase from the other Lenders such participations in the Loans made by them as
shall be necessary to cause such purchasing Lender to share the excess payment
pro rata with each of them; PROVIDED, HOWEVER, that if all or any portion of
such excess payment is thereafter recovered from the purchasing Lender, such
purchase shall to that extent be rescinded and each other Lender shall repay to
the purchasing Lender the purchase price paid therefor, together with an amount
equal to such paying Lender's ratable share (according to the proportion of (i)
the amount of such paying Lender's required repayment to (ii) the total amount
so recovered from the purchasing Lender) of any interest or other amount paid or
payable by the purchasing Lender in respect of the total amount so recovered.
Borrower agrees that any Lender so purchasing a participation from another
Lender may, to the fullest extent permitted by law, exercise all its rights of
payment (including the right of set-off, but subject to Section 2.18) with
respect to such participation as fully as if such Lender were the direct
creditor of Borrower in the amount of such participation. Agent will keep
records (which shall be conclusive and binding in the absence of manifest error)
of participations purchased under this Section and will in each case notify
Lenders following any such purchases or repayments.

     2.21 TAXES.

         (a) All payments by Borrower to Agent and Lenders of principal,
interest, fees and other amounts due under this Agreement and any other Loan
Document shall be made free and clear of and without deduction for any and all
present and future taxes, levies, imposts, duties, fees, assessments, charges,
deductions or withholdings and all liabilities with respect

                                       18

[*] Indicates confidential treatment requested.

<Page>

thereto excluding, in the case of Agent and each Lender, income, gross receipts
and franchise taxes imposed on it by the jurisdiction under the laws of which it
is organized or in which its principal executive offices may be located or any
political subdivision or taxing authority thereof or therein (all such
non-excluded taxes, levies, imposts, duties, fees, assessments, charges,
deductions, withholdings and liabilities being hereinafter referred to as
"Taxes"). Borrower agrees to cause all such Taxes to be paid on behalf of Agent
and each Lender directly to the appropriate Governmental Authority. If at any
time Borrower is required by law or is otherwise compelled to withhold or deduct
any such Taxes from any payment to be made by Borrower in respect of the Loan
Documents, Borrower shall increase the amount paid so that Agent and each Lender
receives when due (and is entitled to retain), after deduction or withholding
for or on account of such Taxes (including deductions or withholdings applicable
to additional sums payable under this Section 2.21), the full amount of the
payment provided for in the Loan Documents.

         (b) Borrower further agrees to pay any present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies and any notarial fees that any Governmental Authorities may impose on
this Agreement, on the issuance of any Note hereunder or on any other Loan
Document, including any stamp taxes or any other similar taxes which may be
required for enforcement purposes (the "Other Charges"). Borrower hereby
indemnifies and holds Agent and each Lender harmless for any and all payments
made by Agent or any Lender of any Taxes and Other Charges and for any
liabilities (including penalties, interest, legal costs and expenses) incurred
by Agent or any Lender or which may be imposed on Agent or any Lender in
connection therewith or any delays in their payment.

         (c) Borrower shall provide Agent and each Lender with original tax
receipts, notarized copies of tax receipts, or such other documentation as Agent
or any Lender shall reasonably request, for all Taxes and Other Charges paid by
Borrower pursuant to this Section 2.21. Borrower shall deliver such receipts or
other documentation to Agent or the requesting Lender, as the case may be,
within 30 days after the due date, including any extensions, for the related Tax
or Other Charge.

         (d) Each Lender that is incorporated under the laws of any jurisdiction
outside the United States agrees to deliver to the Agent and Borrower on or
prior to the Closing Date, and in a timely fashion thereafter, IRS Form W-8BEN,
IRS Form W-8ECI or such other documents and forms of the U.S. Internal Revenue
Service, duly executed and completed by such Lender, as are required under
United States law to establish such Bank's status for United States withholding
tax purposes.

         (e) Notwithstanding the foregoing subsections (a) through (d) of this
Section 2.21, Borrower shall not be required to pay any additional amounts to
any Lender in respect of United States withholding tax pursuant to such
subsections (i) if the obligations to pay such additional amounts would not have
arisen but for the failure by such Lender to comply with the requirements of
Section 2.21 (d) or (ii) at any time that such Lender shall not have furnished
the Borrower with such forms listed in subsection 2.19(d).

         (f) Each Lender agrees that as promptly as practicable after it becomes
aware of the occurrence of an event that would cause the Borrower to make any
payment in respect of

                                       19

[*] Indicates confidential treatment requested.

<Page>

Taxes or Other Charges to such Lender or a payment in indemnification with
respect to any Taxes or Other Charges, and in any event if so requested by the
Borrower following such occurrence, each Lender shall use reasonable efforts to
make, fund or maintain its affected Loan (or relevant part thereof) through
another lending office if as a result thereof the additional amounts so payable
by Borrower would be avoided or materially reduced and if, in the reasonable
opinion of such Lender, the making, funding or maintaining of such Loan (or
relevant part thereof) through such other lending office would not in any
material respect be disadvantageous to such Lender or contrary to such Lender's
normal lending practices.

         (g) Upon the receipt by Borrower from any Affected Lender of a claim
for compensation under this Section 2.21, Borrower may: (i) request one or
more of the other Lenders to acquire and assume all or part of such Affected
Lender's Loans and Commitment; or (ii) designate a Replacement Lender. Any
such designation of a Replacement Lender under clause (i) or (ii) shall be
effected in accordance with, and subject to the terms and conditions of, the
assignment provisions contained in Section 8.7, and shall in any event be
subject to the prior written consent of Agent (which consent shall not be
unreasonably withheld or delayed).

     2.22 SUBSTITUTE BASIS FOR DETERMINING INTEREST. If Agent or Majority
Lenders shall determine that (a) deposits in Dollars are not available to
Majority Lenders in the interbank market in sufficient amounts in the ordinary
course of business to enable such Lenders to fund or continue to fund any Loans
for the applicable Interest Period (as defined in the Schedule), (b) adequate
and reasonable means do not exist for determining LIBOR (as defined in the
Schedule) for any requested Interest Period with respect to a proposed Loan, or
(c) LIBOR as applicable for any Interest Period with respect to a Loan does not
adequately and fairly reflect the cost to Majority Lenders of making, funding or
maintaining their Loans for the applicable Interest Period for such Loan; THEN,
in each case, Agent will promptly so notify Borrower. Thereafter, the obligation
of Lenders to make or maintain Loans accruing interest at LIBOR hereunder shall
be suspended until Agent (upon the instruction of Majority Lenders) revokes such
notice in writing, and all outstanding Loans shall accrue interest at the Prime
Rate (as defined in the Schedule) plus the Applicable Margin minus two percent
(2%) per annum. Upon receipt of such notice, Borrower may revoke any notice of
borrowing then submitted by it. If Borrower does not revoke such notice, Lenders
shall make the Loans, as proposed by Borrower, in the amount specified in the
applicable notice submitted by Borrower, but such Loans shall accrue interest at
the Prime Rate plus the Applicable Margin minus two percent (2%) per annum.

     SECTION 3. CONDITIONS PRECEDENT.

     3.1 CONDITIONS PRECEDENT TO THE INITIAL LOAN. The obligation of each Lender
to make its Loan on the initial Borrowing Date shall be subject to the
satisfaction of each of the following conditions precedent before or
concurrently with the making of such initial Loan:

         (a) DOCUMENTS. Agent shall have received the following, in form and
substance satisfactory to it: (i) this Agreement, executed by each party hereto;
(ii) the Notes required under the Schedule, executed by Borrower and Additional
Borrower; (iii) any required Guaranty and any additional Loan Documents
specified in the Schedule, executed by each of the respective parties thereto,
and (iii) any other documents and information specified in the Schedule.

                                       20

[*] Indicates confidential treatment requested.
<Page>

         (b) ADDITIONAL CLOSING DOCUMENTS. Agent shall have received the
following, in form and substance satisfactory to it: (i) evidence that all
approvals or consents of any other Person, required in connection with the
execution, delivery and performance of the Loan Documents shall have been
obtained; (ii) a certificate of the Secretary or other appropriate officer of
Borrower, dated the Closing Date, or a date not more than five Banking Days
prior to the Closing Date, certifying (A) copies of the certificate or articles
of incorporation and bylaws of Borrower and the resolutions adopted by Borrower
and other actions taken or adopted by Borrower (or any shareholders of Borrower)
authorizing the execution, delivery and performance of the Loan Documents and
(B) the incumbency, authority and signatures of each officer of Borrower
authorized to execute and deliver the Loan Documents and act with respect
thereto; (iii) a certificate of the Secretary or other appropriate officer of
Holdings, dated the Closing Date, or a date not more than five Banking Days
prior to the Closing Date, certifying (A) copies of the certificate or articles
of incorporation and bylaws of Holdings and the resolutions and other actions
taken or adopted by Holdings authorizing the execution, delivery and performance
of any Loan Documents to which Holdings is or shall become a party, and (B) the
incumbency, authority and signatures of each officer of Holdings authorized to
execute and deliver any such Loan Documents and to act with respect thereto; and
(iv) a certificate of the Secretary or other appropriate officer of each
Additional Borrower, dated the Closing Date, or a date not more than five
Banking Days prior to the Closing Date, certifying (A) copies of the respective
certificate or articles of incorporation and bylaws of such Additional Borrower
and the resolutions and other actions taken or adopted by such Additional
Borrower authorizing the execution, delivery and performance of any Loan
Documents to which such Additional Borrower is or shall become a party, and (B)
the incumbency, authority and signatures of each officer of such Additional
Borrower authorized to execute and deliver any such Loan Documents and to act
with respect thereto.

         (c) LEGAL OPINION. Agent shall have received a legal opinion of legal
counsel to Holdings, Borrower, each Additional Borrower and each Guarantor,
dated the Closing Date, or a date not more than five Banking Days prior to the
Closing Date, in form and substance satisfactory to Agent.

         (d) COLLATERAL. If any Collateral Documents are referred to in the
Schedule, Agent shall have received the following, in form and substance
satisfactory to Agent: (i) executed copies of all UCC-1 financing statements
necessary or appropriate in the reasonable opinion of Agent to perfect the
security interests of Agent created under the Collateral Documents; (ii) such
Lien searches as Agent shall have requested, and such termination statements or
other documents, as may be necessary to confirm that the Collateral described in
the Collateral Documents is subject to no other Liens in favor of any Persons
(other than Permitted Liens); (iii) evidence that all other actions necessary or
appropriate in the reasonable opinion of Agent to perfect and protect the
security interest created by the Collateral Documents have been taken; and (iv)
evidence of insurance coverage, together with evidence that Agent has been named
as loss payee under all policies of property insurance and as additional insured
under all policies of liability insurance, in each case as required by the
Collateral Documents.

         (e) FEES, COSTS AND EXPENSES. Borrower shall have paid (i) all fees
then due in accordance with the Fee Letter, (ii) all invoiced costs and
expenses then due in accordance with

                                       21

[*] Indicates confidential treatment requested.

<Page>

Section 8.4 and (iii) all fees, costs and expenses due under the Amended and
Restated Agreement.

         (f) COMPLIANCE CERTIFICATE. Agent shall have received a completed
Compliance Certificate signed by a Responsible Officer of Holdings and Borrower,
indicating compliance with any financial covenants set forth in Section 5.1 in
effect at such date, measured as of the end of the fiscal quarter immediately
preceding the Closing Date.

         (g) MATERIAL CONTRACTS. If requested by Agent, Borrower shall have
delivered to Lenders (through Agent) a complete and current copy of each
Material Contract in existence as of the Closing Date, except that Borrower
shall not have any obligation to deliver such Material Contract but shall
instead provide Agent with a description of the material terms of such Material
Contract in reasonable detail, if such delivery is prohibited by the terms of
such Material Contract or by the terms of any confidentiality or other similar
restriction with respect thereto, and if such prohibition was required by a
party other than Borrower or any of its Subsidiaries.

     3.2 CONDITIONS PRECEDENT TO ALL LOANS. The obligation of each Lender to
make each Loan to be made by it hereunder shall be subject to the satisfaction
of each of the following conditions precedent:

         (a) USE OF PROCEEDS. Agent shall have received details with respect to
the use of proceeds of the Loan at least five Banking Days prior to the proposed
funding date (in the form of a schedule or other listing of the Financed
Products or otherwise in a form as shall be specified by Agent or in the Funding
Procedures and Policies), and the foregoing (including the proposed use of
proceeds) shall be in a form reasonably satisfactory to Agent; provided,
however, that no such notice shall be required in respect of a borrowing
effected pursuant to clause (ii) of Section 2.3(a).

         (b) REPRESENTATIONS AND WARRANTIES; NO DEFAULT. On and as of the date
of such Loan, both before and after giving effect thereto and to the application
of proceeds therefrom: (i) the representations and warranties contained in
Section 4.1 and in the other Loan Documents shall, in each case, be true,
correct and complete as though made on and as of such date (unless they
expressly refer to an earlier date, in which case they shall be true, complete
and correct as of such earlier date); and (ii) no Default shall have occurred
and be continuing or shall result from the making of such Loan. For purposes of
this Section 3.2, clause (i) shall take into account any amendments to any
disclosures made in writing by any Loan Party to Agent after the Closing Date
and approved by Majority Lenders. The giving of any notice of borrowing and the
acceptance by Borrower of the proceeds of each Loan made following the Closing
Date shall each be deemed a certification to Agent and each Lender that on and
as of the date of such Loan such statements are true.

         (c) MATERIAL ADVERSE CHANGE. On and as of the date of such Loan, there
shall have occurred no Material Adverse Change since the date of the most recent
financial statements furnished to Lenders (through Agent).

         (d) CLOSING DATE. The Closing Date shall have occurred.

                                       22

[*] Indicates confidential treatment requested.

<Page>

         (e) ADDITIONAL DOCUMENTS AND CONDITIONS. Agent shall have received, in
form and substance satisfactory to Agent, such additional approvals, opinions,
documents and other information as Agent may reasonably request, including any
such items specified in the Schedule; and any additional conditions precedent
set forth in the Schedule shall have been satisfied.

     SECTION 4. REPRESENTATIONS AND WARRANTIES.

     4.1 REPRESENTATIONS AND WARRANTIES OF HOLDINGS AND BORROWER. Borrower
represents and warrants to Agent and each Lender that:

         (a) ORGANIZATION AND POWERS. Each of Holdings and Borrower (i) is a
corporation duly organized, validly existing and in good standing under the laws
of the jurisdiction of its incorporation, (ii) has all requisite power and
authority to own its assets and carry on its business and to execute, deliver
and perform its obligations under each Loan Document, (iii) is qualified to do
business and is in good standing in each jurisdiction in which the failure so to
qualify or be in good standing would result in a Material Adverse Change, and
(iv) is in compliance with all Requirements of Law, except to the extent that
such noncompliance could not reasonably be expected to result in a Material
Adverse Change.

         (b) AUTHORIZATION; NO CONFLICT. The execution, delivery and performance
by Borrower of the Loan Documents have been duly authorized by all necessary
corporate action of Borrower and do not and will not (i) contravene the terms of
the articles or certificate of incorporation, or bylaws, of Borrower or result
in a breach of or constitute a default under any Material Contract or any
material lease, instrument or other agreement to which Borrower is a party or by
which it or its properties may be bound or affected; or (ii) violate any
provision of any law, rule, regulation, order, judgment, decree or the like
binding on or affecting Borrower.

         (c) BINDING-OBLIGATIONS. The Loan Documents constitute, or when
delivered under this Agreement will constitute, legal, valid and binding
obligations of Borrower, enforceable against Borrower in accordance with their
respective terms, except as limited by bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance and other similar laws relating to or
affecting creditors' rights generally and by general equity principles.

         (d) CONSENTS. No authorization, consent, approval, license, exemption
of, or filing or registration with, any Governmental Authority, or approval or
consent of any other Person, is required for the due execution, delivery or
performance by Borrower or any Guarantor of any of the Loan Documents or the
purchase of the Financed Products, except as may be set forth in the Schedule
and except for any filings necessary to perfect any Liens on any Collateral.

         (e) LITIGATION. There are no actions, suits or proceedings pending or,
to the best of Borrower's knowledge, threatened against or affecting Borrower or
any of its Subsidiaries before any Governmental Authority or arbitrator which if
determined adversely to Borrower or any such Subsidiary would result in a
Material Adverse Change.

         (f) FINANCIAL STATEMENTS. All financial statements of Holdings and its
Subsidiaries delivered to Agent are complete and correct and fairly present the
financial

                                       23

[*] Indicates confidential treatment requested.

<Page>

condition of Holdings and its Subsidiaries as at the times, and for the periods
covered by such statements, in each case in accordance with GAAP, consistently
applied, subject, in the case of any unaudited financial statements, to normal
year-end adjustments and any absence of notes. Since the date of the most recent
financial statements furnished to Agent prior to the Closing Date, there has not
been any Material Adverse Change.

         (g) PURCHASE TRANSACTION. Each purchase transaction to be financed with
any Loan represents a bona fide and undisputed transaction between Borrower and
the Vendor (or other applicable vendor of Financed Products) entered into in
compliance with all applicable laws and regulations.

         (h) SUBSIDIARIES. (i) Except as set forth in the Schedule, on the date
of this Agreement Borrower has no Subsidiaries; and (ii) Additional Borrower has
not incurred any Indebtedness to any Person other than any Indebtedness
permitted under Section 5.1(k) and disclosed to Lenders in writing.

         (i) LICENSES, PATENTS, TRADEMARKS AND OTHER RIGHTS. Except as disclosed
in writing by Borrower, each of Borrower and its Subsidiaries possesses all
material approvals, authorizations, permits, franchises, licenses, patents,
trademarks, trade names, service marks, copyrights, leases and all rights with
respect thereto, free from burdensome restrictions, that are reasonably
necessary for the ownership, maintenance and operation of its business, and
neither Borrower nor any such Subsidiary is in material violation of any rights
of others with respect to the foregoing. Without limiting the generality of the
foregoing, the Schedule sets forth all material authorizations, permits,
licenses and approvals of or from the FCC or any other Governmental Authority
("Permits and Licenses") held by Borrower and each Subsidiary existing on the
date of this Agreement; each Permit and License is in full force and effect and
has not been revoked, suspended, canceled, or modified in any materially adverse
way and, except as may be set forth in the Schedule, is not subject to any
materially adverse conditions or requirements; and Borrower has no knowledge of
the occurrence of any event (including any investigation, proceeding, notice,
violation, or other order or complaint issued by or before and Governmental
Authority) which (i) results in, or after notice or lapse of time or both would
result in, revocation, suspension, adverse modifications, non-renewal,
impairment, restriction, loss or termination of, or order of forfeiture with
respect to, any Permit or License in any respect that could reasonably be
expected to result in a Material Adverse Change, or (ii) affects or could
reasonably be expected in the future to affect any of the rights of Borrower or
any Subsidiary under any Permit or License in any respect that could reasonably
be expected to result in a Material Adverse Change.

         (j) LIENS. There are no Liens upon or with respect to any of the
properties or assets of Borrower, including any of the Collateral, except for
Permitted Liens.

         (k) INSURANCE. The properties of Borrower and its Subsidiaries are
insured, with financially sound and reputable insurance companies, in such
amounts, with such deductibles and covering such risks as is customarily carried
by companies engaged in similar businesses and owning similar properties in the
localities where Borrower or such Subsidiary operates.

                                       24

[*] Indicates confidential treatment requested.

<Page>

         (l) TAXES. Holdings and its Subsidiaries have filed all federal and
other material tax returns and reports required to be filed, have made timely
remittance of all material amounts as required by any Governmental Authority and
have paid all federal and other material taxes, assessments, fees and other
governmental charges levied or imposed upon them or their properties, income or
assets otherwise due and payable, except those which are being or will be
contested in good faith by appropriate proceedings and for which adequate
reserves have been provided in accordance with GAAP. Neither Holdings nor
Borrower have received any notice of any proposed tax assessment against
Holdings or any Subsidiary that would, if made, result in a Material Adverse
Change.

         (m) REGULATED ENTITIES. None of Borrower, any Person controlling
Borrower, or any Subsidiary, is an "Investment Company" within the meaning of
the Investment Company Act of 1940. Neither Borrower nor any Guarantor is
subject to regulation under the Public Utility Holding Company Act of 1935, the
Federal Power Act, the Interstate Commerce Act, any state public utilities code,
or any other Federal or state statute or regulation limiting its ability to
incur Indebtedness.

         (n) DISCLOSURE. (i) Borrower has disclosed to Agent the existence, as
of the date of this Agreement, of each credit agreement, loan agreement,
indenture, purchase agreement, guarantee, letter of credit or other arrangement
providing for or otherwise relating to any Indebtedness or any extension of
credit (or commitment for any extension of credit) to, or guarantee by,
Holdings, Borrower or any of their respective Subsidiaries, the aggregate
principal or face amount of which equals or exceeds (or may equal or exceed)
$100,000 and any Liens with respect thereto. (ii) None of the representations or
warranties made by any Loan Party in the Loan Documents as of the date of such
representations and warranties, and none of the statements contained in any
other information with respect to any Loan Party, including each exhibit or
report, furnished by or on behalf of any Loan Party to Agent or Lenders in
connection with the Loan Documents, contains any untrue statement of a material
fact or omits any material fact required to be stated therein or necessary to
make the statements made therein, in the light of the circumstances under which
they are made, not misleading.

         (o) ENVIRONMENTAL COMPLIANCE. The Loan Parties conduct in the ordinary
course of business a review of the effect of existing Environmental Laws and
claims alleging potential liability or responsibility for violation of any
Environmental Law on their respective businesses, operations and properties, and
as a result thereof each Loan Party has reasonably concluded that, except as
specifically disclosed to Agent on or prior to the date of this Agreement, such
Environmental Laws and claims would not, individually or in the aggregate,
reasonably be expected to result in a Material Adverse Change.

         (p) SOLVENCY. Each of Holdings, Borrower and their respective
Subsidiaries is Solvent, both before and after giving effect to any borrowing of
Loans hereunder.

         (q) ERISA. Except as specifically disclosed to Agent on or prior to the
date of this Agreement, (i) Holdings, Borrower and their respective Subsidiaries
are in compliance with all applicable provisions of ERISA, unless noncompliance
would not, individually or in the aggregate, reasonably be expected to result in
a Material Adverse Change; and (ii) there are no pending or, to the best
knowledge of Holdings or Borrower, threatened claims, litigation,

                                       25

[*] Indicates confidential treatment requested.

<Page>

investigations or other actions or proceedings by or involving any Governmental
Authority, under or in connection with ERISA that would reasonably be expected
to result in a Material Adverse Change.

