Document:

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                                                                   Exhibit 10.67

                                 FIRST AMENDMENT
                         TO LOAN AND SECURITY AGREEMENT

                FIRST AMENDMENT, dated as of May 24, 2001 (this "Amendment"), to
the Loan and Security Agreement, dated as of April 10, 2001 (the "Loan
Agreement"), by and among, on the one hand, the lenders identified on Annex I
hereto under the caption "Continuing Lenders" (each a "Continuing Lender" and
collectively, the "Continuing Lenders") and the lenders identified on Annex I
hereto under the caption "Additional Lenders" (each an "Additional Lender" and
collectively, the "Additional Lenders," and together with the Continuing Lenders
and their respective successors and assigns, each a "Lender" and collectively,
the "Lenders"), FOOTHILL CAPITAL CORPORATION, a California corporation, as the
arranger and administrative agent for the Lenders (the "Agent"), ABLECO FINANCE
LLC, a New York limited liability company, as co-agent for the Lenders (the
"Co-Agent") and, on the other hand, e.spire COMMUNICATIONS, INC., a Delaware
corporation, as a debtor and a debtor in possession (the "Borrower"), and the
subsidiaries of Borrower that are identified on the signature pages of the Loan
Agreement, each as a debtor and a debtor in possession (each individually a
"Guarantor" and collectively the "Guarantors").

                WHEREAS, the Borrower, the Guarantors, the Agent, Co-Agent and
the Lenders are willing to amend the Loan Agreement to, among other things (i)
add the Additional Lenders as Lenders to the Loan Agreement, (ii) increase the
Revolver Commitment and the Total Commitment (each as defined in the Loan
Agreement), (iii) modify the terms of the Borrowing Base (as defined in the Loan
Agreement), and (iv) amend certain other terms and conditions in the Loan
Agreement.

                NOW THEREFORE, in consideration of the premises and other good
and valuable consideration, the parties hereto hereby agree as follows:

                1.1.    Definitions in this Amendment. Any capitalized term used
herein and not defined herein shall have the meaning assigned to it in the Loan
Agreement.

                1.2.    Existing Definitions. (a) The definition of the term
"Adequate Protection Stipulation" in Section 1.1 of the Loan Agreement is hereby
amended in its entirety to read as follows:

                        "'Adequate Protection Stipulation' means the Second
                Amended and Restated Stipulation and Order (I) Granting Adequate
                Protection, (II) Authorizing the Use of Cash Collateral, (III)
                Granting on an Interim Basis Post-Petition Financing and (IV)
                Scheduling a Final Hearing on the Post-Petition Financing
                Arrangements Pursuant to Bankruptcy Code Sections 105, 361, 362,
                363 and 364 so ordered by the Bankruptcy Court, as in effect on
                the Revolver Facility Effective Date, and as thereafter,
                amended, modified or extended from time to time with, in the
                case of any material amendments or modifications, the consent of
                the Agent on behalf of the Required Lenders."

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                        (b)     The definition of the term "Advance Percentage"
in Section 1.1 of the Loan Agreement is hereby deleted in its entirety.

                        (c)     Clause (i) of the definition of the term
"Applicable Prepayment Premium" in Section 1.1 of the Loan Agreement is hereby
amended in its entirety to read as follows:

                        "(i)    $60,000,000, plus"

                        (d)     The definition of the term "Eligible Fiber Optic
Inventory" in Section 1.1 of the Loan Agreement is hereby amended in its
entirety to read as follows:

                        "'Eligible Fiber Optic Inventory' means dark fiber optic
                cable Inventory held for sale by a Loan Party located at one of
                the locations set forth on Schedule E-1, that complies with each
                of the representations and warranties respecting Eligible Fiber
                Optic Inventory made by a Loan Party in the Loan Documents, and
                that is not excluded as ineligible by virtue of the one or more
                of the criteria set forth below; provided, however, that such
                criteria may be fixed and revised from time to time by Agent in
                Agent's Permitted Discretion to address the results of any audit
                or appraisal performed by Agent from time to time after the
                Revolver Facility Effective Date. An item of dark fiber optic
                cable Inventory shall not be included in Eligible Fiber Optic
                Inventory if:

                                (a)     a Loan Party does not have good, valid,
                        and marketable title thereto,

                                (b)     it is not located at one of the
                        locations set forth on Schedule E-1,

                                (c)     it is not subject to a valid and
                        perfected first priority Agent's Lien, or

                                (d)     it consists of obsolete, damaged or
                        defective fiber optic cable or work-in-process, spare
                        parts or supplies used or consumed in a Loan Party's
                        business."

                        (e)     The definition of the term "Maximum Revolver
Amount" in Section 1.1 of the Loan Agreement is hereby amended in its entirety
to read as follows:

                        "Maximum Revolver Amount" means (i) prior to the Final
                Facility Effective Date, $15,000,000 and (ii) on and after the
                Final Facility Effective Date $45,000,000, provided that upon
                the receipt by the Agent and the Borrower of additional Revolver
                Commitments pursuant to paragraph (c) of Section 3.3, the
                Maximum Revolver Amount after the Final Facility Effective Date
                will increase, on a dollar for dollar basis, by the amount of
                such additional Revolver Commitments over $45,000,000 received
                pursuant to paragraph (c) of Section 3.3 up to a maximum of
                $60,000,000."

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                        (f)     The definition of the term "Required Lenders" in
Section 1.1 of the Loan Agreement is hereby amended in its entirety to read as
follows:

                        "'Required Lenders' means, at any time, Lenders whose
                Pro Rata Shares aggregate 55% as determined pursuant to clause
                (d) of the definition of Pro Rata Share, provided that, solely
                for purposes of voting or consenting or objecting to matters
                with respect to the Loan Documents, George Schmitt or any entity
                owned or controlled by George Schmitt shall be deemed not to be
                a "Lender" and the Commitment and/or Advances of George Schmitt
                or any entity owned or controlled by George Schmitt shall be
                deemed to be zero."

                        (g)     The definition of the term Revolver Facility
Effective Date in Section 1.1 of the Loan Agreement is hereby amended by
deleting the words "Final Bankruptcy Court Order" and substituting in lieu
thereof "Interim Bankruptcy Court Order".

                1.3.    New Definitions. Section 1.1 of the Loan Agreement is
hereby amended by adding the following new definitions of "Final Facility
Effective Date" and "Mechanics Lien Reserve" to such Section in alphabetical
order:

                        "'Final Facility Effective Date' means the date, after
                the entry of the Final Bankruptcy Court Order, on which all of
                the conditions precedent to the increase of the Revolver
                Commitments to an amount in excess of $15,000,000 as set forth
                in Section 3.3 are satisfied."

                        "'Mechanics Lien Reserve' has the meaning set forth in
                Section 2.1(a)."

                1.4.    Schedule. Schedule C-1 to the Loan Agreement is hereby
amended in its entirety to read as set forth on Annex II attached hereto.

