Document:

<PAGE>
                                                                    EXHIBIT 10.3

                                 EXECUTION COPY

                                CREDIT AGREEMENT

                          Dated as of January 25, 2002

                                      among

                             LONGVIEW FIBRE COMPANY
                                   as Borrower

                                   THE LENDERS
                         FROM TIME TO TIME PARTY HERETO

                                       and

                              BANK OF AMERICA, N.A.
                             as Administrative Agent

                                      with

                         BANC OF AMERICA SECURITIES LLC
                   as Sole Lead Arranger and Sole Book Manager

                             THE BANK OF NOVA SCOTIA

                                       and

                             WELLS FARGO BANK, N.A.
                            as Co-Syndication Agents

                                       and

                       NORTHWEST FARM CREDIT SERVICES, PCA
                             as Documentation Agent

                                     Page 1
<PAGE>

                               TABLE OF CONTENTS

<TABLE>
<S>                                                                           <C>
SECTION 1  DEFINITIONS                                                         1
1.1  Definitions.                                                              1
1.2  Computation of Time Periods.                                             25
1.3  Accounting Terms.                                                        25
SECTION 2  CREDIT FACILITIES                                                  26
2.1  Revolving Loans.                                                         26
2.2  Letter of Credit Subfacility.                                            28
2.3  Swingline Loans and Procedure.                                           34
SECTION 3  OTHER PROVISIONS RELATING TO CREDIT FACILITIES                     36
3.1  Default Rate.                                                            36
3.2  Extension and Conversion.                                                36
3.3  Prepayments.                                                             37
3.4  Termination and Reduction of Revolving Committed Amount.                 39
3.5  Fees.                                                                    40
3.6  Capital Adequacy.                                                        41
3.7  Limitation on Eurodollar Loans.                                          41
3.8  Illegality.                                                              41
3.9  Requirements of Law.                                                     42
3.10 Treatment of Affected Loans.                                             43
3.11 Taxes.                                                                   43
3.12 Compensation.                                                            45
3.13 Pro Rata Treatment.                                                      46
3.14 Sharing of Payments.                                                     47
3.15 Payments, Computations, Etc.                                             48
3.16 Evidence of Debt.                                                        49
3.17 Replacement of Affected Lenders.                                         50
SECTION 4  CONDITIONS                                                         51
4.1  Closing Conditions.                                                      51
4.2  Conditions to all Extensions of Credit.                                  53
SECTION 5  REPRESENTATIONS AND WARRANTIES                                     54
5.1  Financial Condition.                                                     54
5.2  No Material Change.                                                      55
5.3  Organization and Good Standing.                                          55
5.4  Power; Authorization; Enforceable Obligations.                           55
5.5  No Conflicts.                                                            56
5.6  No Default.                                                              56
5.7  Ownership.                                                               56
5.8  Indebtedness.                                                            56
5.9  Litigation.                                                              56
5.10 Taxes.                                                                   56
5.11 Compliance with Law.                                                     57
5.12 ERISA.                                                                   57
5.13 Corporate Structure; Capital Stock, Etc.                                 58
5.14 Governmental Regulations, Etc.                                           59
5.15 Purpose of Loans and Letters of Credit.                                  59
5.16 Environmental Matters.                                                   60
5.17 Intellectual Property.                                                   61
5.18 Solvency.                                                                61
5.19 Investments.                                                             61
5.20 Disclosure.                                                              61
5.21 No Burdensome Restrictions.                                              61
5.22 Brokers' Fees.                                                           61
5.23 Labor Matters.                                                           61
SECTION 6  AFFIRMATIVE COVENANTS                                              62
6.1  Information Covenants.                                                   62
6.2  Preservation of Existence and Franchises.                                65
6.3  Books and Records.                                                       65
6.4  Compliance with Law.                                                     65
6.5  Payment of Taxes and Other Claims.                                       65
6.6  Insurance.                                                               66
6.7  Maintenance of Property; Management of Timberlands.                      66
6.8  Use of Proceeds.                                                         66
6.9  Audits/Inspections.                                                      67
6.10 Financial Covenants.                                                     67
6.11 Notice of Ratings Change.                                                67
6.12 Performance of Obligations.                                              68
SECTION 7  NEGATIVE COVENANTS                                                 68
7.1   Indebtedness.                                                           68
7.2   Liens.                                                                  69
7.3   Nature of Business.                                                     71
7.4   Consolidation, Merger, Dissolution, etc.                                72
7.5   Asset Dispositions.                                                     72
7.6   Investments.                                                            73
7.7   Restricted Payments.                                                    74
7.8   Limitation on Actions with Respect to Other Indebtedness.               75
7.9   Transactions with Affiliates.                                           76
7.10  Fiscal Year; Organizational Documents.                                  76
7.11  Limitation on Restricted Actions.                                       77
7.12  Ownership of Subsidiaries.                                              77
7.13  Sale Leasebacks.                                                        77
7.14  No Further Negative Pledges.                                            77
7.15  Operating Lease Obligations.                                            78
7.16  Subsidiaries.                                                           78
</TABLE>

                                     Page 2
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<TABLE>
<S>                                                                           <C>
SECTION 8  EVENTS OF DEFAULT                                                  78
8.1   Events of Default.                                                      78
8.2   Acceleration; Remedies.                                                 81
SECTION 9  AGENCY PROVISIONS                                                  82
9.1   Appointment and Authorization of Agent.                                 82
9.2   Delegation of Duties.                                                   82
9.3   Liability of Agent.                                                     83
9.4   Reliance by Agent.                                                      83
9.5   Notice of Default.                                                      84
9.6   Credit Decision; Disclosure of Information by Agent.                    84
9.7   Indemnification of Agent.                                               85
9.8   Agent in its Individual Capacity.                                       85
9.9   Successor Agent.                                                        85
9.10  Other Agents; Lead Managers.                                            86
SECTION 10  MISCELLANEOUS                                                     86
10.1  Notices.                                                                86
10.2  Right of Set-Off; Adjustments.                                          88
10.3  Successors and Assigns.                                                 88
10.4  No Waiver; Remedies Cumulative.                                         92
10.5  Expenses; Indemnification.                                              93
10.6  Amendments, Waivers and Consents.                                       94
10.7  Counterparts.                                                           96
10.8  Headings.                                                               96
10.9  Survival.                                                               96
10.10 Governing Law; Submission to Jurisdiction; Venue; Waiver of Jury Trial. 96
10.11 Severability.                                                           97
10.12 Entirety.                                                               97
10.13 Binding Effect; Termination.                                            98
10.14 Confidentiality.                                                        98
10.15 Source of Funds.                                                        99
10.16 Regulation D.                                                           99
10.17 Conflict.                                                              100
</TABLE>

SCHEDULES

Schedule 2.1(a)   Lenders
Schedule 2.2(a)   Existing Letters of Credit
Schedule 2.2(l)   Reimbursement Agreements
Schedule 5.4      Required Consents, Authorizations, Notices and Filings
Schedule 5.9      Litigation
Schedule 5.12     ERISA
Schedule 5.13     Subsidiaries
Schedule 5.16     Environmental Disclosures
Schedule 6.6      Insurance
Schedule 7.1      Indebtedness
Schedule 7.2      Liens
Schedule 7.6      Investments

EXHIBITS

Exhibit 2.1(b)(i) Form of Notice of Borrowing
Exhibit 2.1(e)    Form of Revolving Note
Exhibit 2.3(b)    Form of Swingline Loan Request
Exhibit 2.3(e)    Form of Swingline Note
Exhibit 3.2       Form of Notice of Extension/Conversion
Exhibit 6.1(c)    Form of Officer's Compliance Certificate
Exhibit 10.3      Form of Assignment and Acceptance

                                     Page 3
<PAGE>

                                CREDIT AGREEMENT

THIS CREDIT AGREEMENT, dated as of January 25, 2002 (as amended, modified,
restated or supplemented from time to time, the "Credit Agreement"), is by and
among LONGVIEW FIBRE COMPANY, a Washington corporation (the "Borrower"), the
Lenders (as defined herein) and BANK OF AMERICA, N.A., as Administrative Agent
for the Lenders (in such capacity, the "Agent").

                               W I T N E S S E T H

WHEREAS, the Borrower has requested that the Lenders provide revolving loans and
letters of credit in an aggregate amount of up to $250,000,000 (the "Credit
Facilities") for the purposes hereinafter set forth; and

WHEREAS, the Lenders have agreed to make the requested Credit Facilities
available to the Borrower on the terms and conditions hereinafter set forth;

NOW, THEREFORE, IN CONSIDERATION of the premises and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereto agree as follows:

SECTION 1

DEFINITIONS

1.1     Definitions.

As used in this Credit Agreement, the following terms shall have the meanings
specified below unless the context otherwise requires:

"Acquisition", by any Person, means the acquisition by such Person of all of the
Capital Stock or all or substantially all of the Property of another Person or a
division or business unit thereof, whether or not involving a merger or
consolidation with such other Person.

"Adjusted Base Rate" means the Base Rate plus the Applicable Percentage.

"Adjusted Eurodollar Rate" means the Eurodollar Rate plus the Applicable
Percentage.

"Affiliate" means, with respect to any Person, any other Person (i) directly or
indirectly controlling or controlled by or under direct or indirect common
control with such Person or (ii) directly or indirectly owning or holding twenty
percent (20%) or more of the Capital Stock in such Person. For purposes of this
definition, "control" when used with respect to any Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.

"Agency Services Address" means Bank of America, N.A., Agency Administration
Services #5596, Mail Code: CA4-706-05-09, 1850 Gateway Boulevard, 5th Floor,
Concord, CA 94520, Attention: Mark Garcia or such other address as may be
identified by written notice from the Agent to the Borrower.

"Agent" shall have the meaning assigned to such term in the heading hereof,
together with any successors or assigns.

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

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"Agent's Fee Letter" means that certain letter agreement, dated as of October 3,
2001 between the Agent and the Borrower, as amended, modified, restated or
supplemented from time to time.

"Applicable Lending Office" means, for each Lender, the office of such Lender
(or of an Affiliate of such Lender) as such Lender may from time to time specify
to the Agent and the Borrower by written notice as the office by which its
Eurodollar Loans are made and maintained.

"Applicable Percentage" means, for purposes of calculating the applicable
interest rate for any day for any Revolving Loan, the applicable rate of the
Unused Fee for any day for purposes of Section 3.5(a) or the applicable rate of
the Letter of Credit Fee for any day for purposes of Section 3.5(b), the
appropriate applicable percentage corresponding to the Funded Indebtedness to
Capitalization Ratio in effect as of the most recent Calculation Date:

<TABLE>
<CAPTION>
                                               Applicable Percentages

                 Funded            For         For    For Letter  For Unused
Pricing     Indebtedness to    Eurodollar  Base Rate   of Credit      Fee
Level    Capitalization Ratio     Loans      Loans        Fee
<S>      <C>          <C>        <C>         <C>         <C>         <C>
I          <35.0%                1.625%      0.375%      1.625%      0.45%
II       <40.0% but > 35.0%       2.00%       0.75%       2.00%      0.50%
III      <50.0% but > 40.0%       2.25%       1.00%       2.25%      0.55%
IV       <60.0% but > 50.0%       2.50%       1.25%       2.50%      0.60%
V        >60.0%                  2.875%      1.625%      2.875%      0.65%
</TABLE>

The Applicable Percentages shall be determined and adjusted quarterly on the
date (each a "Calculation Date") five (5) Business Days after the date by which
the Borrower is required to provide the officer's certificate in accordance with
the provisions of Section 6.1(c) for the most recently ended fiscal quarter of
the Consolidated Parties; provided, however, that (i) the initial Applicable
Percentages shall be based on Pricing Level IV (as shown above) and shall remain
at Pricing Level IV until the Calculation Date relating to the fiscal quarter of
the Consolidated Parties ending on January 31, 2002 on and after which time the
Pricing Level shall be determined by the Funded Indebtedness to Capitalization
Ratio as of the last day of the most recently ended fiscal quarter of the
Consolidated Parties preceding the applicable Calculation Date and (ii) if the
Borrower fail to provide the officer's certificate to the Agency Services
Address as required by Section 6.1(c) for the last day of the most recently
ended fiscal quarter of the Consolidated Parties preceding the applicable
Calculation Date, the Applicable Percentage from such Calculation Date shall be
based on Pricing Level V until such time as an appropriate officer's certificate
is provided, whereupon the Pricing Level shall be determined by the Funded
Indebtedness to Capitalization Ratio as of the last day of the most recently
ended fiscal quarter of the Consolidated Parties preceding such Calculation
Date. Each Applicable Percentage shall be effective from one Calculation Date
until the next Calculation Date. Any adjustment in the Applicable Percentages
shall be applicable to all existing Loans and Letters of Credit as well as any
new Loans and Letters of Credit made or issued.

"Application Period" means, in respect of any Asset Disposition, the period of
360 days (or such earlier date on which an Event of Default shall have occurred
or as provided for reinvestment of the proceeds thereof under the Senior
Subordinated Note Indenture), following the consummation of such Asset
Disposition.

"Approved Fund" means any Fund that is administered or managed by (a) a

                                     Page 5
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Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an
entity that administers or manages a Lender.

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

"Asset Disposition" means any disposition (including pursuant to a Sale and
Leaseback Transaction) of any or all of the Property (including without
limitation the Capital Stock of a Subsidiary) of any Consolidated Party whether
by sale, lease, licensing, transfer or otherwise, but other than pursuant to any
casualty or condemnation event; provided, however, that (i) the term "Asset
Disposition" shall be deemed to include any "Asset Sale" (or any comparable
term) under, and as defined in, the Senior Subordinated Note Indenture or the
documents evidencing or governing any Subordinated Indebtedness, (ii) an Equity
Issuance shall not constitute an Asset Disposition and (iii) a sale of
inventory, electricity, timber or other assets in the ordinary course of
business shall not constitute an Asset Disposition.

"Asset Disposition Prepayment Event" means, with respect to any Asset
Disposition, the failure of the Borrower to apply (or cause to be applied) the
Net Cash Proceeds of such Asset Disposition to Eligible Reinvestments during the
Application Period for such Asset Disposition to the extent such Net Cash
Proceeds exceed $5,000,000.

"Assignment and Acceptance" means an Assignment and Acceptance substantially in
the form of Exhibit 10.3.

"Bank of America" means Bank of America, N.A. and its successors.

"Bankruptcy Code" means the Bankruptcy Code in Title 11 of the United States
Code, as amended, modified, succeeded or replaced from time to time.

"Bankruptcy Event" means, with respect to any Person, the occurrence of any of
the following: (i) the entry of a decree or order for relief by a court or
governmental agency in an involuntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, or the appointment
by a court or governmental agency of a receiver, liquidator, assignee,
custodian, trustee, sequestrator (or similar official) of such Person or for any
substantial part of its Property or the ordering of the winding up or
liquidation of its affairs by a court or governmental agency; or (ii) the
commencement against such Person of an involuntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, or of
any case, proceeding or other action for the appointment of a receiver,
liquidator, assignee, custodian, trustee, sequestrator (or similar official) of
such Person or for any substantial part of its Property or for the winding up or
liquidation of its affairs, and such involuntary case or other case, proceeding
or other action shall remain undismissed for a period of sixty (60) consecutive
days, or the repossession or seizure by a creditor of such Person of a
substantial part of its Property; or (iii) such Person shall commence a
voluntary case under any applicable bankruptcy, insolvency or other similar law
now or hereafter in effect, or consent to the entry of an order for relief in an
involuntary case under any such law, or consent to the appointment of or the
taking possession by a receiver, liquidator, assignee, secured creditor,
custodian, trustee, sequestrator (or similar official) of such Person or for any
substantial part of its Property or make any general assignment for the benefit
of creditors; or (iv) such Person shall be unable to, or shall admit in writing
its inability to, pay its debts generally as they become due.

"Base Rate" means, for any day, a fluctuating rate per annum equal to

                                     Page 6
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the higher of (a) the Federal Funds Rate in effect on such day plus 1/2 of 1%
or (b) the Prime Rate in effect on such day.

"Base Rate Loan" means any Loan bearing interest at a rate determined by
reference to the Base Rate.

"Borrower" means the Person identified as such in the heading hereof, together
with any permitted successors and assigns.

"Business Day" means a day other than a Saturday, Sunday or other day on which
commercial banks in San Francisco, California or New York, New York are
authorized or required by law to close, except that, when used in connection
with a Eurodollar Loan, such day shall also be a day on which dealings between
banks are carried on in Dollar deposits in London, England.

"Businesses" means, at any time, a collective reference to the businesses
operated by the Consolidated Parties at such time.

"Calculation Date" shall have the meaning assigned to such term in the
definition of "Applicable Percentage" set forth in this Section 1.1.

"Capital Lease" means, as applied to any Person, any lease of any Property
(whether real, personal or mixed) by that Person as lessee which, in accordance
with GAAP, is required to be accounted for as a capital lease on the balance
sheet of that Person.

"Capital Stock" means (i) in the case of a corporation, capital stock, (ii) in
the case of an association or business entity, any and all shares, interests,
participations, rights or other equivalents (however designated) of capital
stock, (iii) in the case of a partnership, partnership interests (whether
general or limited), (iv) in the case of a limited liability company, membership
interests and (v) any other interest or participation that confers on a Person
the right to receive a share of the profits and losses of, or distributions of
assets of, the issuing Person.

"Cash Equivalents" means, as at any date, (a) securities issued or directly and
fully guaranteed or insured by the United States or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States is pledged in support thereof) having maturities of not more than twelve
months from the date of acquisition, (b) Dollar denominated time deposits and
certificates of deposit of (i) any Lender, (ii) any domestic commercial bank of
recognized standing having capital and surplus in excess of $500,000,000 or
(iii) any bank whose short-term commercial paper rating from S&P is at least A-1
or the equivalent thereof or from Moody's is at least P-1 or the equivalent
thereof (any such bank being an "Approved Bank"), in each case with maturities
of not more than 270 days from the date of acquisition, (c) commercial paper and
variable or fixed rate notes issued by any Approved Bank (or by the parent
company thereof) or any variable rate notes issued by, or guaranteed by, any
domestic corporation rated A-1 (or the equivalent thereof) or better by S&P or
P-1 (or the equivalent thereof) or better by Moody's and maturing within six
months of the date of acquisition, (d) repurchase agreements entered into by any
Person with a bank or trust company (including any of the Lenders) or recognized
securities dealer having capital and surplus in excess of $500,000,000 for
direct obligations issued by or fully guaranteed by the United States in which
such Person shall have a perfected first priority security interest (subject to
no other Liens) and having, on the date of purchase thereof, a fair market value
of at least 100% of the amount of the repurchase obligations and (e)
Investments, classified in accordance with GAAP as current assets, in money
market investment programs registered

                                     Page 7
<PAGE>

under the Investment Company Act of 1940, as amended, which are administered by
reputable financial institutions having capital of at least $500,000,000 and the
portfolios of which are limited to Investments of the character described in the
foregoing subdivisions (a) through (d).