         (r) MATERIAL CONTRACTS. All of the Material Contacts are in full force
and effect and, to the knowledge of the Borrower, (i) neither the Borrower nor
any of its Subsidiaries is in default in any material respect under the terms of
a Material Contract and (ii) no other Person who is a party to a Material
Contract is in default under the terms of such Material Contract.

         (s) REPRESENTATIONS AND WARRANTIES AS TO CAPITALIZATION. On the Closing
Date, and after giving effect to any applicable provisions set forth in the
Schedule, the authorized capital stock of Borrower consisted of (A) 211,000,000
shares of common stock, of which 14,098,142 shares are issued and outstanding,
and (B) 95,583,184 shares of preferred stock, all of which are issued and
outstanding. All such outstanding shares have been duly and validly issued, are
fully paid and non-assessable and have been issued free of preemptive rights. On
the Closing Date, the Borrower did not have outstanding any securities
convertible into or exchangeable for, or any rights to subscribe for or to
purchase, or any options or warrants for the purchase of (other than those
provided for herein), or any agreement providing for the issuance (contingent or
otherwise) of, or any calls, commitments or claims of any character relating to,
its capital stock, in each case, other than 19,401,858 shares of common stock
reserved for issuance to employees or as separately disclosed in writing to the
Agent.

     4.2 REPRESENTATIONS AND WARRANTIES OF LENDERS. Each Lender represents and
warrants to Borrower that such Lender: (i) will acquire each Note for its own
account for investment and (subject to the disposition of its property being at
all times within its control) not with a view to any resale or other
distribution of such Note in a transaction constituting a public offering or
otherwise requiring registration under the Securities Act of 1933 (the
"Securities Act") or in a transaction that would result in noncompliance with
applicable state securities laws; (ii) has such knowledge and experience in
financial and business matters as to be capable of evaluating the merits and the
risks of its acquisition of any Note and credit extensions to Borrower and any
Additional Borrower, (iii) is an accredited investor as such term is defined in
Rule 501 of Regulation D under the Securities Act, and (iv) understands that
such Note has not been, and will not be, registered under the Securities Act or
any state securities laws.

     SECTION 5. COVENANTS.

     5.1 COVENANTS. So long as any of the Obligations shall remain unpaid or any
Lender shall have any Commitment, each of Holdings and Borrower agrees that:

         (a) FINANCIAL STATEMENTS AND OTHER INFORMATION. Holdings and Borrower
shall furnish to Agent: (i) (A) as soon as available and in any event within 30
days after the end of each calendar month, Borrower's consolidated unaudited
financial statements for such month, prepared in accordance with GAAP, and, if
requested by Agent, its consolidating financial statements for such month, and
(B) as soon as available and in any event with 45 days after the end of each
fiscal quarter of each fiscal year of Holdings (excluding the fourth fiscal
quarter), Holdings' consolidated unaudited financial statements for such quarter
prepared in accordance with GAAP, and, if requested by Agent, its consolidating
financial statements for such quarter,

                                       26

[*] Indicates confidential treatment requested.

<Page>

accompanied in each case by a certificate of a Responsible Officer of Holdings
stating that such financial statements fairly present the financial condition of
Holdings, Borrower and their respective Subsidiaries as at such date and the
results of operations of Holdings, Borrower and their respective Subsidiaries
for the period ended on such date and have been prepared in accordance with GAAP
consistently applied, subject to changes from normal, year-end adjustments and
except for the absence of notes, (ii) as soon as available and in any event
within 90 days after the end of each fiscal year of Holdings, its consolidated
annual financial statements, prepared in accordance with GAAP and, if requested
by Agent, consolidating annual financial statements, and in the case of
consolidated financial statements, accompanied by an unqualified report thereon
of independent certified public accountants of recognized standing; (iii) as
soon as available and in any event not more than 90 days after the commencement
of each fiscal year, the business plan and financial projections of Holdings,
Borrower and their respective Subsidiaries for such fiscal year; (iv) promptly
after Holdings or Borrower has knowledge or becomes aware thereof, notice of the
occurrence of any Default or Event of Default hereunder; (v) prompt written
notice of any condition or event which has resulted, or that could reasonably be
expected to result, in a Material Adverse Change; (vi) together with the
financial statements required pursuant to clauses (i)and (ii), a Compliance
Certificate of a Responsible Officer of Borrower as of the end of the applicable
accounting period; and (vii) such other information respecting the operations,
properties, business or financial condition of Holdings, Borrower, their
respective Subsidiaries and any Guarantor as Agent may from time to time
reasonably request or as may be specified in the Schedule.

         (b) PRESERVATION OF EXISTENCE, ETC. Holdings and Borrower shall, and
shall cause each of their respective Subsidiaries to, maintain and preserve (i)
its corporate (or equivalent) existence, and (ii) all material copyrights,
patents, trademarks, trade names and service marks and other intellectual
property rights, and all other material rights, qualifications, permits,
licenses, franchises and privileges, necessary or desirable in the normal course
of its business and operations and the ownership of its properties, except for
the dissolution of any shell or dormant Subsidiary and except in connection with
any transactions expressly permitted by this Section 5.1.

         (c) LICENSES. Holdings and Borrower shall, and shall cause each of
their respective Subsidiaries to, obtain and maintain all licenses,
authorizations, consents, filings, exemptions, registrations and other
governmental approvals of any Governmental Authority necessary or desirable (i)
in connection with the execution, delivery and performance of the Loan
Documents, the purchase of the Financed Products or the consummation of the
transactions therein contemplated, or (ii) in the normal course of its business
and operations and the ownership of its properties, except, in the case of this
clause (ii), to the extent that the failure to do so could not reasonably be
expected to result in a Material Adverse Change.

         (d) COMPLIANCE WITH LAWS. Holdings and Borrower shall comply, and shall
cause each of their respective Subsidiaries to comply, in all material respects
with all Requirements of Law of any Governmental Authority having jurisdiction
over it or its business, except such as may be contested in good faith or as to
which a bona fide dispute may exist or where noncompliance could not reasonably
be expected to result in a Material Adverse Change.

                                       27

[*] Indicates confidential treatment requested.

<Page>

         (e) PAYMENT OF OBLIGATIONS. Holdings and Borrower shall, and shall
cause each of their respective Subsidiaries to, pay and discharge (i) all
federal and other material taxes, fees, assessments and governmental charges or
levies imposed upon it or upon its properties or assets prior to the date on
which penalties attach thereto, and all lawful claims for labor, materials and
supplies which, if unpaid, might become a Lien upon any properties or assets of
Holdings, Borrower or any Subsidiary, except to the extent such taxes, fees,
assessments or governmental charges or levies, or such claims, are being
contested in good faith by appropriate proceedings and are adequately reserved
against in accordance with GAAP; (ii) all lawful claims which, if unpaid, would
by law become a Lien upon its property not constituting a Permitted Lien; and
(iii) all Indebtedness, as and when due and payable, but subject to any
subordination provisions contained in any instrument or agreement evidencing
such Indebtedness (except where failure to do so would not otherwise constitute
a Default or Event of Default hereunder).

         (f) INSURANCE. Holdings and Borrower shall, and shall cause each of
their respective Subsidiaries to, carry and maintain in full force and effect,
at its own expense and with financially sound and reputable insurance companies,
insurance in such amounts, with such deductibles and covering such risks as is
customarily carried by companies engaged in the same or similar businesses and
owning similar properties in the localities where Holdings, Borrower or such
Subsidiary operates. Without limiting the generality of the foregoing, Holdings
and Borrower shall, and shall cause each of their respective Subsidiaries to,
comply with all requirements of the Collateral Documents pertaining to
maintenance of insurance.

         (g) CHANGE IN NATURE OF BUSINESS. Holdings and Borrower shall not, and
shall not permit any of their respective Subsidiaries to, engage in any material
line of business substantially different from those lines of business carried on
by it or contemplated to be carried on by it (as disclosed to Lenders) on the
date hereof.

         (h) RESTRICTIONS ON FUNDAMENTAL CHANGE. Borrower shall not, and shall
not permit any of its Subsidiaries to, merge with or consolidate into, or
acquire all or substantially all of the assets of, any Person, or sell,
transfer, lease or otherwise dispose of (whether in one transaction or in a
series of transactions) all or substantially all of its assets, except that (i)
Borrower may enter into a Permitted Transaction; (ii) any of Borrower's wholly
owned Subsidiaries may merge with, consolidate into or transfer all or
substantially all of its assets to another of Borrower's wholly owned
Subsidiaries or to Borrower and in connection therewith such Subsidiary may be
liquidated or dissolved (provided that if any such transaction shall be between
an Additional Borrower and another Subsidiary not an Additional Borrower, or a
Subsidiary which is a Guarantor and a Subsidiary which is not a Guarantor, and
such Additional Borrower or Subsidiary Guarantor is not the continuing or
surviving Person, then the continuing or surviving Person shall have assumed all
of the obligations of such Additional Borrower or Subsidiary Guarantor, as the
case may be, under the Loan Documents to which it is a party); and (iii)
Borrower or any of its Subsidiaries may sell or dispose of assets in accordance
with the provisions of subsection (i) below.

         (i) SALES OF ASSETS. Subject to Section 5.1(h), Holdings and Borrower
shall not, and shall not permit any of their respective Subsidiaries to, sell,
lease, transfer, or otherwise dispose of (whether in one transaction or a series
of transactions) any assets (including any shares of stock in any Subsidiary or
other Person) outside the ordinary course of business (each a

                                       28

[*] Indicates confidential treatment requested.

<Page>

"Transfer"), or enter into or consummate any Transfer (i) involving Financed
Products (other than (x) used equipment racks and cables, or (y) in the ordinary
course of business to a wholly owned Subsidiary that is a Guarantor hereunder
and that has granted to Agent a perfected, first priority Lien on such Financed
Products under a security agreement in form and substance satisfactory to
Agent), (ii) that could reasonably be expected to result in a Material Adverse
Change or (iii) that would violate the terms of any other Loan Document;
PROVIDED that as a condition to consummating any Transfer to any such Subsidiary
of Financed Products, Borrower shall provide ten Banking Days' prior written
notice to Agent of the proposed Transfer.

         (j) NEGATIVE PLEDGE. Holdings and Borrower shall not, and shall not
permit any of their respective Subsidiaries to, create, incur, assume or suffer
to exist any Lien upon or with respect to any of its properties, revenues or
assets, whether now owned or hereafter acquired, other than Permitted Liens.

         (k) INDEBTEDNESS. Borrower shall not, and shall not permit any of its
Subsidiaries to, create, incur, assume or otherwise become liable for or suffer
to exist any Indebtedness, other than: (i) Indebtedness of Borrower and its
Subsidiaries to Agent, Lenders or Cisco Systems; (ii) Indebtedness of Borrower
and its Subsidiaries existing on the date hereof and disclosed to Lenders or
extensions, renewals and refinancings of such Indebtedness, provided that the
principal amount of such Indebtedness being extended, renewed or refinanced does
not increase; (iii) Indebtedness of Borrower and its Subsidiaries under the
Financing Documents (if any) or any refinancings, extensions and renewals of
such Indebtedness, provided that the principal amount of such Indebtedness being
refinanced, extended or renewed does not increase; (iv) accounts payable to
trade creditors for goods and services and current operating liabilities (not
the result of the borrowing of money) incurred in the ordinary course of
Borrower's or such Subsidiary's business in accordance with customary terms and
paid within the specified time, unless contested in good faith by appropriate
proceedings and reserved for in accordance with GAAP; (v) Indebtedness
consisting of guarantees resulting from endorsement of negotiable instruments
for collection by Borrower or any such Subsidiary in the ordinary course of
business; (vi) Indebtedness of Borrower and its Subsidiaries under capital
leases or otherwise incurred under or in connection with any Liens of the type
referred to in clause (vii) or (viii) of the definition of Permitted Liens in
Section 1; (vii) Subordinated Debt of Holdings; (viii) in respect of Borrower,
Indebtedness secured by a Permitted Lien; (ix) Indebtedness of Borrower to any
of its wholly owned Subsidiaries or any of its wholly owned Subsidiaries to
another of its wholly owned Subsidiaries; and (x) in respect of Borrower,
Indebtedness incurred in connection with a Permitted Transaction (subject to the
limitations thereon contained in the definition of "Permitted Transaction").

         (l) LOANS AND INVESTMENTS. Holdings and Borrower shall not, and shall
not permit any of their respective Subsidiaries to, purchase or otherwise
acquire the capital stock, assets (constituting a business unit), obligations or
other securities of or any interest in any Person, or otherwise extend any
credit to or make any additional investments in any Person, other than in
connection with: (i) a Permitted Transaction; (ii) extensions of credit in the
nature of accounts receivable or notes receivable arising from the sales of
goods or services in the ordinary course of business; (iii) extensions of credit
by Holdings or Borrower to any of their respective wholly owned Subsidiaries or
by any of their respective wholly owned Subsidiaries to another of their
respective wholly owned Subsidiaries, Holdings or Borrower; (iv) employee

                                       29

[*] Indicates confidential treatment requested.

<Page>

loans and guarantees in the ordinary course of business in accordance with
Borrower's or any such Subsidiary's usual and customary practices with respect
thereto; and (v) short term, investment grade money market instruments, in
accordance with Borrower's usual and customary treasury management policies.

         (m) DISTRIBUTIONS. Holdings and Borrower shall not declare or pay any
dividends in respect of their respective capital stock, or purchase, redeem,
retire or otherwise acquire for value (other than in consideration for equity
securities of Holdings) any shares of their respective capital stock, or any
warrants, rights or options to acquire such shares, now or hereafter
outstanding, return any capital to its shareholders as such, or make any
distribution of assets to their respective shareholders as such, or permit any
of their respective Subsidiaries to purchase, redeem, retire, or otherwise
acquire for value any shares of stock of Holdings or Borrower or any warrants,
rights or options to acquire such shares, except that (A) Holdings and Borrower
may declare and deliver dividends and distributions payable only in common stock
of Holdings or Borrower (as the case may be); (B) Holdings may purchase, redeem,
retire, or otherwise acquire shares of its capital stock or any warrants, rights
or options to acquire such shares with the proceeds received from a
substantially concurrent issue of new shares of its capital stock; (C) Holdings
may purchase, redeem, retire or otherwise acquire shares of its capital stock or
any warrants, rights or options to acquire such shares from any consultants or
employees of Borrower; and (D) Borrower may make cash transfers to Holdings as
required by Holdings to pay: (1) regularly scheduled payments of interest on
Subordinated Debt, provided no Event of Default exists or would result
therefrom, (2) its tax obligations to any Governmental Authority, and (3)
accounts payable to trade creditors for goods and services and current operating
liabilities (not the result of borrowing of money) incurred in the ordinary
course of Holding's business in accordance with customary terms and in amounts
customary for similar holding companies. Additionally, Borrower shall not permit
any Subsidiary of Borrower to grant or otherwise agree to or suffer to exist any
consensual restrictions on the ability of such Subsidiary to pay dividends and
make other distributions to Borrower, or to pay any Indebtedness owed to
Borrower or transfer properties and assets to Borrower.

         (n) SUBORDINATED DEBT. Holdings shall not, and shall not permit any of
its Subsidiaries to, agree to or permit any material amendment, modification or
waiver of any provision of any document or instrument governing or evidencing
Subordinated Debt if such amendment, modification or waiver would adversely
affect the rights of the Lenders hereunder.

         (o) ADDITIONAL SUBSIDIARIES. (i) If Borrower proposes to incorporate,
create or acquire any additional Subsidiary, Borrower shall provide Agent with
prior notice thereof. After the incorporation, creation or acquisition of any
such Subsidiary, within five Banking Days following receipt by Borrower from
Agent of a security agreement, a stock pledge agreement and a guaranty of the
Obligations each in form and substance satisfactory to Agent, Borrower shall (A)
cause such Subsidiary to execute and deliver such guaranty and security
agreement to Agent and (B) pledge (or cause to be pledged) the capital stock or
ownership interest of such Subsidiary to Agent and Lenders pursuant to such
stock pledge agreement. Majority Lenders may elect in their sole discretion to
waive any such requirement for any Subsidiary that will remain a dormant or
shell Subsidiary or in the case of any non-U.S. Subsidiary (or in the case of a
stock pledge, to require the pledge of not more than 65% of the capital stock of
any such Subsidiary). (ii) Within five Banking Days after receipt from Agent of
any request to do so,

                                       30

[*] Indicates confidential treatment requested.

<Page>

Borrower shall, or shall cause such Subsidiary to, have executed and filed any
UCC-1 financing statements furnished by Agent in each jurisdiction in which such
filing is necessary to perfect the security interest of Agent in the Collateral
of such Subsidiary and in which Agent requests that such filing be made. (iii)
Additionally, Borrower and such Subsidiary shall execute and deliver to Agent
such other items as reasonably may be requested by Agent in connection with the
foregoing, including resolutions, incumbency and officers' certificates,
opinions of counsel, search reports and other certificates and documents.

         (p) LEASE OBLIGATIONS. Holdings and Borrower shall not, and shall not
suffer or permit any of their respective Subsidiaries to, create or suffer to
exist any obligations for the payment of rent for any property under lease or
agreement to lease (other than capital leases) which would cause the direct or
contingent liabilities of Holdings, Borrower and their respective Subsidiaries,
on a consolidated basis, in respect of all such obligations together to exceed
the greater of (i) $25,000,000 in any fiscal year or (ii) 25% of revenue in any
fiscal year.

         (q) CAPITAL EXPENDITURES. In addition to the requirements under Section
5.1(r)(ix) below, Holdings and Borrower shall not, and shall not suffer or
permit any of their respective Subsidiaries to, make any expenditures for fixed
or capital assets (i) in excess of $100,000,000, on a consolidated basis, in any
fiscal year ending prior to the third anniversary of the Original Closing Date
and (ii) $300,000,000, on a consolidated basis, in any fiscal year thereafter;
PROVIDED that Borrower shall be entitled to make capital expenditures up to a
maximum $20,000,000 to purchase (a "Permitted Purchase") long haul fiber and
conduit between Seattle, Washington and Borrower's communications network
without such capital expenditures counting toward the caps on capital
expenditures set forth in this Section 5.1(q) for a three year period (the
"Permitted Period") commencing on the date that such long haul fiber conduit is
first purchased by Borrower.

         (r) FINANCIAL COVENANTS.

                  (i) LEVERAGE RATIO. On a consolidated basis, Holdings and its
Subsidiaries shall not, as of the last day of any fiscal quarter, permit its
ratio of Consolidated Funded Debt to EBITDA (measured on a rolling four quarter
basis for the four fiscal quarters ended as of each quarterly period set forth
below) to be greater than the ratios indicated below:

<Table>
<Caption>
          QUARTERLY PERIOD ENDING                                     REQUIRED RATIO
<S>                                                               <C>
          December 31, 2001                                                [*]
          March 31, 2002                                                   [*]
          June 30, 2002                                                    [*]
          September 30, 2002                                               [*]
          December 31, 2002                                                [*]
          March 31, 2003                                                   [*]
          June 30, 2003                                                    [*]
          September 30, 2003                                               [*]
          December 31, 2003                                                [*]
          March 31, 2004                                                   [*]
</Table>

                                       31

[*] Indicates confidential treatment requested.

<Page>

<Table>
<Caption>
          QUARTERLY PERIOD ENDING                                     REQUIRED RATIO
<S>                                                               <C>
          June 30, 2004                                                    [*]
          September 30, 2004                                               [*]
          December 31, 2004                                                [*]
          March 31, 2005                                                   [*]
          June 30, 2005                                                    [*]
          September 30, 2005                                               [*]
          December 31, 2005                                                [*]
          March 31, 2006                                                   [*]
          June 30, 2006                                                    [*]
          September 30, 2006                                               [*]
          December 31, 2006                                                [*]
          March 31, 2007                                                   [*]
          June 30, 2007                                                    [*]
          September 30, 2007                                               [*]
          December 31, 2007                                                [*]
          March 31, 2008                                                   [*]
          Thereafter                                                       [*]
</Table>

                  (ii) MINIMUM TOTAL REVENUES. On a consolidated basis, Holdings
and its Subsidiaries shall not fail to maintain total monthly or total
annualized quarterly revenues of Holdings and its Subsidiaries, for each monthly
or quarterly period, as applicable, set forth below, of not less than the
correlative amount indicated (it being understood that with respect to any
quarterly period, annualized revenues shall be equal to revenues for such
quarterly period, multiplied by four):

<Table>
<Caption>
          MONTHLY PERIOD ENDING                                      REQUIRED AMOUNT
<S>                                                            <C>
          October 31, 2001                                               $468,000
          November 30, 2001                                              $580,000
          December 31, 2001                                              $691,000
          January 31, 2002                                               $755,000
          February 28, 2002                                              $985,000
          March 31, 2002                                                $1,215,000
          April 30, 2002                                                $1,510,000
          May 31, 2002                                                  $1,855,000

          QUARTERLY PERIOD ENDING                               REQUIRED ANNUALIZED AMOUNT

          June 30, 2002                                                    [*]
          September 30, 2002                                               [*]
          December 31, 2002                                                [*]
</Table>

                                       32

[*] Indicates confidential treatment requested.

<Page>

<Table>
<S>                                                                 <C>
          March 31, 2003                                                   [*]
          June 30, 2003                                                    [*]
          September 30, 2003                                               [*]
          December 31, 2003                                                [*]
          March 31, 2004                                                   [*]
          June 30, 2004                                                    [*]
          September 30, 2004                                               [*]
          December 31, 2004                                                [*]
          March 31, 2005                                                   [*]
          June 30, 2005                                                    [*]
          September 30, 2005                                               [*]
          December 31, 2005                                                [*]
          March 31, 2006                                                   [*]
          June 30, 2006                                                    [*]
          September 30, 2006                                               [*]
          December 31, 2006                                                [*]
          March 31, 2007                                                   [*]
          June 30, 2007                                                    [*]
          September 30, 2007                                               [*]
          December 31, 2007                                                [*]
          March 31, 2008                                                   [*]
          Thereafter                                                       [*]
</Table>

                  (iii) MINIMUM EBITDA. On a consolidated basis, Holdings and
its Subsidiaries shall not fail to maintain EBITDA for each period of four
quarters ended as of the last day of each quarterly period set forth below of
not less than the correlative amount indicated (bracketed amounts (< >) are
negative):

<Table>
<Caption>
          QUARTERLY PERIOD ENDING                                    REQUIRED AMOUNT
<S>                                                              <C>
          December 31, 2001                                                [*]
          March 31, 2002                                                   [*]
          June 30, 2002                                                    [*]
          September 30, 2002                                               [*]
          December 31, 2002                                                [*]
          March 31, 2003                                                   [*]
          June 30, 2003                                                    [*]
          September 30, 2003                                               [*]
          December 31, 2003                                                [*]
          March 31, 2004                                                   [*]
          June 30, 2004                                                    [*]
          September 30, 2004                                               [*]
</Table>

                                       33

[*] Indicates confidential treatment requested.