                1.5.    Revolver Advances. (a) Section 2.1(a) of the Loan
Agreement is hereby amended in its entirety to read as follows:

                        "2.1    'Revolver Advances'. (a) Subject to the terms
and conditions of this Agreement and the Orders, and on and after the Entry Date
and during the term of this Agreement, each Lender with a Revolver Commitment
agrees (severally, not jointly or jointly and severally) to make advances
("Advances") to Borrower in an amount at any one time outstanding not to exceed
such Lender's Pro Rata Share of an amount equal to the least of (i) the Maximum
Revolver Amount less the Letter of Credit Usage or (ii) the Borrowing Base less
the Letter of Credit Usage, and (iii) the maximum Indebtedness for the
corresponding month set forth in Section 7.20(c) less the outstanding Term Loan
and Letter of Credit Usage. For purposes of this Agreement, "Borrowing Base,"
means at any time the excess of (i) the lesser of (A) the amount determined by
multiplying (x) $400 and (y) the number of miles of Eligible Fiber Optic
Inventory owned by ACSI Network and (B) the sum of (x) the amount determined by
multiplying (1) $300 and (2) the number of miles of Eligible Fiber Optic
Inventory owned by ACSI Network and (y) the amount determined by multiplying (1)
$100 and (2) the number of miles of Eligible Fiber Optic Inventory owned by the
Loan Parties constituting part of the CLEC Business over (ii) the sum of (A)
$3,000,000 plus (B) $8,000,000 (the "Mechanics Lien Reserve"), provided that (x)
the Mechanics Lien Reserve shall not be released until the Agent is

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satisfied, in its Permitted Discretion, that both (1) either the mechanics or
contractors Liens set forth on Schedule P-1 to this Agreement are released or
the obligations secured by such mechanics or contractors Liens have been
satisfied and (2) the conditions set forth in paragraphs (g) and (h) of Section
3.3 have been satisfied, and (y) if the Agent determines in its Permitted
Discretion that both (1) any such mechanics Liens or contractors Liens are
released or any obligations secured by such mechanics or contractors Liens are
satisfied and (2) the conditions set forth in paragraphs (g) and (h) of Section
3.3 have been satisfied, the Agent shall release a portion of the Mechanics Lien
Reserve in the amount corresponding on Schedule P-1 to the Liens released or the
obligations satisfied, plus (C) the aggregate amount of reserves, if any,
established by Agent under Section 2.1(b)."

                1.6.    Inventory Reappraisals. The last sentence of Section
2.1(b) of the Loan Agreement is hereby amended in its entirety to read as
follows:

                        "In addition to the foregoing, Agent shall have the
                right to have the Inventory reappraised by a qualified appraisal
                company selected by Agent from time to time after the Revolver
                Facility Effective Date for the purpose of redetermining the
                Dollar amount multiplied by Eligible Fiber Optic Inventory and,
                as a result, redetermining the Borrowing Base."

                1.7.    Term Loan Holdback. Section 2.2(b) of the Loan Agreement
is hereby amended by adding the following sentence at the end of such Section:

                        "On the Revolver Facility Effective Date, the Term Loan
                Holdback shall be reduced to zero and, pursuant to paragraph (a)
                of this Section 2.2, the Additional Term Loan to be made on the
                Revolver Facility Effective Date shall be increased by the
                amount of the reduction of the Term Loan Holdback."

                1.8     Cash Management. Section 2.7(a) of the Loan Agreement is
hereby amended by deleting the words "Revolver Facility Effective Date" in the
first line of such Section and substituting in lieu thereof "Final Facility
Effective Date".

                1.9.    Conditions Precedent. Sections 3.2 and 3.3 of the Loan
Agreement are hereby amended in their entirety to read as follows:

                        "3.2    Conditions Precedent to Revolver Commitments and
        Advances and Letters of Credit in excess of $5,000,000. The obligation
        of the Lender Group (or any member thereof) to make the Advances or
        assist the Borrower in obtaining Letters of Credit in excess of
        $5,000,000, is subject to the fulfillment of each of the conditions
        precedent set forth below:

                                (a)     an order, satisfactory in form and
        substance to the Required Lenders, shall have been entered by the
        Bankruptcy Court modifying the Interim Bankruptcy Court Order, and the
        Agent shall have received a certified copy of such order and such order
        shall be in full force and effect and shall not have been reversed,
        stayed, modified or amended absent the written joinder or consent of the
        Agent, on behalf of the Required Lenders, and the Borrower;

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                                (b)     the Lenders, shall be satisfied that the
        Agent has been granted and continues to have a perfected, first priority
        Lien on the Collateral subject to Permitted Priority Liens;

                                (c)     George Schmitt shall have become a
        "Lender" hereunder with a Revolver Commitment of not less than
        $5,000,000, which Revolver Commitment shall be subject to such terms and
        conditions (including, without limitation, fees to be paid in connection
        with such Revolver Commitment) as are acceptable to the Required Lenders
        in their Permitted Discretion;

                                (d)     Agent shall have completed its financial
        and collateral due diligence review, including, without limitation (i) a
        collateral audit and review of the Books and verification of Borrower's
        representations and warranties to Lender Group, (ii) an inspection of
        some of the locations where Eligible Fiber Optic Inventory is located,
        (iii) receipt of satisfactory results of its field survey due diligence,
        audit and business valuation appraisal by auditors, examiners and/or
        appraisers selected by the Agent with the consent of the Required
        Lenders (collectively, the "Revolver Facility Diligence"), the results
        of each of the foregoing of which shall be acceptable to the Required
        Lenders, in their sole discretion;

                                (e)     no Material Adverse Change shall have
        occurred since the Closing Date;

                                (f)     no pending claim, investigation or
        litigation by any Governmental Authority shall exist with respect to any
        Loan Party or the transactions contemplated hereby;

                                (g)     the Required Lenders shall be satisfied
        in their sole discretion with the results of a reference check on each
        member of key management of Borrower;

                                (h)     the Adequate Protection Stipulation
        shall be in form and substance satisfactory to the Agent and the
        Lenders; and

                                (i)     Borrower shall have paid to Agent all
        fees and Lender Group Expenses owing as of the Revolver Facility
        Effective Date.

                        3.3     Conditions Precedent to Revolver Commitments and
        Advances and Letters of Credit in excess of $15,000,000. The obligation
        of the Lender Group (or any member thereof) to make the Advances or
        assist the Borrower in obtaining Letters of Credit in excess of
        $15,000,000, is subject to the fulfillment of each of the conditions
        precedent set forth below:

                                (a)     the Final Bankruptcy Court Order shall
        have been entered by the Bankruptcy Court, and the Agent shall have
        received a certified copy of such Order and such Order shall be in full
        force and effect and shall not have been reversed, stayed, modified or
        amended absent the written joinder or consent of the Agent, on behalf of
        the Required Lenders, and the Borrower;

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                                (b)     the Lenders, shall be satisfied that the
        Agent has been granted and continues to have a perfected, first priority
        Lien on the Collateral subject to Permitted Priority Liens;

                                (c)     (i) George Schmitt shall have become a
        "Lender" hereunder with a Revolver Commitment of not less than
        $10,000,000 and (ii) Persons, acceptable to Required Lenders in their
        Permitted Discretion, may become "Lenders" hereunder with aggregate
        Revolver Commitments of not less than $10,000,000, which Revolver
        Commitments described in clauses (i) and (ii) above shall be subject to
        such terms and conditions (including, without limitation, fees to be
        paid in connection with such Revolver Commitments) as are acceptable to
        the Required Lenders in their Permitted Discretion, provided that
        obtaining the Revolver Commitments set forth in clause (ii) of this
        paragraph (c) shall not be required as a condition to Revolver
        Commitments and Advances and Letters of Credit in excess of $15,000,000;

                                (d)     no Material Adverse Change shall have
        occurred since the Closing Date;

                                (e)     no pending claim, investigation or
        litigation by any Governmental Authority shall exist with respect to any
        Loan Party or the transactions contemplated hereby;

                                (f)     the Adequate Protection Stipulation
        shall be in form and substance satisfactory to the Agent and the
        Required Lenders and the Agent and the agent for the holders of the
        Pre-Petition Credit Facility Debt shall have entered into an
        intercreditor agreement, in form and substance satisfactory to the Agent
        and the Required Lenders;

                                (g)     Agent shall be satisfied in its
        Permitted Discretion with the cash management system of Borrower and
        Agent shall have received Schedule 2.7(a) to this Agreement, which shall
        be satisfactory to the Agent;

                                (h)     the Agent shall have received a Control
        Agreement, in form and substance satisfactory to Agent, duly executed
        for each Securities Account of a Loan Party; and

                                (i)     Borrower shall have paid to Agent all
        Lender Group Expenses owing as of the Final Facility Effective Date."