"Change of Control" means the occurrence of any of the following: (i) any
"person" or "group" (within the meaning of Sections 13(d) and 14(d)(2) of the
Securities Exchange Act of 1934) becomes the "beneficial owner" (as defined in
Rule l3d-3 under the Securities Exchange Act of 1934) of more than 35% of then
outstanding Voting Stock of the Borrower; (ii) the Borrower shall merge or
consolidate with any Person other than in a transaction permitted under Section
7.4; (iii) Continuing Directors shall fail to constitute a majority of the
members of the board of directors of the Borrower; (iv) any Asset Disposition
shall be made that (of itself or when combined with any or all other Asset
Dispositions) constitutes a sale of all or substantially all of the assets of
the Borrower and its Subsidiaries, taken as a whole; (v) any event shall occur
that constitutes a "Change of Control" (or any comparable term) under, and as
defined in, the documents evidencing or governing any Subordinated Indebtedness;
or (vi) any event shall occur that requires the Borrower or any Subsidiary to
repay, redeem, or repurchase (or to offer to repay, redeem or repurchase) any
Indebtedness outstanding in a principal amount in excess of $20,000,000 by
reason of any change of ownership or control affecting the Borrower or such
Subsidiary. "Closing Date" means the date hereof.

"Code" means the Internal Revenue Code of 1986, as amended, and any successor
statute thereto, as interpreted by the rules and regulations issued thereunder,
in each case as in effect from time to time. References to sections of the Code
shall be construed also to refer to any successor sections.

"Commitment" means (i) with respect to each Lender, the Revolving Commitment of
such Lender, (ii) with respect to the Issuing Lender, the LOC Commitment and
(iii) with respect to the Swingline Lender, the Swingline Commitment.

"Compensation Period" shall have the meaning set forth in Section
3.13(c)(ii)(B).

"Consolidated Capital Expenditures" means, as of any date for the four fiscal
quarter period ending on such date with respect to the Consolidated Parties on a
consolidated basis, all capital expenditures, as determined in accordance with
GAAP, including, without limitation, those capital expenditures related to
timberland operations; provided, however, that Consolidated Capital Expenditures
shall not include Eligible Reinvestments made with proceeds of any Involuntary
Disposition.

"Consolidated Cash Taxes" means, as of any date for the four fiscal quarter
period ending on such date with respect to the Consolidated Parties on a
consolidated basis, the aggregate of all income taxes paid in cash during such
period (irrespective of when such taxes were accrued), as determined in
accordance with GAAP.

"Consolidated EBITDDA" means, as of any date for the four fiscal quarter period
ending on such date with respect to the Consolidated Parties on a consolidated
basis, the sum of (i) Consolidated Net Income, plus (ii) an amount which, in the
determination of Consolidated Net Income, has been deducted for (A) Consolidated
Interest Expense, (B) income taxes and (C) depreciation, depletion and
amortization expense, all as determined in accordance with GAAP.

                                     Page 8
<PAGE>

"Consolidated Interest Expense" means, as of any date for the four
fiscal quarter period ending on such date with respect to the
Consolidated Parties on a consolidated basis, interest expense
(including the amortization of debt discount and premium, the interest
component under Capital Leases, the implied interest component under
Synthetic Leases and capitalized interest), as determined in accordance
with GAAP.

"Consolidated Net Income" means, as of any date for the applicable period ending
on such date with respect to the Consolidated Parties on a consolidated basis,
net income (excluding extraordinary items) after interest expense, income taxes
and depreciation and amortization, all as determined in accordance with GAAP (it
being understood that extraordinary items, if any, shall be excluded only to the
extent the Borrower's accountants have concurred with the treatment of such
items as "extraordinary" in accordance with GAAP and such items have been
disclosed in the Borrower's financial statements filed with the Securities and
Exchange Commission).

"Consolidated Net Worth" means, as of any date with respect to the Consolidated
Parties on a consolidated basis, shareholders' equity or net worth, as
determined in accordance with GAAP.

"Consolidated Parties" means a collective reference to the Borrower and its
Subsidiaries, and "Consolidated Party" means any one of them.

"Consolidated Tangible Net Worth" means, as of any date, with respect to the
Consolidated Parties on a consolidated basis, (a) the total assets of the
Consolidated Parties at such date as set forth on a consolidated balance sheet
of the Consolidated Parties prepared in accordance with GAAP (but excluding
therefrom for the purposes hereof, capitalized interest, debt discount and
expense, goodwill, patents, trademarks, copyrights, franchises, licenses,
amounts due from officers and directors, shareholders and Affiliates of the
Borrower and any other items which would be treated as intangibles under GAAP)
less (b) the total liabilities of the Consolidated Parties at such date as set
forth on a consolidated balance sheet of the Consolidated Parties prepared in
accordance with GAAP. "Consolidated Total Capitalization" means, as of any date
of determination with respect to the Consolidated Parties on a consolidated
basis, (i) Funded Indebtedness of the Consolidated Parties on a consolidated
basis as of such date plus (ii) Consolidated Net Worth of the Consolidated
Parties on a consolidated basis as of such date.

"Continue", "Continuation" and "Continued" shall refer to the continuation
pursuant to Section 3.2 hereof of a Eurodollar Loan from one Interest Period to
the next Interest Period.

"Continuing Director" means, as of any date of determination, any member of the
board of directors of the Borrower who (x) was a member of the board of
directors of the Borrower as of the Closing Date or (y) was nominated for
election or elected to such board of directors with the approval of a majority
of the Continuing Directors who were members of such board at the time of such
nomination or election.

"Convert", "Conversion" and "Converted" shall refer to a conversion pursuant to
Section 3.2 or Sections 3.7 through 3.12, inclusive, of a Base Rate Loan into a
Eurodollar Loan.

"Credit Documents" means a collective reference to this Credit Agreement, the
Notes, the LOC Documents and the Agent's Fee Letter (in each case as the same
may be amended, modified, restated, supplemented,

                                     Page 9
<PAGE>

extended, renewed or replaced from time to time), and "Credit Document" means
any one of them.

"Credit Facilities" shall have the meaning assigned to such term in the recitals
hereto.

"Debt Issuance" means the issuance by any Consolidated Party of any Indebtedness
of the type referred to in clause (a) or (b) of the definition thereof set forth
in this Section 1.1, other than any Indebtedness issued under this Credit
Agreement and the Senior Subordinated Notes, which would result, upon giving
effect on a Pro Forma Basis to the incurrence of such Indebtedness and to the
concurrent retirement of any other Indebtedness of any Consolidated Party, in
the Borrower being out of compliance with the financial covenants set forth in
Section 6.10(a)-(c).

"Debt Issuance Prepayment Event" means the receipt by any Consolidated Party of
proceeds from any Debt Issuance.

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

"Defaulting Lender" means, at any time, any Lender that, as determined by the
Agent, (a) has failed to make a Loan or purchase a Participation Interest
required pursuant to the term of this Credit Agreement within one Business Day
of when due, (b) other than as set forth in (a) above, has failed to pay to the
Agent or any Lender an amount owed by such Lender pursuant to the terms of this
Credit Agreement within one Business Day of when due, unless such amount is
subject to a good faith dispute or (c) has been deemed insolvent or has become
subject to a bankruptcy or insolvency proceeding or with respect to which (or
with respect to any of the assets of which) a receiver, trustee or similar
official has been appointed.

"Dollars" and "$" means dollars in lawful currency of the United States.

"Eligible Assignee" means (i) a Lender, (ii) an Affiliate of a Lender, (iii) an
Approved Fund and (iv) any other Person (other than a natural Person) approved
by the Agent and, unless (x) such Person is taking delivery of an assignment in
connection with physical settlement of a credit derivatives transaction or (y) a
Default or an Event of Default has occurred and is continuing, the Borrower
(each such approval not to be unreasonably withheld or delayed); provided,
however, that neither the Borrower nor an Affiliate of the Borrower shall
qualify as an Eligible Assignee.

"Eligible Reinvestment" means (i) any acquisition (whether or not constituting a
capital expenditure, but not constituting an Acquisition) of assets or any
business (or any substantial part thereof) used or useful in the same or a
similar line of business as the Borrower and its Subsidiaries were engaged in on
the Closing Date (or any reasonable extensions or expansions thereof) and (ii)
any Permitted Acquisition. The term "Eligible Reinvestment" shall not include
any item which is not a permitted application of proceeds of an "Asset Sale" (or
any comparable term) under, and as defined in the documents evidencing or
governing any Subordinated Indebtedness.

"Environmental Laws" means any and all applicable Federal, state, local
and foreign statutes, laws (including, without limitation, the
Comprehensive Environmental Response, Compensation and Liability Act of
1980, the Resource Conservation and Recovery Act of 1976, the Toxic
Substances Control Act, the Water Pollution Control Act, the Clean Air
Act and the Hazardous Materials Transportation Act), regulations,

                                    Page 10
<PAGE>

ordinances, rules, judgments, orders, decrees, permits, licenses, agreements or
other governmental restrictions relating to the environment or to emissions,
discharges, releases or threatened releases of Materials of Environmental
Concern into the environment including, without limitation, ambient air, surface
water, ground water, or land, or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport, or
handling of Materials of Environmental Concern.

"Equity Issuance" means any issuance by any Consolidated Party to any Person of
(a) shares of its Capital Stock, (b) any shares of its Capital Stock pursuant to
the exercise of options or warrants, (c) any shares of its Capital Stock
pursuant to the conversion of any debt securities to equity or (d) any options
or warrants relating to its Capital Stock. The term "Equity Issuance" shall not
be deemed to include (a) any Asset Disposition or (b) issuances pursuant to (x)
employee plans of the Borrower that are in place as of the Closing Date to the
extent such issuances are permitted pursuant to the documentation governing
those plans as in effect as of the Closing Date or (y) new employee plans of the
Borrower to the extent such issuances are consistent with past practices of the
Borrower.

"Equity Issuance Prepayment Event" means the receipt by any Consolidated Party
of proceeds from any Equity Issuance.

"ERISA" means the Employee Retirement Income Security Act of 1974, as amended,
and any successor statute thereto, as interpreted by the rules and regulations
thereunder, all as the same may be in effect from time to time. References to
sections of ERISA shall be construed also to refer to any successor sections.

"ERISA Affiliate" means an entity which is under common control with any
Consolidated Party within the meaning of Section 4001(a)(14) of ERISA, or is a
member of a group which includes any Consolidated Party and which is treated as
a single employer under Sections 414(b) or (c) of the Code.

"ERISA Event" means (i) with respect to any Single Employer Plan, the occurrence
of a Reportable Event or the substantial cessation of operations (within the
meaning of Section 4062(e) of ERISA); (ii) the withdrawal by any Consolidated
Party or any ERISA Affiliate from a Multiple Employer Plan during a plan year in
which it was a substantial employer (as such term is defined in Section
4001(a)(2) of ERISA), or the termination of a Multiple Employer Plan; (iii) the
distribution of a notice of intent to terminate or the actual termination of a
Plan pursuant to Section 4041(a)(2) or 4041A of ERISA; (iv) the institution of
proceedings to terminate or the actual termination of a Plan by the PBGC under
Section 4042 of ERISA; (v) any event or condition which could reasonably be
expected to constitute grounds under Section 4042 of ERISA for the termination
of, or the appointment of a trustee to administer, any Plan; (vi) the complete
or partial withdrawal of any Consolidated Party or any ERISA Affiliate from a
Multiemployer Plan; (vii) the conditions for imposition of a lien under Section
302(f) of ERISA exist with respect to any Plan; or (viii) the adoption of an
amendment to any Plan requiring the provision of security to such Plan pursuant
to Section 307 of ERISA.

"Escrow Agreement" means that certain Escrow Agreement dated as of the date
hereof by and among the Borrower, the Agent and Wells Fargo Bank Northwest,
National Association.

"Eurodollar Loan" means any Loan that bears interest at a rate based upon the
Eurodollar Rate.

                                    Page 11
<PAGE>

"Eurodollar Rate" means for any Interest Period with respect to any Eurodollar
Loan, a rate per annum determined by the Agent to be equal to the quotient
obtained by dividing (a) the Interbank Offered Rate by (b) 1 minus the
Eurodollar Reserve Percentage.

"Eurodollar Reserve Percentage" means, for any day during any Interest Period,
the reserve percentage (expressed as a decimal, rounded upward to the next
1/100th of 1%) in effect on such day, whether or not applicable to any Lender,
under regulations issued from time to time by the Board of Governors of the
Federal Reserve System for determining the maximum reserve requirement
(including any emergency, supplemental or other marginal reserve requirement)
with respect to Eurocurrency funding (currently referred to as "Eurocurrency
liabilities"). The Eurodollar Rate for each outstanding Eurodollar Rate Loan
shall be adjusted automatically as of the effective date of any change in the
Eurodollar Reserve Percentage.

"Event of Default" shall have the meaning assigned to such term in Section 8.1.

"Excess Proceeds" shall have the meaning assigned to such term in Section
6.6(b).

"Executive Officer" of any Person means any of the chief executive officer,
chief operating officer, president, chief financial officer or treasurer of such
Person.

"Existing Letters of Credit" means the letters of credit outstanding on the
Closing Date and identified on Schedule 2.2(a).

"Federal Funds Rate" means, for any day, the rate per annum (rounded upwards to
the nearest 1/100 of 1%) 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 Agent.

"Fees" means all fees payable pursuant to Section 3.5.

"Fixed Charge Coverage Ratio" means, as of the end of any fiscal quarter of the
Consolidated Parties for the four fiscal quarter period ending on such date with
respect to the Consolidated Parties on a consolidated basis, the ratio of (a)
the sum of (i) Consolidated EBITDDA for such period minus (ii) Consolidated
Capital Expenditures for such period to (b) the sum of (i) Consolidated Interest
Expense for such period plus (ii) dividends paid by the Borrower to its
shareholders during such period plus (iii) Consolidated Cash Taxes paid during
such period. Notwithstanding the foregoing, for purposes of calculating the
Fixed Charge Coverage Ratio for the first three fiscal quarters to end after the
Closing Date (commencing with the fiscal quarter ending January 31, 2002), the
Fixed Charge Coverage Ratio shall be determined by annualizing the Consolidated
Capital Expenditures component thereof such that for the fiscal quarter ending
January 31, 2002, the Consolidated Capital Expenditures component would be
multiplied by four (4), for the fiscal quarter ending April 30, 2002, the
Consolidated Capital Expenditures component would be multiplied by two (2) and
for the fiscal quarter ending July 31, 2002, the Consolidated Capital
Expenditures component

                                    Page 12
<PAGE>

would be multiplied by one and one-third (1-1/3).

"Foreign Subsidiary" means any direct or indirect Subsidiary of the Borrower
which is not a Domestic Subsidiary.

"Fully Satisfied" means, with respect to the Obligations as of any date, that,
as of such date, (a) all principal of and interest accrued to such date which
constitute Obligations shall have been irrevocably paid in full in cash, (b) all
fees, expenses and other amounts then due and payable which constitute
Obligations shall have been irrevocably paid in cash, (c) all outstanding
Letters of Credit shall have been (i) terminated, (ii) fully irrevocably cash
collateralized or (iii) secured by one or more letters of credit on terms and
conditions, and with one or more financial institutions, reasonably satisfactory
to the Issuing Lender and (d) the Commitments shall have been expired or
terminated in full. As used herein, "irrevocably" shall not require the
expiration of any applicable bankruptcy preference period.

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

"Funded Indebtedness" means, with respect to any Person, without duplication,
(a) all obligations of such Person for borrowed money, (b) all obligations of
such Person evidenced by bonds, debentures, notes or similar instruments, or
upon which interest payments are customarily made, (c) all obligations of such
Person under conditional sale or other title retention agreements relating to
Property purchased by such Person (other than customary reservations or
retentions of title under agreements with suppliers entered into in the ordinary
course of business), (d) all obligations of such Person issued or assumed as the
deferred purchase price of Property or services purchased by such Person (other
than trade debt incurred in the ordinary course of business and due within six
months of the incurrence thereof) which would appear as liabilities on a balance
sheet of such Person, (e) the implied principal component of all obligations of
such Person under Capital Leases, (f) the maximum amount of all performance and
standby letters of credit issued or bankers' acceptances facilities created for
the account of such Person and, without duplication, all drafts drawn thereunder
(to the extent unreimbursed), (g) all preferred Capital Stock issued by such
Person and which by the terms thereof could be (at the request of the holders
thereof or otherwise) subject to mandatory sinking fund payments, redemption or
other acceleration (other than as a result of a Change of Control or an Asset
Disposition that does not in fact result in a redemption of such preferred
Capital Stock) at any time prior to the Maturity Date, (h) the principal portion
of all obligations of such Person under Synthetic Leases, (i) all obligations of
such Person to repurchase any securities issued by such Person at any time prior
to the Maturity Date which repurchase obligations are related to the issuance
thereof, including, without limitation, obligations commonly known as residual
equity appreciation potential shares, (j) the aggregate amount of uncollected
accounts receivable of such Person subject at such time to a sale of receivables
(or similar transaction) to the extent such transaction is effected with
recourse to such Person (whether or not such transaction would be reflected on
the balance sheet of such Person in accordance with GAAP), (k) all Funded
Indebtedness of others secured by (or for which the holder of such Funded
Indebtedness has an existing right, contingent or otherwise, to be secured by)
any Lien on, or payable out of the proceeds of production from, Property owned
or acquired by such Person, whether or not the obligations secured thereby have
been assumed, (l) all Guaranty Obligations of such Person with respect to Funded
Indebtedness of another Person and (m) the Funded Indebtedness of

                                    Page 13
<PAGE>

any partnership or unincorporated joint venture in which such Person is a
general partner or a joint venturer to the extent such Indebtedness is recourse
to such Person.

"Funded Indebtedness to Capitalization Ratio" means, as of the end of any fiscal
quarter of the Consolidated Parties with respect to the Consolidated Parties on
a consolidated basis, the ratio of (a) Funded Indebtedness of the Consolidated
Parties on a consolidated basis on the last day of such period to (b)
Consolidated Total Capitalization on the last day of such period.

"GAAP" means generally accepted accounting principles in the United States
applied on a consistent basis and subject to the terms of Section 1.3 (except,
in respect of Synthetic Leases, as otherwise treated herein).