<Page>

<Table>
<Caption>
          QUARTERLY PERIOD ENDING                                    REQUIRED AMOUNT
<S>                                                              <C>
          December 31, 2004                                                [*]
          March 31, 2005                                                   [*]
          June 30, 2005                                                    [*]
          September 30, 2005                                               [*]
          December 31, 2005                                                [*]
          March 31, 2006                                                   [*]
          June 30, 2006                                                    [*]
          September 30, 2006                                               [*]
          December 31, 2006                                                [*]
          March 31, 2007                                                   [*]
          June 30, 2007                                                    [*]
          September 30, 2007                                               [*]
          December 31, 2007                                                [*]
          March 31, 2008                                                   [*]
          Thereafter                                                       [*]
</Table>

                  (iv) INTEREST COVERAGE RATIO. On a consolidated basis,
Holdings and its Subsidiaries shall not permit the ratio of EBITDA to Interest
Expense (measured on a rolling four quarter basis for the four fiscal quarters
ended on the last day of each quarterly period set forth below) for each
quarterly period set forth below to be less than the ratio set forth below
(determined as of the end of the quarterly period set forth below):

<Table>
<Caption>

          QUARTERLY PERIOD ENDING                                       REQUIRED RATIO
<S>                                                                   <C>
          December 31, 2001                                                  [*]
          March 31, 2002                                                     [*]
          June 30, 2002                                                      [*]
          September 30, 2002                                                 [*]
          December 31, 2002                                                  [*]
          March 31, 2003                                                     [*]
          June 30, 2003                                                      [*]
          September 30, 2003                                                 [*]
          December 31, 2003                                                  [*]
          March 31, 2004                                                     [*]
          June 30, 2004                                                      [*]
          September 30, 2004                                                 [*]
          December 31, 2004                                                  [*]
          March 31, 2005                                                     [*]
</Table>

                                       34

[*] Indicates confidential treatment requested.

<Page>

<Table>
<Caption>
          QUARTERLY PERIOD ENDING                                       REQUIRED RATIO
<S>                                                                   <C>
          June 30, 2005                                                      [*]
          September 30, 2005                                                 [*]
          December 31, 2005                                                  [*]
          March 31, 2006                                                     [*]
          June 30, 2006                                                      [*]
          September 30, 2006                                                 [*]
          December 31, 2006                                                  [*]
          March 31, 2007                                                     [*]
          June 30, 2007                                                      [*]
          September 30, 2007                                                 [*]
          December 31, 2007                                                  [*]
          March 31, 2008                                                     [*]
          Thereafter                                                         [*]
</Table>

                  (v) MAXIMUM FUNDED DEBT TO CAPITALIZATION. On a consolidated
basis, Holdings and its Subsidiaries shall not permit the ratio of Consolidated
Funded Debt to Capitalization to exceed the percentage amount set forth below
(determined as of the end of the quarterly period set forth below):

<Table>
<Caption>

          QUARTERLY PERIOD ENDING                                         PERCENTAGE
<S>                                                                   <C>
          December 31, 2001                                                  [*]
          March 30, 2002                                                     [*]
          June 30, 2002                                                      [*]
          September 30, 2002                                                 [*]
          December 31, 2002                                                  [*]
          March 31, 2003                                                     [*]
          June 30, 2003                                                      [*]
          September 30, 2003                                                 [*]
          December 31, 2003                                                  [*]
          March 31, 2004                                                     [*]
          June 30, 2004                                                      [*]
          September 30, 2004                                                 [*]
          December 31, 2004                                                  [*]
          March 31, 2005                                                     [*]
          June 30, 2005                                                      [*]
          September 30, 2005                                                 [*]
          December 31, 2005                                                  [*]
          March 31, 2006                                                     [*]

</Table>

                                       35

[*] Indicates confidential treatment requested.

<Page>

<Table>
<Caption>
          QUARTERLY PERIOD ENDING                                         PERCENTAGE
<S>                                                                   <C>
          June 30, 2006                                                      [*]
          September 30, 2006                                                 [*]
          December 31, 2006                                                  [*]
          March 31, 2007                                                     [*]
          June 30, 2007                                                      [*]
          September 30, 2007                                                 [*]
          December 31, 2007                                                  [*]
          March 31, 2008                                                     [*]
          Thereafter                                                         [*]
</Table>

                  (vi) MINIMUM CUSTOMERS. The number of revenue generating
customers of Holdings and its Subsidiaries (treating each office location of a
Person purchasing services from Holdings or any Subsidiary to be a separate
customer to the extent such office locations are in separate buildings) as of
the end of the monthly or quarterly period set forth below shall not be less
than the number listed opposite such period:

<Table>
<Caption>
          MONTHLY PERIOD                                                    NUMBER
<S>                                                                  <C>
          October 31, 2001                                                   [*]
          November 30, 2001                                                  [*]
          December 31, 2001                                                  [*]
          January 31, 2002                                                   [*]
          February 28, 2002                                                  [*]
          March 31, 2002                                                     [*]
          April 30, 2002                                                     [*]
          May 31, 2002                                                       [*]

          QUARTERLY PERIOD                                                  NUMBER

          June 30, 2002                                                      [*]
          September 30, 2002                                                 [*]
          December 31, 2002                                                  [*]
          March 31, 2003                                                     [*]
          June 30, 2003                                                      [*]
          September 30, 2003                                                 [*]
          December 31, 2003                                                  [*]
          March 31, 2004                                                     [*]
          June 30, 2004                                                      [*]
</Table>

                                       36

[*] Indicates confidential treatment requested.

<Page>

<Table>
<S>                                                                     <C>
          September 30, 2004                                                 [*]
          December 31, 2004                                                  [*]
          March 31, 2005                                                     [*]
          June 30, 2005                                                      [*]
          September 30, 2005                                                 [*]
          December 31, 2005                                                  [*]
          March 31, 2006                                                     [*]
          June 30, 2006                                                      [*]
          September 30, 2006                                                 [*]
          December 31, 2006                                                  [*]
          March 31, 2007                                                     [*]
          June 30, 2007                                                      [*]
          September 30, 2007                                                 [*]
          December 31, 2007                                                  [*]
          March 31, 2008                                                     [*]
          Thereafter                                                         [*]
</Table>

                  (vii) MINIMUM CASH RESERVES. On a consolidated basis, Holdings
and its Subsidiaries shall maintain as of the last day of each quarterly period
Minimum Cash Reserves not less than the amount listed opposite such date below:

<Table>
<Caption>
          DATE                                                              NUMBER
<S>                                                                      <C>
          December 31, 2001                                                  [*]
          March 31, 2002                                                     [*]
          June 30, 2002                                                      [*]
          September 30, 2002                                                 [*]
          December 31, 2002                                                  [*]
          March 31, 2003                                                     [*]
          June 30, 2003                                                      [*]
          September 30, 2003                                                 [*]
          December 31, 2003                                                  [*]
          March 31, 2004                                                     [*]
          June 30, 2004                                                      [*]
          September 30, 2004                                                 [*]
          December 31, 2004                                                  [*]
          March 31, 2005                                                     [*]
          June 30, 2005                                                      [*]
          September 30, 2005                                                 [*]
          December 31, 2005                                                  [*]
          March 31, 2006                                                     [*]
          June 30, 2006                                                      [*]
</Table>

                                       37

[*] Indicates confidential treatment requested.

<Page>

<Table>
<Caption>
          DATE                                                              NUMBER
<S>                                                                      <C>
          September 30, 2006                                                 [*]
          December 31, 2006                                                  [*]
          March 31, 2007                                                     [*]
          June 30, 2007                                                      [*]
          September 30, 2007                                                 [*]
          December 31, 2007                                                  [*]
          Thereafter                                                         [*]
</Table>

                  (viii) MINIMUM NODES ON NET. The number of nodes connected to
the network maintained by Holdings and its Subsidiaries as of any date listed
below shall not be less than the number listed opposite such monthly or
quarterly period set forth below:

<Table>
<Caption>
          MONTHLY PERIOD                                                    NUMBER
<S>                                                                     <C>
          October 31, 2001                                                   [*]
          November 30, 2001                                                  [*]
          December 31, 2001                                                  [*]
          January 31, 2002                                                   [*]
          February 28, 2002                                                  [*]
          March 31, 2002                                                     [*]
          April 30, 2002                                                     [*]
          May 31, 2002                                                       [*]

          QUARTERLY PERIOD                                                  NUMBER

          June 30, 2002                                                      [*]
          September 30, 2002                                                 [*]
          December 31, 2002                                                  [*]
          March 31, 2003                                                     [*]
          June 30, 2003                                                      [*]
          September 30, 2003                                                 [*]
          December 31, 2003                                                  [*]
          March 31, 2004                                                     [*]
          June 30, 2004                                                      [*]
          September 30, 2004                                                 [*]
          December 31, 2004                                                  [*]
          March 31, 2005                                                     [*]
          June 30, 2005                                                      [*]
          September 30, 2005                                                 [*]
          December 31, 2005                                                  [*]
</Table>

                                       38

[*] Indicates confidential treatment requested.

<Page>

<Table>
<S>                                                                     <C>
          March 31, 2006                                                     [*]
          June 30, 2006                                                      [*]
          September 30, 2006                                                 [*]
          December 31, 2006                                                  [*]
          March 31, 2007                                                     [*]
          June 30, 2007                                                      [*]
          September 30, 2007                                                 [*]
          December 31, 2007                                                  [*]
          March 31, 2008                                                     [*]
          Thereafter                                                         [*]
</Table>

                  (ix) MAXIMUM CAPITAL EXPENDITURES. On a consolidated basis,
Holdings and its Subsidiaries shall not make any expenditures for fixed or
capital assets on an annual basis in excess of the amount listed below
(determined as of the end of the annual period set forth below):

<Table>
<Caption>
          DATE                                                          ANNUAL AMOUNT
<S>                                                                  <C>
          December 31, 2001                                                  [*]
          December 31, 2002                                                  [*]
          December 31, 2003                                                  [*]
          December 31, 2004                                                  [*]
          December 31, 2005                                                  [*]
          December 31, 2006                                                  [*]
          December 31, 2007                                                  [*]
          Thereafter                                                         [*]
</Table>

As used in this subsection (r), the following terms shall have the following
meanings: "Capitalization" means, on any date, the sum of (i) Consolidated
Funded Debt, and (ii) the sum of common and preferred equity, including without
duplication capital stock plus paid in capital of Holdings and its Subsidiaries
on such date, on a consolidated basis and as determined in accordance with,
GAAP; "Consolidated Funded Debt" means, as of any date of determination, all
Indebtedness of Holdings and its Subsidiaries on such date, on a consolidated
basis and as determined in accordance with GAAP; "EBITDA" means, for any period
with respect to Holdings and its Subsidiaries, net income (excluding
extraordinary items), plus (except to the extent attributable to extraordinary
items) the amount of any interest, taxes, depreciation, amortization and other
non-cash charges deducted in determining such net income, all of the foregoing
as determined on a consolidated basis for Holdings and its Subsidiaries,
determined in conformity with GAAP; "Interest Expense" means, for any period
with respect to Holdings and its Subsidiaries, the amount of interest expense,
both expensed and capitalized (including

                                       39

[*] Indicates confidential treatment requested.

<Page>

the portion of any payments in respect of any capital leases allocable to
interest expense), on a consolidated basis, as determined in accordance with
GAAP, paid or payable during such period in respect of any Indebtedness of
Holdings and its Subsidiaries; and "Minimum Cash Reserves" means unrestricted
cash and cash equivalents of Borrower and its wholly-owned Subsidiaries.
Notwithstanding anything in this Section 5.1(r) to the contrary, any
Indebtedness or any Interest Expense thereon accruing or becoming due during the
Permitted Period resulting from Permitted Purchases shall not be included by
Holdings in determining compliance with the financial covenants set forth in
this Section 5.1(r). Notwithstanding any provision to the contrary contained
herein, if Holdings and its Subsidiaries fail to comply with any of the
financial covenants set forth in this Section 5.1(r) prior to the period ending
June 30, 2002, such non-compliance shall not constitute an Event of Default
hereunder, but neither Agent nor any other Lender shall have any obligation to
make any Loans to Borrower (other than Tranche X Loans (as defined in the
Schedule), which shall continue to be available to Borrower), until Holdings and
its Subsidiaries shall have complied with all of the monthly financial covenants
set forth in this Section 5.1(r) for a subsequent month during the period prior
to and including the period ending June 30, 2002. On and after June 30, 2002,
any non-compliance with any of the financial covenants shall constitute an Event
of Default hereunder.

         (s) MATERIAL CONTRACTS. Neither Borrower nor Holdings shall, nor shall
they permit any of their respective Subsidiaries to, agree to or permit any
amendment, modification or waiver of any material provision of any Material
Contract, if the effect thereof could reasonably be expected to result in a
Material Adverse Change. If Holdings, Borrower or any of their respective
Subsidiaries enter into a Material Contract after the Closing Date, Borrower
shall promptly notify Agent thereof and, if requested by Agent, Borrower shall
deliver to Lenders (through Agent) a complete and current copy of such Material
Contract in a reasonably prompt fashion after the creation thereof, except that
Borrower shall not have any obligation to deliver such Material Contract if such
delivery is prohibited by the terms of such Material Contract and if such
prohibition was required by a party other than Holdings, Borrower or any of
their respective Subsidiaries.

         (t) OWNERSHIP OF SUBSIDIARIES. Holdings and Borrower shall cause each
of their Subsidiaries to remain and be a direct or indirect wholly-owned
Subsidiary.

         (u) ACCOUNTING CHANGES. Neither Borrower nor Holdings shall, nor shall
they suffer or permit any of their respective Subsidiaries to, make any
significant change in accounting treatment or reporting practices, except as
required by GAAP, or change the fiscal year of Holdings or Borrower or of any of
their respective Subsidiaries, except to change the fiscal year of a Subsidiary
to conform its fiscal year to Borrower's.

         (v) HAZARDOUS SUBSTANCES. Neither Borrower nor Holdings shall, nor
shall they permit any of their Subsidiaries to, use, generate, manufacture,
install, treat, release, store or dispose of any Hazardous Substances, except in
compliance with all applicable Environmental Laws, unless noncompliance would
not, individually or in the aggregate, reasonably be expected to result in a
Material Adverse Change.

                                       40

[*] Indicates confidential treatment requested.

<Page>

         (w) BOOKS AND RECORDS; INSPECTIONS. Borrower and Holdings shall, and
they shall cause each of their respective Subsidiaries to, keep adequate records
and books of account, in which complete entries will be made in accordance with
GAAP. Holdings and Borrower shall provide Agent, each Lender and their
respective agents access to the premises of Holdings, Borrower and any of their
respective Subsidiaries at any time and from time to time, during normal
business hours and upon reasonable notice under the circumstances, and at any
time on and after the occurrence of a Default or Event of Default, for the
purposes of (i) inspecting and any and all records verifying the Collateral,
(ii) inspecting and copying (at Borrower's expense) pertaining thereto, and
(iii) discussing the affairs, finances and business of Holdings, Borrower and
their respective Subsidiaries with any executive officer or director of Holdings
or Borrower or with their accountants. Borrower shall reimburse Agent for the
reasonable travel and related expenses of Agent's employees or, at Agent's
option, of such outside accountants or examiners as may be retained by Agent to
verify or inspect Collateral, records or documents of Holdings or Borrower on a
regular basis or for a special inspection if Agent deems the same appropriate.
If outside examiners or accountants are used, Borrower shall also pay Agent such
reasonable sum as Agent may be obligated to pay as fees therefor; PROVIDED that
prior to the occurrence of a Default or an Event of Default, Borrower shall only
be liable to Agent for one such inspection during any twelve (12) month period.

         (x) CAPITAL CONTRIBUTIONS. Holdings shall contribute to Borrower, and
Borrower shall accept, as common equity, within two Banking Days of receipt, (i)
all net proceeds received from the sale of any of Holdings' equity securities or
debt instruments or securities (other than issuances of equity securities to
officers, directors, employees or consultants of Borrower in the ordinary course
of business), (ii) any cash or cash equivalents generated or received by
Holdings at any time and from time to time, other than cash received by Holdings
from Borrower pursuant to clause (D) of Section 5.1(m) and (iii) any other asset
acquired or received by Holdings at any time and from time to time that is not
reasonably necessary for Holdings to perform its function as the holding company
of Borrower.

         (y) FURTHER ASSURANCES AND ADDITIONAL ACTS. Holdings and Borrower shall
execute, acknowledge, deliver, file, notarize and register at its own expense
all such further agreements, instruments, certificates, documents and assurances
and perform such acts as Agent shall deem necessary or appropriate to effectuate
the purposes of the Loan Documents, and promptly provide Agent with evidence of
the foregoing satisfactory in form and substance to Agent.

     SECTION 6. EVENTS OF DEFAULT.

     6.1 EVENTS OF DEFAULT. Any of the following events which shall occur shall
constitute an "Event of Default":

         (a) PAYMENTS. Borrower shall fail to pay when due (i) any amount of
principal of any Loan or Note, or (ii) any amount of interest on any Loan or
Note, or any fee or other amount payable under any of the Loan Documents, or
Holdings or any other Loan Party shall fail to pay when due any amount payable
under any of the Loan Documents, and in the case of this clause (ii) any such
default shall remain unremedied for five days.

                                       41

[*] Indicates confidential treatment requested.

<Page>

         (b) REPRESENTATIONS AND WARRANTIES. Any representation or warranty by
any Loan Party under or in connection with the Loan Documents shall prove to
have been incorrect in any material respect when made or deemed made.

         (c) FAILURE BY HOLDINGS OR BORROWER TO PERFORM CERTAIN COVENANTS.
Holdings or Borrower shall fail to perform or observe any term, covenant or
agreement contained in subsections (b)(i) or (g) through (u) of Section 5.1 or
shall fail to issue any of the Warrants that Holdings is required to issue to
Agent pursuant to Section 10 of the Schedule.

         (d) FAILURE BY HOLDINGS OR BORROWER TO PERFORM OTHER COVENANTS.
Holdings, Borrower or any other Loan Party shall fail to perform or observe any
other term, covenant or agreement contained in any Loan Document on its part to
be performed or observed and any such failure shall remain unremedied for a
period of 20 days from the occurrence thereof (unless Majority Lenders
reasonably determine that such failure is not capable of remedy).

         (e) INSOLVENCY. (i) Holdings, Borrower, any Guarantor or any of their
respective Subsidiaries shall be dissolved, liquidated, wound up or cease its
corporate (or equivalent) existence, except to the extent expressly permitted by
Section 5.1; or (ii) Holdings, Borrower, any Guarantor or any such Subsidiary
(A) shall make a general assignment for the benefit of creditors, or shall
generally fail to pay, or admit in writing its inability to pay, its debts as
they become due, subject to applicable grace periods, if any, whether at stated
maturity or otherwise; (B) shall voluntarily cease to conduct its business in
the ordinary course, except as permitted by Section 5.1; (C) shall commence any
Insolvency Proceeding with respect to itself, or (D) shall take any action to
effectuate or authorize any of the foregoing.

         (f) INVOLUNTARY PROCEEDINGS. (i) Any involuntary Insolvency Proceeding
is commenced or filed against Holdings, Borrower, any Guarantor or any of their
respective Subsidiaries, or any writ, judgment, warrant of attachment, execution
or similar process, is issued or levied against a substantial part of Holdings',
Borrower's, any Guarantor's or any such Subsidiary's properties, and any such
proceeding or petition shall not be dismissed, or such writ, judgment, warrant
of attachment, execution or similar process shall not be released, vacated or
fully bonded within 60 days after commencement, filing or levy; (ii) Holdings,
Borrower, any Guarantor or any of their respective Subsidiaries admits the
material allegations of a petition against it in any Insolvency Proceeding, or
an order for relief (or similar order under non-U.S. law) is ordered in any
Insolvency Proceeding; or (iii) Holdings, Borrower, any Guarantor or any of
their respective Subsidiaries acquiesces in the appointment of a receiver,
trustee, custodian, conservator, liquidator, mortgagee in possession (or agent
therefor), or other similar Person for itself or a substantial portion of its
property or business.

         (g) DEFAULTS UNDER OTHER INDEBTEDNESS. Holdings, Borrower, any
Guarantor or any of their respective Subsidiaries shall fail (i) to make any
payment of any Indebtedness evidenced by or arising under any Financing
Document, if any, or any amount of any other Indebtedness in an aggregate
principal amount for all such Indebtedness together of at least $1,000,000 (or
its equivalent in another currency) when due (whether by scheduled maturity,
required prepayment, acceleration, demand or otherwise), and such failure shall
continue after the applicable grace or notice period, if any, specified in the
agreement or instrument relating to such Indebtedness as of the date of such
failure, or (ii) to perform or observe any term, covenant

                                       42

[*] Indicates confidential treatment requested.

<Page>

or condition on its part to be performed or observed under any Financing
Document, if any, or any other agreement, note or instrument relating to any
such Indebtedness, when required to be performed or observed, or any other event
shall occur or condition shall exist thereunder, and such failure, event or
condition shall continue after the applicable grace or notice period, if any,
specified in such agreement, note or instrument, if the effect of such failure,
event or condition is to accelerate, or to permit the acceleration of, the
maturity of such Indebtedness; or any such Indebtedness shall be declared to be
due and payable, or required to be prepaid (other than by a regularly scheduled
required prepayment), prior to the stated maturity thereof, or (without limiting
the generality of the foregoing) any defined "Event of Default" (as defined in
any Financing Document) shall have occurred and be continuing.

         (h) CISCO DEFAULTS. So long as CSCC is a Lender hereunder, any of the
Loan Parties or any of their respective Subsidiaries (i) shall fail to pay any
Indebtedness or other obligations owing under any other material agreement with
Cisco Systems or any Subsidiary thereof (including CSCC) or under any note or
instrument in favor of Cisco Systems or any Subsidiary thereof (including CSCC),
when due (whether at scheduled maturity or by required prepayment, acceleration,
demand or otherwise), or (ii) shall otherwise be in breach of or default in any
of its obligations under any such agreement, note or instrument, and such
failure, breach or default shall continue after the applicable grace period, if
any, specified in such agreement, note or instrument.

         (i) MATERIAL ADVERSE CHANGE. Any Material Adverse Change shall occur.