                1.10.   Term. Section 3.6 of Loan Agreement is hereby amended by
deleting clause (vii) thereof in its entirety and substituting in lieu thereof
"(vii) June 12, 2001 if upon that date the Final Bankruptcy Court Order has not
been entered; and"

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                1.11.   Conditions Subsequent. Section 3.5 of the Loan Agreement
is hereby amended by inserting new paragraph (b) to read as follows:

                        "(b) on or before August 15, 2001, Agent shall receive a
                report from a third party consulting firm acceptable to Agent
                verifying that Borrower is in compliance with Section 7.20(e)
                and (f) of the Agreement as of June 30, 2001."

                1.12.   Financial Covenants. Section 7.20 of the Loan Agreement
is hereby amended by (i) deleting the gross conduit miles installed at ACSI
Network in paragraph (e) of such section for the quarters ending June 30, 2001
and September 30, 2001 and substituting in lieu thereof 770 gross conduit miles
installed for the quarter end June 30, 2001 and 789 gross conduit miles
installed for the quarter end September 30, 2001, and (ii) inserting new
paragraphs (g) and (h) at the end of such section to read as follows:

                        "(g) Minimum Gross Fiber Miles. (i) Fail to maintain
                50,000 gross miles of Eligible Fiber Optic Inventory installed
                at the CLEC Business at all times.

                                (ii)    Fail to maintain 150,000 gross miles of
                Eligible Fiber Optic Inventory at ACSI Network at all times.

                        (h)     Market Completion. (i) Fail to complete the
                fiber optic cable network in each of Atlanta, Georgia and
                Dallas, Texas on or before December 31, 2001.

                                (ii)    Fail to complete the fiber optic cable
                network in Tampa, Florida on or before March 30, 2002."

                1.13.   Amendments and Waivers. Section 15.1 of the Loan
Agreement is hereby amended by adding the following new paragraph (iii) at the
end of such Section:

                        "(iii) Notwithstanding anything to the contrary, solely
                for purposes of voting on amendments, waivers and consents to
                matters with respect to the Loan Documents, George Schmitt and
                any entity owned or controlled by George Schmitt shall be deemed
                not to be a "Lender" and the Commitment and/or Advances of
                George Schmitt and any entity owned or controlled by George
                Schmitt shall be deemed to be zero, provided that, nothing
                contained in this paragraph (iii) shall permit George Schmitt
                and/or any entity owned or controlled by George Schmitt to
                receive less favorable treatment with respect to his or its
                Revolver Commitment or Advances than the other Lenders with
                respect to their Revolver Commitments or Advances (including,
                except to the extent otherwise provided in a letter agreement,
                dated May 24, 2001, between the Agent and George Schmitt with
                respect to fees provided for in this Agreement, the payment by
                the Borrower of any waiver or similar fees payable ratably to
                the Lenders after the date hereof)."

                2.      Additional Lenders. (a) On and as of the Revolver
Facility Effective Date, the Additional Lenders shall provide additional
Revolver Commitments to the Borrower,

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and each Continuing Lender shall sell and assign and the Additional Lenders
shall purchase and assume, at the principal amount thereof, such interests in
the Revolver Commitments, the Advances and the Letter of Credit Usage
outstanding on such date, in each case as shall be necessary in order that,
after giving effect to all such increases, assignments and purchases, the
Commitments will be as set forth in Annex II to this Amendment, and the
Commitments, Advances and Letter of Credit Usage will be held by the Lenders
ratably in accordance with their Pro Rata Shares in the Commitments as set forth
in Annex II to this Amendment. Such sales, assignments and purchases shall be
without recourse, representation or warranty, except that (i) each Continuing
Lender represents that it is the legal and beneficial owner of the interests
assigned by it free and clear of any adverse claim and (ii) paragraphs 2, 3 and
5 of Exhibit A-1 to the Loan Agreement are hereby incorporated by reference as
if set forth herein and each Continuing Lender shall be deemed to have made the
representations, warranties and statements of Assignor in such paragraphs and
each Additional Lender shall be deemed to have made the representations,
warranties and statements of Assignee in such paragraphs.

                        (b)     On the Revolver Facility Effective Date, (i) the
Additional Lenders shall pay the purchase price for the Advances purchased by it
pursuant to paragraph (a) of this Section 2 by wire transfer of immediately
available funds to the Agent, not later than 12:00 p.m. California time, and
(ii) the Agent shall promptly pay to each Continuing Lender the purchase price
for Advances sold by it pursuant to paragraph (a) of this Section 2, out of the
amounts received by it pursuant to clause (i) of this paragraph (b), by wire
transfer of immediately available funds to an account designated by such
Continuing Lender.

                        (c)     Borrower and Guarantors hereby consent to the
addition of the Additional Lenders, to the increase in the Revolver Commitments
and to the sales, assignments and purchases provided for in paragraphs (a) and
(b) of this Section 2 and agree that the Additional Lenders shall have all of
the rights of a Lender under the Loan Agreement with respect to the increase in
the Commitments provided by it and the interests purchased by it pursuant to
such paragraphs. Commencing on the Revolver Facility Effective Date, the
Additional Lenders will be parties to the Loan Agreement, agree to be bound by
the terms and conditions of the Loan Agreement and the Loan Documents and will
have all of the rights and obligations of a Lender under the Loan Agreement and
the Loan Documents.

                3.      Waiver and Consent. (a) Pursuant to the request of the
Borrower, the Agent and the Lenders hereby consent to and waive any Event of
Default that would arise by reason of a breach of Section 7.20(b) of the Loan
Agreement as a result of the Loan Parties failing to receive cumulative cash
receipts from sales of fiber and conduit of $4,500,000 for the month ended April
30, 2001, provided that the actual cumulative cash receipts for such month from
sales of fiber and conduit was not less than $3,700,000.

                        (b)     The waiver and consent provided for in this
Section 3 (i) shall become effective only in this specific instance and for the
specific purposes set forth herein and (ii) does not permit any other or further
departure from the terms and conditions of the Loan Agreement or any other Loan
Document, which terms and conditions shall continue in full force and effect.

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<PAGE>   9

                4.      Conditions. The effectiveness of this Amendment is
subject to the fulfillment, in a manner satisfactory to the Agent, of each of
the following conditions precedent (the date such conditions are fulfilled or
waived by the Lenders as hereafter referred to as the "Amendment Effective
Date"):

                        (a)     Representations and Warranties; No Event of
Default. The representations and warranties contained herein, in Section 5 of
the Loan Agreement and in each other Loan Document and certificate or other
writing delivered to the Agent or any Lender pursuant hereto on or prior to the
Amendment Effective Date shall be correct on and as of the Amendment Effective
Date as though made on and as of such date, except to the extent that such
representations and warranties (or any schedules related thereto) expressly
relate solely to an earlier date (in which case such representations and
warranties shall be true and correct on and as of such date); and no Default or
Event of Default shall have occurred and be continuing on the Amendment
Effective Date or would result from this Amendment becoming effective in
accordance with its terms.

                        (b)     Delivery of Documents. The Agent shall have
received on or before the Amendment Effective Date the following, each in form
and substance satisfactory to the Agent and, unless indicated otherwise, dated
the Amendment Effective Date:

                                (i)     a true and correct copy of the
        employment agreement between Mike Miller and the Borrower, certified as
        a true and correct copy thereof by an authorized officer of the
        Borrower;

                                (ii)    a letter agreement between the Agent and
        each of the Additional Lenders, duly executed by each Additional Lender;
        and

                                (iii)   such other agreements, instruments and
        other documents as the Agent may reasonably request.