"Governmental Authority" means any Federal, state, local or foreign court or
governmental agency, authority, instrumentality or regulatory body.

"Guaranty Obligations" means, with respect to any Person, without duplication,
any obligations of such Person (other than endorsements in the ordinary course
of business of negotiable instruments for deposit or collection) guaranteeing or
intended to guarantee any Indebtedness of any other Person in any manner,
whether direct or indirect, and including without limitation any obligation,
whether or not contingent, (i) to purchase any such Indebtedness or any Property
constituting security therefor, (ii) to advance or provide funds or other
support for the payment or purchase of any such Indebtedness or to maintain
working capital, solvency or other balance sheet condition of such other Person
(including without limitation keep well agreements, maintenance agreements,
comfort letters or similar agreements or arrangements) for the benefit of any
holder of Indebtedness of such other Person, (iii) to lease or purchase
Property, securities or services primarily for the purpose of assuring the
holder of such Indebtedness, or (iv) to otherwise assure or hold harmless the
holder of such Indebtedness against loss in respect thereof. The amount of any
Guaranty Obligation hereunder shall (subject to any limitations set forth
therein) be deemed to be an amount equal to the outstanding principal amount (or
maximum principal amount, if larger) of the Indebtedness in respect of which
such Guaranty Obligation is made.

"Hedging Agreements" means any interest rate protection agreement, foreign
currency exchange agreement or commodity price protection agreement.

"Indebtedness" means, with respect to any Person, without duplication, (a) all
obligations of such Person for borrowed money, (b) all obligations of such
Person evidenced by bonds, debentures, notes or similar instruments, or upon
which interest payments are customarily made, (c) all obligations of such Person
under conditional sale or other title retention agreements relating to Property
purchased by such Person (other than customary reservations or retentions of
title under agreements with suppliers entered into in the ordinary course of
business), (d) all obligations of such Person issued or assumed as the deferred
purchase price of Property or services purchased by such Person (other than
trade debt incurred in the ordinary course of business and due within six months
of the incurrence thereof) which would appear as liabilities on a balance sheet
of such Person, (e) all obligations of such Person under take-or-pay or similar
arrangements or under commodities agreements under which such Person must make
payments notwithstanding the failure of the counter-party to deliver the goods
or services which such counter-party is required to deliver thereunder (and, for
the avoidance of doubt shall not include arrangements under which

                                    Page 14
<PAGE>

such Person must pay for capacity or availability that must be delivered or made
available to entitle the counter-party to payment, notwithstanding that such
Person may not use such capacity or availability), (f) the implied principal
component of all obligations of such Person under Capital Leases, (g) all net
obligations of such Person under Hedging Agreements, (h) the maximum amount of
all performance and standby letters of credit issued or bankers' acceptances
facilities created for the account of such Person and, without duplication, all
drafts drawn thereunder (to the extent unreimbursed), (i) all preferred Capital
Stock issued by such Person and which by the terms thereof could be (at the
request of the holders thereof or otherwise) subject to mandatory sinking fund
payments, redemption or other acceleration (other than as a result of a Change
of Control or an Asset Disposition that does not in fact result in a redemption
of such preferred Capital Stock) at any time prior to the Maturity Date, (j) the
principal portion of all obligations of such Person under Synthetic Leases, (k)
all obligations of such Person to repurchase any securities issued by such
Person at any time prior to the Maturity Date which repurchase obligations are
related to the issuance thereof, including, without limitation, obligations
commonly known as residual equity appreciation potential shares, (l) the
aggregate amount of uncollected accounts receivable of such Person subject at
such time to a sale of receivables (or similar transaction) to the extent such
transaction is effected with recourse to such Person (whether or not such
transaction would be reflected on the balance sheet of such Person in accordance
with GAAP), (m) all Indebtedness of others secured by (or for which the holder
of such Indebtedness has an existing right, contingent or otherwise, to be
secured by) any Lien on, or payable out of the proceeds of production from,
Property owned or acquired by such Person, whether or not the obligations
secured thereby have been assumed, (n) all Guaranty Obligations of such Person
with respect to Indebtedness of another Person and (o) the Indebtedness of any
partnership or unincorporated joint venture in which such Person is a general
partner or a joint venturer to the extent such Indebtedness is recourse to such
Person.

"Indemnified Party" shall have the meaning assigned to such term in Section
10.5(b).

"Interbank Offered Rate" means, for any Eurodollar Loan for any Interest Period
therefor, the rate per annum (rounded upwards to the nearest 1/100th of 1%) in
each case determined by the Agent to be equal to:

(a) the offered rate that appears on the Dow Jones Telerate Screen Page 3750 (or
any successor page) that displays an average British Bankers Association
Interest Settlement Rate for deposits in Dollars (for delivery on the first day
of the applicable Interest Period) for a term equivalent to the applicable
Interest Period at approximately 11:00 A.M. (London time) two Business Days
prior to the first day of the applicable Interest Period; or

(b) if for any reason the foregoing rate in clause (i) is unavailable or
undeterminable, 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 the applicable Interest
Period) for a term equivalent to the applicable Interest Period at approximately
11:00 A.M. (London time) two Business Days prior to the first day of the
applicable Interest Period; or

(c) if for any reason the foregoing rates in clauses (i) and (ii) are
unavailable or undeterminable, the rate of interest at which deposits in Dollars
for delivery on the first day of the applicable Interest in same day funds in
the approximate amount

                                    Page 15
<PAGE>

of the applicable Eurodollar Loan for a term equivalent to the applicable
Interest Period would be offered by the London branch of Bank of America to
major banks in the offshore Dollar market at approximately 11:00 A.M. (London
time) two Business Days prior to the first day of the applicable Interest
Period.

"Interest Payment Date" means (a) as to Base Rate Loans and Swingline Loans, the
last Business Day of each March, June, September and December, the date of
repayment of principal of such Loan and the Maturity Date, and (b) as to
Eurodollar Loans, the last day of each applicable Interest Period, the date of
repayment of principal of such Loan and the Maturity Date, and in addition where
the applicable Interest Period for a Eurodollar Loan is greater than three
months, then also the date three months from the beginning of the Interest
Period and each three months thereafter.

"Interest Period" means, as to Eurodollar Loans, a period of one, two, three or
six months' duration, as the Borrower may elect, commencing, in each case, on
the date of the borrowing (including continuations and conversions thereof);
provided, however, (a) if any Interest Period would end on a day which is not a
Business Day, such Interest Period shall be extended to the next succeeding
Business Day (except that where the next succeeding Business Day falls in the
next succeeding calendar month, then on the next preceding Business Day), (b) no
Interest Period shall extend beyond the Maturity Date and (c) where an Interest
Period begins on a day for which there is no numerically corresponding day in
the calendar month in which the Interest Period is to end, such Interest Period
shall end on the last Business Day of such calendar month.

"Investment" in any Person means (a) the acquisition (whether for cash,
property, services, assumption of Indebtedness, securities or otherwise) of
assets (other than equipment, timber, timberlands, inventory and supplies in the
ordinary course of business and other than any acquisition of assets
constituting a Consolidated Capital Expenditure), Capital Stock, bonds, notes,
debentures, partnership, joint ventures or other ownership interests or other
securities of such other Person, (b) any deposit with, or advance, loan or other
extension of credit to, such Person (other than deposits made in connection with
the purchase of equipment, timber, timberlands, inventory and supplies in the
ordinary course of business) or (c) any other capital contribution to or
investment in such Person, including, without limitation, any Guaranty
Obligations (including any support for a letter of credit issued on behalf of
such Person) incurred for the benefit of such Person and any Asset Disposition
to such Person for consideration less than the fair market value of the Property
disposed in such transaction, but excluding any Restricted Payment to such
Person. Investments which are capital contributions or purchases of Capital
Stock which have a right to participate in the profits of the issuer thereof
shall be valued at the amount actually contributed or paid to purchase such
Capital Stock as of the date of such contribution or payment. Investments which
are loans, advances, extensions of credit or Guaranty Obligations shall be
valued at the principal amount of such loan, advance or extension of credit
outstanding as of the date of determination or, as applicable, the principal
amount of the loan or advance outstanding as of the date of determination
actually guaranteed by such Guaranty Obligation.

"Involuntary Disposition" means any loss of, damage to or destruction of, or any
condemnation or other taking for public use of, any Property of any Consolidated
Party.

"Involuntary Disposition Prepayment Event" means, with respect to any
Involuntary Disposition, the failure of the Borrower to apply (or cause to be
applied) an amount equal to the Excess Proceeds of such Involuntary

                                    Page 16
<PAGE>

Disposition, if any, either (i) to prepay the Loans (and cash collateralize the
LOC Obligations) in accordance with the terms of Section 3.3(b)(ii)(B) or (ii)
to make Eligible Reinvestments (including but not limited to the repair or
replacement of the Property affected by such Involuntary Disposition) within the
period of 360 days following the date of receipt of such Excess Proceeds,
subject to the terms and conditions of Section 6.6(b).

"Issuing Lender" means (a) with respect to any Existing Letter of Credit, the
financial institution shown on Schedule 2.2(a) as the issuer of such Letter of
Credit, and (b) with respect to any other Letter of Credit, Bank of America in
its capacity as issuer of such Letter of Credit.

"Joint Venture" means a single-purpose corporation, partnership, limited
liability company, joint venture or other similar legal arrangement (whether
created by contract or conducted through a separate legal entity) now or
hereafter formed by any Consolidated Party with another Person in order to
conduct a common venture or enterprise with such Person.

"Lender" means any of the Persons identified as a "Lender" on the signature
pages hereto, and any Person which may become a Lender by way of assignment in
accordance with the terms hereof, together with their successors and permitted
assigns.

"Letter of Credit" means any Existing Letter of Credit and any letter of credit
issued by the Issuing Lender for the account of the Borrower in accordance with
the terms of Section 2.2.

"Letter of Credit Application" means an application for a Letter of Credit
issuance from time to time in use by an Issuing Lender.

"Letter of Credit Fee" shall have the meaning assigned to such term in Section
3.5(b).

"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, security interest, encumbrance, lien (statutory or otherwise) or
charge of any kind (including any agreement to give any of the foregoing, any
conditional sale or other title retention agreement and any lease in the nature
thereof).

"Loan" or "Loans" means the Revolving Loans (or a portion thereof bearing
interest at the Adjusted Base Rate or the Adjusted Eurodollar Rate and referred
to as a Base Rate Loan or a Eurodollar Loan) and/or Swingline Loans,
individually or collectively, as appropriate.

"LOC Commitment" means the commitment of the Issuing Lender to issue Letters of
Credit in an aggregate face amount at any time outstanding (together with the
amounts of any unreimbursed drawings thereon) of up to the LOC Committed Amount.

"LOC Committed Amount" shall have the meaning assigned to such term in Section
2.2.

"LOC Documents" means, with respect to any Letter of Credit, such Letter of
Credit, any amendments thereto, any documents delivered in connection therewith,
any application therefor, and any agreements, instruments, guarantees or other
documents (whether general in application or applicable only to such Letter of
Credit) governing or providing for (i) the rights and obligations of the parties
concerned or at risk or (ii) any collateral security for such obligations.

"LOC Obligations" means, at any time, without duplication, the sum of

                                    Page 17
<PAGE>

(i) the maximum amount which is, or at any time thereafter may become, available
to be drawn under Letters of Credit then outstanding, assuming compliance with
all requirements for drawings referred to in such Letters of Credit plus (ii)
the aggregate amount of all drawings under Letters of Credit honored by the
Issuing Lender but not theretofore reimbursed by the Borrower.

"Material Adverse Effect" means a material adverse effect on (i) the condition
(financial or otherwise), operations, business, assets, liabilities or prospects
of the Consolidated Parties taken as a whole, (ii) the ability of the Borrower
to perform any material obligation under the Credit Documents to which it is a
party or (iii) the material rights and remedies of the Agent and the Lenders
under the Credit Documents.

"Materials of Environmental Concern" means any gasoline or petroleum (including
crude oil or any fraction thereof) or petroleum products or any hazardous or
toxic substances, materials or wastes, defined or regulated as such in or under
any Environmental Laws, including, without limitation, asbestos, polychlorinated
biphenyls and urea-formaldehyde insulation.

"Maturity Date" means December 10, 2004.

"Moody's" means Moody's Investors Service, Inc., or any successor or assignee of
the business of such company in the business of rating securities.

"Multiemployer Plan" means a Plan which is a "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA, and which is subject to Title IV of ERISA.

"Multiple Employer Plan" means a Plan (other than a Multiemployer Plan) which
any Consolidated Party or any ERISA Affiliate and at least one employer other
than the Consolidated Parties or any ERISA Affiliate are contributing sponsors.

"Net Cash Proceeds" means the aggregate cash or Cash Equivalents proceeds
received by any Consolidated Party in respect of any Asset Disposition, Equity
Issuance, Debt Issuance or Involuntary Disposition, net of (a) direct costs
(including, without limitation, legal, accounting and investment banking fees,
and sales commissions) (b) taxes paid or payable as a result thereof and (c) in
the case of any Asset Disposition, the amount necessary to prepay or retire any
Indebtedness either secured by a Permitted Lien (ranking senior to any Lien of
the Agent) on the related Property or incurred specifically in connection with
the acquisition of the Property that is included in such Asset Disposition; it
being understood that "Net Cash Proceeds" shall include, without limitation, any
cash or Cash Equivalents received upon the sale or other disposition of any
non-cash consideration received by any such Consolidated Party in any Asset
Disposition, Equity Issuance, Debt Issuance or Involuntary Disposition. In
addition and without duplication, the "Net Cash Proceeds" of any Asset
Disposition shall include any other amounts which constitute "Net Proceeds" (or
any comparable term) of such transaction under, and as defined in the documents
evidencing or governing any Subordinated Indebtedness.

"Note" or "Notes" means the Revolving Notes and/or the Swingline Note,
individually or collectively, as appropriate.

"Notice of Borrowing" means a written notice of borrowing in substantially the
form of Exhibit 2.1(b)(i), as required by Section 2.1(b)(i) or Section 2.3(b).

                                    Page 18
<PAGE>

"Notice of Extension/Conversion" means the written notice of extension or
conversion in substantially the form of Exhibit 3.2, as required by Section 3.2.

"Obligations" means, in each case, whether now in existence or hereafter
arising: (a) the principal of and interest on (including interest accruing after
the filing of any bankruptcy or similar petition) the Loans, (b) all payment and
other obligations owing by the Borrower to any Lender or Affiliate of a Lender
or the Agent under any Hedging Agreement (which such Hedging Agreement is
permitted hereunder), and (c) all other fees and commissions (including
attorney's fees), charges, indebtedness, loans, liabilities, financial
accommodations, obligations, covenants and duties owing by the Borrower to the
Lenders or the Agent, of every kind, nature and description, direct or indirect,
absolute or contingent, due or to become due, contractual or tortious,
liquidated or unliquidated, and whether or not evidenced by any note, in each
case under or in respect of this Agreement, any Note, or any of the other Credit
Documents. "Operating Lease" means, as applied to any Person, any lease
(including, without limitation, leases which may be terminated by the lessee at
any time) of any Property (whether real, personal or mixed) which is not a
Capital Lease other than any such lease in which that Person is the lessor.

"Other Taxes" shall have the meaning assigned to such term in Section 3.11(b).

"Participant" shall have the meaning assigned to such term in Section 10.3(d).

"Participation Interest" means a purchase by a Lender of a participation in
Letters of Credit or LOC Obligations as provided in Section 2.2, Swingline Loans
as provided in Section 2.3 or in any Loans as provided in Section 3.14.

"PBGC" means the Pension Benefit Guaranty Corporation established pursuant to
Subtitle A of Title IV of ERISA and any successor thereof.

"Permitted Acquisition" means an Acquisition by the Borrower or any Subsidiary
of the Borrower permitted pursuant to the terms of Section 7.6(h).

"Permitted Asset Disposition" means any Asset Disposition permitted by Section
7.5.

"Permitted Investments" means, at any time, Investments by the Consolidated
Parties permitted to exist at such time pursuant to the terms of Section 7.6.

"Permitted Liens" means, at any time, Liens in respect of Property of the
Consolidated Parties permitted to exist at such time pursuant to the terms of
Section 7.2.

"Person" means any individual, partnership, joint venture, firm, corporation,
limited liability company, association, trust or other enterprise (whether or
not incorporated) or any Governmental Authority.

"Plan" means any employee benefit plan (as defined in Section 3(3) of ERISA)
which is covered by ERISA and with respect to which any Consolidated Party or
any ERISA Affiliate is (or, if such plan were terminated at such time, would
under Section 4069 of ERISA be deemed to be) an "employer" within the meaning of
Section 3(5) of ERISA.

                                    Page 19
<PAGE>

"Prime Rate" means, for any day, the per annum rate of interest rate 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.

"Prior Bank Commitments" means (i) the Borrower's committed credit facility
evidenced by that certain Credit Agreement dated as of February 24, 2000 by and
among the Borrower, the several financial institutions from time to time party
thereto, and Bank of America, as Agent, as amended and modified prior to the
Closing Date, and (ii) the Borrower's revolving credit facility evidenced by
that certain Letter Loan Agreement dated as of January 26, 2001 by and among the
Borrower and Bank of America, as amended and modified prior to the Closing Date.
"Pro Forma Basis" means, for purposes of calculating (utilizing the principles
set forth in the second paragraph of Section 1.3) compliance with each of the
financial covenants set forth in Section 6.10(a)-(c) in respect of a proposed
transaction, that such transaction shall be deemed to have occurred as of the
first day of the four fiscal-quarter period ending as of the most recent fiscal
quarter end preceding the date of such transaction with respect to which the
Agent has received the Required Financial Information. As used herein,
"transaction" shall mean (i) any incurrence or assumption of Indebtedness as
referred to in Section 7.1(f), (ii) any Asset Disposition as referred to in
Section 7.5 or (iii) any Acquisition as referred to in Section 7.6(i). In
connection with any calculation of the financial covenants set forth in Section
6.10(a)-(c) upon giving effect to a transaction on a Pro Forma Basis:

(A) for purposes of any such calculation in respect of any incurrence or
assumption of Indebtedness as referred to in Section 7.1(f), any Indebtedness
which is retired in connection with such incurrence or assumption shall be
excluded and deemed to have been retired as of the first day of the applicable
period;

(B) for purposes of any such calculation in respect of any Asset Disposition as
referred to in Section 7.5, (1) income statement items (whether positive or
negative) attributable to the Property disposed of shall be excluded and (2) any
Indebtedness which is retired in connection with such transaction shall be
excluded and deemed to have been retired as of the first day of the applicable
period; and

(C) for purposes of any such calculation in respect of any Acquisition as
referred to in Section 7.6(i), (1) any Indebtedness incurred by any Consolidated
Party in connection with such transaction (x) shall be deemed to have been
incurred as of the first day of the applicable period and (y) if such
Indebtedness has a floating or formula rate, shall have an implied rate of
interest for the applicable period for purposes of this definition determined by
utilizing the rate which is or would be in effect with respect to such
Indebtedness as at the relevant date of determination, (2) income statement
items (whether positive or negative) attributable to the Person or Property
acquired shall be included beginning as of the first day of the applicable
period and (3) pro forma adjustments may be included to the extent that such
adjustments would be permitted under GAAP and give effect to events that are (x)
directly attributable to such transaction, (y) expected to have a continuing
impact on the Consolidated Parties and (z) factually supportable.