         (j) FAILURE BY GUARANTOR TO PERFORM COVENANTS; INVALIDITY OF GUARANTY.
Any Guarantor shall fail to perform or observe any term, covenant or agreement
contained in any Guaranty on its part to be performed or observed, or any
default shall occur under any Guaranty, and any such failure or default shall
continue after the applicable grace period, if any, specified in any Guaranty as
of the date of such failure, or any defined "Event of Default" as defined in any
Guaranty shall have occurred and is continuing; or any Guaranty or any other
Guarantor Document shall for any reason be revoked or invalidated, or otherwise
cease to be in full force and effect, or any Guarantor or any other Person shall
contest in any manner the validity or enforceability thereof or deny that it has
any further liability or obligation thereunder.

         (k) DEFAULT UNDER OTHER DOCUMENTS. Any defined "Event of Default" (as
defined in any other Loan Document) shall have occurred; or Holdings, Borrower
or any of their respective Subsidiaries shall be in breach of or default in any
of its obligations under any Material Contract, and such failure, breach or
default shall continue after the applicable grace period, if any, specified in
such Material Contract and could reasonably be expected to result in a Material
Adverse Change.

         (l) CONSENTS, ETC. Any law, decree, license, consent, authorization,
registration or approval now or hereafter necessary to enable Borrower or any
Loan Party to comply with its obligations incurred in the Loan Documents or in
connection with the purchase of Financed Products shall be modified in a
materially adverse manner, or shall be revoked, withdrawn or withheld or shall
cease to remain in full force and effect if such revocation, withdrawal, or
withholding could reasonably be expected to result in a Material Adverse Change.

                                       43

[*] Indicates confidential treatment requested.

<Page>

         (m) JUDGMENTS. A final judgment or order for the payment of money in
excess of $1,000,000 (or its equivalent in another currency) which is not fully
covered by third-party insurance shall be rendered against Borrower or any
Guarantor or any of their respective Subsidiaries; or (ii) any non-monetary
judgment or order shall be rendered against Borrower, any Guarantor or any such
Subsidiary which has resulted in or would reasonably be expected to result in a
Material Adverse Change; and in each case there shall be any period of 30
consecutive days during which such judgment continues unsatisfied or during
which a stay of enforcement of such judgment or order, by reason of a pending
appeal or otherwise, shall not be in effect.

         (n) CHANGE OF CONTROL. Any Change of Control shall occur and Agent
shall have notified Holdings or Borrower that such Change of Control is an Event
of Default within 30 days of Agent receiving notice from Holdings or Borrower of
such Change of Control; PROVIDED that any Change of Control shall automatically
constitute an Event of Default if Holdings or Borrower fails to notify Agent of
such Change of Control within 10 days of the occurrence of such Change of
Control.

         (o) SUBORDINATION. Any Loan Party shall make any voluntary or optional
payment or repayment on, redemption, exchange or acquisition for value of, or
any sinking fund or similar payment with respect to, any Subordinated Debt other
than in consideration for equity securities of Holdings or as permitted in the
applicable subordination agreement, or if any Person who has subordinated such
Subordinated Debt terminates or in any way limits its subordination agreement.

         (p) LOAN DOCUMENTS. Any of the Loan Documents after delivery thereof
shall for any reason be revoked or invalidated, or otherwise cease to be in full
force and effect, or any Loan Party or any other Person shall contest in any
manner the validity or enforceability thereof, or any Loan Party or any other
Person shall deny that it has any further liability or obligation thereunder; or
any Loan Party or any other Person shall do or undertake any act evidencing an
intent to repudiate the Loan Documents, or any of the Collateral Documents for
any reason, except to the extent permitted by the terms thereof, shall cease to
create a valid and perfected Lien subject only to Permitted Liens in any of the
Collateral purported to be covered thereby; or any of the Financed Products
shall at any time be located outside of the United States.

     6.2 EFFECT OF EVENT OF DEFAULT. If any Event of Default shall occur and is
continuing, Agent shall, at the request of, or may, with the consent of,
Majority Lenders, by notice from Agent to Borrower, (i) declare the Commitments
of the Lenders to be terminated, whereupon the same shall forthwith terminate,
and (ii) declare the entire unpaid principal amount of the Loans and the Notes,
all interest accrued and unpaid thereon and all other Obligations to be
forthwith due and payable, whereupon the Loans and the Notes, all such accrued
interest and all such other Obligations shall become and be forthwith due and
payable, without presentment, demand, protest or further notice of any kind, all
of which are hereby expressly waived by Borrower, PROVIDED that if an event
described in Section 6.1(e) or 6.1(f) shall occur, the result which would
otherwise occur only upon giving of notice by Agent to Borrower as specified in
this Section 6.2 shall occur automatically, without the giving of any such
notice. Additionally, Agent and Lenders may exercise any or all of their
respective rights and remedies under the Collateral Documents, and proceed to
enforce all other rights and remedies available to them under the Loan Documents
and applicable law. Notwithstanding anything to the contrary contained

                                       44

[*] Indicates confidential treatment requested.

<Page>

in this Agreement, Agent shall not issue or maintain in effect any "orders" or
give any "notices of exclusive control" or similar notices pursuant to any
account control agreement among Borrower, Agent and Lenders and a securities
intermediary, except upon the occurrence and continuation of an Event of
Default.

     SECTION 7. THE AGENT.

     7.1 APPOINTMENT AND AUTHORIZATION; "AGENT". Each Lender hereby irrevocably
(subject to Section 7.10) appoints, designates and authorizes Agent to take such
action on its behalf under the provisions of this Agreement and each other Loan
Document and to exercise such powers and perform such duties as are expressly
delegated to it by the terms of this Agreement or any other Loan Document,
together with such powers as are reasonably incidental thereto. Notwithstanding
any provision to the contrary contained elsewhere in this Agreement or in any
other Loan Document, Agent shall not have any duties or responsibilities, except
those expressly set forth herein, nor shall Agent have or be deemed to have any
fiduciary relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against Agent. Without
limiting the generality of the foregoing sentence, the use of the term "agent"
in this Agreement with reference to Agent is not intended to connote any
fiduciary or other implied (or express) obligations arising under agency
doctrine of any applicable law. Instead, such term is used merely as a matter of
market custom, and is intended to create or reflect only an administrative
relationship between independent contracting parties.

     7.2 DELEGATION OF DUTIES. Agent may execute any of its duties under this
Agreement or any other Loan Document by or through agents, employees or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. Agent shall not be responsible for the
negligence or misconduct of any agent or attorney-in-fact that it selects with
reasonable care.

     7.3 LIABILITY OF AGENT. None of Agent-Related Persons shall (i) be liable
for any action taken or omitted to be taken by any of them under or in
connection with this Agreement or any other Loan Document or the transactions
contemplated hereby (except for its own gross negligence or willful misconduct),
or (ii) be responsible in any manner to any of Lenders for any recital,
statement, representation or warranty made by Holdings or Borrower or any
Subsidiary or Affiliate of Borrower, or any officer thereof, contained in this
Agreement or in any other Loan Document, or in any certificate, report,
statement or other document referred to or provided for in, or received by Agent
under or in connection with, this Agreement or any other Loan Document, or for
the value of or title to any Collateral, or the validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or any other Loan
Document, or for any failure of any Loan Party to perform its obligations
hereunder or thereunder. No Agent-Related Person shall be under any obligation
to any Lender to ascertain or to inquire as to the observance or performance of
any of the agreements contained in, or conditions of, this Agreement or any
other Loan Document, or to inspect the properties, books or records of Borrower
or any of Holdings, Borrower or any of their Subsidiaries or Affiliates.

     7.4 RELIANCE BY AGENT. (a) Agent shall be entitled to rely, and shall be
fully protected in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter, telegram,

                                       45

[*] Indicates confidential treatment requested.

<Page>

facsimile, telex or telephone message, statement or other document or
conversation believed by it to be genuine and correct and to have been signed,
sent or made by the proper Person or Persons, and upon advice and statements of
legal counsel (including counsel to Borrower), independent accountants and other
experts selected by Agent. Agent shall be fully justified in failing or refusing
to take any action under this Agreement or any other Loan Document unless it
shall first receive such advice or concurrence of Majority Lenders as it deems
appropriate and, if it so requests, it shall first be indemnified to its
satisfaction by Lenders against any and all liability and expense which may be
incurred by it by reason of taking or continuing to take any such action. Agent
shall in all cases be fully protected in acting, or in refraining from acting,
under this Agreement or any other Loan Document in accordance with a request or
consent of Majority Lenders and such request and any action taken or failure to
act pursuant thereto shall be binding upon all of Lenders. (b) For purposes of
determining compliance with the conditions specified in Section 3.1 or 3.2, each
Lender that has executed this Agreement shall be deemed to have consented to,
approved or accepted or to be satisfied with, each document or other matter
either sent (or made available) by Agent to such Lender for consent, approval,
acceptance or satisfaction, or required thereunder to be consented to or
approved by or acceptable or satisfactory to such Lender.

     7.5 NOTICE OF DEFAULT. Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default or Event of Default, except with respect
to defaults in the payment of principal, interest and fees required to be paid
to Agent for the account of Lenders, unless Agent shall have received written
notice from a Lender or Borrower referring to this Agreement, describing such
Default or Event of Default and stating that such notice is a "notice of
default". Agent will notify Lenders of its receipt of any such notice. Agent
shall take such action with respect to such Default or Event of Default as may
be requested by Majority Lenders in accordance with Article VI; PROVIDED,
HOWEVER, that unless and until Agent has received any such request, Agent may
(but shall not be obligated to) take such action, or refrain from taking such
action, with respect to such Default or Event of Default as it shall deem
advisable or in the best interest of Lenders.

     7.6 CREDIT DECISIONS. Each Lender acknowledges that none of Agent-Related
Persons has made any representation or warranty to it, and that no act by Agent
hereinafter taken, including any review of the affairs of Holdings, Borrower and
their Subsidiaries, shall be deemed to constitute any representation or warranty
by any Agent-Related Person to any Lender. Each Lender represents to Agent that
it has, independently and without reliance upon any Agent-Related Person and
based on such documents and information as it has deemed appropriate, made its
own appraisal of and investigation into the business, prospects, operations,
property, financial and other condition and creditworthiness of Holdings,
Borrower and their Subsidiaries, the value of and title to any Collateral, and
all applicable regulatory laws relating to the transactions contemplated hereby,
and made its own decision to enter into this Agreement and to extend credit to
Borrower and any Additional Borrower hereunder. Each Lender also represents that
it will, independently and without reliance upon any Agent-Related Person and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit analysis, appraisals and decisions in
taking or not taking action under this Agreement and the other Loan Documents,
and to make such investigations as it deems necessary to inform itself as to the
business, prospects, operations, property, financial and other condition and
creditworthiness of the Loan Parties. Except for notices, reports and other
documents expressly

                                       46

[*] Indicates confidential treatment requested.

<Page>

herein required to be furnished to Lenders by Agent, Agent shall not have any
duty or responsibility to provide any Lender with any credit or other
information concerning the business, prospects, operations, property, financial
and other condition or creditworthiness of Holdings, Borrower or any Subsidiary
which may come into the possession of any of Agent-Related Persons.

     7.7 INDEMNIFICATION OF AGENT. Whether or not the transactions contemplated
hereby are consummated, Lenders shall indemnify upon demand all Agent-Related
Persons (to the extent not reimbursed by or on behalf of Borrower and without
limiting the obligation of Borrower to do so), PRO RATA, from and against any
and all Indemnified Liabilities; PROVIDED, HOWEVER, that no Lender shall be
liable for the payment to Agent-Related Persons of any portion of such
Indemnified Liabilities resulting solely from such Person's gross negligence or
willful misconduct. Without limitation of the foregoing, each Lender shall
reimburse Agent upon demand for its ratable share of any costs or out-of-pocket
expenses incurred by Agent in connection with the preparation, execution,
delivery, administration, modification, amendment or enforcement (whether
through negotiations, legal proceedings or otherwise) of, or legal advice in
respect of rights or responsibilities under, this Agreement, any other Loan
Document, or any document contemplated by or referred to herein, to the extent
that Agent is not reimbursed for such expenses by or on behalf of Borrower. The
undertaking in this Section shall survive the payment of all Obligations
hereunder and the resignation or replacement of Agent.

     7.8 AGENT IN INDIVIDUAL CAPACITY. CSCC and its Affiliates (including Cisco
Systems) may make loans to, enter into leases with, sell equipment and provide
related services to, acquire equity interests in and generally engage in any
kind of business with Holdings, Borrower and their Subsidiaries and Affiliates
as though CSCC were not Agent hereunder and without notice to or consent of
Lenders. Lenders acknowledge that, pursuant to such activities, CSCC or its
Affiliates may receive information regarding Holdings, Borrower or their
Affiliates (including information that may be subject to confidentiality
obligations in favor of Holdings, Borrower or such Affiliate) and acknowledge
that Agent shall be under no obligation to provide such information to them.
With respect to its Loans, CSCC shall have the same rights and powers under this
Agreement as any other Lender and may exercise the same as though it were not
Agent, and the terms "Lender" and "Lenders" include CSCC in its individual
capacity.

     7.9 COLLATERAL MATTERS. (a) Agent is authorized on behalf of all Lenders,
without the necessity of any notice to or further consent from Lenders, from
time to time to take any action with respect to any Collateral or the Collateral
Documents which may be necessary to perfect and maintain perfected the security
interest in and Liens upon the Collateral granted pursuant to the Collateral
Documents. (b) Lenders irrevocably authorize Agent, at its option and in its
discretion, to release any Lien granted to or held by Agent upon any Collateral
(i) upon termination of the Commitments and payment in full of all Loans and all
other Obligations known to Agent and payable under this Agreement or any other
Loan Document; (ii) constituting property sold or to be sold or disposed of as
part of or in connection with any disposition permitted hereunder; (iii)
constituting property in which a Loan Party owned no interest at the time the
Lien was granted or at any time thereafter; (iv) constituting property leased to
a Loan Party in a transaction permitted under this Agreement; (v) consisting of
an instrument evidencing Indebtedness or other debt instrument, if the
indebtedness evidenced thereby has been paid in full; or (vi) if approved,
authorized or ratified in writing by Majority Lenders or all Lenders, as

                                       47

[*] Indicates confidential treatment requested.

<Page>

the case may be, as provided in Section 8.1. Upon request by Agent at any time,
Lenders will confirm in writing Agent's authority to release particular types or
items of Collateral pursuant to this Section 7.9, provided that the absence of
any such confirmation for whatever reason shall not affect Agent's rights under
this Section 7.9. (c) EACH LENDER AGREES WITH AND IN FAVOR OF EACH OTHER (WHICH
AGREEMENT SHALL NOT BE FOR THE BENEFIT OF BORROWER OR ANY SUBSIDIARY) THAT THE
OBLIGATIONS TO SUCH LENDER ARE NOT AND SHALL NOT BE SECURED BY ANY REAL PROPERTY
COLLATERAL NOW OR HEREAFTER ACQUIRED BY SUCH LENDER OTHER THAN THE REAL PROPERTY
DESCRIBED IN THE SCHEDULE.

     7.10 SUCCESSOR AGENT. Agent may, and at the request of Majority Lenders
shall, resign as Agent upon 30 days' notice to Lenders. If Agent resigns under
this Agreement, Majority Lenders shall appoint from among Lenders a successor
agent for Lenders. If no successor agent is appointed prior to the effective
date of the resignation of Agent, Agent may appoint, after consulting with
Lenders and Borrower, a successor agent from among Lenders. Upon the acceptance
of its appointment as successor agent hereunder, such successor agent shall
succeed to all the rights, powers and duties of the retiring Agent and the term
"Agent" shall mean such successor agent and the retiring Agent's appointment,
powers and duties as Agent shall be terminated. After any retiring Agent's
resignation hereunder as Agent, the provisions of this Article VII and Section
8.4 shall inure to its benefit as to any actions taken or omitted to be taken by
it while it was Agent under this Agreement. If no successor agent has accepted
appointment as Agent by the date which is 30 days following a retiring Agent's
notice of resignation, the retiring Agent's resignation shall nevertheless
thereupon become effective and Lenders shall perform all of the duties of Agent
hereunder until such time, if any, as Majority Lenders appoint a successor agent
as provided for above.

     SECTION 8. MISCELLANEOUS.

     8.1 AMENDMENTS. No material amendment or waiver (as reasonably determined
by Agent) of any provision of this Agreement or any other Loan Document, and no
consent with respect to any departure by Holdings, Borrower or any applicable
Subsidiary therefrom, shall be effective unless the same shall be in writing and
signed by Majority Lenders (or by Agent at the written request of Majority
Lenders), Holdings and Borrower and acknowledged by Agent, and then any such
amendment, waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given; PROVIDED, HOWEVER, that no such
waiver, amendment, or consent shall, unless in writing and signed by all
Lenders, Holdings and Borrower and acknowledged by Agent, do any of the
following:

         (a) increase or extend the Commitment of any Lender (or reinstate any
Commitment terminated pursuant to Section 6.2);

         (b) postpone or delay any date fixed by this Agreement or any other
Loan Document for any payment of principal, interest, fees (other than any fees
payable solely to Agent, which fees Agent may, in its sole discretion and
without further consent, agree to amend or modify) or other amounts due to
Lenders (or any of them) hereunder or under, any other Loan Document (including
the date of any mandatory prepayment hereunder);

                                       48

[*] Indicates confidential treatment requested.

<Page>

         (c) reduce the principal of, or the rate of interest specified herein
on any Loan, or any fees or other amounts payable hereunder or under any other
Loan Document (other than any fees or other amounts payable solely to Agent,
which fees and other amounts Agent may, in its sole discretion and without
further consent, agree to amend or modify);

         (d) change the percentage of the Commitments or of the aggregate unpaid
principal amount of the Loans which is required for Lenders or any of them to
take any action hereunder;

         (e) amend this Section 8.1, Section 2.20, the definition of "Majority
Lenders" herein, or any provision herein providing for consent or other action
by all Lenders or some specified amount of Lenders; or

         (f) discharge any Guarantor, or release any portion of the Collateral
except as otherwise may be provided in this Agreement or the Collateral
Documents or except where the consent of Majority Lenders only is specifically
provided for;

and, PROVIDED FURTHER, that (i) no amendment, waiver or consent shall, unless in
writing and signed by Agent in addition to Majority Lenders or all Lenders, as
applicable, affect the rights or duties of Agent under this Agreement or any
other Loan Document, and (ii) the Fee Letter may be amended, or rights or
privileges thereunder waived, in a writing executed by the parties thereto.

     8.2 NOTICES.

         (a) All notices and other communications provided for hereunder and
under the other Loan Documents shall, unless otherwise stated herein, be in
writing (including by facsimile transmission) and mailed, sent or delivered to
the respective parties hereto at or to their respective addresses or facsimile
numbers set forth in the Schedule or the Annex, as the case may be, or at or to
such other address or facsimile number as shall be designated by any party in a
written notice to the other party hereto. All such notices and communications
shall be effective (i) if delivered by hand, when delivered; (ii) if sent by
courier service, when delivered; (iii) if sent by mail, upon the earlier of the
date of receipt or five Banking Days after deposit in the mail, first class (or
air mail, with respect to communications to be sent to or from the United
States), postage prepaid; and (iv) if sent by facsimile transmission, when sent;
provided, however, that notices and communications to Agent or Lenders pursuant
to Section 2 shall not be effective until received.

         (b) Any agreement of Agent and Lenders herein to receive certain
notices by telephone or facsimile is solely for the convenience and at the
request of Borrower. Agent and Lenders shall be entitled to rely on the
authority of any Person purporting to be a Person authorized by Borrower to give
such notice and Agent and Lenders shall not have any liability to Borrower or
other Person on account of any action taken or not taken in good faith by Agent
or Lenders in reliance upon such telephonic or facsimile notice. The obligation
of Borrower to repay the Loans shall not be affected in any way or to any extent
by any failure by Agent and Lenders to receive written confirmation of any
telephonic or facsimile notice, or the receipt by

                                       49

[*] Indicates confidential treatment requested.

<Page>

Agent and Lenders of a confirmation which is at variance with the terms
understood by Agent and Lenders to be contained in the telephonic or facsimile
notice.

         (c) Each Lender shall notify Agent in writing of any changes in the
address to which notices to Lender should be directed, of addresses of any
lending office, of payment instructions in respect of all payments to be made to
it hereunder and of such other administrative information as Agent shall
reasonably request.

     8.3 NO WAIVER; CUMULATIVE REMEDIES. No failure on the part of Agent or any
Lender to exercise, and no delay in exercising, any right, remedy, power or
privilege under any Loan Document shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right, remedy, power or privilege
preclude any other or further exercise thereof or the exercise of any other
right, remedy, power or privilege. The rights and remedies under the Loan
Documents are cumulative and not exclusive of any rights, remedies, powers and
privileges that may otherwise be available to Agent or any Lender.

     8.4 COSTS AND EXPENSES; INDEMNIFICATION. Borrower agrees to pay on demand
by Agent (i) the reasonable out-of-pocket costs and expenses of Agent and any of
its Affiliates, and the reasonable fees and disbursements of counsel to Agent
(excluding allocated costs and expenses for internal legal services), in
connection with the negotiation, preparation, execution and delivery of the Loan
Documents; (ii) all costs and expenses of Agent and its Affiliates, and fees and
disbursements of counsel (excluding allocated costs and expenses for internal
legal services), in connection with any amendments, modifications or waivers of
the terms of any Loan Documents, and (iii) all costs and expenses of Agent, each
Lender and their respective Affiliates, and fees and disbursements of counsel
(including allocated costs and expenses for internal legal services), in
connection with any Default, the enforcement or attempted enforcement of, and
preservation of any rights or interests under, the Loan Documents, and any
out-of-court workout or other refinancing or restructuring or any bankruptcy or
insolvency case or proceeding. In addition, whether or not the transactions
contemplated hereby shall be consummated, each of Holdings and Borrower hereby
agrees to indemnify each Agent-Related Person, each Lender, any Affiliate
thereof and their respective directors, officers, employees, agents, counsel and
other advisors (each an "Indemnified Person") against, and hold each of them
harmless from, any and all liabilities, obligations, losses, claims, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever, including the reasonable fees and disbursements of
counsel to an Indemnified Person (including, to the extent permitted herein,
allocated costs and expenses for internal legal services), which may be imposed
on, incurred by, or asserted against any Indemnified Person, in any way relating
to or arising out of any of the Loan Documents, the use or intended use of the
proceeds of the Loans or the transactions contemplated hereby or thereby,
including with respect to any investigation, litigation or other proceeding
relating to any of the foregoing, irrespective of whether the Indemnified Person
shall be designated a party thereto (the "Indemnified Liabilities"); provided
that neither Holdings nor Borrower shall be liable to any Indemnified Person for
any portion of such Indemnified Liabilities resulting from such Indemnified
Person's gross negligence or willful misconduct. If and to the extent that the
foregoing indemnification is for any reason held unenforceable, each of Holdings
and Borrower agrees to make the maximum contribution to the payment and
satisfaction of each of the Indemnified Liabilities which is permissible under
applicable law.