                        (c)     Revolver Facility Effective Date. Each of the
conditions set forth in Section 3.2 of the Loan Agreement shall have been
satisfied prior to or simultaneously with this Amendment (which satisfaction may
be as a result of the effectiveness of this Amendment).

                        (d)     Proceedings. All proceedings in connection with
the transactions contemplated by this Amendment, and all documents incidental
thereto, shall be satisfactory to the Agent and its counsel, and the Agent and
such counsel shall have received all such information and such counterpart
originals or certified copies of documents as the Agent or such counsel may
reasonably request.

                5.      Representations and Warranties. Each Loan Party hereby
represents and warrants to the Agent and the Lenders as follows:

                        (a)     The representations and warranties herein, in
Section 5 of the Loan Agreement and in each other Loan Document and certificate
or other writing delivered to the Agent or any Lender pursuant hereto on or
prior to the Amendment Effective Date are correct on and as of the Amendment
Effective Date as though made on and as of such date, except to the extent that
such representations and warranties (or any schedules related thereto) expressly
relate

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<PAGE>   10

solely to an earlier date (in which case such representations and warranties are
true and correct on and as of such date); and no Default or Event of Default has
occurred and is continuing on the Effective Date or would result from this
Amendment becoming effective in accordance with its terms.

                        (b)     Such Loan Party (i) is duly organized and
existing and in good standing under the laws of the jurisdiction of its
organization, (ii) has all requisite power and authority to execute, deliver and
perform this Amendment and to perform the Loan Agreement, as amended hereby, and
(iii) is duly qualified to do business in each jurisdiction in which the
character of the properties owned or leased by it or in which the transaction of
its business makes such qualification necessary except where the failure to be
so qualified could not be expected to have a Material Adverse Change.

                        (c)     The execution, delivery and performance by such
Loan Party of this Amendment and the performance by such Loan Party of the Loan
Agreement, as amended by this Amendment, (i) have been duly authorized by all
necessary action, (ii) do not and will not contravene such Loan Party's charter
or by-laws or any applicable law.

                        (d)     The execution, delivery, and performance by such
Loan Party of this Amendment and the performance of the Loan Agreement, as
amended by this Amendment, do not and will not require any registration with,
consent, or approval of, or notice to, or other action with or by, any
Governmental Authority or other Person, except for the approval of the
Bankruptcy Court pursuant to the Orders and except to the extent any such
registration, consent, approval, notice or other action is not required by
reason of the Orders or the Bankruptcy Code.

                        (e)     Subject to the approval of the Bankruptcy Court
pursuant to the Orders, this Amendment and the Loan Agreement, as amended by
this Amendment, when executed and delivered by each Loan Party will be the
legally valid and binding obligations of each Loan Party, enforceable against
each Loan Party in accordance with their respective terms.

                6.      Miscellaneous.

                        (a)     Continued Effectiveness of the Loan Agreement.
Except as otherwise expressly provided herein, the Loan Agreement and the other
Loan Documents are, and shall continue to be, in full force and effect and are
hereby ratified and confirmed in all respects, except that on and after the
Amendment Effective Date (i) all references in the Loan Agreement to "this
Agreement", "hereto", "hereof", "hereunder" or words of like import referring to
the Loan Agreement shall mean the Loan Agreement as amended by this Amendment,
and (ii) all references in the other Loan Documents to which any Loan Party is a
party to the "Loan Agreement", "thereto", "thereof", "thereunder" or words of
like import referring to the Loan Agreement shall mean the Loan Agreement as
amended by this Amendment. Except as expressly provided herein, the execution,
delivery and effectiveness of this Amendment shall not operate as an amendment
of any right, power or remedy of the Agent or the Lenders under the Loan
Agreement or any other Loan Document, nor constitute an amendment of any
provision of the Loan Agreement or any other Loan Document.

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<PAGE>   11

                        (b)     Counterparts. This Amendment may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which shall be deemed to be an original, but all of which
taken together shall constitute one and the same agreement.

                        (c)     Headings. Section headings herein are included
for convenience of reference only and shall not constitute a part of this
Amendment for any other purpose.

                        (d)     Governing Law. This Amendment shall be governed
by, and construed in accordance with, the law of the State of New York except to
the extent governed by the Bankruptcy Code.

                        (e)     Costs and Expenses. The Borrower agrees to pay
on demand all fees, costs and expenses of each Agent in connection with the
preparation, execution and delivery of this Amendment and the other related
agreements, instruments and documents.

                        (f)     Amendment as Loan Document. Each Loan Party
hereby acknowledges and agrees that this Amendment constitutes a "Loan Document"
under the Loan Agreement. Accordingly, it shall be an Event of Default under the
Loan Agreement if (i) any representation or warranty made by Loan Party under or
in connection with this Amendment shall have been untrue, false or misleading in
any material respect when made, or (ii) a Loan Party shall fail to perform or
observe any term, covenant or agreement contained in this Amendment.

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

                     Borrower:

                     E.SPIRE COMMUNICATIONS, INC.,
                     a Delaware corporation

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

                     Guarantors:

                     e.spire Finance Corporation,
                          a Delaware corporation
                     ACSI Network Technologies, Inc.,
                          a Maryland corporation
                     e.spireDATA, Inc.,
                          a Maryland corporation
                     ACSI Local Switched Services, Inc.,
                          a Maryland corporation
                     ACSI Long Distance, Inc.,
                          a Maryland corporation
                     e.spire Leasing Corporation,
                          a Maryland corporation
                     American Communication Services of Albuquerque, Inc.,
                          a Delaware corporation
                     American Communication Services of Amarillo, Inc.,
                          a Maryland corporation
                     American Communication Services of Atlanta, Inc.,
                          a Maryland corporation
                     American Communication Services of Austin, Inc.,
                          a Delaware corporation
                     American Communication Services of Baton Rouge, Inc.,
                          a Maryland corporation
                     American Communication Services of Birmingham, Inc.,
                          a Delaware corporation
                     American Communication Services of Charleston, Inc.,
                          a Delaware corporation
                     American Communication Services of Chattanooga, Inc.,
                          a Delaware corporation
                     American Communication Services of Colorado Springs, Inc.,
                          a Maryland corporation
                     American Communication Services of Columbia, Inc.,
                          a Delaware corporation

<PAGE>   13

                     American Communication Services of Columbus, Inc.,
                          a Maryland corporation
                     American Communication Services of Corpus Christi, Inc.,
                          a Maryland corporation Inc.
                     American Communication Services of Dallas, Inc.,
                          a Maryland corporation
                     American Communication Services of D.C., Inc.,
                          a Maryland corporation
                     American Communication Services of El Paso, Inc.,
                          a Delaware corporation
                     American Communication Services of Fort Worth, Inc.,
                          a Delaware corporation
                     American Communication Services of Greenville, Inc.,
                          a Delaware corporation
                     American Communication Services of Irving, Inc.,
                          a Maryland corporation
                     American Communication Services of Jackson, Inc.,
                          a Maryland corporation
                     American Communication Services of Jacksonville, Inc.,
                          a Maryland corporation
                     American Communication Services of Kansas City, Inc.,
                          a Maryland corporation
                     American Communication Services of Las Vegas, Inc.,
                          a Maryland corporation
                     American Communication Services of Lexington, Inc.,
                          a Delaware corporation
                     American Communication Services of Little Rock, Inc.,
                          a Delaware corporation
                     American Communication Services of Louisiana, Inc.,
                          a Delaware corporation
                     American Communication Services of Louisville, Inc.,
                          a Delaware corporation
                     American Communication Services of Maryland, Inc.,
                          a Maryland corporation
                     American Communication Services of Miami, Inc.,
                          a Maryland corporation
                     American Communication Services of Mobile, Inc.,
                          a Delaware corporation
                     American Communication Services of Montgomery, Inc.,
                          a Maryland corporation
                     American Communication Services of Pima County, Inc.,
                          a Delaware corporation
                     American Communication Services of Rio Rancho, Inc.,
                          a Maryland corporation
                     American Communication Services of Roanoke, Inc.,
                          a Maryland corporation