                                    Page 20
<PAGE>

"Pro Forma Compliance Certificate" means a certificate of an Executive Officer
of the Borrower delivered to the Agent in connection with (i) any incurrence,
assumption or retirement of Indebtedness as referred to in Section 7.1(f), (ii)
any Asset Disposition as referred to in Section 7.5 or (iii) any Acquisition as
referred to in Section 7.6(i), as applicable, and containing reasonably detailed
calculations, upon giving effect to the applicable transaction on a Pro Forma
Basis, of the Funded Indebtedness to Capitalization Ratio, the Fixed Charge
Coverage Ratio and Consolidated Net Worth as of the most recent fiscal quarter
end preceding the date of the applicable transaction with respect to which the
Agent shall have received the Required Financial Information.

"Property" means any interest in any kind of property or asset, whether real,
personal or mixed, or tangible or intangible.

"Real Properties" means, at any time, a collective reference to each of the
facilities and real properties owned, leased or operated by the Consolidated
Parties at such time.

"Register" shall have the meaning assigned to such term in Section 10.3(c).

"Regulation D, T, U, or X" means Regulation D, T, U or X, respectively, of the
Board of Governors of the Federal Reserve System as from time to time in effect
and any successor to all or a portion thereof.

"Reimbursement Agreement" shall mean any agreement set forth on Schedule 2.2(l)
hereto.

"Reportable Event" means any of the events set forth in Section 4043(c) of
ERISA, other than those events as to which the notice requirement has been
waived.

"Required Financial Information" means, with respect to the applicable
Calculation Date, (i) the financial statements of the Consolidated Parties
required to be delivered pursuant to Section 6.1(a) or (b) for the fiscal period
or quarter ending as of such Calculation Date, and (ii) the certificate of an
Executive Officer of the Borrower required by Section 6.1(c) to be delivered
with the financial statements described in clause (i) above.

"Required Lenders" means, at any time, Lenders (other than Defaulting Lenders)
holding in the aggregate at least sixty-six and two-thirds percent (66-2/3%) of
(i) the unfunded Commitments (and Participation Interests therein) and the
outstanding Loans (and Participation Interests therein) or (ii) if all of the
Commitments have been terminated, the outstanding Loans, LOC Obligations and
Participation Interests (including the Participation Interests of the Issuing
Lender in any Letters of Credit).

"Requirement of Law" means, as to any Person, the certificate of incorporation
and by-laws or other organizational or governing documents of such Person, and
any law, treaty, rule or regulation or determination of an arbitrator or a court
or other Governmental Authority, in each case applicable to or binding upon such
Person or to which any of its material property is subject and in the case of
the determination of an arbitrator, court or Governmental Authority, which
determination shall not have been discharged or execution thereof stayed pending
appeal within 30 days after the expiration of any applicable stay of execution.

"Restricted Payment" means (i) any dividend or other payment or distribution,
direct or indirect, on account of any shares of any class

                                    Page 21
<PAGE>

of Capital Stock of any Consolidated Party, now or hereafter outstanding
(including without limitation any payment in connection with any dissolution,
merger, consolidation or disposition involving any Consolidated Party), or to
the holders, in their capacity as such, of any shares of any class of Capital
Stock of any Consolidated Party, now or hereafter outstanding (other than
dividends or distributions payable in Capital Stock of the applicable Person and
dividends or distributions payable (directly or indirectly through Subsidiaries)
to the Borrower), (ii) any redemption, retirement, sinking fund or similar
payment, purchase or other acquisition for value, direct or indirect, of any
shares of any class of Capital Stock of any Consolidated Party, now or hereafter
outstanding, (iii) any payment made to retire, or to obtain the surrender of,
any outstanding warrants, options or other rights to acquire shares of any class
of Capital Stock of any Consolidated Party, now or hereafter outstanding, and
(iv) any payment or prepayment of principal of, or premium, if any, on
(including any redemption, purchase, retirement, defeasance, sinking fund or
similar payment with respect to) the Senior Subordinated Notes. Notwithstanding
the foregoing, the term Restricted Payment shall not include any redemption of
share purchase rights issued pursuant to the Borrower's shareholder rights plan
existing on the Closing Date (as the same may be amended from time to time) or
any similar successor or replacement shareholder rights plan, for a redemption
price not to exceed $0.01 per share purchase right.

"Revolving Commitment" means, with respect to each Lender, the commitment of
such Lender in an aggregate principal amount at any time outstanding of up to
such Lender's Revolving Commitment Percentage of the Revolving Committed Amount,
(i) to make Revolving Loans in accordance with the provisions of Section 2.1(a)
and (ii) to purchase Participation Interests in Letters of Credit in accordance
with the provisions of Section 2.2(c).

"Revolving Commitment Percentage" means, for any Lender, the percentage
identified as its Revolving Commitment Percentage on Schedule 2.1(a), as such
percentage may be modified in connection with any assignment made in accordance
with the provisions of Section 10.3.

"Revolving Committed Amount" shall have the meaning assigned to such term in
Section 2.1(a).

"Revolving Loans" shall have the meaning assigned to such term in Section
2.1(a).

"Revolving Note" shall have the meaning assigned to such term in Section 2.1(e).

"S&P" means Standard & Poor's Ratings Services, a division of The McGraw-Hill
Companies, Inc., or any successor or assignee of the business of such division
in the business of rating securities.

"Sale and Leaseback Transaction" means any arrangement pursuant to which any
Consolidated Party, directly or indirectly, becomes liable as lessee, guarantor
or other surety with respect to any lease, whether an Operating Lease or a
Capital Lease, of any Property (a) which such Consolidated Party has sold or
transferred (or is to sell or transfer) to a Person which is not a Consolidated
Party or (b) which such Consolidated Party intends to use for substantially the
same purpose as any other Property which has been sold or transferred (or is to
be sold or transferred) by such Consolidated Party to another Person which is
not a Consolidated Party in connection with such lease, provided that any
transaction that satisfies the conditions in preceding subsection (a) or (b)
shall not constitute a "Sale and Leaseback Transaction" where lessor under such
lease is organized under the laws of a jurisdiction outside of the United
States, the Property is located in the United States and the obligations

                                    Page 22
<PAGE>

in respect of the lease or incurred in connection therewith for which the
Consolidated Party is liable have been defeased.

"Securities Act" means the Securities Act of 1933, as amended, and all
regulations issued pursuant thereto.

"Securities Exchange Act" means the Securities Exchange Act of 1934, as amended,
and all regulations issued pursuant thereto.

"Senior Subordinated Note" means any one of the 10.0% Senior Subordinated Notes
due 2009, issued by the Borrower in favor of the Senior Subordinated Noteholders
pursuant to the Senior Subordinated Note Indenture, as such Senior Subordinated
Notes may be amended, modified, restated or supplemented and in effect from time
to time in accordance with the terms hereof.

"Senior Subordinated Note Indenture" means the Indenture, dated as of the
Closing Date, by and among the Borrower and the Trustee for the Senior
Subordinated Noteholders, as the same may be amended, modified, restated or
supplemented and in effect from time to time in accordance with the terms
hereof.

"Senior Subordinated Noteholder" means any one of the holders from time to time
of the Senior Subordinated Notes.

"Single Employer Plan" means any Plan which is covered by Title IV of ERISA, but
which is not a Multiemployer Plan or a Multiple Employer Plan.

"Solvent" or "Solvency" means, with respect to any Person as of a particular
date, that on such date (i) such Person is able to pay its debts and other
liabilities, contingent obligations and other commitments as they mature in the
normal course of business, (ii) 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 in their ordinary course, (iii) such
Person is not engaged in a business or a transaction, and is not about to engage
in a business or a transaction, for which such Person's Property would
constitute unreasonably small capital after giving due consideration to the
prevailing practice in the industry in which such Person is engaged or is to
engage, (iv) the fair value of the Property of such Person is greater than the
total amount of liabilities, including, without limitation, contingent
liabilities, of such Person and (v) the present fair salable value of the assets
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. In computing the amount of contingent liabilities at any time, it is
intended that such liabilities will be computed at the amount which, in light of
all the facts and circumstances existing at such time, represents the amount
that can reasonably be expected to become an actual or matured liability.

"SPV" have the meaning set forth in Section 10.3(i).

"Subordinated Indebtedness" means Indebtedness outstanding under the Senior
Subordinated Note Indenture and the Senior Subordinated Notes and any other
Indebtedness of the Borrower which by its terms is subordinated to the
Obligations in a manner and to an extent acceptable to the Required Lenders.

"Subsidiary" means, as to any Person at any time, (a) any corporation more than
50% of whose Capital Stock of any class or classes having by the terms thereof
ordinary voting power to elect a majority of the directors of such corporation
(irrespective of whether or not at such time, any class or classes of such
corporation shall have or might have

                                    Page 23
<PAGE>

voting power by reason of the happening of any contingency) is at such time
owned by such Person directly or indirectly through Subsidiaries, and (b) any
partnership, association, joint venture or other entity of which such Person
directly or indirectly through Subsidiaries owns at such time more than 50% of
the Capital Stock of such entity.

"Swingline Commitment" means the obligation of the Swingline Lender to make
Swingline Loans under the Revolving Commitment for the account of the Borrower
in an aggregate principal amount at any time outstanding not to exceed Fifteen
Million Dollars ($15,000,000). "Swingline Lender" means Bank of America in its
capacity as issuer of any Swingline Loan. "Swingline Loan Request" means a
request by the Borrower for a Swingline Loan in substantially the form of
Exhibit 2.3(b).

"Swingline Loans" means the collective reference to the revolving loans made
pursuant to Section 2.3; "Swingline Loan" means any of such Swingline Loans.
"Swingline Note" shall have the meaning assigned to such term in Section 2.3(e).

"Synthetic Lease" means any synthetic lease, tax retention operating lease,
off-balance sheet loan or similar off-balance sheet financing product where such
transaction is considered borrowed money indebtedness for tax purposes but is
classified as an Operating Lease under GAAP.

"Taxes" shall have the meaning assigned to such term in Section 3.11(a).

"Unused Fee" shall have the meaning assigned to such term in Section 3.5(a).

"Unused Fee Calculation Period" shall have the meaning assigned to such term in
Section 3.5(a).

"Unused Revolving Committed Amount" means, for any period, the amount by which
(a) the then applicable Revolving Committed Amount exceeds (b) the daily average
sum for such period of (i) the outstanding aggregate principal amount of all
Revolving Loans plus (ii) the outstanding aggregate principal amount of all LOC
Obligations.

"Voting Stock" means, with respect to any Person, Capital Stock issued by such
Person the holders of which are ordinarily, in the absence of contingencies,
entitled to vote for the election of directors (or persons performing similar
functions) of such Person, even though the right so to vote has been suspended
by the happening of such a contingency.

"Wholly Owned Subsidiary" means any Person 100% of whose Voting Stock is at the
time owned by the Borrower directly or indirectly through other Persons 100% of
whose Voting Stock is at the time owned, directly or indirectly, by the
Borrower.

1.2 Computation of Time Periods.

For purposes of computation of periods of time hereunder, the word "from" means
"from and including" and the words "to" and "until" each mean "to but
excluding."

1.3 Accounting Terms.

Except as otherwise expressly provided herein, all accounting terms used herein
shall be interpreted, and all financial statements and certificates and reports
as to financial matters required to be delivered to the Lenders hereunder shall
be prepared, in accordance with GAAP

                                    Page 24
<PAGE>

applied on a consistent basis; provided, however, that calculations of the
implied principal component of all obligations under any Synthetic Lease or the
implied interest component of any rent paid under any Synthetic Lease shall be
made by the Borrower in accordance with accepted financial practice and
consistent with the terms of such Synthetic Lease. All calculations made for the
purposes of determining compliance with this Credit Agreement shall (except as
otherwise expressly provided herein) be made by application of GAAP applied on a
basis consistent with the most recent annual or quarterly financial statements
delivered pursuant to Section 6.1 (or, prior to the delivery of the first
financial statements pursuant to Section 6.1, consistent with the financial
statements as at July 31, 2001); provided, however, if (a) the Borrower shall
object to determining such compliance on such basis at the time of delivery of
such financial statements due to any change in GAAP or the rules promulgated
with respect thereto or (b) the Agent or the Required Lenders shall so object in
writing within 60 days after delivery of such financial statements, then such
calculations shall be made on a basis consistent with the most recent financial
statements delivered by the Borrower to the Lenders as to which no such
objection shall have been made.

Notwithstanding the above, the parties hereto acknowledge and agree that, for
purposes of all calculations made under the financial covenants set forth in
Section 6.10 (including without limitation for purposes of the definitions of
"Applicable Percentage" and "Pro Forma Basis" set forth in Section 1.1), (i)
after consummation of any Asset Disposition for consideration (cash and
non-cash) in excess of $10,000,000 (A) income statement items (whether positive
or negative) and capital expenditures attributable to the Property disposed of
shall be excluded to the extent relating to any period occurring prior to the
date of such transaction and (B) Indebtedness which is retired shall be excluded
and deemed to have been retired as of the first day of the applicable period and
(ii) after consummation of any Acquisition for an Investment for consideration
(cash and non-cash) in excess of $10,000,000 (A) income statement items (whether
positive or negative) and capital expenditures attributable to the Person or
Property acquired shall, to the extent not otherwise included in such income
statement items for the Consolidated Parties in accordance with GAAP or in
accordance with any defined terms set forth in Section 1.1, be included to the
extent relating to any period applicable in such calculations, (B) to the extent
not retired in connection with such Acquisition, Indebtedness of the Person or
Property acquired shall be deemed to have been incurred as of the first day of
the applicable period and (C) pro forma adjustments may be included to the
extent that such adjustments would be permitted under GAAP and give effect to
items that are (x) directly attributable to such transaction, (y) expected to
have a continuing impact on the Consolidated Parties and (z) factually
supportable.

SECTION 2

CREDIT FACILITIES

2.1 Revolving Loans.

(a) Revolving Commitment. Subject to the terms and conditions hereof and in
reliance upon the representations and warranties set forth herein, each Lender
severally agrees to make available to the Borrower such Lender's Revolving
Commitment Percentage of revolving credit loans requested by the Borrower in
Dollars ("Revolving Loans") from time to time from the Closing Date until the
Maturity Date, or such earlier date as the Revolving Commitments shall have been
terminated as provided herein; provided, however, that the sum of the aggregate
outstanding

                                    Page 25
<PAGE>

principal amount of Revolving Loans plus the aggregate amount of Swingline Loans
outstanding plus the outstanding LOC Obligations shall not exceed TWO HUNDRED
FIFTY MILLION DOLLARS ($250,000,000) (as such aggregate maximum amount may be
reduced from time to time as provided in Section 3.4, the "Revolving Committed
Amount"); provided, further, with regard to each Lender individually, such
Lender's outstanding Revolving Loans plus its Participation Interests in
Swingline Loans and LOC Obligations shall not exceed such Lender's Revolving
Commitment Percentage of the Revolving Committed Amount. Revolving Loans may
consist of Base Rate Loans or Eurodollar Loans, or a combination thereof, as the
Borrower may request; provided, however, that no more than six (6) Eurodollar
Loans which are Revolving Loans shall be outstanding hereunder at any time (it
being understood that, for purposes hereof, Eurodollar Loans with different
Interest Periods shall be considered as separate Eurodollar Loans, even if they
begin on the same date, although borrowings, extensions and conversions may, in
accordance with the provisions hereof, be combined at the end of existing
Interest Periods to constitute a new Eurodollar Loan with a single Interest
Period). Revolving Loans hereunder may be repaid and reborrowed in accordance
with the provisions hereof.

(b) Revolving Loan Borrowings.

(i) Notice of Borrowing. The Borrower shall request a Revolving Loan borrowing
by written notice (or telephonic notice promptly confirmed in writing) to the
Agent no later than 9:00 A.M. (San Francisco, California time) on the date of
the requested borrowing in the case of Base Rate Loans, and on the third
Business Day prior to the date of the requested borrowing in the case of
Eurodollar Loans. Each such request for borrowing shall be irrevocable and shall
specify (A) that a Revolving Loan is requested, (B) the date of the requested
borrowing (which shall be a Business Day), (C) the aggregate principal amount to
be borrowed, and (D) whether the borrowing shall be comprised of Base Rate
Loans, Eurodollar Loans or a combination thereof, and if Eurodollar Loans are
requested, the Interest Period(s) therefor. If the Borrower shall fail to
specify in any such Notice of Borrowing (I) an applicable Interest Period in the
case of a Eurodollar Loan, then such notice shall be deemed to be a request for
an Interest Period of one month, or (II) the type of Revolving Loan requested,
then such notice shall be deemed to be a request for a Base Rate Loan hereunder.
The Agent shall give notice to each affected Lender promptly upon receipt of
each Notice of Borrowing pursuant to this Section 2.1(b)(i), the contents
thereof and each such Lender's share of any borrowing to be made pursuant
thereto.

(ii) Minimum Amounts. Except for Revolving Loans made for the purpose of
reimbursing the Issuing Lender in respect of a drawing under a Letter of Credit
pursuant to Section 2.2(e) or Swingline Loans pursuant to Section 2.3(d), each
Eurodollar Loan or Base Rate Loan that is a Revolving Loan shall be in a minimum
aggregate principal amount of $5,000,000 and integral multiples of $1,000,000 in
excess thereof (or the remaining amount of the Revolving Committed Amount, if
less).

(iii) Advances. Each Lender will make its Revolving Commitment Percentage of
each Revolving Loan borrowing available to the Agent for the account of the
Borrower as specified in Section 3.15(a), or in such other manner as the Agent
may specify in writing, by 12:00 noon (San Francisco, California time) on the
date specified in the applicable Notice of Borrowing in Dollars and in funds
immediately available to the Agent. Such borrowing will then be made available
to the Borrower by the Agent by crediting the account of the Borrower on the
books of such office with the aggregate of the amounts made available to the
Agent by the Lenders and in like funds as received by the Agent.