                                       50

[*] Indicates confidential treatment requested.

<Page>

     8.5 SURVIVAL. All covenants, agreements, representations and warranties
made in any Loan Documents shall, except to the extent otherwise provided
therein, survive the execution and delivery of this Agreement, the making of the
Loans and the execution and delivery of any Note, and shall continue in full
force and effect so long as any Lender has any Commitment, any Loans remain
outstanding or any other Obligations remain unpaid or any obligation to perform
any other act hereunder or under any other Loan Document remains unsatisfied.
Without limiting the generality of the foregoing, the obligations of Holdings
and Borrower under Sections 2.11, 2.12, 2.14, 2.21 and 8.4, and all similar
obligations under the other Loan Documents (including all obligations to pay
costs and expenses and all indemnity obligations), shall survive the repayment
of the Loans and the termination of the Commitments.

     8.6 BENEFITS OF AGREEMENT. The Loan Documents are entered into for the sole
protection and benefit of the parties hereto and their successors and assigns
and the Indemnified Persons referred to in Section 8.4, and no other Person
(other than Cisco Systems to the extent provided for in the Loan Documents)
shall be a direct or indirect beneficiary of, or shall have any direct or
indirect cause of action or claim in connection with, any Loan Document.

     8.7 BINDING EFFECT; SUCCESSORS AND ASSIGNS.

         (a) Any Lender may, with the written consent of the Agent (which shall
not be unreasonably withheld), at any time assign and delegate to one or more
Eligible Assignees (each an "Assignee") all, or any ratable part of all, of the
Loans, the Commitment and the other rights and obligations of such Lender
hereunder; PROVIDED, HOWEVER, that (i) no written consent of Agent shall be
required in connection with any assignment and delegation by a Lender to an
Eligible Assignee that is another Lender or an Affiliate of such Lender or an
Approved Fund; and (ii) except in connection with an assignment of all of a
Lender's rights and obligations with respect to its Commitment and Loans, any
such assignment to an Eligible Assignee that is not a Lender hereunder shall be
equal to or greater than $1,000,000; and PROVIDED FURTHER, HOWEVER, that
Holdings, Borrower and Agent may continue to deal solely and directly with such
Lender in connection with the interest so assigned to an Assignee until (A) such
Lender and its Assignee shall have delivered to Holdings, Borrower and Agent an
Assignment and Acceptance Agreement substantially in the form of EXHIBIT L (an
"Assignment and Acceptance"), together with any Note or Notes subject to such
assignment; (B) a written notice of such assignment, together with payment
instructions, addresses and related information with respect to the Assignee, in
substantially the form of the Notice of Assignment and Acceptance attached as
Schedule I to the Assignment and Acceptance, shall have been given to Holdings,
Borrower and Agent by such Lender and the Assignee; (C) the assignor Lender or
Assignee shall have paid to Agent a processing fee in the amount of $4,000; and
(D) Agent shall have provided any required consent to such assignment in
accordance with this Section.

         (b) From and after the date that Agent notifies the assignor Lender
that Agent has received (and, if required, provided its consent with respect
thereto) an executed Assignment and Acceptance and payment of the
above-referenced processing fee, (i) the Assignee thereunder shall be a party
hereto and, to the extent that rights and obligations hereunder have been
assigned to it pursuant to such Assignment and Acceptance, shall have the rights
and obligations of a Lender under the Loan Documents, (ii) this Agreement shall
be deemed to be amended to the extent, but only to the extent, necessary to
reflect the addition of the Assignee and the resulting

                                       51

[*] Indicates confidential treatment requested.

<Page>

adjustment of the Commitments arising therefrom, and (iii) the assignor Lender
shall, to the extent that rights and obligations hereunder and under the other
Loan Documents have been assigned by it pursuant to such Assignment and
Acceptance, relinquish its rights and be released from its obligations under the
Loan Documents; PROVIDED, HOWEVER, that the assignor Lender shall not relinquish
its rights under Sections 2.11, 2.12, 2.18 or 2.21 (and any equivalent
provisions of the other Loan Documents) to the extent such rights relate to the
time prior to the effective date of the Assignment and Acceptance. The
Commitment allocated to each Assignee shall reduce the Commitment of the
assigning Lender PRO TANTO.

         (c) Within five Banking Days after Borrower's receipt of notice by
Agent that it has received an executed Assignment and Acceptance and payment of
the processing fee, Borrower shall execute and deliver to Agent any new Notes
requested by such Assignee evidencing such Assignee's assigned Loans and
Commitment and, if the assignor Lender has retained a portion of its Loans and
its Commitment, replacement ` Notes as requested by the assignor Lender
evidencing the Loans and Commitment retained by the assignor Lender (such Notes
to be in exchange for, but not in payment of, the Notes held by such Lender, if
any).

         (d) Any Lender may at any time sell to one or more lending institutions
or other Persons not Affiliates of Holdings (a "Participant") participating
interests in any Loans, the Commitment of that Lender and the other interests of
that Lender (the "originating Lender") hereunder and under the other Loan
Documents; provided, however, that (i) the originating Lender's obligations
under this Agreement shall remain unchanged, (ii) the originating Lender shall
remain solely responsible for the performance of such obligations, (iii)
Holdings, Borrower and Agent shall continue to deal solely and directly with the
originating Lender in connection with the originating Lender's rights and
obligations under this Agreement and the other Loan Documents, and (iv) no
Lender shall transfer or grant any participating interest under which the
Participant has rights to approve any amendment to, or any consent or waiver
with respect to, this Agreement or any other Loan Document, except to the extent
such amendment, consent or waiver would require unanimous consent of Lenders as
described in the first proviso to Section 8.1. In the case of any such
participation, the Participant shall be entitled to the benefit of Sections
2.11, 2.21 and 8.4 as though it were also a Lender hereunder, and if amounts
outstanding under this Agreement are due and unpaid, or shall have been declared
or shall have become due and payable upon the occurrence of an Event of Default,
each Participant shall be deemed to have the right of set-off in respect of its
participating interest in amounts owing under this Agreement to the same extent
as if the amount of its participating interest were owing directly to it as a
Lender under this Agreement.

         (e) Notwithstanding any other provision in this Agreement, any Lender
may at any time create a security interest in, or pledge, all or any portion of
its rights under and interest in this Agreement and the Notes held by it in
favor of any Federal Reserve Bank in accordance with Regulation A of the FRB or
U.S. Treasury Regulation 31 C.F.R. ss.203.14, and such Federal Reserve Bank may
enforce such pledge or security interest in any manner permitted under
applicable law.

     8.8 CONFIDENTIALITY.

                                       52

[*] Indicates confidential treatment requested.

<Page>

         (a) Each of the Lenders and Agent agree to take normal and reasonable
precautions and exercise due care to maintain the confidentiality of all
information respecting Holdings and Borrower and their respective businesses
("Customer Information") and not to use the Customer Information other than for
purposes under this Agreement or the other Loan Documents. Holdings and Borrower
agree that Agent or any Lender may disclose from time to time all Customer
Information in its possession to Agent's or any such Lender's legal counsel,
agents and other professional advisors, and to its Subsidiaries and Affiliates,
to any potential assignees or participants of the rights and/or obligations of
any such Lender hereunder, to any underwriters or placement agents for any
securities to be issued by any such Lender or any of its Subsidiaries or
Affiliates (or any transferee of any such Subsidiaries or Affiliates) and to any
rating agency rating such securities and to their respective legal counsel,
agents and other professional advisors; PROVIDED that such recipients agree not
to disclose such Customer Information for any purposes other than as
contemplated herein. Holdings and Borrower also consent to the disclosure of
Customer Information by Lender, or any of its Subsidiaries or Affiliates, (i) at
the request of any Governmental Authority having jurisdiction over Agent or such
Lender or such Subsidiary or Affiliate, (ii) pursuant to subpoena or other court
process, (iii) to the extent reasonably required in connection with any
litigation to which Agent or such Lender or any of its Subsidiaries or
Affiliates is a party, (iv) to the extent reasonably required in connection with
the exercise of any remedy hereunder or under any other Loan Document, (v) when
otherwise required to do so in accordance with applicable law, and (vi)(A) to
the extent such information is made available by Holdings or Borrower or was or
becomes generally available to the public other than as a result of disclosure
by Agent or such Lender, or (B) was or becomes available on a non-confidential
basis from a source other than Holdings or Borrower, provided that such source
is not bound by a confidentiality agreement with Holdings or Borrower known to
Agent or such Lender; PROVIDED, HOWEVER, that, to the extent that the disclosure
of any Customer Information is to be made by Agent or such Lender pursuant to
the immediately preceding clauses (i), (ii) or (iii) and Agent or such Lender
may lawfully do so, Agent or such Lender shall use commercially reasonable
efforts to first give Holdings or Borrower notice and a reasonable opportunity
to interpose an objection to such disclosure to obtain a protective order
requiring that the Customer Information so disclosed be held in confidence by
such court or government body or, if disclosed, be used only for the purposes
for which such disclosure is required and otherwise permitted under such
clauses.

         (b) Holdings and Borrower each agree to take normal and reasonable
precautions and exercise due care to maintain the confidentiality of this
Agreement, the Fee Letter and the terms and provisions hereof and thereof. Agent
and each Lender agree that Holdings and Borrower may disclose from time to time
the existence of this Agreement, the Fee Letter and the terms and provisions
hereof and thereof to Holdings' and Borrower's legal counsel, agents and other
professional advisors, and to their respective Subsidiaries and Affiliates, as
reasonably required in connection with negotiations with a prospective acquirer
of Holdings or Borrower or substantially all of Holdings' or Borrower's assets
or a prospective merger partner, to any bank or other financial institution or
any other Person proposing to provide financing to Holdings or Borrower or any
of their respective Subsidiaries or Affiliates, to any underwriters or placement
agents for any securities to be issued by Holdings or Borrower or any of their
respective Subsidiaries or Affiliates and to any rating agency rating such
securities and to their respective legal counsel, agents and other professional
advisors. Agent and each Lender also consent to the

                                       53

[*] Indicates confidential treatment requested.

<Page>

disclosure of this Agreement, the Fee Letter and the terms and provisions hereof
and thereof by Holdings or Borrower, or any of their respective Subsidiaries or
Affiliates, (i) at the request of any Governmental Authority having jurisdiction
over Holdings, Borrower or such Subsidiary or Affiliate, (ii) pursuant to
subpoena or other court process, (iii) to the extent reasonably required in
connection with any litigation to which Holdings, Borrower or any of their
respective Subsidiaries or Affiliates is a party, and (iv) when otherwise
required to do so in accordance with applicable law. THE FOREGOING PERMITTED
DISCLOSURE DOES NOT INCLUDE DISCLOSURE TO ANY OTHER VENDOR PROVIDING VENDOR
FINANCING TO HOLDINGS, BORROWER OR ANY OF THEIR RESPECTIVE SUBSIDIARIES (WHETHER
DIRECTLY OR INDIRECTLY). HOLDINGS AND BORROWER SHALL PROVIDE PRIOR NOTICE TO
AGENT OF ANY PROPOSED PUBLIC ANNOUNCEMENTS OR OTHER PUBLIC DISCLOSURE OR FILINGS
OF OR RELATING TO THIS AGREEMENT, THE FEE LETTER, AND THE TERMS AND PROVISIONS
HEREOF AND THEREOF AS PERMITTED BY THIS SUBSECTION (b) ("PUBLIC DISCLOSURE"),
AND NO PUBLIC DISCLOSURE MAY BE MADE IN RESPECT OF THE FEES, INTEREST RATE AND
OTHER PRICING INFORMATION WITH RESPECT HERETO WITHOUT LENDER'S PRIOR CONSENT
(SUCH CONSENT NOT TO BE UNREASONABLY WITHHELD). PRIOR TO MAKING ANY REQUIRED
FILING WITH THE U.S. SECURITIES AND EXCHANGE COMMISSION OR ANY OTHER FEDERAL,
STATE, PROVINCIAL OR FOREIGN GOVERNMENTAL AUTHORITY AS PART OF ANY PUBLIC
DISCLOSURE, HOLDINGS OR BORROWER SHALL REQUEST CONFIDENTIAL TREATMENT OF THE
FEES, INTEREST RATE AND OTHER PRICING INFORMATION WITH RESPECT HERETO TO THE
EXTENT PERMITTED BY APPLICABLE LAW.

     8.9 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

     8.10 SUBMISSION TO JURISDICTION.

         (a) Each of Holdings and Borrower each hereby (i) submits to the
non-exclusive jurisdiction of the courts of the State of New York and the
Federal courts of the United States sitting in the Borough of Manhattan
(collectively, the "New York Courts"), for the purpose of any action or
proceeding arising out of or relating to the Loan Documents, (ii) irrevocably
waives (to the extent permitted by applicable law) any objection which it now or
hereafter may have to the laying of venue of any such action or proceeding
brought in any of the New York Courts, and any objection on the ground that any
such action or proceeding in any New York Court has been brought in an
inconvenient forum, and (iii) agrees that (to the extent permitted by applicable
law) a final judgment in any such action or proceeding brought in a New York
Court shall be conclusive and may be enforced in other jurisdictions by suit on
the judgment or in any other manner permitted by law.

         (b) If a process agent (the "Process Agent") is specified in the
Schedule, Holdings and Borrower each hereby irrevocably appoints the Process
Agent as its authorized agent with all powers necessary to receive on its behalf
service of copies of the summons and complaint and any other process which may
be served in any action or proceeding arising out of or relating to the Loan
Documents in any of the New York Courts. Such service may be made by mailing or
delivering a copy of such process to Holdings and Borrower in care of the
Process Agent at the Process Agent's above address and Holdings and Borrower
each hereby irrevocably authorizes and directs the Process Agent to accept such
service on its behalf and agrees that the failure of the Process Agent to give
any notice of any such service to Holdings and Borrower shall not impair or
affect the validity of such service or of any judgment rendered in any action or

                                       54

[*] Indicates confidential treatment requested.

<Page>

proceeding based thereon. As an alternative method of service, Holdings and
Borrower each also irrevocably consents to the service of any and all process in
any such action or proceeding by the mailing of copies of such process to
Holdings and Borrower at their respective address specified in the Schedule. If
for any reason the Process Agent specified in the Schedule shall cease to act as
such, Holdings and Borrower each shall appoint forthwith, in the manner provided
for herein, a successor Process Agent qualified to act as an agent for service
of process with respect to all New York Courts and acceptable to Agent.

         (c) NO LIMITATION. Nothing in this Section 8.10 shall affect the right
of Agent or any Lender to serve legal process in any other manner permitted by
law or limit the right of Agent or any Lender to bring any action or proceeding
against Holdings or Borrower or its property in the courts of other
jurisdictions.

     8.11 WAIVER OF JURY TRIAL. EACH OF AGENT, LENDERS, HOLDINGS AND BORROWER
HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHTS IT MAY HAVE TO
A TRIAL BY JURY IN RESPECT OF ANY LITIGATION IN CONNECTION WITH ANY LOAN
DOCUMENT.

     8.12 ENTIRE AGREEMENT. The Loan Documents reflect the entire agreement
among Holdings, Borrower, each Additional Borrower, if any, Agent and Lenders
with respect to the matters set forth therein and supersede any prior
agreements, commitments, drafts, communication, discussions and understandings,
oral or written, with respect thereto.

     8.13 SEVERABILITY. Whenever possible, each provision of the Loan Documents
shall be interpreted in such manner as to be effective and valid under all
applicable laws and regulations. If, however, any provision of any of the Loan
Documents shall be prohibited by or invalid under any such law or regulation in
any jurisdiction, it shall, as to such jurisdiction, be deemed modified to
conform to the minimum requirements of such law or regulation, or, if for any
reason it is not deemed so modified, it shall be ineffective and invalid only to
the extent of such prohibition or invalidity without affecting the remaining
provisions of such Loan Document, or the validity or effectiveness of such
provision in any other jurisdiction.

     8.14 COUNTERPARTS. This Agreement may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute but one and the same agreement.

     8.15 SECOND AMENDED AND RESTATED CREDIT AGREEMENT. This Agreement amends
and restates the Original Credit Agreement, as amended and restated by the
Amended and Restated Agreement, in its entirety, shall constitute a Loan
Document and shall be deemed in all respects to constitute the "Credit
Agreement" for the purposes of the Notes, the Collateral Documents and the other
Loan Documents. In addition, the Borrower hereby expressly acknowledges,
ratifies and confirms each of its obligations under the Original Credit
Agreement, this Agreement and the other Loan Documents.

     8.16 JOINT AND SEVERAL LIABILITY. If any Additional Borrowers are
designated in the Schedule, the liability of Borrower and such Additional
Borrowers shall be joint and several and, except as the context otherwise
requires, each reference herein to "Borrower" shall mean and be

                                       55

[*] Indicates confidential treatment requested.

<Page>

a reference to each Borrower and such Additional Borrowers. Borrower and any
such Additional Borrowers agree that any and all of the Obligations shall be the
joint and several responsibility of each of them notwithstanding any absence
herein or in any other Loan Document of a reference such as "jointly and
severally" with respect to such Obligation. The compromise of any claim with, or
the release of, Borrower shall not constitute a compromise with, or a release
of, any Additional Borrower, and the compromise of any claim with, or the
release of, any Additional Borrower shall not constitute a compromise with, or a
release of, Borrower or any other Additional Borrower.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       56

[*] Indicates confidential treatment requested.

<Page>

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the date first above written.

                                      CISCO SYSTEMS CAPITAL CORPORATION,
                                      as Agent and as a Lender

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

                                      Name:
                                           -------------------------------------

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

                                     COGENT COMMUNICATIONS, INC., as Borrower

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

                                     Name:
                                          --------------------------------------

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

                                     COGENT INTERNET, INC.,
                                     as Additional Borrower

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

                                     Name:
                                          --------------------------------------

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

ACKNOWLEDGED AND AGREED:

COGENT COMMUNICATIONS GROUP, INC.,
as Holdings

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

Name:
     ----------------------------------------------------

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

                                       57

[*] Indicates confidential treatment requested.

<Page>

                                     [LOGO]

As of October 24, 2001

                             SCHEDULE OF INFORMATION

         This Schedule of Information (this "Schedule") is an integral part of
the Second Amended and Restated Agreement dated as of October 24, 2001 (as
amended, modified, renewed or extended from time to time, the "Agreement") among
Cogent Communications, Inc., ("Borrower"), Cogent Internet, Inc. ("Additional
Borrower"), the several financial institutions from time to time party thereto
("Lenders") and Cisco Systems Capital Corporation, as administrative agent for
itself and the other Lenders (in such capacity, "Agent"). Capitalized terms used
but not otherwise defined herein shall have the respective meanings assigned to
such terms in the Second Amended and Restated Agreement.

1.  INFORMATION RELATING TO THE LOANS AND BORROWER:

         (a) AVAILABILITY PERIOD: (i) (A) Up to $145,000,000 ("Tranche Al")
shall be available from the Original Closing Date to the Closing Date, (B) up to
$25,000,000, ("Tranche A2"), shall be available from the Closing Date until June
30, 2002 (the "Tranche 2 Availability Termination Date"), and (C) up to
$100,000,000, PLUS any unused portion of Tranche A2 (the aggregate of such
amounts, "Tranche A3"), shall be available from the first Banking Day following
the Tranche 2 Availability Termination Date (the "Tranche A3 Commencement Date")
until December 31, 2004 (the "Tranche 3 Availability Termination Date"); and

         (ii) (A) Up to $29,000,000 ("Tranche B1") shall be available from the
Original Closing Date to the Closing Date, and (B) up to $35,000,000, ("Tranche
B3"), shall be available from the first Banking Day following the Tranche 2
Availability Termination Date to the Tranche 3 Availability Termination Date;
and

         (iii) (A) Up to $16,000,000 ("Tranche X2") shall be available from the
Closing Date until the Tranche 2 Availability Termination Date, and (B) up to
$59,000,000 ("Tranche X3") shall be available from the Tranche A3 Commencement
Date until December 31, 2005 (the "Tranche X Availability Termination Date");
PROVIDED, however, that in the event that after the Closing Date one or more
investors shall have made cash equity contributions to Borrower and Holdings in
an aggregate amount together in excess of [*], the then unused portion of
Tranche X shall be reduced by [*] percent ([*]%) of the amount by which the
aggregate amount of such cash equity contributions exceeds [*].

         Tranche A1 and Tranche B1 are hereinafter collectively referred to as
"Tranche 1", and any Loans outstanding under Tranche 1 are hereinafter referred
to as "Tranche 1 Loans".

                                       1.

[*] Indicates confidential treatment requested.

<Page>

         Any Loans outstanding under Tranche A2 and Tranche X2 are hereinafter
referred to as "Tranche 2 Loans".

         Tranche A3, Tranche B3 and Tranche X3 are hereinafter referred to as
"Tranche 3", and any Loans outstanding under Tranche 3 are hereinafter referred
to as "Tranche 3 Loans".

         Tranche A1, Tranche A2 and Tranche A3 are hereinafter referred to as
"Tranche A", and any Loans outstanding under Tranche A are hereinafter referred
to as "Tranche A Loans".

         Tranche B1 and Tranche B3 are hereinafter referred to as "Tranche B",
and any Loans outstanding under Tranche B are hereinafter referred to as
"Tranche B Loans".

         Tranche X2 and Tranche X3 are hereinafter referred to as "Tranche X"
and any Loans outstanding under Tranche X are hereinafter referred to as
"Tranche X Loans".

         The last Banking Day on which Tranche X Loans are available is referred
to herein as the "Commitment Expiry Date". A tranche becomes available hereunder
on the first Banking Day that Loans under such tranche are available to Borrower
under this Section 1(a).

         (b) NOTICE OF BORROWING, MINIMUM AMOUNTS AND OTHER LIMITATIONS:
Borrower shall provide five Banking Days' advance notice to Agent of any
proposed borrowing. Except to the extent otherwise permitted by Agent in its
sole discretion, each Loan shall be in a minimum principal amount of $1,000,000.
No more than two Loan drawdowns per each tranche available hereunder will be
permitted in any month.

         (c) AGGREGATE COMMITMENT: $409,000,000.

         (d) INTEREST: Borrower agrees to pay interest on the unpaid principal
amount of each Loan outstanding under the Agreement from the date of such Loan
until the maturity thereof during each Interest Period for such Loan at a rate
per annum equal at all times to LIBOR for such Interest Period PLUS the
applicable margin as set forth in the table below (the "Applicable Margin").