<PAGE>   14

                     American Communication Services of San Antonio, Inc.,
                          a Delaware corporation
                     American Communication Services of Savannah, Inc.,
                          a Maryland corporation
                     American Communication Services of Shreveport, Inc.,
                          a Maryland corporation
                     American Communication Services of Spartanburg, Inc.,
                          a Maryland corporation
                     American Communication Services of Tampa, Inc.,
                          a Maryland corporation
                     American Communication Services of Tulsa, Inc.,
                          a Maryland corporation
                     American Communication Services of Virginia, Inc.,
                          a Virginia corporation
                     American Communication Services International, Inc.,
                          a Delaware corporation
                     ACSI Local Switched Services of Virginia, Inc.,
                          a Virginia corporation
                     Cybergate, Inc.,
                          a Florida corporation
                     FloridaNet, Inc.,
                          a Florida corporation

                     Each by:
                             -------------------------------------------------
                              Title:

<PAGE>   15

                                        Agents and Continuing Lenders:

                                        FOOTHILL CAPITAL CORPORATION

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

                                        ABLECO FINANCE LLC

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

                                        Additional Lenders:

                                        ----------------------------------------
                                        GEORGE SCHMITT

<PAGE>   16

                                     ANNEX I

Continuing Lenders:

Foothill Capital Corporation
Ableco Finance LLC

Additional Lenders:

George Schmitt<PAGE>   1
                                                                    EXHIBIT 10.5

                               CIRRUS LOGIC, INC.

                            INDEMNIFICATION AGREEMENT

         THIS INDEMNIFICATION AGREEMENT ("Agreement") is effective as of
February 17, 1999 by and between Cirrus Logic, Inc., a Delaware corporation (the
"Company"), and Indemnitee ("Indemnitee").

         WHEREAS, effective as of the date hereof, Cirrus Logic, Inc., a
California corporation, is reincorporating into Delaware;

         WHEREAS, the Company desires to attract and retain the services of
highly qualified individuals, such as Indemnitee, to serve the Company and its
related entities;

         WHEREAS, in order to induce Indemnitee to continue to provide services
to the Company, the Company wishes to provide for the indemnification of, and
the advancement of expenses to, Indemnitee to the maximum extent permitted by
law;

         WHEREAS, the Company and Indemnitee recognize the continued difficulty
in obtaining liability insurance for the Company's directors, officers,
employees, agents and fiduciaries, the significant increases in the cost of such
insurance and the general reductions in the coverage of such insurance;

         WHEREAS, the Company and Indemnitee further recognize the substantial
increase in corporate litigation in general, subjecting directors, officers,
employees, agents and fiduciaries to expensive litigation risks at the same time
as the availability and coverage of liability insurance has been severely
limited; and

         WHEREAS, in connection with the Company's reincorporation, the Company
and Indemnitee desire to continue to have in place the additional protection
provided by an indemnification agreement to provide indemnification and
advancement of expenses to the Indemnitee to the maximum extent permitted by
Delaware law;

         WHEREAS, in view of the considerations set forth above, the Company
desires that Indemnitee shall be indemnified and advanced expenses by the
Company as set forth herein;

         NOW, THEREFORE, the Company and Indemnitee hereby agree as set forth
below.

1.  CERTAIN DEFINITIONS.

              (a) "Change in Control" shall mean, and shall be deemed to have
occurred if, on or after the date of this Agreement, (i) any "person" (as such
term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934,
as amended) or group acting in concert, other than a trustee or other fiduciary
holding securities under an employee benefit plan of the Company acting in such
capacity or a corporation owned directly or indirectly by the stockholders of
the Company in substantially the same proportions as their ownership of stock of
the Company, becomes the "beneficial owner" (as defined in Rule 13d-3 under said
Act), directly or indirectly, of securities of the Company representing more
than 50% of the total voting power represented by the Company's then outstanding
Voting Securities, (ii) during any period of two consecutive years, individuals
who at the beginning of such period constitute the Board of Directors of the
Company and any new director whose election by the Board of Directors or
nomination for election by the Company's stockholders

DELAWARE INDEMNIFICATION AGREEMENT     1                                    9/98
<PAGE>   2

was approved by a vote of at least two thirds (2/3) of the directors then still
in office who either were directors at the beginning of the period or whose
election or nomination for election was previously so approved, cease for any
reason to constitute a majority thereof, (iii) the stockholders of the Company
approve a merger or consolidation of the Company with any other corporation
other than a merger or consolidation which would result in the Voting Securities
of the Company outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into Voting Securities of
the surviving entity) at least 80% of the total voting power represented by the
Voting Securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation, or (iv) the stockholders of the
Company approve a plan of complete liquidation of the Company or an agreement
for the sale or disposition by the Company of (in one transaction or a series of
related transactions) all or substantially all of the Company's assets.

              (b) "Claim" shall mean with respect to a Covered Event: any
threatened, pending or completed action, suit, proceeding or alternative dispute
resolution mechanism, or any hearing, inquiry or investigation that Indemnitee
in good faith believes might lead to the institution of any such action, suit,
proceeding or alternative dispute resolution mechanism, whether civil, criminal,
administrative, investigative or other.

              (c) References to the "Company" shall include, in addition to
Cirrus Logic, Inc., any constituent corporation (including any constituent of a
constituent) absorbed in a consolidation or merger to which Cirrus Logic, Inc.
(or any of its wholly owned subsidiaries) is a party which, if its separate
existence had continued, would have had power and authority to indemnify its
directors, officers, employees, agents or fiduciaries, so that if Indemnitee is
or was a director, officer, employee, agent or fiduciary of such constituent
corporation, or is or was serving at the request of such constituent corporation
as a director, officer, employee, agent or fiduciary of another corporation,
partnership, joint venture, employee benefit plan, trust or other enterprise,
Indemnitee shall stand in the same position under the provisions of this
Agreement with respect to the resulting or surviving corporation as Indemnitee
would have with respect to such constituent corporation if its separate
existence had continued.

              (d) "Covered Event" shall mean any event or occurrence related to
the fact that Indemnitee is or was a director, officer, employee, agent or
fiduciary of the Company, or any subsidiary of the Company, or is or was serving
at the request of the Company as a director, officer, employee, agent or
fiduciary of another corporation, partnership, joint venture, trust or other
enterprise, or by reason of any action or inaction on the part of Indemnitee
while serving in such capacity.

              (e) "Expenses" shall mean any and all expenses (including
attorneys' fees and all other costs, expenses and obligations incurred in
connection with investigating, defending, being a witness in or participating in
(including on appeal), or preparing to defend, to be a witness in or to
participate in, any action, suit, proceeding, alternative dispute resolution
mechanism, hearing, inquiry or investigation), judgments, fines, penalties and
amounts paid in settlement (if such settlement is approved in advance by the
Company, which approval shall not be unreasonably withheld) of any Claim and any
federal, state, local or foreign taxes imposed on the Indemnitee as a result of
the actual or deemed receipt of any payments under this Agreement.