                                    Page 26
<PAGE>

(c) Repayment. The Borrower hereby promises to pay the principal amount of all
outstanding Revolving Loans in full on the Maturity Date, unless accelerated
sooner pursuant to Section 8.2.

(d) Interest. Subject to the provisions of Section 3.1,

(i) Base Rate Loans. During such periods as Revolving Loans shall be comprised
in whole or in part of Base Rate Loans, such Base Rate Loans shall bear interest
at a per annum rate equal to the Adjusted Base Rate.

(ii) Eurodollar Loans. During such periods as Revolving Loans shall be comprised
in whole or in part of Eurodollar Loans, such Eurodollar Loans shall bear
interest at a per annum rate equal to the Adjusted Eurodollar Rate.

The Borrower hereby promises to pay interest on Revolving Loans in arrears on
each applicable Interest Payment Date (or at such other times as may be
specified herein).

(e) Revolving Notes. The Borrower hereby agrees that, upon the request to the
Agent by any Lender, the Borrower will, without duplication, execute and deliver
to such Lender a promissory note evidencing the Revolving Loans of such Lender,
substantially in the form of Exhibit 2.1(e) (a "Revolving Note").

2.2 Letter of Credit Subfacility.

(a) Issuance. The Existing Letters of Credit have previously been issued by the
applicable Issuing Lender and subject to the terms and conditions hereof and in
reliance upon the representations and warranties set forth herein, Bank of
America, in its capacity as an Issuing Lender, agrees to issue, the applicable
Issuing Lender agrees to renew, extend and modify and each Lender severally
agrees to participate in the issuance by such Issuing Lender of, standby Letters
of Credit in Dollars from time to time from the Closing Date until the date
thirty (30) days prior to the Maturity Date as the Borrower may request, by
delivering a Letter of Credit Application to the applicable Issuing Lender;
provided, however, that (i) the LOC Obligations outstanding shall not at any
time exceed FIFTY MILLION DOLLARS ($50,000,000) (the "LOC Committed Amount") and
(ii) the sum of (A) the aggregate outstanding principal amount of Revolving
Loans, (B) the aggregate outstanding principal amount of Swingline Loans and (C)
the aggregate outstanding principal amount of LOC Obligations shall not at any
time exceed the Revolving Committed Amount. No Letter of Credit shall (x) have
an original expiry date more than one year from the date of issuance (provided
that any such Letter of Credit (I) may contain customary "evergreen" provisions
pursuant to which the expiry date is automatically extended by a specific time
period unless the applicable Issuing Lender gives notice to the beneficiary of
such Letter of Credit at least a specified time period prior to the expiry date
then in effect and/or (II) may have an expiration date more than one year from
the date of issuance if required under related industrial revenue bond documents
and agreed to by the Issuing Lender) or (y) as originally issued or as extended,
have an expiry date extending beyond the date thirty (30) days prior to the
Maturity Date. Each Letter of Credit shall comply with the related LOC
Documents. The issuance date of each Letter of Credit shall be a Business Day.
All Existing Letters of Credit shall be deemed to have been issued pursuant
hereto, and from and after the Closing Date shall be subject to and governed by
the terms and conditions hereof.

(b) Notice and Reports. The request for the issuance of a Letter of Credit shall
be submitted by the Borrower to the applicable Issuing Lender and the Agent at
least three (3) Business Days prior to the

                                    Page 27
<PAGE>

requested date of issuance. The Agent will, at least quarterly and more
frequently upon request, disseminate to each of the Lenders a detailed report
specifying the Letters of Credit which are then issued and outstanding and any
activity with respect thereto which may have occurred since the date of the
prior report, and including therein, among other things, the beneficiary, the
face amount and the expiry date, as well as any payment or expirations which may
have occurred.

(c) Participation. Each Lender, upon issuance of a Letter of Credit, shall be
deemed to have purchased without recourse a Participation Interest from the
applicable Issuing Lender in such Letter of Credit (including each Existing
Letter of Credit) and the obligations arising thereunder and any collateral
relating thereto, in each case in an amount equal to its pro rata share of the
obligations under such Letter of Credit (based on the respective Revolving
Commitment Percentages of the Lenders) and shall absolutely, unconditionally and
irrevocably assume and be obligated to pay to such Issuing Lender and discharge
when due, its pro rata share of the obligations arising under such Letter of
Credit (including each Existing Letter of Credit). Without limiting the scope
and nature of each Lender's Participation Interest in any Letter of Credit, to
the extent that an Issuing Lender has not been reimbursed as required hereunder
or under any such Letter of Credit, each such Lender shall pay to such Issuing
Lender its pro rata share of such unreimbursed drawing in same day funds on the
day of notification by such Issuing Lender of an unreimbursed drawing pursuant
to the provisions of subsection (d) below. The obligation of each Lender to so
reimburse the Issuing Lender shall be absolute and unconditional and shall not
be affected by the occurrence of a Default, an Event of Default or any other
occurrence or event. Any such reimbursement shall not relieve or otherwise
impair the obligation of the Borrower to reimburse the applicable Issuing Lender
under any Letter of Credit, together with interest as hereinafter provided.

(d) Reimbursement. In the event of any drawing under any Letter of Credit, the
applicable Issuing Lender will promptly notify the Borrower. Unless the Borrower
shall immediately notify such Issuing Lender that the Borrower intends to
otherwise reimburse such Issuing Lender for such drawing, the Borrower shall be
deemed to have requested that the Lenders make a Revolving Loan in the amount of
the drawing as provided in subsection (e) below on the related Letter of Credit,
the proceeds of which will be used to satisfy the related reimbursement
obligations. The Borrower promises to reimburse the applicable Issuing Lender on
the day of drawing under any Letter of Credit (either with the proceeds of a
Revolving Loan obtained hereunder or otherwise) in same day funds. If the
Borrower shall fail to reimburse any Issuing Lender as provided hereinabove, the
Borrower promises to pay such Issuing Lender interest on the unreimbursed amount
of such drawing on demand at a per annum rate equal to the Adjusted Base Rate
plus 2%. The Borrower's reimbursement obligations hereunder shall be absolute
and unconditional under all circumstances irrespective of any rights of setoff,
counterclaim or defense to payment the Borrower may claim or have against any
Issuing Lender, the Agent, the Lenders, the beneficiary of the Letter of Credit
drawn upon or any other Person, including without limitation any defense based
on any failure of the Borrower to receive consideration or the legality,
validity, regularity or unenforceability of the Letter of Credit. The applicable
Issuing Lender will promptly notify the Agent of the amount of any unreimbursed
drawing and each Lender shall promptly pay to the Agent for the account of such
Issuing Lender in Dollars and in immediately available funds, the amount of such
Lender's pro rata share of such unreimbursed drawing. Such payment shall be made
on the day such notice is received by such Lender from such Issuing Lender if
such notice is received at or before 12:00 noon (San Francisco, California
time), and otherwise such payment shall be made at or before 1:00 P.M. (San

                                    Page 28
<PAGE>

Francisco, California time) on the Business Day next succeeding the day such
notice is received. If such Lender does not pay such amount to the Agent in full
upon such request, such Lender shall, on demand, pay to the Agent for the
account of such Issuing Lender interest on the unpaid amount during the period
from the date of such drawing until such Lender pays such amount to such Issuing
Lender in full at a rate per annum equal to, if paid within two (2) Business
Days of the date that such Lender is required to make payments of such amount
pursuant to the preceding sentence, the Federal Funds Rate and thereafter at a
rate equal to the Base Rate. Each Lender's obligation to make such payment to
the applicable Issuing Lender, and the right of such Issuing Lender to receive
the same, shall be absolute and unconditional, shall not be affected by any
circumstance whatsoever and without regard to the termination of this Credit
Agreement or the Commitments hereunder, the existence of a Default or Event of
Default or the acceleration of the obligations of the Borrower hereunder and
shall be made without any offset, abatement, withholding or reduction
whatsoever. Simultaneously with the making of each such payment by a Lender to
an Issuing Lender, such Lender shall, automatically and without any further
action on the part of such Issuing Lender or such Lender, acquire a
Participation Interest in an amount equal to such payment (excluding the portion
of such payment constituting interest owing to such Issuing Lender) in the
related unreimbursed drawing portion of the LOC Obligation and in the interest
thereon and in the related LOC Documents, and shall have a claim against the
Borrower with respect thereto.

(e) Repayment with Revolving Loans. On any day on which the Borrower shall have
requested, or been deemed to have requested, a Revolving Loan advance to
reimburse a drawing under a Letter of Credit, the Agent shall give notice to the
Lenders that a Revolving Loan has been requested or deemed requested by the
Borrower to be made in connection with a drawing under a Letter of Credit, in
which case a Revolving Loan advance comprised of Base Rate Loans (or Eurodollar
Loans to the extent the Borrower has complied with the procedures of Section
2.1(b)(i) with respect thereto) shall be immediately made to the Borrower by all
Lenders (notwithstanding any termination of the Commitments pursuant to Section
8.2) pro rata based on the respective Revolving Commitment Percentages of the
Lenders (determined before giving effect to any termination of the Commitments
pursuant to Section 8.2) and the proceeds thereof shall be paid directly to the
applicable Issuing Lender for application to the respective LOC Obligations.
Each such Lender hereby irrevocably agrees to make its pro rata share of each
such Revolving Loan immediately upon any such request or deemed request in the
amount, in the manner and on the date specified in the preceding sentence
notwithstanding (i) the amount of such borrowing may not comply with the minimum
amount for advances of Revolving Loans otherwise required hereunder, (ii)
whether any conditions specified in Section 4.2 are then satisfied, (iii)
whether a Default or an Event of Default then exists, (iv) failure for any such
request or deemed request for Revolving Loan to be made by the time otherwise
required hereunder, (v) whether the date of such borrowing is a date on which
Revolving Loans are otherwise permitted to be made hereunder or (vi) any
termination of the Commitments relating thereto immediately prior to or
contemporaneously with such borrowing. In the event that any Revolving Loan
cannot for any reason be made on the date otherwise required above (including,
without limitation, as a result of the commencement of a proceeding under the
Bankruptcy Code with respect to the Borrower), then each such Lender hereby
agrees that it shall forthwith purchase (as of the date such borrowing would
otherwise have occurred, but adjusted for any payments received from the
Borrower on or after such date and prior to such purchase) from the applicable
Issuing Lender such Participation Interests in the outstanding LOC Obligations
as shall be necessary to cause each such Lender to share in such LOC Obligations
ratably (based upon the respective Revolving Commitment

                                    Page 29
<PAGE>

Percentages of the Lenders (determined before giving effect to any termination
of the Commitments pursuant to Section 8.2)), provided that at the time any
purchase of Participation Interests pursuant to this sentence is actually made,
the purchasing Lender shall be required to pay to such Issuing Lender, to the
extent not paid to such Issuing Lender by the Borrower in accordance with the
terms of subsection (d) above, interest on the principal amount of Participation
Interests purchased for each day from and including the day upon which such
borrowing would otherwise have occurred to but excluding the date of payment for
such Participation Interests, at the rate equal to, if paid within two (2)
Business Days of the date of the Revolving Loan advance, the Federal Funds Rate,
and thereafter at a rate equal to the Base Rate.

(f) Designation of Consolidated Parties as Account Parties. Notwithstanding
anything to the contrary set forth in this Credit Agreement, including without
limitation Section 2.2(a), a Letter of Credit may be issued hereunder for the
account of any Subsidiary of the Borrower, provided that, the Borrower shall be
the actual applicant for all purposes of this Credit Agreement for such Letter
of Credit and such statement shall not affect the Borrower's reimbursement
obligations hereunder with respect to such Letter of Credit.

(g) Renewal, Extension. The renewal or extension of any Letter of Credit shall,
for purposes hereof, be treated in all respects the same as the issuance of a
new Letter of Credit hereunder.

(h) Applicability of ISP98. Unless otherwise expressly agreed by the applicable
Issuing Lender and the Borrower when a Letter of Credit is issued, the rules of
the "International Standby Practices 1998" published by the Institute of
International Banking Law & Practice (or such later version thereof as may be in
effect at the time of issuance) shall apply to each Letter of Credit.

(i) Indemnification; Nature of Issuing Lender's Duties.

(i) In addition to its other obligations under this Section 2.2, the Borrower
hereby agrees to pay, and protect, indemnify and save each Lender harmless from
and against, any and all claims, demands, liabilities, damages, losses, costs,
charges and expenses (including reasonable attorneys' fees) that such Lender may
incur or be subject to as a consequence, direct or indirect, of (A) the issuance
of any Letter of Credit or (B) the failure of such Lender to honor a drawing
under a Letter of Credit as a result of any act or omission, whether rightful or
wrongful, of any present or future de jure or de facto government or
Governmental Authority (all such acts or omissions, herein called "Government
Acts").

(ii) As between the Borrower and the Lenders (including each Issuing Lender),
the Borrower shall assume all risks of the acts, omissions or misuse of any
Letter of Credit by the beneficiary thereof. No Lender (including an Issuing
Lender) shall be responsible: (A) for the form, validity, sufficiency, accuracy,
genuineness or legal effect of any document submitted by any party in connection
with the application for and issuance of any Letter of Credit, even if it should
in fact prove to be in any or all respects invalid, insufficient, inaccurate,
fraudulent or forged; (B) for the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign any Letter of
Credit or the rights or benefits thereunder or proceeds thereof, in whole or in
part, that may prove to be invalid or ineffective for any reason; (C) for
errors, omissions, interruptions or delays in transmission or delivery of any
messages, by mail, cable, telegraph, telex or otherwise, whether or not they be
in cipher; (D) for any loss or delay in the transmission or otherwise of any
document required in order

                                    Page 30
<PAGE>

to make a drawing under a Letter of Credit or of the proceeds thereof; and (E)
for any consequences arising from causes beyond the control of such Lender,
including, without limitation, any Government Acts. None of the above shall
affect, impair, or prevent the vesting of an Issuing Lender's rights or powers
hereunder.

(iii) In furtherance and extension and not in limitation of the specific
provisions hereinabove set forth, any action taken or omitted by any Lender
(including an Issuing Lender), under or in connection with any Letter of Credit
or the related certificates, if taken or omitted in good faith, shall not put
such Lender under any resulting liability to the Borrower. It is the intention
of the parties that this Credit Agreement shall be construed and applied to
protect and indemnify each Lender (including each Issuing Lender) against any
and all risks involved in the issuance of the Letters of Credit, all of which
risks are hereby assumed by the Borrower, including, without limitation, any and
all Government Acts. No Lender (including an Issuing Lender) shall, in any way,
be liable for any failure by such Lender or anyone else to pay any drawing under
any Letter of Credit as a result of any Government Acts or any other cause
beyond the control of such Lender.

(iv) Nothing in this subsection (i) is intended to limit the reimbursement
obligations of the Borrower contained in subsection (d) above. The obligations
of the Borrower under this subsection (i) shall survive the termination of this
Credit Agreement. No act or omission of any current or prior beneficiary of a
Letter of Credit shall in any way affect or impair the rights of the Lenders
(including each Issuing Lender) to enforce any right, power or benefit under
this Credit Agreement.

(v) Notwithstanding anything to the contrary contained in this subsection (i),
the Borrower shall have no obligation to indemnify any Lender (including an
Issuing Lender) in respect of any liability incurred by such Lender (A) arising
solely out of the gross negligence or willful misconduct of such Lender, as
determined by a court of competent jurisdiction, or (B) caused by such Lender's
failure to pay under any Letter of Credit after presentation to it of a request
strictly complying with the terms and conditions of such Letter of Credit, as
determined by a court of competent jurisdiction, unless such payment is
prohibited by any law, regulation, court order or decree.

(j) Responsibility of Each Issuing Lender. It is expressly understood and agreed
that the obligations of each Issuing Lender hereunder to the Lenders are only
those expressly set forth in this Credit Agreement and that each Issuing Lender
shall be entitled to assume that the conditions precedent set forth in Section
4.2 have been satisfied unless it shall have acquired actual knowledge that any
such condition precedent has not been satisfied; provided, however, that nothing
set forth in this Section 2.2 shall be deemed to prejudice the right of any
Lender to recover from any Issuing Lender any amounts made available by such
Lender to such Issuing Lender pursuant to this Section 2.2 in the event that it
is determined by a court of competent jurisdiction that the payment with respect
to a Letter of Credit constituted gross negligence or willful misconduct on the
part of such Issuing Lender.

(k) Limitation on Obligation of Each Issuing Lender. Notwithstanding anything
contained herein to the contrary, no Issuing Lender shall be under any
obligation to issue, renew or extend any Letter of Credit if (i) any order,
judgment or decree of any Governmental Authority or arbitrator shall by its
terms purport to enjoin or restrain such Issuing Lender from issuing a Letter of
Credit, or any applicable law, rule or regulation or any request or directive
(whether or not having the force of law) from any governmental with jurisdiction
over the

                                    Page 31
<PAGE>

Issuing Lender shall prohibit, or request that such Issuing Lender refrain from,
the issuance of letters of credit generally or any such Letter of Credit in
particular, or shall impose upon the Issuing Lender with respect to any such
Letter of Credit any restriction, reserve or capital requirement (for which such
Issuing Lender is not otherwise compensated hereunder) not in effect on the
Closing Date, or shall impose upon such Issuing Lender any unreimbursed loss,
costs or expense which was not applicable on the Closing Date and which such
Issuing Lender should deem material to it in good faith, or (ii) the issuance,
renewal or extension would violate or otherwise contravene its internal policy.

(l) Conflict with LOC Documents. In the event of any conflict between this
Credit Agreement and any LOC Document (including any Letter of Credit
Application), this Credit Agreement shall control with respect to the Persons
who are parties to this Credit Agreement and such LOC Document. Notwithstanding
the generality of the foregoing, each of the Reimbursement Agreements set forth
on Schedule 2.2(l) is and shall be deemed amended such that the representations
and warranties, covenants and events of default (and definitions related
thereto) set out in such Reimbursement Agreements, except to the extent they
relate specifically to the relevant bonds or relevant remarketing program,
conform with the representations and warranties, covenants and events of default
(and definitions related thereto) set out in this Credit Agreement (the
"Incorporated Provisions"). Such amendments shall survive (i) the payment in
full of all obligations due the Lenders by the Borrower under this Credit
Agreement, (ii) the termination (for any reason) of this Credit Agreement, (iii)
the sale or participation (in whole or in part) of a Lender's interest in this
Credit Agreement, or (iv) any other event which has the effect of terminating
the obligations of the Borrower to the Lenders under this Credit Agreement. Upon
the happening of one of the events set forth in the immediately preceding
sentence, the Borrower agrees to promptly execute a modification of the relevant
Reimbursement Agreement(s) to confirm such amendment. Notwithstanding the
preceding sentence or the failure of any such modification to be executed, the
Borrower must remain in compliance with the Incorporated Provisions as if set
forth in the relevant Reimbursement Agreement(s). Any future modification of or
amendment to the Incorporated Provisions shall be a modification of or amendment
to the relevant Reimbursement Agreement(s) for purposes of compliance with such
agreements. Likewise, if the Agent and the Required Lenders grant a waiver of
compliance of the Incorporated Provisions for any period, such waiver shall be
deemed to be a waiver of compliance of the relevant Reimbursement Agreement(s)
for the limited period of time for which the waiver was granted.