         The Applicable Margin for any Interest Period (i) for any Tranche 1
Loan shall be [*] per annum, and (ii) for any other Loan shall be (A) [*] per
annum in the event that the Borrower has negative EBITDA (measured as of the
Quarterly Date immediately preceding such Interest Period) or (B) in the event
that the Borrower has maintained positive EBITDA for two consecutive quarters
(measured at the Quarterly Date immediately preceding such Interest Period), the
rate per annum set forth below based on the Leverage Ratio set forth in Section
5.1(r)(i) of the Agreement (measured as of the Quarterly Date immediately
preceding such Interest Period); in each case, as set forth in the most recently
delivered Compliance Certificate delivered by Borrower pursuant to Section
5.1(a) of the Agreement. Changes in the Applicable Margin resulting from a
change in the Leverage Ratio shall become effective for the Interest Period
immediately succeeding the date of delivery by Borrower of a new Compliance
Certificate pursuant to Section 5.1(a). If any Compliance Certificate is not
delivered by Borrower when required under Section 5.1(a) of the Agreement, the
highest Applicable Margin shall apply until such Compliance Certificate is
delivered by Borrower.

                                       2.

[*] Indicates confidential treatment requested.

<Page>

<Table>
<Caption>
               --------------------------------------------------------
                      LEVERAGE RATIO               APPLICABLE MARGIN
                                                     (PER ANNUM)
               --------------------------------------------------------
<S>                                               <C>
               Equal to or greater than 10.00              [*]
               to 1.00
               --------------------------------------------------------
               Equal or greater than 8.50 to               [*]
               1.00 but less than 10.00 to 1.00
               --------------------------------------------------------
               Equal to or greater than 6.00               [*]
               to 1.00 but less than 8.50 to
               1.00
               --------------------------------------------------------
               Equal or greater than 5.00 to               [*]
               1.00 but less than 6.00 to 1.00
               --------------------------------------------------------
               Less than 5.00 to 1.00                      [*]
               --------------------------------------------------------
</Table>

         The period between the date of a Loan and the applicable Maturity Date
(as defined below) shall be divided into successive periods, each such period
being an "Interest Period" for purposes of the Agreement. The initial Interest
Period for a Loan shall begin on the date such Loan is made and end on the next
Quarterly Date. Each subsequent Interest Period shall begin on the last day of
the immediately preceding Interest Period and shall end on the next succeeding
Quarterly Date (with the last Interest Period to end on the applicable Maturity
Date). Interest shall accrue on each outstanding Loan during each Interest
Period with respect thereto from the first day of such Interest Period to the
last day thereof. As used herein, "LIBOR" means for any Interest Period the rate
of interest per annum determined by Agent to be the rate of interest per annum
(rounded upward, if necessary, to the nearest 1/100 of 1%) for deposits in
Dollars for three months appearing on "Telerate Page 3750", at or about 11:00
a.m. (London time) on the second Banking Day preceding the first day of the
applicable calendar quarter in which such Interest Period occurs, provided that
if no, or only one, offered quotation appears on such page, "LIBOR" shall be
determined by reference to the Reuters Screen LIBOR Page of the Reuters Monitor
Money Rates Service (or any replacement page thereof or other applicable Reuters
display page) or other comparable source of interest quotations for such
interbank rates selected by Agent. For purposes hereof, "Telerate Page 3750"
means the display designated as "3750" by Bridge Information Systems, Inc.
(formerly known as Dow Jones Market Service) or any replacement page thereof.

         Interest on each Loan shall be payable in arrears by Borrower to
Lenders (through Agent) on each Quarterly Date and on the applicable Maturity
Date; PROVIDED that if any prepayment of the Loans is effected other than on a
Quarterly Date, accrued interest on the Loans shall be due on such prepayment
date as to the principal amount prepaid.

         If any Quarterly Date or the applicable Maturity Date would occur on a
day other than a Banking Day, then such Quarterly Date or the applicable
Maturity Date, as the case may be, shall occur on the next succeeding Banking
Day.

         As used herein, "Banking Day" means a day other than a Saturday or
Sunday on which commercial banks are not required or authorized by law to close
in San Jose, California,

                                       3.

[*] Indicates confidential treatment requested.

<Page>

except that if the applicable Banking Day relates to any determination of LIBOR,
"Banking Day" means such a day on which dealings are carried out in the
applicable offshore U.S. Dollar interbank market.

         In the event that any amount of principal of the Loans or interest
thereon, or any other Obligations, shall not be paid in full when due (whether
at stated maturity, by acceleration or otherwise), Borrower shall pay interest
(after as well as before entry of judgment thereon to the extent permitted by
law) on such unpaid amount to Lenders (through Agent), from the date such amount
becomes due until the date such amount is paid in full, payable on demand of
Agent, at a fluctuating rate per annum, equal at all times to the Prime Rate (as
defined below) plus the Applicable Margin plus [*] per annum (the "Default
Rate"). Additionally, and without limiting the foregoing, following the
occurrence and during the continuance of any Event of Default, at the option of
Majority Lenders, the interest rate on all Loans shall be the Default Rate.

         As used herein, "Prime Rate" means for any day the rate of interest in
effect for such day as publicly announced from time to time by Citibank, N.A.,
in New York, New York, as its base rate. Each change in the interest rate on the
Obligations based on a change in the Prime Rate shall be effective at the
opening of business on the day specified in the public announcement of such
change.

         (e) AMORTIZATION: Borrower shall repay to Lenders the aggregate
principal amount of the outstanding Tranche 2 Loans and Tranche 3 Loans made by
such Lenders in twelve (12) substantially equal consecutive quarterly
installments, commencing on March 31, 2005, with subsequent installments payable
on each Quarterly Date thereafter, and with the last such installment to be due
and payable on December 31, 2007, and in the amount necessary to repay in full
the unpaid principal balance of the Tranche 2 Loans and the Tranche 3 Loans
owing to such Lenders; and Borrower shall repay to Lenders the aggregate
principal amount of the outstanding Tranche 1 Loans and Tranche X Loans made by
such Lenders in twelve (12) substantially equal consecutive quarterly
installments, commencing on March 31, 2006, with subsequent installments payable
on each Quarterly Date thereafter, and with the last such installment to be due
and payable on December 31, 2008 (the "Maturity Date") and in the amount
necessary to repay in full the unpaid principal balance of the Tranche 1 Loans,
the Tranche X Loans, and any and all other unpaid amounts under the Loan
Documents, owing to such Lenders.

         (f) PREPAYMENT FEES: In connection with any prepayment of Loans
hereunder, Borrower shall pay to Agent, for the ratable benefit of each Lender,
any fees arising under Section 2.12 of the Agreement.

         (g) CLOSING DEADLINE: November 16, 2001.

         (h) ADDITIONAL CLOSING DOCUMENTS AND INFORMATION: (i) Completion of
additional due diligence satisfactory to Agent including satisfactory analysis
validating underlying industry and market assumptions with regard to Borrower's
business plan and pro forma financials; (ii) Borrower and Cisco Systems shall
have executed Amendment No. 4 to the Service Provider Agreement; and (iii)
Borrower shall have delivered to Agent such documents

                                       4.

[*] Indicates confidential treatment requested.

<Page>

and other information with respect to Borrower's purchase of the assets of
Netrail as Agent may require to evaluate and approve or disapprove of such
transaction.

         (i) OTHER CONDITIONS:

         (i) CONDITIONS PRECEDENT TO THE INITIAL DRAW: Loans under Tranche 2,
Tranche 3 or Tranche X shall not be available unless Holdings has provided Agent
with reasonably satisfactory evidence that an amount of at least $62,000,000 in
the aggregate of additional cash equity has been contributed to Holdings by one
or more investors in its Series C round of equity financing. Each Loan Party
acknowledges that, as of the Closing Date, the Tranche 1 Loans have been fully
funded and no additional Loan amounts are available to Borrower thereunder.

         (ii) CONDITIONS PRECEDENT TO TRANCHE A2: Loans under Tranche A2 shall
be available in accordance with the terms of the Tranche A2 availability
schedule prepared by Agent on or before the Closing Date.

         (iii) CONDITIONS PRECEDENT TO TRANCHE 3: Loans under Tranche 3 shall
not be available unless Borrower has provided Agent with reasonably satisfactory
evidence that the business plan of Borrower is "fully funded" (as described
below). For purposes of this Agreement, Borrower's business plan shall be deemed
"fully funded" if, on June 30, 2002, Borrower maintains (x) Minimum Cash
Reserves equal to or greater than [*], and (y) minimum annualized EBITDA equal
to or greater than [*].

         (iv) CONDITIONS PRECEDENT TO TRANCHE X3: Tranche X3 Loans shall not be
available after the Tranche 3 Availability Termination Date, unless all
conditions to availability with respect to the Tranche 3 Loans were satisfied by
Borrower as of such date (regardless of whether the Tranche 3 Loans are fully
drawn at such time).

         (v) CONDITIONS PRECEDENT TO EACH BORROWING DATE: Additionally, the
following conditions precedent shall be satisfied on or prior to each Borrowing
Date: (A) After giving effect to any borrowing of Tranche B Loans, the aggregate
principal amount of outstanding Tranche A Loans and Tranche B Loans shall not
exceed [*] of the aggregate principal amount of Tranche A Loans then
outstanding, and (B) Borrower shall be in compliance with all of the financial
covenants contained in Section 5.1(r) of this Agreement.

         (j) WARRANTS: As an integral part of the consideration for the making
of the Loans hereunder, Holdings shall issue to Agent, on or prior to the
Closing Date, stock subscription warrants in substantially the form of EXHIBIT J
(the "Warrants") in an aggregate amount of up to [*] (which aggregate amount
shall include the Warrants granted under the Amended and Restated Agreement for
[*] of Holdings' fully diluted common stock) of Holdings' fully diluted common
stock (including for this purpose any shares of Holdings' common stock reserved
for issuance to employees) determined as of the Closing Date. The incremental
Warrants (i.e., the Warrants excluding the outstanding Warrants) shall be
exercisable at a price equal to $1.25 per share. The Warrants shall be
exercisable for 8 years from the date of issuance. Agent shall have the option
to exercise the Warrants without payment of the exercise price and shall then
receive the number of shares of common stock of Holdings that represents the
value of

                                       5.

[*] Indicates confidential treatment requested.

<Page>

the difference between the fair market value of such common stock at the time of
exercise and the exercise price.

         (k) ADDITIONAL BORROWER: Cogent Internet, Inc. The Additional Borrower
shall be entitled to obtain Loans under the Credit Agreement. For purposes of
requesting any Loans, receiving any Loan proceeds and otherwise administering
the Loans and the Credit Agreement, each such Additional Borrower hereby
irrevocably appoints, designates and authorizes Borrower to act on such
Additional Borrower's behalf, and the action of Borrower in the name of any
Additional Borrower shall in each case bind such Additional Borrower. Agent and
Lenders shall be fully entitled to rely upon and act following receipt of any
notice, request or instructions by Borrower on behalf of any Additional
Borrower.

         (l) SUBSIDIARIES: Cogent Internet, Inc.

2.  ADDITIONAL TERMS AND CONDITIONS:

         (a) USE OF PROCEEDS:

         (i) The Tranche A Loans shall be used solely for the purpose of
purchasing new Cisco Products from the Vendor thereof. Not less than [*] of the
Tranche A2 Loans may be used to purchase new Cisco Products (consisting of
networking hardware only) from Cisco Systems and not more than [*] of the
Tranche A2 Loans may be used to finance Cisco Systems' soft costs.

         (ii) The Tranche B Loans shall be used for the financing of any soft
costs or other related costs of Borrower associated with or otherwise incurred
by Borrower in connection with the integration and installation of networking
and telecommunications equipment and services or shall be used for working
capital, capital expenditure, or general corporate purposes (but not for the
purpose of financing any acquisition transaction (including Permitted
Transactions) or any interest, fees, costs or expenses due under the Loan
Documents).

         (iii) The Tranche X Loans shall be used solely for the purpose of
financing interest and fees payable by Borrower to Agent or Lenders hereunder or
pursuant to the Agreement.

         (b) NOTES: (i) Promissory Note(s) in favor of each Lender, in
substantially the form of EXHIBIT L, evidencing the Indebtedness of Borrower to
each such Lender in respect of the Tranche A Loans to be made by each such
Lender; (ii) Promissory Note(s) in favor of each Lender, in substantially the
form of EXHIBIT M, evidencing the Indebtedness of Borrower to each such Lender
in respect of the Tranche B Loans to be made by each such Lender, and (iii)
Promissory Note(s) in favor of each Lender, in substantially the form of EXHIBIT
N, evidencing the Indebtedness of Borrower to each such Lender in respect of the
Tranche X Loans to be made by each such Lender, in each case (i), (ii) and
(iii), as amended, amended and restated or modified from time to time.

         (c) MANDATORY PREPAYMENT: (i) Promptly after the end of each fiscal
year, Borrower shall calculate Excess Cash Flow for the fiscal year then ended
and shall, not later than 90 days after the end of such fiscal year, prepay the
outstanding principal amount of the Loans,

                                       6.

[*] Indicates confidential treatment requested.

<Page>

in an amount equal to [*] of the Excess Cash Flow for such fiscal year;
PROVIDED, HOWEVER, that any such prepayment shall not be required if the amount
of Excess Cash Flow for such year is less than [*].

         (ii) The Tranche B Loans and the Tranche X Loans shall be subject to
mandatory prepayment on or before the later of (A) the third Banking Day after
any date Holdings receives the net proceeds from the sale of any of its equity
securities or debt instruments or securities (the "Holdings Prepayment Date")
(other than issuances of equity securities to officers, directors, employees or
consultants in the ordinary course of business); PROVIDED, that Holdings shall
not be required to make any such mandatory prepayment if it contributes such
proceeds to Borrower as common equity prior to the Holdings Prepayment Date and,
in such case, any mandatory prepayment required by this subsection 2(c)(ii)
shall be made according to the provisions of the immediately succeeding clause
(B) and (B) the next Banking Day after Borrower receives from Holdings the net
proceeds from the sale of any of Holdings' equity securities or debt instruments
or securities (other than issuances of equity securities to officers, directors,
employees or consultants in the ordinary course of business), in each case,
whether in one transaction or a series of transactions and in the amount of such
proceeds; PROVIDED, however, that Holdings or Borrower may retain (A) the first
[*] of proceeds of equity offerings of Holdings or Borrower measured from the
date of the Borrower's incorporation and (B) up to [*] of proceeds of
Subordinated Debt offerings of Holdings without being required to make such
prepayment; PROVIDED that any retained proceeds retained by Holdings shall be
contributed by Holdings to Borrower as common equity pursuant to the terms of
this Agreement and the Guaranty executed by Holdings in connection herewith.

         (iii) The Loans shall be subject to mandatory prepayment on any date
Holdings or Borrower makes any voluntary prepayments under the Financing
Documents, if any, or on any term loans or other Indebtedness for borrowed money
(other than revolving working capital loans, unless a permanent commitment
reduction occurs simultaneously with the principal payment), on a PRO RATA basis
with the principal payment made to the holder(s) of such Indebtedness.

         (iv) The Loans shall be subject to mandatory prepayment on any date
Borrower or any of its Subsidiaries sells, transfers or otherwise disposes of
any Financed Products, in the amount of such proceeds; PROVIDED that any such
sales, transfers or other dispositions shall be done in compliance with the
restrictions and limitations thereon set forth in the Agreement. Additionally,
the Loans shall be subject to mandatory prepayment on the date Holdings or
Borrower or any of their respective Subsidiary receives the net proceeds from
the sale, transfer or other disposition of any of Holdings, Borrower's or any
Subsidiary's assets (or group of related assets) other than Financed Products,
in the amount of such proceeds; PROVIDED, that Holdings or Borrower (or such
Subsidiary) may retain the first $100,000 of such proceeds in any calendar year
without being required to make such prepayment; PROVIDED, that in the case of
Holdings, any such proceeds shall be contributed to Borrower as common equity in
accordance with the terms of this Agreement and the Guaranty executed by
Holdings in connection herewith; and PROVIDED further that any such sales,
transfers or other dispositions shall be done in compliance with the
restrictions and limitations thereon set forth in the Agreement.

                                       7.

[*] Indicates confidential treatment requested.

<Page>

         (v) If any Casualty Event shall occur with respect to any of Holdings',
Borrower's or their respective Subsidiaries' properties or assets in an amount
exceeding $100,000, or any of the Financed Products, the Loans shall be subject
to mandatory prepayment on the date Holdings, Borrower or such Subsidiary
receives the net proceeds therefrom, in the amount of such proceeds, unless
Holdings or Borrower (or such Subsidiary) applies all or a portion of such
proceeds to the repair or replacement thereof and completes such repair within
six months of such Casualty Event; PROVIDED that in the case of Holdings, any
such proceeds along with any asset being repaired or replaced with such proceeds
shall be contributed to Borrower as common equity pursuant to the terms of this
Agreement and the Guaranty executed by Holdings in connection herewith.

         Except to the extent that any such prepayment is required to be applied
to a particular tranche, any such amounts received as a mandatory prepayment of
the Loans shall be applied first to the Tranche X Loans, second to the Tranche B
Loans and third to the Tranche A Loans.

         If the amount of funds available for application to a prepayment
pursuant to clause (i), (ii) or (iii) above exceeds the outstanding principal
amount of Loans subject to the prepayment requirement (the "Subject Loans") and
any part of the unused Aggregate Commitment is available for the borrowing of
additional Subject Loans, the Aggregate Commitment with respect to the Subject
Loans shall be reduced by an amount equal to the difference between (1) the
amount of outstanding Subject Loans and (2) the amount that would be required to
be prepaid assuming the Aggregate Commitment with respect to the Subject Loans
were fully utilized.

         As used herein, "Casualty Event" means, with respect to any property of
any Person, any loss of or damage to, or any condemnation or other taking of,
such property for which such Person or any of its Subsidiaries receives
insurance proceeds, or proceeds of a condemnation award or other compensation;
"Excess Cash Flow" means for any period, determined with respect to Holdings and
its Subsidiaries on a consolidated basis in accordance with GAAP, without
duplication, EBITDA for such period, MINUS Capital Expenditures made during such
period, PLUS the aggregate amount of capital leases and other Indebtedness
incurred during such period for the purpose of financing such Capital
Expenditures made during such period, MINUS all principal payments on
Indebtedness made during such period, but only to the extent not refinanced from
the proceeds of other Indebtedness, MINUS (PLUS) additions (reductions) to
non-cash working capital for such period (i.e., the increase or decrease in
consolidated non-cash current assets of Holdings and its Subsidiaries MINUS the
consolidated current liabilities (excluding the current maturities of long term
debt) of Holdings and its Subsidiaries from the beginning to the end of such
period) MINUS income taxes; and "Capital Expenditures" means, with respect to
Holdings and its Subsidiaries for any period, the aggregate amount of all
expenditures during such period which are or should be included as "capital
expenditures", "additions to property, plant and equipment" or similar items in
the financial statements of Holdings and its Subsidiaries in conformity with
GAAP.

         (d) COLLATERAL DOCUMENTS: As conditions precedent to the effectiveness
of the Agreement, Borrower, Holdings and Additional Borrower, as applicable,
shall have delivered to Agent, on or prior to the Closing Date, the following
documents, each in form and substance

                                       8.

[*] Indicates confidential treatment requested.

<Page>

satisfactory to Agent: (i) Amended and Restated Security Agreement between Agent
(on behalf of each Lender) and Borrower in substantially the form of EXHIBIT C;
(ii) Amended and Restated Security Agreement between Agent (on behalf of each
Lender) and Holdings in substantially the form of EXHIBIT D; (iii) Amended and
Restated Security Agreement between Agent (on behalf of each Lender) and
Additional Borrower in substantially the form of EXHIBIT E; (iv) Amended and
Restated Stock Pledge Agreement between Agent (on behalf of each Lender) and
Holdings in substantially the form of EXHIBIT F; and (v) Amended and Restated
Stock Pledge Agreement between Agent (on behalf of each Lender) and Borrower in
substantially the form of EXHIBIT G.

         (e) GUARANTY: As conditions precedent to the effectiveness of the
Agreement, Holdings and Additional Borrower, as applicable, shall have delivered
to Agent, on or prior to the Closing Date, the following documents, each in form
and substance satisfactory to Agent: (i) Amended and Restated Guaranty, made by
Holdings in favor of Agent and Lenders, in substantially the form of EXHIBIT H;
(ii) Amended and Restated Guaranty, made by Additional Borrower in favor of
Agent and Lenders, in substantially the form of EXHIBIT I; and (iii) Guaranty
made by Borrower in favor of Agent and Lenders, in substantially the form of
EXHIBIT J.

         (f) ADDITIONAL LOAN DOCUMENTS: As conditions precedent to the
effectiveness of the Agreement, Borrower, Holdings and Additional Borrower, as
applicable, shall have delivered to Agent, on or prior to the Closing Date, the
following documents, each in form and substance satisfactory to Agent: (i) Stock
Subscription Warrant, executed by Holdings, in substantially the form of EXHIBIT
K; (ii) Confirmation of Position and Release Agreement, executed by each of
Borrower, Holdings and Additional Borrower, in substantially the form of EXHIBIT
P; (iii) Guarantor Consent Agreement, executed by Holdings and Additional
Borrower, in substantially the form of EXHIBIT Q; (iv) Collateral Access
Agreements, as required pursuant to the Collateral Documents; (v) the Fee
Letter, and (vi) if required by Agent in its reasonable discretion,
Intercreditor Agreement(s), in form and substance satisfactory to Agent.

         (g) FINANCING DOCUMENTS: None.

         (h) MATERIAL CONTRACTS: Fiber Optic Network Lease Fiber Agreement
Product Order dated as of February 7, 2000 between Borrower and Metromedia Fiber
Network Services, Inc. (the "MFN Agreement"); and Dark Fiber IRU Agreement dated
as of April 14, 2000 between Borrower and Williams Communications, Inc. (now
known as Williams Communications, LLQ.

         (i) GOVERNMENTAL LICENSES AND PERMITS: None.

         (j) OTHER REQUIRED CONSENTS: Consent of Shareholders of Holdings and
Borrower to the Loan Documents and such other consents of each Guarantor as
Agent may reasonably require. Consent of each of Metromedia Fiber Network
Services, Inc. and Williams Communications, Inc. with respect to the liens
granted to Agent hereunder.

         (k) ADDITIONAL PERMITTED LIENS: None.

         (l) ADDITIONAL REPORTING REQUIREMENTS: None.

3.  ADDRESSES FOR NOTICES:

                                       9.

[*] Indicates confidential treatment requested.