              (f)  "Expense Advance" shall mean a payment to Indemnitee pursuant
to Section 3 of Expenses in advance of the settlement of or final judgement in
any action, suit, proceeding or alternative dispute resolution mechanism,
hearing, inquiry or investigation which constitutes a Claim.

DELAWARE INDEMNIFICATION AGREEMENT     2                                    9/98
<PAGE>   3

              (g) "Independent Legal Counsel" shall mean an attorney or firm of
attorneys, selected in accordance with the provisions of Section 2(d) hereof,
who shall not have otherwise performed services for the Company or Indemnitee
within the last three years (other than with respect to matters concerning the
rights of Indemnitee under this Agreement, or of other Indemnitees under similar
indemnity agreements).

              (h) References to "other enterprises" shall include employee
benefit plans; references to "fines" shall include any excise taxes assessed on
Indemnitee with respect to an employee benefit plan; and references to "serving
at the request of the Company" shall include any service as a director, officer,
employee, agent or fiduciary of the Company which imposes duties on, or involves
services by, such director, officer, employee, agent or fiduciary with respect
to an employee benefit plan, its participants or its beneficiaries; and if
Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to
be in the interest of the participants and beneficiaries of an employee benefit
plan, Indemnitee shall be deemed to have acted in a manner "not opposed to the
best interests of the Company" as referred to in this Agreement.

              (i) "Reviewing Party" shall mean, subject to the provisions of
Section 2(d), any person or body appointed by the Board of Directors in
accordance with applicable law to review the Company's obligations hereunder and
under applicable law, which may include a member or members of the Company's
Board of Directors, Independent Legal Counsel or any other person or body not a
party to the particular Claim for which Indemnitee is seeking indemnification.

              (j)  "Section" refers to a section of this Agreement unless
otherwise indicated.

              (k) "Voting Securities" shall mean any securities of the Company
that vote generally in the election of directors.

2.  INDEMNIFICATION.

              (a) Indemnification of Expenses. Subject to the provisions of
Section 2(b) below, the Company shall indemnify Indemnitee for Expenses to the
fullest extent permitted by law if Indemnitee was or is or becomes a party to or
witness or other participant in, or is threatened to be made a party to or
witness or other participant in, any Claim (whether by reason of or arising in
part out of a Covered Event), including all interest, assessments and other
charges paid or payable in connection with or in respect of such Expenses.

              (b) Review of Indemnification Obligations. Notwithstanding the
foregoing, in the event any Reviewing Party shall have determined (in a written
opinion, in any case in which Independent Legal Counsel is the Reviewing Party)
that Indemnitee is not entitled to be indemnified hereunder under applicable
law, (i) the Company shall have no further obligation under Section 2(a) to make
any payments to Indemnitee not made prior to such determination by such
Reviewing Party, and (ii) the Company shall be entitled to be reimbursed by
Indemnitee (who hereby agrees to reimburse the Company) for all Expenses
theretofore paid to Indemnitee to which Indemnitee is not entitled hereunder
under applicable law; provided, however, that if Indemnitee has commenced or
thereafter commences legal proceedings in a court of competent jurisdiction to
secure a determination that Indemnitee is entitled to be indemnified hereunder
under applicable law, any determination made by any Reviewing Party that
Indemnitee is not entitled to be indemnified hereunder under applicable law
shall not be binding and Indemnitee shall not be required to reimburse the
Company for any Expenses theretofore paid in indemnifying Indemnitee until a
final judicial determination is made with respect thereto (as to which all
rights of appeal therefrom have been exhausted or lapsed). Indemnitee's
obligation to reimburse the Company for any Expenses shall be unsecured and no
interest shall be charged thereon.

DELAWARE INDEMNIFICATION AGREEMENT     3                                    9/98
<PAGE>   4

              (c) Indemnitee Rights on Unfavorable Determination: Binding
Effect. If any Reviewing Party determines that Indemnitee substantively is not
entitled to be indemnified hereunder in whole or in part under applicable law,
Indemnitee shall have the right to commence litigation seeking an initial
determination by the court or challenging any such determination by such
Reviewing Party or any aspect thereof, including the legal or factual bases
therefor, and, subject to the provisions of Section 15, the Company hereby
consents to service of process and to appear in any such proceeding. Absent such
litigation, any determination by any Reviewing Party shall be conclusive and
binding on the Company and Indemnitee.

              (d) Selection of Reviewing Party: Change in Control. If there has
not been a Change in Control, any Reviewing Party shall be selected by the Board
of Directors, and if there has been such a Change in Control (other than a
Change in Control which has been approved by a majority of the Company's Board
of Directors who were directors immediately prior to such Change in Control),
any Reviewing Party with respect to all matters thereafter arising concerning
the rights of Indemnitee to indemnification of Expenses under this Agreement or
any other agreement or under the Company's Certificate of Incorporation or
Bylaws as now or hereafter in effect, or under any other applicable law, if
desired by Indemnitee, shall be Independent Legal Counsel selected by Indemnitee
and approved by the Company (which approval shall not be unreasonably withheld).
Such counsel, among other things, shall render its written opinion to the
Company and Indemnitee as to whether and to what extent Indemnitee would be
entitled to be indemnified hereunder under applicable law and the Company agrees
to abide by such opinion. The Company agrees to pay the reasonable fees of the
Independent Legal Counsel referred to above and to indemnify fully such counsel
against any and all expenses (including attorneys' fees), claims, liabilities
and damages arising out of or relating to this Agreement or its engagement
pursuant hereto. Notwithstanding any other provision of this Agreement, the
Company shall not be required to pay Expenses of more than one Independent Legal
Counsel in connection with all matters concerning a single Indemnitee, and such
Independent Legal Counsel shall be the Independent Legal Counsel for any or all
other Indemnitees unless (i) the employment of separate counsel by one or more
Indemnitees has been previously authorized by the Company in writing, or (ii) an
Indemnitee shall have provided to the Company a written statement that such
Indemnitee has reasonably concluded that there may be a conflict of interest
between such Indemnitee and the other Indemnitees with respect to the matters
arising under this Agreement.

              (e) Mandatory Payment of Expenses. Notwithstanding any other
provision of this Agreement other than Section 10 hereof, to the extent that
Indemnitee has been successful on the merits or otherwise, including, without
limitation, the dismissal of an action without prejudice, in defense of any
Claim, Indemnitee shall be indemnified against all Expenses incurred by
Indemnitee in connection therewith.

3.   EXPENSE ADVANCES.

              (a) Obligation to Make Expense Advances. Upon receipt of a written
undertaking by or on behalf of the Indemnitee to repay such amounts if it shall
ultimately be determined that the Indemnitee is not entitled to be indemnified
therefore by the Company hereunder under applicable law, the Company shall make
Expense Advances to Indemnitee.

              (b) Form of Undertaking. Any obligation to repay any Expense
Advances hereunder pursuant to a written undertaking by the Indemnitee shall be
unsecured and no interest shall be charged thereon.

              (c) Determination of Reasonable Expense Advances. The parties
agree that for the purposes of any Expense Advance for which Indemnitee has made
written demand to the Company in

DELAWARE INDEMNIFICATION AGREEMENT     4                                    9/98
<PAGE>   5

accordance with this Agreement, all Expenses included in such Expense Advance
that are certified by affidavit of Indemnitee's counsel as being reasonable
shall be presumed conclusively to be reasonable.

4.  PROCEDURES FOR INDEMNIFICATION AND EXPENSE ADVANCES.

              (a) Timing of Payments. All payments of Expenses (including
without limitation Expense Advances) by the Company to the Indemnitee pursuant
to this Agreement shall be made to the fullest extent permitted by law as soon
as practicable after written demand by Indemnitee therefor is presented to the
Company, but in no event later than thirty (30) business days after such written
demand by Indemnitee is presented to the Company, except in the case of Expense
Advances, which shall be made no later than ten (10) business days after such
written demand by Indemnitee is presented to the Company.