2.3 Swingline Loans and Procedure.

(a) Swingline Loans. Subject to the terms and conditions hereof and in reliance
upon the representations and warranties set forth herein, the Swingline Lender
hereby agrees to make loans (each a "Swingline Loan" and collectively, the
"Swingline Loans") to the Borrower, in Dollars, at any time and from time to
time, during the period from and including the Closing Date to but not including
the Maturity Date (or such earlier date if the Commitments have been terminated
as provided herein); provided that (i) the aggregate principal amount of the
Swingline Loans outstanding at any one time shall not exceed the Swingline
Commitment and (ii) the aggregate amount of outstanding Swingline Loans plus the
aggregate amount of outstanding Revolving Loans plus LOC Obligations shall not
exceed the Revolving Committed Amount. Subject to the terms of this Loan
Agreement, the Borrower may borrow, repay and reborrow Swingline Loans. The
Swingline Loans shall bear interest at a rate mutually agreeable to the
Swingline Lender and the Borrower at the time of the borrowing of such Swingline
Loan.

                                    Page 32
<PAGE>

(b) Borrowing Procedures. By no later than 3:00 P.M. (San Francisco, California
time) on the date of the requested borrowing of Swingline Loans, the Borrower
shall provide telephone notice to the Swingline Lender, followed promptly by a
written Swingline Loan Request in the form of Exhibit 2.3(b) (which maybe
submitted by telecopy) setting forth (i) the amount of the requested Swingline
Loan and (ii) the date of the requested Swingline Loan and complying in all
respects with Section 4.2. The Swingline Lender shall initiate the transfer of
funds representing the Swingline Loan advance to the Borrower by 4:00 P.M. (San
Francisco, California time) on the Business Day of the requested borrowing.

(c) Minimum Amounts. Each Swingline Loan shall be in a minimum amount of the
lesser of $500,000 (and in integral multiples of $100,000 in excess thereof) or
the remaining amount available under the Swingline Commitment.

(d) Repayment and Participations of Swingline Loans. The Borrower agrees to
repay all Swingline Loans immediately upon the existence of a Default or Event
of Default or otherwise within one Business Day of demand therefor by the
Swingline Lender. If the Borrower does not immediately notify the Swingline
Lender that the Borrower intends to otherwise repay such Swingline Loan, the
Borrower shall be deemed to have requested a Revolving Loan advance comprised
solely of Base Rate Loans in the amount of such Swingline Loans; provided,
however, that any such demand shall be deemed to have been given one Business
Day prior to the Maturity Date and on the date of the occurrence of any Event of
Default described in Section 8.1 and upon acceleration of the indebtedness
hereunder and the exercise of remedies in accordance with the provisions of
Section 8.2. Each Lender hereby irrevocably agrees to make its pro rata share of
each such Revolving Loan in the amount, in the manner and on the date specified
in the preceding sentence notwithstanding (i) the amount of such borrowing may
not comply with the minimum amount for advances of Revolving Loans otherwise
required hereunder, (ii) whether any conditions specified in Section 4.2 are
then satisfied, (iii) whether a Default or an Event of Default then exists, (iv)
failure of any such request or deemed request for a Revolving Loan to be made by
the time otherwise required hereunder, (v) whether the date of such borrowing is
a date on which Revolving Loans are otherwise permitted to be made hereunder or
(vi) any termination of the Commitments relating thereto immediately prior to or
contemporaneously with such borrowing. In the event that any Revolving Loan
cannot for any reason be made on the date otherwise required above (including,
without limitation, as a result of the commencement of a proceeding under the
Bankruptcy Code with respect to the Borrower or any other Consolidated Party),
then each Lender hereby agrees that it shall forthwith purchase (as of the date
such borrowing would otherwise have occurred, but adjusted for any payments
received from the Borrower on or after such date and prior to such purchase)
from the Swingline Lender such Participation Interests in the outstanding
Swingline Loans as shall be necessary to cause each such Lender to share in such
Swingline Loans ratably based upon its Revolving Commitment Percentage of the
Revolving Committed Amount (determined before giving effect to any termination
of the Commitments pursuant to Section 3.4), provided that (A) all interest
payable on the Swingline Loans shall be for the account of the Swingline Lender
until the date as of which the respective Participation Interest is purchased
and (B) at the time any purchase of Participation Interests pursuant to this
sentence is actually made, the purchasing Lender shall be required to pay to the
Swingline Lender, interest on the principal amount of Participation Interests
purchased for each day from the date of demand thereof, at a rate equal to, if
paid within two Business Days of such date, the Federal Funds Rate, and
thereafter at a rate equal to the Base Rate plus two percent (2%) per annum.

                                    Page 33
<PAGE>

(e) Swingline Loan Note. The Swingline Loans made by the Swingline Lender shall
be evidenced by a duly executed promissory note of the Borrower to the Swingline
Lender in substantially the form of Exhibit 2.3(e) (a "Swingline Note").

SECTION 3

OTHER PROVISIONS RELATING TO CREDIT FACILITIES

3.1 Default Rate.

Upon the occurrence, and during the continuance, of an Event of Default, (i) the
principal of and, to the extent permitted by law, interest on the Loans and any
other amounts owing hereunder or under the other Credit Documents shall bear
interest, payable on demand, at a per annum rate 2% greater than the rate which
would otherwise be applicable (or if no rate is applicable, whether in respect
of interest, fees or other amounts, then the Adjusted Base Rate plus 2%) and
(ii) the Letter of Credit Fee shall accrue at a per annum rate 2% greater than
the rate which would otherwise be applicable.

3.2 Extension and Conversion.

The Borrower shall have the option, on any Business Day, to extend existing
Revolving Loans into a subsequent permissible Interest Period or to convert
Revolving Loans into Revolving Loans of another interest rate type; provided,
however, that (i) except as provided in Section 3.8, Eurodollar Loans may be
converted into Base Rate Loans or extended as Eurodollar Loans for new Interest
Periods only on the last day of the Interest Period applicable thereto, (ii)
Revolving Loans extended as, or converted into, Eurodollar Loans shall be
subject to the terms of the definition of "Interest Period" set forth in Section
1.1 and shall be in such minimum amounts as provided in Section 2.1(b)(ii),
(iii) no more than six (6) Eurodollar Loans which are Revolving Loans shall be
outstanding hereunder at any time (it being understood that, for purposes
hereof, Eurodollar Loans with different Interest Periods shall be considered as
separate Eurodollar Loans, even if they begin on the same date, although
borrowings, extensions and conversions may, in accordance with the provisions
hereof, be combined at the end of existing Interest Periods to constitute a new
Eurodollar Loan with a single Interest Period) and (iv) any request for
extension or conversion of a Eurodollar Loan which shall fail to specify an
Interest Period shall be deemed to be a request for an Interest Period of one
month. Each such extension or conversion shall be effected by the Borrower by
giving a Notice of Extension/Conversion (or telephonic notice promptly confirmed
in writing) to the office of the Agent specified in Schedule 2.1(a), or at such
other office as the Agent may designate in writing, prior to 10:00 A.M. (San
Francisco, California time) on the Business Day of, in the case of the
conversion of a Eurodollar Loan into a Base Rate Loan, and on the third Business
Day prior to, in the case of the extension of a Eurodollar Loan as, or
conversion of a Base Rate Loan into, a Eurodollar Loan, the date of the proposed
extension or conversion, specifying the date of the proposed extension or
conversion, the Revolving Loans to be so extended or converted, the types of
Revolving Loans into which such Revolving Loans are to be converted and, if
appropriate, the applicable Interest Periods with respect thereto. In the event
the Borrower fails to request extension or conversion of any Eurodollar Loan in
accordance with this Section 3.2, or any such conversion or extension is not
permitted or required by this Section 3.2, then such Eurodollar Loan shall be
automatically converted into a Base Rate Loan at the end of the Interest Period
applicable thereto. The Agent shall give each Lender notice as

                                    Page 34
<PAGE>

promptly as practicable of any such proposed extension or conversion affecting
any Revolving Loan.

3.3 Prepayments.

(a) Voluntary Prepayments. The Borrower shall have the right to prepay Loans in
whole or in part from time to time; provided, however, that each partial
prepayment of Loans shall be in a minimum principal amount of $5,000,000 and
integral multiples of $1,000,000 in excess thereof (or, the then remaining
principal balance of the Revolving Loans, if less) or, in the case of Swingline
Loans, in a minimum principal amount of $500,000 and multiples of $100,000 in
excess thereof. Subject to the foregoing terms, amounts prepaid under this
Section 3.3(a) shall be applied as the Borrower may elect; provided that if the
Borrower shall fail to specify its elected application with respect to any
voluntary prepayment, such voluntary prepayment shall be applied first to
Swingline Loans and then to Revolving Loans, and with respect to Revolving Loans
first to Base Rate Loans and then to Eurodollar Loans in direct order of
Interest Period maturities. All prepayments under this Section 3.3(a) shall be
subject to Section 3.12, but otherwise without premium or penalty and shall be
accompanied by interest on the principal amount prepaid through the date of
prepayment.

(b) Mandatory Prepayments.

(i) (A) Revolving Committed Amount. If at any time, the sum of the aggregate
outstanding principal amount of Revolving Loans plus LOC Obligations plus
Swingline Loans shall exceed the Revolving Committed Amount, the Borrower
immediately shall prepay the Revolving Loans and (after the Revolving Loans have
been repaid) cash collateralize the LOC Obligations, in an amount sufficient to
eliminate such excess.

(B) LOC Committed Amount. If at any time, the sum of the aggregate principal
amount of LOC Obligations shall exceed the LOC Committed Amount, the Borrower
immediately shall cash collateralize the LOC Obligations in an amount sufficient
to eliminate such excess.

(C) Swingline Commitment. If at any time, the sum of the Swingline Loans shall
exceed the Swingline Commitment, the Borrower immediately shall prepay the
Swingline Loans in an amount sufficient to eliminate such excess.

(ii) (A) Asset Dispositions. Immediately upon the occurrence of any Asset
Disposition Prepayment Event the Borrower shall prepay the Loans in an aggregate
amount equal to 100% of the Net Cash Proceeds of the related Asset Disposition
not applied (or caused to be applied) by the Borrower during the related
Application Period to make Eligible Reinvestments as contemplated by the terms
of Section 7.5(g) (such prepayment to be applied as set forth in clause (v)
below).

(B) Involuntary Dispositions. Immediately upon the occurrence of an Involuntary
Disposition Prepayment Event, the Borrower shall prepay the Loans in an
aggregate amount equal to 100% of the Excess Proceeds not used to make Eligible
Reinvestments (such prepayment to be applied as set forth in clause (v) below).

(iii) Debt Issuances. Immediately upon the occurrence of a Debt Issuance
Prepayment Event, the Borrower shall prepay the Loans in an aggregate amount
equal to 100% of the Net Cash Proceeds of the related Debt Issuance (such
prepayment to be applied as set forth in clause (v) below).

(iv) Equity Issuances. Immediately upon the occurrence of an Equity

                                    Page 35
<PAGE>

Issuance Prepayment Event, the Borrower shall prepay the Loans in an aggregate
amount equal to 50% of the Net Cash Proceeds of the related Equity Issuance
(such prepayment to be applied as set forth in clause (v) below).

(v) Application of Mandatory Prepayments. Subject to the next succeeding
paragraph, all amounts required to be paid pursuant to this Section 3.3(b) shall
be applied as follows: (A) with respect to all amounts prepaid pursuant to
Section 3.3(b)(i)(A), to Revolving Loans and (after the Revolving Loans have
been repaid) to a cash collateral account in respect of LOC Obligations, (B)
with respect to all amounts prepaid pursuant to Section 3.3(b)(i)(B), to a cash
collateral account in respect of LOC Obligations, (C) with respect to all
amounts prepaid pursuant to 3.3(b)(i)(C), to Swingline Loans, (D) with respect
to all amounts prepaid pursuant to Section 3.3(b)(ii), first to the Swingline
Loans and then Revolving Loans and (after all such Loans have been repaid) to a
cash collateral account in respect of LOC Obligations (with a corresponding
reduction in the Revolving Committed Amount in an amount equal to all amounts
applied, or available to be applied, to Revolving Loans and in respect of LOC
Obligations pursuant to this clause (D)) and (E) with respect to all amounts
prepaid pursuant to Section 3.3(b)(iii) or (iv), first to the Swingline Loans
and then to Revolving Loans and (after all Revolving Loans and Swingline Loans
have been repaid) to a cash collateral account in respect of LOC Obligations.
Within the parameters of the applications set forth above, prepayments shall be
applied first to Base Rate Loans and then to Eurodollar Loans in direct order of
Interest Period maturities. All prepayments under this Section 3.3(b) shall be
subject to Section 3.12, but otherwise without premium or penalty, and shall be
accompanied by interest on the principal amount prepaid through the date of
prepayment.

Notwithstanding the foregoing, to the extent that any mandatory prepayment
required under this Section 3.3 would have the effect of reducing the Revolving
Committed Amount below the amount necessary to support LOC Obligations, such
portion of the prepayment shall be applied to a cash collateral account in
respect of such LOC Obligations and the Revolving Committed Amount shall not be
reduced thereby.

(vi) Prepayment Account. If the Borrower is required to make a mandatory
prepayment of Eurodollar Loans under this Section 3.3(b), the Borrower shall
have the right, as long as no Default or Event of Default then exists, in lieu
of making such prepayment in full, to deposit an amount equal to such mandatory
prepayment with the Agent in a cash collateral account maintained (pursuant to
documentation reasonably satisfactory to the Agent) by and in the sole dominion
and control of the Agent. Any amounts so deposited shall be held by the Agent as
collateral for the prepayment of such Eurodollar Loans and shall be applied to
the prepayment of the applicable Eurodollar Loans at the end of the current
Interest Periods applicable thereto. At the request of the Borrower, amounts so
deposited shall be invested by the Agent in Cash Equivalents maturing prior to
the date or dates on which it is anticipated that such amounts will be applied
to prepay such Eurodollar Loans; any interest earned on such Cash Equivalents
will be for the account of the Borrower and the Borrower will deposit with the
Agent the amount of any loss on any such Cash Equivalents to the extent
necessary in order that the amount of the prepayment to be made with the
deposited amounts may not be reduced.

3.4 Termination and Reduction of Revolving Committed Amount.

(a) Voluntary Reductions. The Borrower may from time to time permanently reduce
or terminate the Revolving Committed Amount in whole or in part (in minimum
aggregate amounts of $5,000,000 or in integral

                                    Page 36
<PAGE>

multiples of $1,000,000 in excess thereof (or, if less, the full remaining
amount of the then applicable Revolving Committed Amount)) upon five Business
Days' prior written notice to the Agent; provided, however, no such termination
or reduction shall be made which would cause the sum of the aggregate
outstanding principal amount of Revolving Loans plus LOC Obligations plus the
aggregate amount of outstanding Swingline Loans to exceed the Revolving
Committed Amount, unless, concurrently with such termination or reduction, the
Revolving Loans are repaid to the extent necessary to eliminate such excess. The
Agent shall promptly notify each affected Lender of receipt by the Agent of any
notice from the Borrower pursuant to this Section 3.4(a).

(b) Mandatory Reductions. The Revolving Committed Amount automatically shall be
permanently reduced from time to time in accordance with the terms of Section
3.3(b)(v).

(c) Maturity Date. Unless terminated sooner pursuant to Section 3.4(a), Section
8.2 or Section 10.3(h), the Revolving Commitments of the Lenders, the LOC
Commitment of the Issuing Lender and Swingline Commitment of the Swingline
Lender shall automatically terminate on the Maturity Date.

(d) General. The Borrower shall pay to the Agent for the account of the Lenders
in accordance with the terms of Section 3.5(a), on the date of each termination
or reduction of the Revolving Committed Amount, the Unused Fee accrued through
the date of such termination or reduction on the amount of the Revolving
Committed Amount so terminated or reduced.

3.5 Fees.

(a) Unused Fee. In consideration of the Revolving Commitments of the Lenders
hereunder, the Borrower promises to pay to the Agent for the account of each
Lender a fee (the "Unused Fee") on the Unused Revolving Committed Amount
computed at a per annum rate for each day during the applicable Unused Fee
Calculation Period (hereinafter defined) at a rate equal to the Applicable
Percentage in effect from time to time. The Unused Fee shall commence to accrue
on the Closing Date and shall be due and payable in arrears on the last Business
Day of each March, June, September and December (and on any date that the
Revolving Committed Amount is reduced and on the Maturity Date) for the
immediately preceding quarter (or portion thereof) (each such quarter or portion
thereof for which the Unused Fee is payable hereunder being herein referred to
as an "Unused Fee Calculation Period"), beginning with the first of such dates
to occur after the Closing Date.

(b) Letter of Credit Fee. In consideration of the issuance of standby Letters of
Credit hereunder, the Borrower promises to pay to the Agent for the account of
each Lender a fee (the "Letter of Credit Fee") on such Lender's Revolving
Commitment Percentage of the average daily maximum amount available to be drawn
under each such Letter of Credit computed at a per annum rate for each day from
the date of issuance to the date of expiration equal to the Applicable
Percentage. The Letter of Credit Fee will be payable quarterly in arrears on the
last Business Day of each March, June, September and December for the
immediately preceding quarter (or a portion thereof).

(c) Issuing Lender Fees. In addition to the Letter of Credit Fee payable
pursuant to clause (b) above the Borrower promises to pay to each Issuing Lender
without sharing by the other Lenders (i) a letter of credit fronting fee of
0.125% on the average daily maximum amount available to be drawn under each
Letter of Credit (other than the Existing Letters of Credit except in connection
with renewals, modifications or extension of the Existing Letters of Credit)
issued by

                                    Page 37
<PAGE>

such Issuing Lender computed at a per annum rate for each day from the date of
issuance to the date of expiration (which fronting fee shall be payable
quarterly in arrears on the last day of each March, June, September and December
for the immediately preceding quarter (or a portion thereof)) and (ii) the
customary charges from time to time of the Issuing Lender with respect to the
issuance, amendment, transfer, administration, cancellation and conversion of,
and drawings under, such Letters of Credit.