<Page>

         (a) BORROWER:

             Cogent Communications, Inc.
             1015 31st Street, NW
             Washington, D.C. 20007
             Attn: Mr. David Schaeffer
             Fax No.: (202) 342-8269

         (b) ADDITIONAL BORROWER:

             Cogent Internet, Inc.
             1015 31st Street, NW
             Washington, D.C.  20007
             Attn: Mr. David Schaeffer
             Fax No.: (202) 342-8269

         (c) HOLDINGS

             Cogent Communications Group, Inc.
             1015 31st Street, NW
             Washington, D.C.  20007
             Attn: Mr. David Schaeffer
             Fax No.: (202) 342-8269

         (d) AGENT:

             Cisco Systems Capital Corporation
             6005 Plumas Street, Suite 101
             Reno, NV 89509
             Attn.:  Loan Compliance and Administration
             Fax:  (775) 823-7880

4.  AGENT'S ACCOUNT FOR PAYMENTS:

          Account no.: 30448199
          Account Name:  Citicorp North America as Agent for Cisco Systems
          Ref. "Cisco Systems Capital/Cogent Communications, Inc."
          ABA no.: 021000089

          Account maintained with:

          Citibank, N.A.

5.  PROCESS AGENT:  CT Corporation System, 111 Eighth Avenue, New York, NY 10111

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       10.

[*] Indicates confidential treatment requested.

<Page>

ACKNOWLEDGED AND AGREED:
-----------------------
Cisco Systems Capital Corporation,
as Agent and as Lender

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

Cogent Communications, Inc.

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

Cogent Communications Group, Inc.

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

Cogent Internet, Inc.

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

                                       11.

[*] Indicates confidential treatment requested.

<Page>

                                  LENDER ANNEX

                                   COMMITMENTS
                               AND PRO RATA SHARES

<Table>
<Caption>
LENDER                                              COMMITMENT                  PRO RATA SHARE
------                                              ----------                  --------------
<S>                                             <C>                            <C>
Cisco Systems Capital Corporation                  $409,000,000                      100%

TOTAL                                              $409,000,000                      100%

</Table>

                         ADDRESS FOR NOTICES TO LENDERS

CISCO SYSTEMS CAPITAL CORPORATION
   as Lender

NOTICES FOR BORROWING AND PAYMENTS:

Cisco Systems Capital Corporation
6005 Plumas Street, Suite 101
Reno, NV 89509
Attn.:  Loan Compliance and Administration
Fax:  (775) 823-7880

OTHER NOTICES:

Cisco Systems Capital Corporation
6005 Plumas Street, Suite 101
Reno, NV 89509
Attn.:  Loan Compliance and Administration
Fax:  (775) 823-7880

                                    Annex 1.

[*] Indicates confidential treatment requested.

<Page>

                                    EXHIBIT A

                           FORM OF NOTICE OF BORROWING

Date:  __________

To:      Cisco Systems Capital Corporation, as Agent
         6005 Plumas Street, Suite 101
         Reno, NV 89509
         Attn.:  Loan Compliance and Administration
         Fax:  (775) 823-7880

Ladies and Gentlemen:

         The undersigned, Cogent Communications, Inc. ("Borrower"), refers to
the Second Amended and Restated Credit Agreement dated as of October 24, 2001
(as amended, modified, renewed or extended from time to time, the "Credit
Agreement"), among Borrower, any Additional Borrower party thereto ("Additional
Borrower"), the several financial institutions from time to time party thereto
("Lenders") and Cisco Systems Capital Corporation, as administrative agent for
itself and the other Lenders (in such capacity, "Agent"). Capitalized terms used
but not otherwise defined herein shall have the respective meanings assigned to
such terms in the Credit Agreement. Borrower hereby gives Agent irrevocable
notice, pursuant to Section 2.3 of the Credit Agreement, of the borrowing of the
Loans specified herein:

         1. The date of the proposed borrowing is [the Closing Date]
[_____________].

         2. The amount of the proposed borrowing is $___________.

         3. The borrowing is a utilization of Tranche __ .

         4. The purpose of the borrowing is ____________________. Detailed
information on any purchase transaction being financed by the proposed borrowing
is attached hereto.

         5. The borrowing requested hereby is being made available to
[Borrower][________________] as Additional Borrower.

         6. In the case of a funding to any Person other than Cisco Systems, the
payment instructions with respect to the funds to be made available by Lenders
are as follows: __________.

         7. After giving effect to all borrowings of Loans, including any
borrowings requested hereby, Borrower will be in full compliance with the
requirements of Clause (ii) of Section 1(v) of the Schedule.

         8. Borrower hereby certifies to Agent and each Lender that on and as of
the date of the borrowing requested hereby, both before and after giving effect
thereto and to the

                                       A-1

[*] Indicates confidential treatment requested.

<Page>

application of proceeds therefrom: (i) the representations
and warranties contained in Section 4.1 of the Credit Agreement and in the other
Loan Documents shall be true, correct and complete as though made on and as of
such date (unless such representations and warranties expressly refer to an
earlier date, in which case they shall be true, complete and correct as of such
earlier date); and (ii) no Default or Event of Default shall have occurred and
be continuing or shall result from the making of any Loans on such borrowing
date. For purposes hereof, clause (i) above shall take into account any
amendments to any disclosures made in writing by Borrower, Additional Borrower,
or any Loan Parties to Agent and Lenders after the Closing Date and approved by
Majority Lenders.

                                            Cogent Communications, Inc.

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

                                       A-2

[*] Indicates confidential treatment requested.

<Page>

                                    EXHIBIT B

                         FORM OF COMPLIANCE CERTIFICATE

Date:  __________, ___

To:  Cisco Systems Capital Corporation, as Agent
     6005 Plumas Street, Suite 101
     Reno, NV 89509
     Attn.:  Loan Compliance and Administration
     Fax:  (775) 823-7880

         Re:  COGENT COMMUNICATIONS, INC.
               --------------------------

Ladies and Gentlemen:

         This Compliance Certificate is made and delivered pursuant to the
Second Amended and Restated Credit Agreement, dated as of October 24, 2001 (as
amended, modified, renewed or extended from time to time, the "Credit
Agreement"), among Cogent Communications Group, Inc. ("Holdings"), Cogent
Communications, Inc. ("Borrower"), any Additional Borrower party thereto
("Additional Borrower"), the several financial institutions party thereto
("Lenders") and Cisco Systems Capital Corporation, as administrative agent for
itself and the other Lenders (in such capacity, "Agent"). Reference is made to
the Credit Agreement for full particulars of the matters described therein. All
capitalized terms used but not otherwise described in this Compliance
Certificate shall have the respective meanings assigned to such terms in the
Credit Agreement. This Compliance Certificate relates to the accounting period
ending __________, ____.

         I am a Responsible Officer of Holdings and Borrower. I have reviewed
the terms of the Credit Agreement and I have made, or caused to be made under my
supervision, a detailed review of the transactions and conditions of Holdings
and its Subsidiaries during such accounting period. I hereby certify that the
information set forth on SCHEDULE 1 hereto (and on any additional schedules
hereto setting forth further supporting detail) is true, accurate and complete
in all material respects as of the end of such accounting period.

         I hereby further certify that (i) as of the date hereof that no Default
has occurred and is continuing, and (ii) on and as of the date hereof, there has
occurred no Material Adverse Change since the date of the financial statements
furnished to Agent prior to the Closing Date, except in each case as may be set
forth in a separate attachment hereto describing in detail the nature of each
condition or event constituting an exception to the foregoing statements, the
period during which it has existed and the action which Borrower is taking or
proposes to take with respect to each such condition or event.

         IN WITNESS WHEREOF, the undersigned officer has signed this Compliance
Certificate this ____ day of ______________, ____.

                                       B-1

[*] Indicates confidential treatment requested.

<Page>

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

                                       B-2

[*] Indicates confidential treatment requested.

<Page>

                                   SCHEDULE 1
                          TO THE COMPLIANCE CERTIFICATE

                         Dated _________________, _____

For the fiscal [month/quarter] ended __________, _____

<Table>
<Caption>
                                                                             ACTUAL        REQUIRED/PERMITTED
                                                                             ------        ------------------
<S>                                                          <C>          <C>            <C>
SECTION 5.1(r)(i) - LEVERAGE RATIO
(A)      Holdings Consolidated Funded Debt
                                                                             $______
(B)      Holdings EBITDA calculation (measured for each
         four consecutive fiscal quarter period on a rolling
         four quarter basis)

          consolidated net income (excluding extraordinary
          items)                                                $_______

         PLUS consolidated interest expense                      _______

         PLUS consolidated income tax expense                    _______

         PLUS consolidated depreciation expense                  _______

         PLUS consolidated amortization expense                  _______

         MINUS extraordinary gains                               _______

         PLUS extraordinary losses                               _______

         Holdings EBITDA
                                                                             $_______

(C)      Ratio of (A) to (B)                                                  ____:____    Not greater than ____:____

                                                                                           See Table in Section
                                                                                           5.1(r)(i) of the Credit
                                                                                           Agreement

SECTION 5.1(r)(ii) - MINIMUM TOTAL REVENUES

Holdings consolidated total revenues (measured as set forth in               $_________    Not less than $_________
Section 5.1(r)(ii) of the Credit Agreement)

                                                                                           See Table in Section
                                                                                           5.1(r)(ii) of the Credit
                                                                                           Agreement

</Table>

                      Schedule 1 to Compliance Certificate
                                     Page 1

[*] Indicates confidential treatment requested.

<Page>

<Table>
<Caption>
                                                                             ACTUAL        REQUIRED/PERMITTED
                                                                             ------        ------------------
<S>                                                          <C>          <C>            <C>
SECTION 5.1(r)(iii) - MINIMUM EBITDA
------------------------------------
  Holdings EBITDA calculation (measured as set forth in
  Section 5.1(r)(iii) of the Credit Agreement).                               $_______     Not less than $_______

                                                                                           See Table in
                                                                                           Section 5.1(r)(iii) of the
                                                                                           Credit Agreement

SECTION 5.1(r)(iv) - INTEREST COVERAGE RATIO
--------------------------------------------
(A)      Holdings EBITDA calculation (measured for each four
         consecutive fiscal quarter period on a rolling four                 $________
         quarter basis), as calculated as provided above

(B)      Holdings Interest Expense (measured for each four
         consecutive fiscal quarter period on a rolling four
         quarter basis)

         Interest payments in respect of any Indebtedness       $_______

         Holdings Interest Expense                                           $________

(C)      Ratio of (A) to (B)                                                  ___:___      Not less than ___:___

                                                                                           See Table in
                                                                                           Section 5.1(r)(iv) of the
                                                                                           Credit Agreement

SECTION 5.1(r)(v) - MAXIMUM FUNDED DEBT TO CAPITALIZATION
(A)      Holdings Consolidated Funded Debt
                                                                             $________
(B)      Capitalization

         Holdings Consolidated Funded Debt                      $_______

         PLUS capital stock                                      _______

         PLUS paid in capital                                    _______

         Capitalization                                                      $________
</Table>

                      Schedule 1 to Compliance Certificate
                                     Page 2

[*] Indicates confidential treatment requested.

<Page>

<Table>
<Caption>
                                                                             ACTUAL        REQUIRED/PERMITTED
                                                                             ------        ------------------
<S>                                                          <C>          <C>            <C>
(C)      Ratio of (A) to (B)
                                                                              _______%     Not to exceed ______%

                                                                                           See Table in
                                                                                           Section 5.1(r)(vi) of the
                                                                                           Credit Agreement

SECTION 5.1(r)(vi) - MINIMUM CUSTOMERS
         Total revenue generating customers (measured as set
         forth in Section 5.1(r)(vi) of the Credit Agreement).               ________      Not less than _____

                                                                                           See Table in
                                                                                           Section 5.1(r)(vii) of the
                                                                                           Credit Agreement

SECTION 5.1(r)(vii) - MINIMUM CASH RESERVES
-------------------------------------------
         Borrower consolidated unrestricted cash                $_______

         PLUS Borrower consolidated cash equivalents

         Borrower Minimum Cash Reserves                         $______

                                                                             $________     Not less than $________

                                                                                           See Table in
                                                                                           Section 5.1(r)(vii) of the
                                                                                           Credit Agreement

SECTION 5.1(r)(viii) - MINIMUM NODES ON NET

         Borrower Minimum Nodes on Net                               $______ $______       Not less than $_________

                                                                                           See Table in
                                                                                           Section 5.1(r)(viii) of the
                                                                                           Credit Agreement

SECTION 5.1(r)(ix) - MAXIMUM CAPITAL EXPENDITURES
         Borrower Maximum Capital Expenditures (measured as
         set forth in Section 5.1(r)(ix) of the Credit          _______      ________      Not more than _____
         Agreement)
                                                                                           See Table in
                                                                                           Section 5.1(r)(ix) of the
                                                                                           Credit Agreement

</Table>

                      Schedule 1 to Compliance Certificate
                                     Page 3

[*] Indicates confidential treatment requested.

<Page>

                                    EXHIBIT C

            FORM OF BORROWER AMENDED AND RESTATED SECURITY AGREEMENT

                        (SEE ATTACHED SECURITY AGREEMENT)

                                      C-1

[*] Indicates confidential treatment requested.

<Page>

                                    EXHIBIT D

            FORM OF HOLDINGS AMENDED AND RESTATED SECURITY AGREEMENT

                        (SEE ATTACHED SECURITY AGREEMENT)

                                      D-1

[*] Indicates confidential treatment requested.

<Page>

                                    EXHIBIT E

       FORM OF ADDITIONAL BORROWER AMENDED AND RESTATED SECURITY AGREEMENT

                        (SEE ATTACHED SECURITY AGREEMENT)

                                      E-1

[*] Indicates confidential treatment requested.

<Page>

                                    EXHIBIT F

          FORM OF BORROWER AMENDED AND RESTATED STOCK PLEDGE AGREEMENT

                      (SEE ATTACHED STOCK PLEDGE AGREEMENT)

                                      F-1

[*] Indicates confidential treatment requested.

<Page>

                                    EXHIBIT G

     FORM OF ADDITIONAL BORROWER AMENDED AND RESTATED STOCK PLEDGE AGREEMENT

                      (SEE ATTACHED STOCK PLEDGE AGREEMENT)

                                      G-1

[*] Indicates confidential treatment requested.

<Page>

                                    EXHIBIT H

                 FORM OF AMENDED AND RESTATED HOLDINGS GUARANTY

                             (SEE ATTACHED GUARANTY)

                                      H-1

[*] Indicates confidential treatment requested.

<Page>

                                    EXHIBIT I

            FORM OF AMENDED AND RESTATED ADDITIONAL BORROWER GUARANTY

                             (SEE ATTACHED GUARANTY)

                                      I-1

[*] Indicates confidential treatment requested.

<Page>

                                    EXHIBIT J

                            FORM OF BORROWER GUARANTY

                             (SEE ATTACHED GUARANTY)

                                      J-1

[*] Indicates confidential treatment requested.

<Page>

                                    EXHIBIT K

                       FORM OF STOCK SUBSCRIPTION WARRANT

                    (SEE ATTACHED STOCK SUBSCRIPTION WARRANT)

                                      K-1

[*] Indicates confidential treatment requested.

<Page>

                                    EXHIBIT L

                             FORM OF TRANCHE A NOTE

         THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
         AMENDED, OR ANY OTHER APPLICABLE SECURITIES LAWS. IT MAY NOT BE SOLD OR
         OTHERWISE TRANSFERRED UNDER CIRCUMSTANCES THAT WOULD RESULT IN A
         VIOLATION OF THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OF
         1933 OR SUCH OTHER LAWS.

U.S.$270,000,000                                                October __, 2001

         FOR VALUE RECEIVED, the undersigned, Cogent Communications, Inc.
("Borrower"), a Delaware corporation, and the Additional Borrower party hereto
("Additional Borrower"), HEREBY UNCONDITIONALLY PROMISE TO PAY to the order of
CISCO SYSTEMS CAPITAL CORPORATION ("Lender"), the principal sum of Two Hundred
Seventy Million United States Dollars (U.S.$270,000,000), or such greater or
lesser amount as represents the aggregate principal amount of the Tranche A
loans (the "Loans") made by Lender to Borrower and Additional Borrower pursuant
to the Credit Agreement referred to below, on the dates and in the amounts
referred to in the Credit Agreement.

         Borrower and Additional Borrower further promise to pay interest on the
unpaid principal amount of the Loans evidenced hereby from time to time at the
rates, on the dates, and otherwise as provided in the Credit Agreement.

         Lender shall record the date and amount of each Loan made to Borrower
and Additional Borrower, as applicable, the amount of principal and interest due
and payable from time to time hereunder, each payment thereof, and the resulting
unpaid principal balance hereof, in Lender's internal records, and any such
records shall be conclusive evidence absent manifest error of the amount of the
Loans made by Lender and the interest and payments thereon; PROVIDED, HOWEVER,
that Lender's failure so to record shall not limit or otherwise affect the
obligations of Borrower hereunder and under the Credit Agreement to repay the
principal of and interest on the Loans.

         This promissory note is a Note referred to in, and is subject to and
entitled to the benefits of, the Second Amended and Restated Credit Agreement,
dated as of October 24, 2001, among Borrower, Additional Borrower, the several
financial institutions party thereto and Lender (as amended, modified, renewed
or extended from time to time, the "Credit Agreement"). Capitalized terms used
but not otherwise defined herein shall have the respective meanings assigned to
such terms in the Credit Agreement.

         The Credit Agreement provides, among other things, for acceleration
(which in certain cases shall be automatic) of the maturity hereof upon the
occurrence of certain stated events, in each case without presentment, demand,
protest or further notice of any kind, all of which are hereby expressly waived.

                                      L-1

[*] Indicates confidential treatment requested.

<Page>

         This promissory note is subject to prepayment in whole or in part as
provided in the Credit Agreement.

         This promissory note is secured by certain Collateral as more
specifically described in the Credit Agreement and the Collateral Documents.

         This promissory note replaces and supercedes in its entirety that
certain Tranche A promissory note (the "Original Tranche A Note") dated as of
[___________] in the principal amount of $[_____________], made by Borrower in
favor of Cisco Systems Capital Corporation, as "Lender," in connection with the
Original Credit Agreement and evidences a continuation and not a novation or
repayment of the Loans evidenced by the Original Credit Agreement and the
Original Tranche A Note.

         Borrower and Additional Borrower hereby waive diligence, presentment,
protest or notice of total or partial nonpayment or dishonor with respect to
this promissory note.

         Failure by the holder hereof to exercise any of its rights hereunder in
any instance shall not constitute a waiver thereof in that or any other
instance.

         Borrower and Additional Borrower agree to pay on demand all costs and
expenses of Lender and its Affiliates, and fees and disbursements of counsel
(including allocated costs and expenses for internal legal services), in
connection with the enforcement or attempted enforcement of, and preservation of
any rights or interests under, (i) this promissory note, and (ii) any
out-of-court workout or other refinancing or restructuring or any bankruptcy or
insolvency case or proceeding, including any losses, costs and expenses
sustained by Lender as a result of any failure by Borrower or Additional
Borrower to perform or observe its obligations contained herein.

         THIS PROMISSORY NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF NEW YORK.

         IN WITNESS WHEREOF, Borrower and each Additional Borrower signing below
by its duly authorized legal representative(s) has executed this promissory note
on the date and in the year first above mentioned.

                                                     BORROWER

                                                     COGENT COMMUNICATIONS, INC.

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

                                                     ADDITIONAL BORROWER

                                      L-2

[*] Indicates confidential treatment requested.

<Page>

                                                     COGENT INTERNET, INC.

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

                                      L-3

[*] Indicates confidential treatment requested.

<Page>

                                    EXHIBIT M

                             FORM OF TRANCHE B NOTE

         THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
         AMENDED, OR ANY OTHER APPLICABLE SECURITIES LAWS. IT MAY NOT BE SOLD OR
         OTHERWISE TRANSFERRED UNDER CIRCUMSTANCES THAT WOULD RESULT IN A
         VIOLATION OF THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OF
         1933 OR SUCH OTHER LAWS.

U.S.$64,000,000                                                 October __, 2001

         FOR VALUE RECEIVED, the undersigned, Cogent Communications, Inc.
("Borrower"), a Delaware corporation, and the Additional Borrower party hereto
("Additional Borrower"), HEREBY UNCONDITIONALLY PROMISE TO PAY to the order of
CISCO SYSTEMS CAPITAL CORPORATION ("Lender"), the principal sum of Sixty-Four
Million United States Dollars (U.S.$64,000,000), or such greater or lesser
amount as represents the aggregate principal amount of the Tranche B loans (the
"Loans") made by Lender to Borrower and Additional Borrower pursuant to the
Credit Agreement referred to below, on the dates and in the amounts referred to
in the Credit Agreement.

         Borrower and Additional Borrower further promise to pay interest on the
unpaid principal amount of the Loans evidenced hereby from time to time at the
rates, on the dates, and otherwise as provided in the Credit Agreement.

         Lender shall record the date and amount of each Loan made to Borrower
and Additional Borrower, as applicable, the amount of principal and interest due
and payable from time to time hereunder, each payment thereof, and the resulting
unpaid principal balance hereof, in Lender's internal records, and any such
records shall be conclusive evidence absent manifest error of the amount of the
Loans made by Lender and the interest and payments thereon; PROVIDED, HOWEVER,
that Lender's failure so to record shall not limit or otherwise affect the
obligations of Borrower hereunder and under the Credit Agreement to repay the
principal of and interest on the Loans.

         This promissory note is a Note referred to in, and is subject to and
entitled to the benefits of, the Second Amended and Restated Credit Agreement,
dated as of October 24, 2001, among Borrower, Additional Borrower, the several
financial institutions party thereto and Lender (as amended, modified, renewed
or extended from time to time, the "Credit Agreement"). Capitalized terms used
but not otherwise defined herein shall have the respective meanings assigned to
such terms in the Credit Agreement.

         The Credit Agreement provides, among other things, for acceleration
(which in certain cases shall be automatic) of the maturity hereof upon the
occurrence of certain stated events, in each case without presentment, demand,
protest or further notice of any kind, all of which are hereby expressly waived.

                                      M-1

[*] Indicates confidential treatment requested.

<Page>

         This promissory note is subject to prepayment in whole or in part as
provided in the Credit Agreement.

         This promissory note is secured by certain Collateral as more
specifically described in the Credit Agreement and the Collateral Documents.

         This promissory note replaces and supercedes in its entirety that
certain Tranche B promissory note (the "Original Tranche B Note") dated as of
[___________] in the principal amount of $[_____________], made by Borrower in
favor of Cisco Systems Capital Corporation, as "Lender," in connection with the
Original Credit Agreement and evidences a continuation and not a novation or
repayment of the Loans evidenced by the Original Credit Agreement and the
Original Tranche B Note.

         Borrower and Additional Borrower hereby waive diligence, presentment,
protest or notice of total or partial nonpayment or dishonor with respect to
this promissory note.