              (b) Notice/Cooperation by Indemnitee. Indemnitee shall, as a
condition precedent to Indemnitee's right to be indemnified or Indemnitee's
right to receive Expense Advances under this Agreement, give the Company notice
in writing as soon as practicable of any Claim made against Indemnitee for which
indemnification will or could be sought under this Agreement. Notice to the
Company shall be directed to the Chief Executive Officer of the Company at the
address shown on the signature page of this Agreement (or such other address as
the Company shall designate in writing to Indemnitee). In addition, Indemnitee
shall give the Company such information and cooperation as it may reasonably
require and as shall be within Indemnitee's power.

              (c) No Presumptions: Burden of Proof. For purposes of this
Agreement, the termination of any Claim by judgment, order, settlement (whether
with or without court approval) or conviction, or upon a plea of nolo
contendere, or its equivalent, shall not create a presumption that Indemnitee
did not meet any particular standard of conduct or have any particular belief or
that a court has determined that indemnification is not permitted by this
Agreement or applicable law. In addition, neither the failure of any Reviewing
Party to have made a determination as to whether Indemnitee has met any
particular standard of conduct or had any particular belief, nor an actual
determination by any Reviewing Party that Indemnitee has not met such standard
of conduct or did not have such belief, prior to the commencement of legal
proceedings by Indemnitee to secure a judicial determination that Indemnitee
should be indemnified under this Agreement under applicable law, shall be a
defense to Indemnitee's claim or create a presumption that Indemnitee has not
met any particular standard of conduct or did not have any particular belief. In
connection with any determination by any Reviewing Party or otherwise as to
whether the Indemnitee is entitled to be indemnified hereunder under applicable
law, the burden of proof shall be on the Company to establish that Indemnitee is
not so entitled.

              (d) Notice to Insurers. If, at the time of the receipt by the
Company of a notice of a Claim pursuant to Section 4(b) hereof, the Company has
liability insurance in effect which may cover such Claim, the Company shall give
prompt notice of the commencement of such Claim to the insurers in accordance
with the procedures set forth in the respective policies. The Company shall
thereafter take all necessary or desirable action to cause such insurers to pay,
on behalf of the Indemnitee, all amounts payable as a result of such Claim in
accordance with the terms of such policies.

              (e) Selection of Counsel. In the event the Company shall be
obligated hereunder to provide indemnification for or make any Expense Advances
with respect to the Expenses of any Claim, the Company, if appropriate, shall be
entitled to assume the defense of such Claim with counsel approved by Indemnitee
(which approval shall not be unreasonably withheld) upon the delivery to
Indemnitee of written notice of the Company's election to do so. After delivery
of such notice, approval of such counsel by Indemnitee and the retention of such
counsel by the Company, the Company will not be liable to Indemnitee under this
Agreement for any fees or expenses of separate

DELAWARE INDEMNIFICATION AGREEMENT     5                                    9/98
<PAGE>   6

counsel subsequently retained by or on behalf of Indemnitee with respect to the
same Claim; provided that, (i) Indemnitee shall have the right to employ
Indemnitee's separate counsel in any such Claim at Indemnitee's expense and (ii)
if (A) the employment of separate counsel by Indemnitee has been previously
authorized by the Company, (B) Indemnitee shall have reasonably concluded that
there may be a conflict of interest between the Company and Indemnitee in the
conduct of any such defense, or (C) the Company shall not continue to retain
such counsel to defend such Claim, then the fees and expenses of Indemnitee's
separate counsel shall be Expenses for which Indemnitee may receive
indemnification or Expense Advances hereunder.

 5.  ADDITIONAL INDEMNIFICATION RIGHTS; NONEXCLUSIVITY.

              (a) Scope. The Company hereby agrees to indemnify the Indemnitee
 to the fullest extent permitted by law, notwithstanding that such
 indemnification is not specifically authorized by the other provisions of this
 Agreement, the Company's Certificate of Incorporation, the Company's Bylaws or
 by statute. In the event of any change after the date of this Agreement in any
 applicable law, statute or rule which expands the right of a Delaware
 corporation to indemnify a member of its board of directors or an officer,
 employee, agent or fiduciary, it is the intent of the parties hereto that
 Indemnitee shall enjoy by this Agreement the greater benefits afforded by such
 change. In the event of any change in any applicable law, statute or rule which
 narrows the right of a Delaware corporation to indemnify a member of its board
 of directors or an officer, employee, agent or fiduciary, such change, to the
 extent not otherwise required by such law, statute or rule to be applied to
 this Agreement, shall have no effect on this Agreement or the parties' rights
 and obligations hereunder except as set forth in Section 10(a) hereof.

              (b) Nonexclusivity. The indemnification and the payment of Expense
Advances provided by this Agreement shall be in addition to any rights to which
Indemnitee may be entitled under the Company's Certificate of Incorporation, its
Bylaws, any other agreement, any vote of stockholders or disinterested
directors, the General Corporation Law of the State of Delaware, or otherwise.
The indemnification and the payment of Expense Advances provided under this
Agreement shall continue as to Indemnitee for any action taken or not taken
while serving in an indemnified capacity even though subsequent thereto
Indemnitee may have ceased to serve in such capacity.

6. NO DUPLICATION OF PAYMENTS. The Company shall not be liable under this
Agreement to make any payment in connection with any Claim made against
Indemnitee to the extent Indemnitee has otherwise actually received payment
(under any insurance policy, provision of the Company's Certificate of
Incorporation, Bylaws or otherwise) of the amounts otherwise payable hereunder.

7. PARTIAL INDEMNIFICATION. If Indemnitee is entitled under any provision of
this Agreement to indemnification by the Company for some or a portion of
Expenses incurred in connection with any Claim, but not, however, for all of the
total amount thereof, the Company shall nevertheless indemnify Indemnitee for
the portion of such Expenses to which Indemnitee is entitled.

8. MUTUAL ACKNOWLEDGMENT. Both the Company and Indemnitee acknowledge that in
certain instances, federal law or applicable public policy may prohibit the
Company from indemnifying its directors, officers, employees, agents or
fiduciaries under this Agreement or otherwise. Indemnitee understands and
acknowledges that the Company has undertaken or may be required in the future to
undertake with the Securities and Exchange Commission to submit the question of
indemnification to a court in certain circumstances for a determination of the
Company's right under public policy to indemnify Indemnitee.

9. LIABILITY INSURANCE. To the extent the Company maintains liability insurance
applicable to directors, officers, employees, agents or fiduciaries, Indemnitee
shall be covered by such policies in

DELAWARE INDEMNIFICATION AGREEMENT     6                                    9/98
<PAGE>   7

such a manner as to provide Indemnitee the same rights and benefits as are
provided to the most favorably insured of the Company's directors, if Indemnitee
is a director; or of the Company's officers, if Indemnitee is not a director of
the Company but is an officer; or of the Company's key employees, agents or
fiduciaries, if Indemnitee is not an officer or director but is a key employee,
agent or fiduciary.

10. EXCEPTIONS. Notwithstanding any other provision of this Agreement, the
Company shall not be obligated pursuant to the terms of this Agreement:

              (a) Excluded Action or Omissions. To indemnify or make Expense
Advances to Indemnitee with respect to Claims arising out of acts, omissions or
transactions for which Indemnitee is prohibited from receiving indemnification
under applicable law.