(d) Agent's Fees. The Borrower promises to pay to the Agent, for its own
account, for the account of each Issuing Lender and for the account of the
Arranger, as applicable, the fees referred to in the Agent's Fee Letter.

3.6 Capital Adequacy.

If any Lender has determined, after the date hereof, that the adoption or the
becoming effective of, or any change in, or any change by any Governmental
Authority, central bank or comparable agency charged with the interpretation or
administration thereof in the interpretation or administration of, any
applicable law, rule or regulation regarding capital adequacy, or compliance by
such Lender with any request or directive regarding capital adequacy (whether or
not having the force of law) of any such authority, central bank or comparable
agency, has or would have the effect of reducing the rate of return on such
Lender's capital or assets as a consequence of its commitments or obligations
hereunder to a level below that which such Lender could have achieved but for
such adoption, effectiveness, change or compliance (taking into consideration
such Lender's policies with respect to capital adequacy), then, upon notice from
such Lender to the Borrower, the Borrower shall be obligated to pay to such
Lender such additional amount or amounts as will compensate such Lender for such
reduction. Each determination by any such Lender of amounts owing under this
Section shall, absent manifest error, be conclusive and binding on the parties
hereto.

3.7 Limitation on Eurodollar Loans.

If on or prior to the first day of any Interest Period for any Eurodollar Loan:

(a) the Agent determines (which determination shall be conclusive) that by
reason of circumstances affecting the relevant market, adequate and reasonable
means do not exist for ascertaining the Eurodollar Rate for such Interest
Period; or

(b) the Required Lenders determine (which determination shall be conclusive) and
notify the Agent that the Eurodollar Rate will not adequately and fairly reflect
the cost to the Lenders of funding Eurodollar Loans for such Interest Period;
then the Agent shall give the Borrower prompt notice thereof, and so long as
such condition remains in effect, the Lenders shall be under no obligation to
make additional Eurodollar Loans, Continue Eurodollar Loans, or to Convert Base
Rate Loans into Eurodollar Loans and the Borrower shall, on the last day(s) of
the then current Interest Period(s) for the outstanding Eurodollar Loans, either
prepay such Eurodollar Loans or Convert such Eurodollar Loans into Base Rate
Loans in accordance with the terms of this Credit Agreement.

3.8 Illegality.

Notwithstanding any other provision of this Credit Agreement, in the event that
it becomes unlawful for any Lender or its Applicable Lending Office to make,
maintain, or fund Eurodollar Loans hereunder, then such Lender shall promptly
notify the Borrower thereof and such Lender's

                                    Page 38
<PAGE>

obligation to make or Continue Eurodollar Loans and to Convert Base Rate Loans
into Eurodollar Loans shall be suspended until such time as such Lender may
again make, maintain, and fund Eurodollar Loans (in which case the provisions of
Section 3.10 shall be applicable).

3.9 Requirements of Law.

If, after the date hereof, the adoption of any applicable law, rule, or
regulation, or any change in any applicable law, rule, or regulation, or any
change in the interpretation or administration thereof by any Governmental
Authority, central bank, or comparable agency charged with the interpretation or
administration thereof, or compliance by any Lender (or its Applicable Lending
Office) with any request or directive (whether or not having the force of law)
of any such Governmental Authority, central bank, or comparable agency:

(i) shall subject such Lender (or its Applicable Lending Office) to any tax,
duty, or other charge with respect to any Eurodollar Loans, its Notes, or its
obligation to make Eurodollar Loans, or change the basis of taxation of any
amounts payable to such Lender (or its Applicable Lending Office) under this
Credit Agreement or its Notes in respect of any Eurodollar Loans (other than
taxes imposed on the overall income of such Lender by the jurisdiction in which
such Lender has its principal office or such Applicable Lending Office);

(ii) shall impose, modify, or deem applicable any reserve, special deposit,
assessment, or similar requirement (other than the Eurodollar Reserve Percentage
utilized in the determination of the Adjusted Eurodollar Rate) relating to any
extensions of credit or other assets of, or any deposits with or other
liabilities or commitments of, such Lender (or its Applicable Lending Office),
including the Commitment of such Lender hereunder; or

(iii) shall impose on such Lender (or its Applicable Lending Office) or the
London interbank market any other condition affecting this Credit Agreement or
its Notes or any of such extensions of credit or liabilities or commitments;

and the result of any of the foregoing is to increase the cost to such Lender
(or its Applicable Lending Office) of making, Converting into, Continuing, or
maintaining any Eurodollar Loans or to reduce any sum received or receivable by
such Lender (or its Applicable Lending Office) under this Credit Agreement or
its Notes with respect to any Eurodollar Loans, then the Borrower shall pay to
such Lender on demand such amount or amounts as will compensate such Lender for
such increased cost or reduction. If any Lender requests compensation by the
Borrower under this Section 3.9, the Borrower may, by notice to such Lender
(with a copy to the Agent), suspend the obligation of such Lender to make or
Continue Eurodollar Loans, or to Convert Base Rate Loans into Eurodollar Loans,
until the event or condition giving rise to such request ceases to be in effect
(in which case the provisions of Section 3.10 shall be applicable); provided
that such suspension shall not affect the right of such Lender to receive the
compensation so requested. Each Lender shall promptly notify the Borrower and
the Agent of any event of which it has knowledge, occurring after the date
hereof, which will entitle such Lender to compensation pursuant to this Section
3.9 and will designate a different Applicable Lending Office if such designation
will avoid the need for, or reduce the amount of, such compensation and will
not, in the judgment of such Lender, be otherwise disadvantageous to it. Any
Lender claiming compensation under this Section 3.9 shall furnish to the
Borrower and the Agent a statement setting forth the additional amount or
amounts to be paid to it hereunder which shall be conclusive in the absence of
manifest error. In determining such amount, such Lender may

                                    Page 39
<PAGE>

use any reasonable averaging and attribution methods.

3.10 Treatment of Affected Loans.

If the obligation of any Lender to make any Eurodollar Loan or to Continue, or
to Convert Base Rate Loans into, Eurodollar Loans shall be suspended pursuant to
Section 3.7, 3.8 or 3.9 hereof, such Lender's Eurodollar Loans shall be
automatically Converted into Base Rate Loans on the last day(s) of the then
current Interest Period(s) for such Eurodollar Loans (or, in the case of a
Conversion, on such earlier date as such Lender may specify to the Borrower with
a copy to the Agent) and, unless and until such Lender gives notice as provided
below that the circumstances specified in Section 3.7, 3.8 or 3.9 hereof that
gave rise to such Conversion no longer exist:

(a) to the extent that such Lender's Eurodollar Loans have been so Converted,
all payments and prepayments of principal that would otherwise be applied to
such Lender's Eurodollar Loans shall be applied instead to its Base Rate Loans;
and

(b) all Loans that would otherwise be made or Continued by such Lender as
Eurodollar Loans shall be made or Continued instead as Base Rate Loans, and all
Base Rate Loans of such Lender that would otherwise be Converted into Eurodollar
Loans shall remain as Base Rate Loans.

If such Lender gives notice to the Borrower (with a copy to the Agent) that the
circumstances specified in Section 3.7, 3.8 or 3.9 hereof that gave rise to the
Conversion of such Lender's Eurodollar Loans pursuant to this Section 3.10 no
longer exist (which such Lender agrees to do promptly upon such circumstances
ceasing to exist) at a time when Eurodollar Loans made by other Lenders are
outstanding, such Lender's Base Rate Loans shall be automatically Converted, on
the first day(s) of the next succeeding Interest Period(s) for such outstanding
Eurodollar Loans, to the extent necessary so that, after giving effect thereto,
all Loans held by the Lenders holding Eurodollar Loans and by such Lender are
held pro rata (as to principal amounts, interest rate basis, and Interest
Periods) in accordance with their respective Commitments.

3.11 Taxes.

(a) Any and all payments by the Borrower to or for the account of any Lender or
the Agent hereunder or under any other Credit Document shall be made free and
clear of and without deduction for any and all present or future taxes, duties,
levies, imposts, deductions, charges or withholdings, and all liabilities with
respect thereto, excluding, in the case of each Lender and the Agent, taxes
imposed on its income, and franchise taxes imposed on it, by the jurisdiction
under the laws of which such Lender (or its Applicable Lending Office) or the
Agent (as the case may be) operates its business or is organized or any
political subdivision thereof (all such non-excluded taxes, duties, levies,
imposts, deductions, charges, withholdings, and liabilities being hereinafter
referred to as "Taxes"). If the Borrower shall be required by law to deduct any
Taxes from or in respect of any sum payable under this Credit Agreement or any
other Credit Document to any Lender or the Agent, (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 3.11) such
Lender or the Agent 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 law, and (iv) the
Borrower shall furnish to the Agent, at its address referred to in Section 10.1,
the original or a certified copy of a receipt

                                    Page 40
<PAGE>

evidencing payment thereof.

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

(c) The Borrower agrees to indemnify each Lender and the Agent for the full
amount of Taxes and Other Taxes (including, without limitation, any Taxes or
Other Taxes imposed or asserted by any jurisdiction on amounts payable under
this Section 3.11) paid by such Lender or the Agent (as the case may be) and any
liability (including penalties, interest, and expenses) arising therefrom or
with respect thereto.

(d) Each Lender that is not a United States person under Section 7701(a)(30) of
the Code, on or prior to the date of its execution and delivery of this Credit
Agreement in the case of each Lender listed on the signature pages hereof and on
or prior to the date on which it becomes a Lender in the case of each other
Lender, and from time to time thereafter if requested in writing by the Borrower
or the Agent (but only so long as such Lender remains lawfully able to do so),
shall provide the Borrower and the Agent with (i) Internal Revenue Service Form
W-8 BEN or W-8 ECI, as appropriate, or any successor form prescribed by the
Internal Revenue Service, certifying that such Lender is entitled to benefits
under an income tax treaty to which the United States is a party which reduces
to zero the rate of withholding tax on payments of interest or certifying that
the income receivable pursuant to this Credit Agreement is effectively connected
with the conduct of a trade or business in the United States, (ii) Internal
Revenue Service Form W-8 or W-9, as appropriate, or any successor form
prescribed by the Internal Revenue Service, and/or (iii) any other form or
certificate required by any taxing authority (including any certificate required
by Sections 871(h) and 881(c) of the Internal Revenue Code), certifying that
such Lender is entitled to an exemption from tax on payments pursuant to this
Credit Agreement or any of the other Credit Documents.

(e) For any period with respect to which a Lender has failed to provide the
Borrower and the Agent with the appropriate form pursuant to Section 3.11(d)
(unless such failure is due to a change in treaty, law, or regulation occurring
subsequent to the date on which a form originally was required to be provided),
such Lender shall not be entitled to indemnification under Section 3.11(a) or
3.11(b) with respect to Taxes imposed by the United States; provided, however,
that should a Lender, which is otherwise exempt from withholding tax, become
subject to Taxes because of its failure to deliver a form required hereunder,
the Borrower, at the cost and expense of the Lender, shall take such steps as
such Lender shall reasonably request to assist such Lender to recover such
Taxes.

(f) If the Borrower is required to pay additional amounts to or for the account
of any Lender pursuant to this Section 3.11, then such Lender will agree to use
reasonable efforts to change the jurisdiction of its Applicable Lending Office
so as to eliminate or reduce any such additional payment which may thereafter
accrue if such change, in the judgment of such Lender, is not otherwise
disadvantageous to such Lender.

(g) Without prejudice to the survival of any other agreement of the Borrower
hereunder, the agreements and obligations of the Borrower contained in this
Section 3.11 shall survive the repayment of the Loans, LOC Obligations and other
obligations under the Credit Documents and the

                                    Page 41
<PAGE>

termination of the Commitments hereunder.

3.12 Compensation.

Upon demand of any Lender (with a copy to the 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 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 3.17;

including any loss of anticipated profits and 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 3.12, each Lender shall be deemed to have funded each Eurodollar
Loan made by it at the Interbank Offered Rate for such Loan by a matching
deposit or other borrowing in the applicable offshore Dollar interbank market
for a comparable amount and for a comparable period, whether or not such
Eurodollar Loan was in fact so funded. The covenants of the Borrower set forth
in this Section 3.12 shall survive the repayment of the Loans, LOC Obligations
and other obligations under the Credit Documents and the termination of the
Commitments hereunder.

3.13 Pro Rata Treatment.

Except to the extent otherwise provided herein:

(a) Loans. Each Loan (other than Swingline Loans), each payment or (subject to
the terms of Section 3.3) prepayment of principal of any Loan (other than
Swingline Loans) or reimbursement obligations arising from drawings under
Letters of Credit, each payment of interest on the Loans (other than Swingline
Loans) or reimbursement obligations arising from drawings under Letters of
Credit, each payment of Unused Fees, each payment of the Letter of Credit Fee,
each reduction of the Revolving Committed Amount and each conversion or
extension of any Loan (other than Swingline Loans), shall be allocated pro rata
among the Lenders in accordance with the respective principal amounts of their
outstanding Loans of the applicable type and Participation Interests in Loans of
the applicable type and Letters of Credit.

(b) Swingline Loans. The Swingline Lender shall receive, for its own account,
all payments or prepayments of principal and interest with respect to the
Swingline Loans; provided, however, upon the funding of the Participants'
participation interests with respect to a Swingline Loan pursuant to Section
2.3(d), such Participants shall be entitled to

                                    Page 42
<PAGE>

receive their pro rata share of any payment or prepayment of principal and
interest with respect to such Swingline Loan.

(c) Advances.

(i) No Lender shall be responsible for the failure or delay by any other Lender
in its obligation to make its ratable share of a borrowing hereunder; provided,
however, that the failure of any Lender to fulfill its obligations hereunder
shall not relieve any other Lender of its obligations hereunder.

(ii) Unless the Borrower or any Lender has notified the Agent prior to the date
any payment is required to be made by it to the Agent hereunder, that the
Borrower or such Lender, as the case may be, will not make such payment, the
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 Agent in
immediately available funds, then:

(A) if the Borrower failed to make such payment, each Lender shall forthwith on
demand repay to the 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 Agent to such Lender to the date such amount is repaid to the
Agent in immediately available funds, at the Federal Funds Rate from time to
time in effect; and

(B) if any Lender failed to make such payment, such Lender shall forthwith on
demand pay to the 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 Agent to the Borrower to the date such amount is recovered by
the Agent (the "Compensation Period") at a rate per annum equal to the Federal
Funds Rate from time to time in effect. If such Lender does not pay such amount
forthwith upon the Agent's demand therefor, the Agent may make a demand therefor
upon the Borrower, and the Borrower shall pay such amount to the 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 that the Agent or the Borrower
may have against any Lender as a result of any default by such Lender hereunder.
A notice of the Agent to any Lender with respect to any amount owing under this
subsection (b) shall be conclusive, absent manifest error.

3.14 Sharing of Payments.

The Lenders agree among themselves that, in the event that any Lender shall
obtain payment in respect of any Loan, LOC Obligations or any other obligation
owing to such Lender under this Credit Agreement through the exercise of a right
of setoff, banker's lien or counterclaim, or pursuant to a secured claim under
Section 506 of Title 11 of the United States Code or other security or interest
arising from, or in lieu of, such secured claim, received by such Lender under
any applicable bankruptcy, insolvency or other similar law or otherwise, or by
any other means, in excess of its pro rata share of such payment as provided for
in this Credit Agreement, such Lender shall promptly purchase from the other
Lenders a Participation Interest in such Loans, LOC Obligations and other
obligations in such amounts, and make such other adjustments from time to

                                    Page 43
<PAGE>

time, as shall be equitable to the end that all Lenders share such payment in
accordance with their respective ratable shares as provided for in this Credit
Agreement. The Lenders further agree among themselves that if payment to a
Lender obtained by such Lender through the exercise of a right of setoff,
banker's lien, counterclaim or other event as aforesaid shall be rescinded or
must otherwise be restored, each Lender which shall have shared the benefit of
such payment shall, by repurchase of a Participation Interest theretofore sold,
return its share of that benefit (together with its share of any accrued
interest payable with respect thereto) to each Lender whose payment shall have
been rescinded or otherwise restored. The Borrower agrees that any Lender so
purchasing such a Participation Interest may, to the fullest extent permitted by
law, exercise all rights of payment, including setoff, banker's lien or
counterclaim, with respect to such Participation Interest as fully as if such
Lender were a holder of such Loan, LOC Obligations or other obligation in the
amount of such Participation Interest. Except as otherwise expressly provided in
this Credit Agreement, if any Lender shall fail to remit to the Agent or any
other Lender an amount payable by such Lender to the Agent or such other Lender
pursuant to this Credit Agreement on the date when such amount is due, such
payments shall be made together with interest thereon for each date from the
date such amount is due until the date such amount is paid to the Agent or such
other Lender at a rate per annum equal to the Federal Funds Rate. If under any
applicable bankruptcy, insolvency or other similar law, any Lender receives a
secured claim in lieu of a setoff to which this Section 3.14 applies, such
Lender shall, to the extent practicable, exercise its rights in respect of such
secured claim in a manner consistent with the rights of the Lenders under this
Section 3.14 to share in the benefits of any recovery on such secured claim.

3.15 Payments, Computations, Etc.

(a) Generally. The Obligations shall not be deemed to be paid in full until the
same are Fully Satisfied hereunder. Except as otherwise specifically provided
herein, all payments hereunder shall be made to the Agent in Dollars in
immediately available funds, without condition or deduction for any
counterclaim, defense, recoupment or setoff of any kind, at the Agent's office
specified in Schedule 2.1(a) not later than 12:00 noon (San Francisco,
California time) on the date when due. Payments received after such time shall
be deemed to have been received on the next succeeding Business Day. The Agent
may (but shall not be obligated to) debit the amount of any such payment which
is not made by such time to any ordinary deposit account of the Borrower
maintained with the Agent (with notice to the Borrower). The Borrower shall, at
the time it makes any payment under this Credit Agreement, specify to the Agent
the Loans, LOC Obligations, Fees, interest or other amounts payable by the
Borrower hereunder to which such payment is to be applied (and in the event that
it fails so to specify, or if such application would be inconsistent with the
terms hereof, the Agent shall distribute such payment to the Lenders in such
manner as the Agent may determine to be appropriate in respect of obligations
owing by the Borrower hereunder, subject to the terms of Section 3.13(a)). The
Agent will distribute such payments to such Lenders, if any such payment is
received prior to 12:00 noon (San Francisco, California time) on a Business Day
in like funds as received prior to the end of such Business Day and otherwise
the Agent will distribute such payment to such Lenders on the next succeeding
Business Day. Whenever any payment hereunder shall be stated to be due on a day
which is not a Business Day, the due date thereof shall be extended to the next
succeeding Business Day (subject to accrual of interest and Fees for the period
of such extension), except that in the case of Eurodollar Loans, if the
extension would cause the payment to be made in the next following calendar
month, then such payment shall instead be made on the next preceding Business
Day. Except as expressly

                                    Page 44
<PAGE>

provided otherwise herein, all computations of interest and fees shall be made
on the basis of actual number of days elapsed over a year of 360 days, except
with respect to computation of interest on Base Rate Loans and Swingline Loans
which shall be calculated based on a year of 365 or 366 days, as appropriate.
Interest shall accrue from and include the date of borrowing, but exclude the
date of payment.