         Failure by the holder hereof to exercise any of its rights hereunder in
any instance shall not constitute a waiver thereof in that or any other
instance.

         Borrower and Additional Borrower agree to pay on demand all costs and
expenses of Lender and its Affiliates, and fees and disbursements of counsel
(including allocated costs and expenses for internal legal services), in
connection with the enforcement or attempted enforcement of, and preservation of
any rights or interests under, (i) this promissory note, and (ii) any
out-of-court workout or other refinancing or restructuring or any bankruptcy or
insolvency case or proceeding, including any losses, costs and expenses
sustained by Lender as a result of any failure by Borrower or Additional
Borrower to perform or observe its obligations contained herein.

         THIS PROMISSORY NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF NEW YORK.

         IN WITNESS WHEREOF, Borrower and each Additional Borrower signing below
by its duly authorized legal representative(s) has executed this promissory note
on the date and in the year first above mentioned.

                                                     BORROWER

                                                     COGENT COMMUNICATIONS, INC.

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

                                       M-2

[*] Indicates confidential treatment requested.

<Page>

                                                     ADDITIONAL BORROWER

                                                     COGENT INTERNET, INC.

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

                                       M-3

[*] Indicates confidential treatment requested.

<Page>

                                    EXHIBIT N

                             FORM OF TRANCHE X NOTE

         THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
         AMENDED, OR ANY OTHER APPLICABLE SECURITIES LAWS. IT MAY NOT BE SOLD OR
         OTHERWISE TRANSFERRED UNDER CIRCUMSTANCES THAT WOULD RESULT IN A
         VIOLATION OF THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OF
         1933 OR SUCH OTHER LAWS.

U.S.$75,000,000                                                 October __, 2001

         FOR VALUE RECEIVED, the undersigned, Cogent Communications, Inc.
("Borrower"), a Delaware corporation, and the Additional Borrower party hereto
("Additional Borrower"), HEREBY UNCONDITIONALLY PROMISE TO PAY to the order of
CISCO SYSTEMS CAPITAL CORPORATION ("Lender"), the principal sum of Seventy-Five
Million United States Dollars (U.S.$75,000,000), or such greater or lesser
amount as represents the aggregate principal amount of the Tranche X loans (the
"Loans") made by Lender to Borrower and Additional Borrower pursuant to the
Credit Agreement referred to below, on the dates and in the amounts referred to
in the Credit Agreement.

         Borrower and Additional Borrower further promise to pay interest on the
unpaid principal amount of the Loans evidenced hereby from time to time at the
rates, on the dates, and otherwise as provided in the Credit Agreement.

         Lender shall record the date and amount of each Loan made to Borrower
and Additional Borrower, as applicable, the amount of principal and interest due
and payable from time to time hereunder, each payment thereof, and the resulting
unpaid principal balance hereof, in Lender's internal records, and any such
records shall be conclusive evidence absent manifest error of the amount of the
Loans made by Lender and the interest and payments thereon; PROVIDED, HOWEVER,
that Lender's failure so to record shall not limit or otherwise affect the
obligations of Borrower hereunder and under the Credit Agreement to repay the
principal of and interest on the Loans.

         This promissory note is a Note referred to in, and is subject to and
entitled to the benefits of, the Second Amended and Restated Credit Agreement,
dated as of October 24, 2001, among Borrower, Additional Borrower, the several
financial institutions party thereto and Lender (as amended, modified, renewed
or extended from time to time, the "Credit Agreement"). Capitalized terms used
but not otherwise defined herein shall have the respective meanings assigned to
such terms in the Credit Agreement.

         The Credit Agreement provides, among other things, for acceleration
(which in certain cases shall be automatic) of the maturity hereof upon the
occurrence of certain stated events, in each case without presentment, demand,
protest or further notice of any kind, all of which are hereby expressly waived.

                                       N-1

[*] Indicates confidential treatment requested.

<Page>

         This promissory note is subject to prepayment in whole or in part as
provided in the Credit Agreement.

         This promissory note is secured by certain Collateral as more
specifically described in the Credit Agreement and the Collateral Documents.

         Borrower and Additional Borrower hereby waive diligence, presentment,
protest or notice of total or partial nonpayment or dishonor with respect to
this promissory note.

         Failure by the holder hereof to exercise any of its rights hereunder in
any instance shall not constitute a waiver thereof in that or any other
instance.

         Borrower and Additional Borrower agree to pay on demand all costs and
expenses of Lender and its Affiliates, and fees and disbursements of counsel
(including allocated costs and expenses for internal legal services), in
connection with the enforcement or attempted enforcement of, and preservation of
any rights or interests under, (i) this promissory note, and (ii) any
out-of-court workout or other refinancing or restructuring or any bankruptcy or
insolvency case or proceeding, including any losses, costs and expenses
sustained by Lender as a result of any failure by Borrower or Additional
Borrower to perform or observe its obligations contained herein.

         THIS PROMISSORY NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF NEW YORK.

         IN WITNESS WHEREOF, Borrower and each Additional Borrower signing below
by its duly authorized legal representative(s) has executed this promissory note
on the date and in the year first above mentioned.

                                                     BORROWER

                                                     COGENT COMMUNICATIONS, INC.

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

                                                     ADDITIONAL BORROWER

                                                     COGENT INTERNET, INC.

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

                                       N-2

[*] Indicates confidential treatment requested.

<Page>

                                    EXHIBIT O

                   FORM OF ASSIGNMENT AND ACCEPTANCE AGREEMENT

         THIS ASSIGNMENT AND ACCEPTANCE AGREEMENT (this "Agreement") dated as of
_____________________________, ____, is made between ___________________
______________________________ (the "Assignor") and
______________________________ (the "Assignee").

                             PRELIMINARY STATEMENTS

         1. The Assignor is party to that certain Second Amended and Restated
Credit Agreement, dated as of October 24, 2001 (as amended, restated, modified,
supplemented or renewed from time to time, the "Credit Agreement"), among Cogent
Communications, Inc (the "Borrower"), any Additional Borrower named therein, the
several financial institutions from time to time party thereto (including the
Assignor) (the "Lenders") and Cisco Systems Capital Corporation, as
administrative agent for itself and the other Lenders (in such capacity, the
"Agent"). All capitalized terms used but not otherwise defined in this Agreement
shall have the respective meanings assigned to such terms in the Credit
Agreement.

         2. As provided under the Credit Agreement, the Assignor has committed
to making Loans to the Borrower in an aggregate amount not to exceed $__________
(the "Commitment") [, and its Commitment to make Loans has terminated];

         3. [The Assignor has made Loans in the aggregate principal amount of
$__________ to the Borrower and Additional Borrower consisting of _____________
[DESCRIBE LENDER'S INTERESTS IN TRANCHES OUTSTANDING]] [No Loans are outstanding
under the Credit Agreement.]

         4. The Assignor wishes to assign to the Assignee [part of the] [all]
rights and obligations of the Assignor under the Credit Agreement in respect of
its Commitment, [together with a corresponding portion of each of its
outstanding Loans], in an amount equal to ___% of the Assignor's Commitment [and
Loans], on the terms and subject to the conditions set forth herein, and the
Assignee wishes to accept assignment of such rights and to assume such
obligations from the Assignor on such terms and subject to such conditions.

         Accordingly, in consideration of the foregoing and the mutual
agreements contained herein, the parties hereto agree as follows:

         1. ASSIGNMENT AND ACCEPTANCE.

         (a) Subject to the terms and conditions of this Agreement, (i) the
Assignor hereby sells, transfers and assigns to the Assignee, and (ii) the
Assignee hereby purchases, assumes and undertakes from the Assignor, without
recourse and without representation or warranty (except as provided in this
Agreement) ___% (the "Assignee's Percentage Share") of (A) the Commitment [and
the Loans] of the Assignor and (B) all related rights, benefits,

                                       O-1

[*] Indicates confidential treatment requested.

<Page>

obligations, liabilities and indemnities of the Assignor under and in connection
with the Credit Agreement and the Loan Documents.

         (b) With effect on and after the Effective Date (as defined in Section
5 hereof), the Assignee shall be a party to the Credit Agreement and succeed to
all of the rights and be obligated to perform all of the obligations of a Lender
under the Credit Agreement, including the requirements concerning
confidentiality, if any, and the payment of indemnification, with a Commitment
in the amount set forth in subsection (c) below. The Assignee agrees that it
shall perform in accordance with their terms all of the obligations which by the
terms of the Credit Agreement are required to be performed by it as a Lender. It
is the intent of the parties hereto that the Commitment of the Assignor shall,
as of the Effective Date, be reduced by an amount equal to the portion thereof
assigned to the Assignee hereunder, and the Assignor shall relinquish its rights
and be released from its obligations under the Credit Agreement to the extent
such obligations have been assumed by the Assignee; PROVIDED, HOWEVER, that the
Assignor shall not relinquish its rights under Sections 2.11, 2.12, 2.21, 8.4 or
8.16 of the Credit Agreement (and any equivalent provisions of the other Loan
Documents) to the extent such rights relate to the time prior to the Effective
Date.

         (c) After giving effect to the assignment and assumption set forth
herein, on the Effective Date: (i) the Assignee's Commitment shall be
$__________; and (ii) the Assignee's aggregate outstanding Loans shall be
$_______________.

         (d) After giving effect to the assignment and assumption set forth
herein, on the Effective Date: (i) the Assignor's Commitment shall be
$__________; and (ii) the Assignor's aggregate outstanding Loans shall be
$_______________.

         2. PAYMENTS.

         (a) As consideration for the sale, assignment and transfer contemplated
in Section 1 hereof, the Assignee shall pay to the Assignor on the Effective
Date in immediately available funds an amount equal to $__________, representing
the Assignee's Percentage Share of the principal amount of all Loans previously
made by the Assignor to the Borrower under the Credit Agreement and outstanding
on the Effective Date.

         (b) The [Assignor] [Assignee] further agrees to pay to the Agent a
processing fee in the amount specified in Section 8.7(a) of the Credit
Agreement.

         3. REALLOCATION OF PAYMENTS. Any interest, fees and other payments
accrued to the Effective Date with respect to the Commitment [and Loans] of the
Assignor shall be for the account of the Assignor. Any interest, fees and other
payments accrued on and after the Effective Date with respect to the portion of
such Commitment [and Loans] assigned to the Assignee shall be for the account of
the Assignee. Each of the Assignor and the Assignee agrees that it will hold in
trust for the other party any interest, fees and other amounts which it may
receive to which the other party is entitled pursuant to the preceding sentence
and pay to the other party any such amounts which it may receive promptly upon
receipt.

                                       O-2

[*] Indicates confidential treatment requested.

<Page>

         4. INDEPENDENT CREDIT DECISION. The Assignee (a) acknowledges that it
has received a copy of the Credit Agreement and the Schedules and Exhibits
thereto, together with copies of the most recent financial statements delivered
pursuant to the Credit Agreement, and such other documents and information as it
has deemed appropriate to make its own credit and legal analysis and decision to
enter into this Agreement; and (b) agrees that it will, independently and
without reliance upon the Assignor, the Agent or any other Lender and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit and legal decisions in taking or not taking
action under the Credit Agreement and the other Loan Documents.

         5. EFFECTIVE DATE; NOTICES.

         (a) As between the Assignor and the Assignee, the effective date for
this Agreement shall be ______________ (the "Effective Date"); provided that the
following conditions precedent have been satisfied on or before the Effective
Date:

         (i) this Agreement shall have been executed and delivered by the
Assignor and the Assignee;

         (ii) any consent of the Agent required under Section 8.7 of the Credit
Agreement for the effectiveness of the assignment hereunder by the Assignor to
the Assignee shall have been duly obtained and shall be in full force and effect
as of the Effective Date;

         (iii) the Assignee shall have paid to the Assignor all amounts due to
the Assignor under this Agreement;

         (iv) the processing fee referred to in Section 2(b) hereof and in
Section 8.7(a) of the Credit Agreement shall have been paid to the Agent; and

         (v) the Assignor and Assignee shall have complied with the other
requirements of Section 8.7 of the Credit Agreement (to the extent applicable).

         (b) Promptly following the execution of this Agreement, the Assignor
shall deliver to Holdings, the Borrower and the Agent for acknowledgment by the
Agent, a Notice of Assignment substantially in the form attached hereto as
Schedule 1.

         6. AGENT. The Assignee hereby appoints and authorizes the Assignor to
take such action as agent on its behalf and to exercise such powers under the
Credit Agreement and the other Loan Documents as are delegated to the Agent by
the Lenders pursuant to the terms of the Credit Agreement and such other Loan
Documents. [The Assignee shall assume no duties or obligations held by the
Assignor in its capacity as Agent under the Credit Agreement and the other Loan
Documents.

         7. WITHHOLDING TAX. The Assignee (a) represents and warrants to the
Assignor, the Agent and the Borrower that under applicable law and treaties no
tax will be required to be withheld by the Assignor with respect to any payments
to be made to the Assignee hereunder, and (b) agrees to furnish (if it is
organized under the laws of any jurisdiction other

                                       O-3

[*] Indicates confidential treatment requested.

<Page>

than the United States or any State thereof) to the Agent and the Borrower prior
to the time that the Agent or Borrower is required to make any payment of
interest or fees under the Credit Agreement, duplicate executed originals of IRS
Form W-8BEN, IRS Form W-8ECI or such other documents and forms of the United
States Internal Revenue Service, duly executed and completed by the Assignee, as
are required under United States law to establish the Assignee's status for
United States withholding tax purposes.

         8. REPRESENTATIONS AND WARRANTIES.

         (a) The Assignor represents and warrants that (i) it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any Lien or other adverse claim; (ii) it is duly
organized and existing and it has the full power and authority to take, and has
taken, all action necessary to execute and deliver this Agreement and any other
documents required or permitted to be executed or delivered by it in connection
with this Agreement and to fulfill its obligations hereunder; (iii) no notices
to, or consents, authorizations or approvals of, any Person are required (other
than those referred to in Section 5(a)(ii) hereof and any already given or
obtained) for its due execution, delivery and performance of this Agreement, and
apart from any agreements or undertakings or filings required by the Credit
Agreement, no further action by, or notice to, or filing with, any Person is
required of it for such execution, delivery or performance; and (iv) this
Agreement has been duly executed and delivered by it and constitutes the legal,
valid and binding obligation of the Assignor, enforceable against the Assignor
in accordance with the terms hereof, subject, as to enforcement, to bankruptcy,
insolvency, moratorium, reorganization and other laws of general application
relating to or affecting creditors' rights and to general equitable principles.

         (b) The Assignor makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Credit Agreement or any other Loan Document or
the execution, legality, validity, enforceability, genuineness, sufficiency or
value of the Credit Agreement or any other Loan Document. The Assignor makes no
representation or warranty in connection with, and assumes no responsibility
with respect to, the solvency, financial condition or statements of the Borrower
or any other Person, or the performance or observance by the Borrower or any
other Person, of any of its respective obligations under the Credit Agreement or
any other Loan Document.

         (c) The Assignee represents and warrants that (i) it is duly organized
and existing and it has full power and authority to take, and has taken, all
action necessary to execute and deliver this Agreement and any other documents
required or permitted to be executed or delivered by it in connection with this
Agreement, and to fulfill its obligations hereunder; (ii) no notices to, or
consents, authorizations or approvals of, any Person are required (other than
those referred to in Section 5(a)(ii) hereof and any already given or obtained)
for its due execution, delivery and performance of this Agreement; and apart
from any agreements or undertakings or filings required by the Credit Agreement,
no further action by, or notice to, or filing with, any Person is required of it
for such execution, delivery or performance; (iii) this Agreement has been duly
executed and delivered by it and constitutes the legal, valid and binding
obligation of the Assignee, enforceable against the Assignee in accordance with
the terms hereof, subject, as

                                       O-4

[*] Indicates confidential treatment requested.

<Page>

to enforcement, to bankruptcy, insolvency, moratorium, reorganization and other
laws of general application relating to or affecting creditors' rights and to
general equitable principles; and (iv) it is an Eligible Assignee.

         9. FURTHER ASSURANCES. The Assignor and the Assignee each hereby agrees
to execute and deliver such other instruments, and take such other action, as
either party may reasonably request in connection with the transactions
contemplated by this Agreement, including the delivery of any notices or other
documents or instruments to the Borrower or the Agent, which may be required in
connection with the assignment and assumption contemplated hereby.

         10. MISCELLANEOUS.

         (a) Any amendment or waiver of any provision of this Agreement shall be
in writing and signed by the parties hereto.

         (b) No failure on the part of the Assignor or Assignee to exercise, and
no delay in exercising, any right, remedy, power or privilege hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such right, remedy, power or privilege preclude any other or further exercise
thereof or the exercise of any other right, remedy, power or privilege. The
rights and remedies under this Agreement are cumulative and not exclusive of any
rights, remedies, powers and privileges that may otherwise be available to the
parties.

         (c) All payments made hereunder shall be made without any set-off or
counterclaim.

         (d) The Assignor and the Assignee shall each pay its own costs and
expenses incurred in connection with the negotiation, preparation, execution and
performance of this Agreement.

         (e) This Agreement may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together shall
constitute but one and the same agreement.

         (F) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAW OF THE STATE OF NEW YORK.

         [OTHER PROVISIONS TO BE ADDED AS MAY BE NEGOTIATED BETWEEN THE ASSIGNOR
AND THE ASSIGNEE, PROVIDED THAT SUCH PROVISIONS ARE NOT INCONSISTENT WITH THE
CREDIT AGREEMENT.]

                                       O-5

[*] Indicates confidential treatment requested.

<Page>

         IN WITNESS WHEREOF, the Assignor and the Assignee have caused this
Agreement to be executed and delivered by their duly authorized officers or
agents as of the date first above written.

                                          THE ASSIGNOR

                                          [__________________________]
                                          By:________________________
                                          Title:_____________________

                                          THE ASSIGNEE

                                          [__________________________]
                                          By:________________________
                                          Title:_____________________

                                       O-6

[*] Indicates confidential treatment requested.

<Page>

                                   SCHEDULE 1

                   to the Assignment and Acceptance Agreement

                       NOTICE OF ASSIGNMENT AND ACCEPTANCE

Date:    _________________________

To:      Cisco Systems Capital Corporation, as Agent

         Cogent Communications, Inc

         Cogent Communications Group, Inc

                  Re:  COGENT COMMUNICATIONS, INC

Ladies and Gentlemen:

         We refer to the Credit Agreement dated as of ____________, 2001 (as
amended, restated, modified, supplemented or renewed from time to time, the
"Credit Agreement") among Cogent Communications Group, Inc ("Holdings"), Cogent
Communications, Inc (the "Borrower"), any Additional Borrower named therein, the
Lenders named therein (including the Assignor), and Cisco Systems Capital
Corporation, as administrative agent (the "Agent"). Terms defined in the Credit
Agreement are used herein as therein defined.

         1. We hereby give you notice of[, and request the consent of the Agent
to,] the assignment by ________________________ (the "Assignor") to
____________________ (the "Assignee") of ____% of the right, title and interest
of the Assignor in and to the Credit Agreement (including, without limitation,
____% of the right, title and interest of the Assignor in and to the Commitment
of the Assignor [and all outstanding Loans made by the Assignor]) pursuant to
that certain Assignment and Acceptance Agreement, dated as of ___________ (the
"Assignment and Acceptance") between Assignor and Assignee, a copy of which
Assignment and Acceptance is attached hereto. Before giving effect to such
assignment the Assignor's Commitment is $___________. [The Assignor has made
Loans in the aggregate principal amount of $__________ to the Borrower
consisting of ____________ [describe Lender's interests in tranches
outstanding]. [No Loans are outstanding under the Credit Agreement.]

         2. The Assignee agrees that, upon receiving the consent of the Agent to
such assignment (if applicable) and from and after the Effective Date (as such
term is defined in Section 5 of the Assignment and Acceptance), the Assignee
shall be bound by the terms of the Credit Agreement, with respect to the
interest in the Credit Agreement assigned to it as specified above, as fully and
to the same extent as if the Assignee were the Lender originally holding such
interest in the Credit Agreement.

                Schedule 1 to Assignment and Acceptance Agreement
                                     Page 1.

[*] Indicates confidential treatment requested.

<Page>

         3. The following administrative details apply to the Assignee:

         (a) Lending Office(s):

         Assignee name:    _________________________________
         Address:          _________________________________
                           _________________________________
                           _________________________________
                           _________________________________
         Attention:        _________________________________
         Telephone:        (________)_______________________
         Facsimile:        (________)_______________________

         (b) Address for Notices

         Assignee name:    _________________________________
         Address:          _________________________________
                           _________________________________
                           _________________________________
                           _________________________________
         Attention:        _________________________________
         Telephone:        (________)_______________________
         Facsimile:        (________)_______________________

         (c) Payment Instructions:

         Account No.:      _________________________________
         ABA No.:          _________________________________
         At:               _________________________________
                           _________________________________
                           _________________________________
         Reference:        _________________________________
         Attention:        _________________________________

         4. You are entitled to rely upon the representations, warranties and
covenants of each of the Assignor and Assignee contained in the Assignment and
Acceptance.

         5. This Notice of Assignment and Acceptance may be executed by the
Assignor and the Assignee in separate counterparts, each of which when so
executed and delivered shall be deemed to be an original and all of which taken
together shall constitute one and the same notice and agreement.

                Schedule 1 to Assignment and Acceptance Agreement
                                     Page 2.

[*] Indicates confidential treatment requested.

<Page>

         IN WITNESS WHEREOF, the Assignor and the Assignee have caused this
Notice of Assignment and Acceptance to be executed by their respective duly
authorized officers or agents as of the date first above written.

                                                  Very truly yours,

ADJUSTED COMMITMENT:                              [ASSIGNOR]
-------------------

$                                                 By:___________________________
 -------------------------------                  Title:________________________

ADJUSTED PRO RATA SHARE:
-----------------------

____________%

COMMITMENT:                                       [ASSIGNEE]
----------

$_____________________________                    By:___________________________
                                                  Title:________________________

PRO RATA SHARE:
--------------

____________%

ACKNOWLEDGED [AND CONSENTED TO] this ____ day of ________:

Cisco Systems Capital Corporation,
     as Agent

By:__________________________________
Title:_______________________________

                Schedule 1 to Assignment and Acceptance Agreement
                                     Page 3.

[*] Indicates confidential treatment requested.

<Page>

                                    EXHIBIT P

             FORM OF CONFIRMATION OF POSITION AND RELEASE AGREEMENT

          (SEE ATTACHED CONFIRMATION OF POSITION AND RELEASE AGREEMENT)

                                      P-1

[*] Indicates confidential treatment requested.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00032-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00032-of-00352.parquet"}]]