              (b) Claims Initiated by Indemnitee. To indemnify or make Expense
Advances to Indemnitee with respect to Claims initiated or brought voluntarily
by Indemnitee and not by way of defense, counterclaim or crossclaim, except (i)
with respect to actions or proceedings brought to establish or enforce a right
to indemnification under this Agreement or any other agreement or insurance
policy or under the Company's Certificate of Incorporation or Bylaws now or
hereafter in effect relating to Claims for Covered Events, (ii) in specific
cases if the Board of Directors has approved the initiation or bringing of such
Claim, or (iii) as otherwise required under Section 145 of the Delaware General
Corporation Law, regardless of whether Indemnitee ultimately is determined to be
entitled to such indemnification, Expense Advances, or insurance recovery, as
the case may be.

              (c) Lack of Good Faith. To indemnify Indemnitee for any Expenses
incurred by the Indemnitee with respect to any action instituted (i) by
Indemnitee to enforce or interpret this Agreement, if a court having
jurisdiction over such action determines as provided in Section 13 that each of
the material assertions made by the Indemnitee as a basis for such action was
not made in good faith or was frivolous, or (ii) by or in the name of the
Company to enforce or interpret this Agreement, if a court having jurisdiction
over such action determines as provided in Section 13 that each of the material
defenses asserted by Indemnitee in such action was made in bad faith or was
frivolous.

              (d) Claims Under Section 16(b). To indemnify Indemnitee for
Expenses and the payment of profits arising from the purchase and sale by
Indemnitee of securities in violation of Section 16(b) of the Securities
Exchange Act of 1934, as amended, or any similar successor statute.

11. COUNTERPARTS. This Agreement may be executed in one or more counterparts,
each of which shall constitute an original.

12. BINDING EFFECT; SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon
and inure to the benefit of and be enforceable by the parties hereto and their
respective successors, assigns (including any direct or indirect successor by
purchase, merger, consolidation or otherwise to all or substantially all of the
business or assets of the Company), spouses, heirs and personal and legal
representatives. The Company shall require and cause any successor (whether
direct or indirect, and whether by purchase, merger, consolidation or otherwise)
to all, substantially all, or a substantial part, of the business or assets of
the Company, by written agreement in form and substance satisfactory to
Indemnitee, expressly to assume and agree to perform this Agreement in the same
manner and to the same extent that the Company would be required to perform if
no such succession had taken place. This Agreement shall continue in effect
regardless of whether Indemnitee continues to serve as a director, officer,
employee, agent or fiduciary (as applicable) of the Company or of any other
enterprise at the Company's request.

DELAWARE INDEMNIFICATION AGREEMENT     7                                    9/98
<PAGE>   8

13. EXPENSES INCURRED IN ACTION RELATING TO ENFORCEMENT OR INTERPRETATION. In
the event that any action is instituted by Indemnitee under this Agreement or
under any liability insurance policies maintained by the Company to enforce or
interpret any of the terms hereof or thereof, Indemnitee shall be entitled to be
indemnified for all Expenses incurred by Indemnitee with respect to such action
(including without limitation attorneys' fees), regardless of whether Indemnitee
is ultimately successful in such action, unless as a part of such action a court
having jurisdiction over such action makes a final judicial determination (as to
which all rights of appeal therefrom have been exhausted or lapsed) that each of
the material assertions made by Indemnitee as a basis for such action was not
made in good faith or was frivolous; provided, however, that until such final
judicial determination is made, Indemnitee shall be entitled under Section 3 to
receive payment of Expense Advances hereunder with respect to such action. In
the event of an action instituted by or in the name of the Company under this
Agreement to enforce or interpret any of the terms of this Agreement, Indemnitee
shall be entitled to be indemnified for all Expenses incurred by Indemnitee in
defense of such action (including without limitation costs and expenses incurred
with respect to Indemnitee's counterclaims and cross-claims made in such
action), unless as a part of such action a court having jurisdiction over such
action makes a final judicial determination (as to which all rights of appeal
therefrom have been exhausted or lapsed) that each of the material defenses
asserted by Indemnitee in such action was made in bad faith or was frivolous;
provided, however, that until such final judicial determination is made,
Indemnitee shall be entitled under Section 3 to receive payment of Expense
Advances hereunder with respect to such action.

14. PERIOD OF LIMITATIONS. No legal action shall be brought and no cause of
action shall be asserted by or in the right of the Company against Indemnitee,
Indemnitee's estate, spouse, heirs, executors or personal or legal
representatives after the expiration of two years from the date of accrual of
such cause of action, and any claim or cause of action of the Company shall be
extinguished and deemed released unless asserted by the timely filing of a legal
action within such two year period; provided, however, that if any shorter
period of limitations is otherwise applicable to any such cause of action, such
shorter period shall govern.

15. NOTICE. All notices, requests, demands and other communications under this
Agreement shall be in writing and shall be deemed duly given (i) if delivered by
hand and signed for by the party addressed, on the date of such delivery, or
(ii) if mailed by domestic certified or registered mail with postage prepaid, on
the third business day after the date postmarked. Addresses for notice to either
party are as shown on the signature page of this Agreement, or as subsequently
modified by written notice.

16. CONSENT TO JURISDICTION. The Company and Indemnitee each hereby irrevocably
consent to the jurisdiction of the courts of the State of Delaware for all
purposes in connection with any action or proceeding which arises out of or
relates to this Agreement and agree that any action instituted under this
Agreement shall be commenced, prosecuted and continued only in the Court of
Chancery of the State of Delaware in and for New Castle County, which shall be
the exclusive and only proper forum for adjudicating such a claim.

17. SEVERABILITY. The provisions of this Agreement shall be severable in the
event that any of the provisions hereof (including any provision within a single
section, paragraph or sentence) are held by a court of competent jurisdiction to
be invalid, void or otherwise unenforceable, and the remaining provisions shall
remain enforceable to the fullest extent permitted by law. Furthermore, to the
fullest extent possible, the provisions of this Agreement (including without
limitation each portion of this Agreement containing any provision held to be
invalid, void or otherwise unenforceable, that is not itself invalid, void or
unenforceable) shall be construed so as to give effect to the intent manifested
by the provision held invalid, illegal or unenforceable.

DELAWARE INDEMNIFICATION AGREEMENT     8                                    9/98
<PAGE>   9

18. CHOICE OF LAW. This Agreement, and all rights, remedies, liabilities, powers
and duties of the parties to this Agreement, shall be governed by and construed
in accordance with the laws of the State of Delaware as applied to contracts
between Delaware residents entered into and to be performed entirely in the
State of Delaware without regard to principles of conflicts of laws.

19. SUBROGATION. In the event of payment under this Agreement, the Company shall
be subrogated to the extent of such payment to all of the rights of recovery of
Indemnitee, who shall execute all documents required and shall do all acts that
may be necessary to secure such rights and to enable the Company effectively to
bring suit to enforce such rights.

20. AMENDMENT AND TERMINATION. No amendment, modification, termination or
cancellation of this Agreement shall be effective unless it is in writing signed
by both the parties hereto. No waiver of any of the provisions of this Agreement
shall be deemed to be or shall constitute a waiver of any other provisions
hereof (whether or not similar), nor shall such waiver constitute a continuing
waiver.

21. INTEGRATION AND ENTIRE AGREEMENT. This Agreement sets forth the entire
understanding between the parties hereto and supersedes and merges all previous
written and oral negotiations, commitments, understandings and agreements
relating to the subject matter hereof between the parties hereto.

22. NO CONSTRUCTION AS EMPLOYMENT AGREEMENT. Nothing contained in this Agreement
shall be construed as giving Indemnitee any right to be retained in the employ
of the Company or any of its subsidiaries or affiliated entities. i i i IN

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

          CIRRUS LOGIC, INC.

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

          AGREED TO AND ACCEPTED

          INDEMNITEE:

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

DELAWARE INDEMNIFICATION AGREEMENT     9                                    9/98

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