(b) Allocation of Payments After Acceleration. Notwithstanding any other
provisions of this Credit Agreement to the contrary, after acceleration of the
Obligations pursuant to Section 8.2, all amounts collected or received by the
Agent or any Lender on account of the Obligations or any other amounts
outstanding under any of the Credit Documents shall be paid over or delivered as
follows:

FIRST, to the payment of all reasonable out-of-pocket costs and expenses
(including without limitation reasonable attorneys' fees) of the Agent in
connection with enforcing the rights of the Lenders under the Credit Documents;

SECOND, to payment of any fees owed to the Agent or the Swingline Lender;

THIRD, to the payment of all of the Obligations consisting of accrued fees and
interest;

FOURTH, to the payment of the outstanding principal amount of the Obligations
(including the payment or cash collateralization of the outstanding LOC
Obligations);

FIFTH, to the payment of all reasonable out-of-pocket costs and expenses
(including without limitation, reasonable attorneys' fees) of each of the
Lenders in connection with enforcing its rights under the Credit Documents or
otherwise with respect to the Obligations owing to such Lender;

SIXTH, to all other Obligations and other obligations which shall have become
due and payable under the Credit Documents or otherwise and not repaid pursuant
to clauses "FIRST" through "FIFTH" above; and

SEVENTH, to the payment of the surplus, if any, to whomever may be lawfully
entitled to receive such surplus.

In carrying out the foregoing, (i) amounts received shall be applied in the
numerical order provided until exhausted prior to application to the next
succeeding category; (ii) each of the Lenders shall receive an amount equal to
its pro rata share (based on the proportion that the then outstanding Loans and
LOC Obligations held by such Lender bears to the aggregate then outstanding
Loans and LOC Obligations) of amounts available to be applied pursuant to
clauses "THIRD", "FOURTH", "FIFTH" and "SIXTH" above; and (iii) to the extent
that any amounts available for distribution pursuant to clause "FIFTH" above are
attributable to the issued but undrawn amount of outstanding Letters of Credit,
such amounts shall be held by the Agent in a cash collateral account and applied
(A) first, to reimburse the Issuing Lender from time to time for any drawings
under such Letters of Credit and (B) then, following the expiration of all
Letters of Credit, to all other obligations of the types described in clauses
"FIFTH" and "SIXTH" above in the manner provided in this Section 3.15(b).

3.16 Evidence of Debt.

(a) Each Lender shall maintain an account or accounts evidencing each Loan made
by such Lender to the Borrower from time to time, including the amounts of
principal and interest payable and paid to such Lender from

                                    Page 45
<PAGE>

time to time under this Credit Agreement. Each Lender will make reasonable
efforts to maintain the accuracy of its account or accounts and to promptly
update its account or accounts from time to time, as necessary.

(b) The Agent shall maintain the Register pursuant to Section 10.3(c), and a
subaccount for each Lender, in which Register and subaccounts (taken together)
shall be recorded (i) the amount, type and Interest Period of each such Loan
hereunder, (ii) the amount of any principal or interest due and payable or to
become due and payable to each Lender hereunder and (iii) the amount of any sum
received by the Agent hereunder from or for the account of the Borrower and each
Lender's share thereof. The Agent will make reasonable efforts to maintain the
accuracy of the subaccounts referred to in the preceding sentence and to
promptly update such subaccounts from time to time, as necessary.

(c) The entries made in the accounts, Register and subaccounts maintained
pursuant to clause (b) of this Section 3.16 (and, if consistent with the entries
of the Agent, clause (a)) shall be prima facie evidence of the existence and
amounts of the obligations of the Borrower therein recorded; provided, however,
that the failure of any Lender or the Agent to maintain any such account, such
Register or such subaccount, as applicable, or any error therein, shall not in
any manner affect the obligation of the Borrower to repay the Obligations owing
to such Lender.

3.17 Replacement of Affected Lenders.

If (i) any Lender becomes a Defaulting Lender or otherwise defaults in its
Revolving Commitment or (ii) the Borrower is required to make any payments to
any Lender under Section 3.6, Section 3.9 or Section 3.11 in excess of the
proportionate amount (based on the respective Commitments and/or Loans of the
Lenders) of corresponding payments required to be made to the other Lenders, the
Borrower shall have the right, if no Default or Event of Default then exists, to
replace such Lender (the "Replaced Lender") with one or more other Eligible
Assignee or Eligible Assignees, none of whom shall constitute a Defaulting
Lender at the time of such replacement (collectively, the "Replacement Lender"),
provided that (a) at the time of any replacement pursuant to this Section 3.17,
the Replaced Lender and Replacement Lender shall enter into an Assignment and
Acceptance pursuant to which the Replacement Lender shall acquire all or a
portion, as the case may be, of the Commitments and outstanding Loans of, and
participation in Letters of Credit by, the Replaced Lender and (b) all
obligations of the Borrower owing to the Replaced Lender relating to the Loans
so replaced (including, without limitation, such increased costs and excluding
those specifically described in clause (a) above in respect of which the
assignment purchase price has been, or is concurrently being paid) shall be paid
in full to such Replaced Lender concurrently with such replacement. Upon the
execution of the appropriate Assignment and Acceptance, the payment of amounts
referred to in clauses (a) and (b) above and, if so requested by the Replacement
Lender, delivery to the Replacement Lender of the appropriate Note or Notes
executed by the Borrower, the Replacement Lender shall become a Lender hereunder
and the Replaced Lender shall cease to constitute a Lender hereunder with
respect to such replaced Loans, except with respect to indemnification
provisions under this Credit Agreement, which shall survive as to such Replaced
Lender. Notwithstanding anything to the contrary contained above, (1) the Lender
that acts as the Issuing Lender may not be replaced hereunder at any time that
it has Letters of Credit outstanding hereunder unless arrangements satisfactory
to the Issuing Lender (including the furnishing of a back-up standby letter of
credit in form and substance, and issued by an

                                    Page 46
<PAGE>

issuer satisfactory to such Issuing Lender or the depositing of cash collateral
into a cash collateral account maintained with the Agent in amounts and pursuant
to arrangements satisfactory to such Issuing Lender) have been made with respect
to such outstanding Letters of Credit and (2) the Lender that acts as the Agent
may not be replaced hereunder except in accordance with the terms of Section
9.9. The Replaced Lender shall be required to deliver for cancellation its
applicable Notes to be canceled on the date of replacement, or if any such Note
is lost or unavailable, such other assurances or indemnification therefor as the
Borrower may reasonably request.

SECTION 4

CONDITIONS

4.1 Closing Conditions.

The obligation of the Lenders to enter into this Credit Agreement and to make
the initial Loans or the Issuing Lender to issue the initial Letter of Credit,
whichever shall occur first, shall be subject to satisfaction of the following
conditions:

(a) Executed Credit Documents. Receipt by the Agent of duly executed copies of:
(i) this Credit Agreement, (ii) the Notes (as requested pursuant to Section
2.1(e)), (iii) the Agent's Fee Letter and (iv) all other Credit Documents.

(b) Corporate Documents. Receipt by the Agent of the following:

(i) Charter Documents. Copies of the articles or certificates of incorporation
or other charter documents of the Borrower certified to be true and complete as
of a recent date by the appropriate Governmental Authority of the state or other
jurisdiction of its incorporation and certified by a secretary or assistant
secretary of the Borrower to be true and correct as of the Closing Date.

(ii) Bylaws. A copy of the bylaws of the Borrower certified by a secretary or
assistant secretary of the Borrower to be true and correct as of the Closing
Date.

(iii) Resolutions. Copies of resolutions of the Board of Directors of the
Borrower approving and adopting the Credit Documents to which it is a party, the
transactions contemplated therein and authorizing execution and delivery
thereof, certified by a secretary or assistant secretary of the Borrower to be
true and correct and in force and effect as of the Closing Date.

(iv) Good Standing. Copies of (A) certificates of good standing, existence or
its equivalent with respect to the Borrower certified as of a recent date by the
appropriate Governmental Authorities of the state or other jurisdiction of
incorporation and each other jurisdiction in which the failure to so qualify and
be in good standing could reasonably be expected to have a Material Adverse
Effect and (B) to the extent available, a certificate indicating payment of all
corporate or comparable franchise taxes certified as of a recent date by the
appropriate governmental taxing authorities.

(v) Incumbency. An incumbency certificate of the Borrower certified by a
secretary or assistant secretary to be true and correct as of the Closing Date.

(c) Opinions of Counsel. The Agent shall have received an opinion, in

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<PAGE>

form and substance reasonably satisfactory to the Agent, of counsel to the
Borrower, addressed to the Agent and the Lenders, with respect to the corporate
authority of the Borrower, the enforceability of the Credit Documents and such
other matters as the Agent shall reasonably request.

(d) Material Adverse Change. Since October 31, 2000, there shall have been no
development or event relating to or affecting a Consolidated Party which has had
or could reasonably be expected to have a Material Adverse Effect.

(e) Officer's Certificates. The Agent shall have received a certificate or
certificates executed by an Executive Officer of the Borrower as of the Closing
Date, in form and substance satisfactory to the Agent, stating that (A) the
Borrower is in material compliance with all existing financial obligations, (B)
all governmental, shareholder and third party consents and approvals, if any,
required with respect to the Credit Documents and the transactions contemplated
thereby have been obtained, (C) no action, suit, investigation or proceeding is
pending or, to the knowledge of any Executive Officer of the Borrower,
threatened in any court or before any arbitrator or governmental instrumentality
that purports to affect the Borrower or any transaction contemplated by the
Credit Documents, if such action, suit, investigation or proceeding could
reasonably be expected to have a Material Adverse Effect, and (D) immediately
after giving effect to the initial borrowings hereunder, (1) no Default or Event
of Default exists, and (2) all representations and warranties contained herein
and in the other Credit Documents are true and correct in all material respects.

(f) Senior Subordinated Notes. The sum of (i) the gross proceeds beneficially
received by the Borrower (excluding any original issue discount and before
taking into account any underwriters' discount) from the issuance by the
Borrower of the Senior Subordinated Notes on terms satisfactory to the Agent and
the Lenders plus (ii) the Revolving Commitment Amount available on the Closing
Date shall be an amount equal to at least $435,000,000. The Agent shall have
received a copy certified by an Executive Officer of the Borrower as true and
complete of the Senior Subordinated Note Indenture, as originally executed and
delivered, together with all exhibits and schedules thereto.

(g) Fees and Expenses. Payment by the Borrower to the Lenders and the Agent of
all fees and expenses relating to the Credit Facilities which are due and
payable on the Closing Date, including, without limitation, payment to the Agent
of the fees set forth in the Agent's Fee Letter.

(h) Termination of Prior Bank Commitments. The Prior Bank Commitments shall have
been (or will be upon the initial borrowing hereunder and the application of the
proceeds thereof) terminated and the obligations of the Borrower thereunder paid
in full and fully satisfied.

(i) Appraisals. The Agent shall have received timber appraisal reports with
respect to all the timberlands owned by the Consolidated Parties, the form,
scope and results of which shall be agreed to by the Agent and the Borrower.

(j) Escrow Account. The Borrower shall have established an escrow account for
the purposes of holding $20,000,000 of the proceeds of the Revolving Loans made
on the Closing Date, which amount will be used solely to repay $20,000,000 in
principal amount of senior notes maturing on August 15, 2002, pursuant to the
Escrow Agreement and other documentation satisfactory in all respects to the
Agent.

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<PAGE>

(k) Other. Receipt by the Lenders of such other documents, instruments,
agreements or information as reasonably requested by any Lender, including, but
not limited to, information regarding litigation, tax, accounting, labor,
insurance, pension liabilities (actual or contingent), real estate leases,
material contracts, debt agreements, property ownership and contingent
liabilities of the Consolidated Parties.

4.2 Conditions to all Extensions of Credit.

The obligations of each Lender to make, convert or extend any Loan and of the
Issuing Lender to issue or extend any Letter of Credit (including the initial
Loans and the initial Letter of Credit) are subject to satisfaction of the
following conditions in addition to satisfaction on the Closing Date of the
conditions set forth in Section 4.1:

(a) The Borrower shall have delivered (i) in the case of any Revolving Loans, an
appropriate Notice of Borrowing or Notice of Extension/Conversion, (ii) in the
case of any Swingline Loan, an appropriate Swingline Loan Request or (iii) in
the case of any Letter of Credit, the Issuing Lender shall have received an
appropriate request for issuance in accordance with the provisions of Section
2.2(b);

(b) The representations and warranties set forth in Section 5 shall, subject to
the limitations set forth therein, be true and correct in all material respects
as of such date (except for those which expressly relate to an earlier date);
provided, however, that the representation in Section 5.12(f) shall be subject
to the accuracy of the Lenders' representation in Section 10.15 as of the same
date;

(c) There shall not have been commenced against any Consolidated Party an
involuntary case under any applicable bankruptcy, insolvency or other similar
law now or hereafter in effect, or any case, proceeding or other action for the
appointment of a receiver, liquidator, assignee, custodian, trustee,
sequestrator (or similar official) of such Person or for any substantial part of
its Property or for the winding up or liquidation of its affairs, and such
involuntary case or other case, proceeding or other action shall remain
undismissed;

(d) No Default or Event of Default shall exist and be continuing either prior to
or after giving effect thereto; and

(e) Immediately after giving effect to the making of such Loan, in the case of a
request for a Revolving Loan, (and the application of the proceeds thereof) or
to the issuance of such Letter of Credit, as the case may be, (i) the sum of the
aggregate outstanding principal amount of Revolving Loans plus Swingline Loans
plus LOC Obligations shall not exceed the Revolving Committed Amount and (ii)
the LOC Obligations shall not exceed the LOC Committed Amount.

The delivery of each Notice of Borrowing, Notice of Extension/Conversion and
each request for a Letter of Credit pursuant to Section 2.2(b) shall constitute
a representation and warranty by the Borrower of the correctness of the matters
specified in subsections (b), (c), (d) and (e) above.

SECTION 5

REPRESENTATIONS AND WARRANTIES

The Borrower hereby represents to the Agent and each Lender that:

5.1 Financial Condition.

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<PAGE>

(a) The audited consolidated balance sheets and income statements of the
Consolidated Parties for the fiscal years ended October 31, 1998, October 31,
1999 and October 31, 2000 (including the notes thereto) (i) have been audited by
PricewaterhouseCoopers LLP, (ii) have been prepared in accordance with GAAP
consistently applied throughout the periods covered thereby and (iii) present
fairly (on the basis disclosed in the footnotes to such financial statements)
the consolidated financial condition, results of operations and cash flows of
the Consolidated Parties as of such date and for such periods. The unaudited
interim balance sheets of the Consolidated Parties as at the end of, and the
related unaudited interim statements of earnings and of cash flows for, each
fiscal quarterly period ended after October 31, 2000 and prior to the Closing
Date (i) have been prepared in accordance with GAAP consistently applied
throughout the periods covered thereby and (ii) present fairly (on the basis
disclosed in the footnotes to such financial statements) the consolidated
financial condition, results of operations and cash flows of the Consolidated
Parties as of such date and for such periods. During the period from October 31,
2000 to and including the Closing Date, there has been no sale, transfer or
other disposition by any Consolidated Party of any material part of the business
or property of the Consolidated Parties, taken as a whole, and no purchase or
other acquisition by any of them of any business or property (including any
Capital Stock of any other Person) material in relation to the consolidated
financial condition of the Consolidated Parties, taken as a whole, in each case,
which is not reflected in the foregoing financial statements or in the notes
thereto and has not otherwise been disclosed in writing to the Lenders on or
prior to the Closing Date. As of the Closing Date, the Borrower and its
Subsidiaries have no material liabilities (contingent or otherwise) that are not
reflected in the foregoing financial statements or in the notes thereto other
than the Indebtedness evidenced by the Senior Subordinated Notes.

(b) The financial statements delivered pursuant to Section 6.1(a) and (b) have
been prepared in accordance with GAAP (except as may otherwise be permitted
under Section 6.1(a) and (b)) and present fairly (on the basis disclosed in the
footnotes to such financial statements) the consolidated financial condition,
results of operations and cash flows of the Consolidated Parties as of such date
and for such periods.

5.2 No Material Change.

Except as disclosed in reports filed by the Borrower prior to the Closing Date
pursuant to the Securities Exchange Act, since October 31, 2000, there has been
no development or event relating to or affecting a Consolidated Party which has
had or could reasonably be expected to have a Material Adverse Effect.

5.3 Organization and Good Standing.

Each of the Consolidated Parties (a) is duly organized, validly existing and is
in good standing under the laws of the jurisdiction of its incorporation or
organization, (b) has the corporate or other necessary power and authority, and
the legal right, to own and operate its property, to lease the property it
operates as lessee and to conduct the business in which it is currently engaged
and (c) is duly qualified as a foreign entity and in good standing under the
laws of each jurisdiction where its ownership, lease or operation of property or
the conduct of its business requires such qualification, other than in such
jurisdictions where the failure to be so qualified and in good standing would
not reasonably be expected to have a Material Adverse Effect.

5.4 Power; Authorization; Enforceable Obligations.

                                    Page 50
<PAGE>

The Borrower has the corporate or other necessary power and authority, and the
legal right, to make, deliver and perform the Credit Documents to which it is a
party, and in the case of the Borrower, to obtain extensions of credit
hereunder, and has taken all necessary corporate or other necessary action to
authorize the borrowings and other extensions of credit on the terms and
conditions of this Credit Agreement and to authorize the execution, delivery and
performance of the Credit Documents to which it is a party. No consent or
authorization of, filing with, notice to or other similar act by or in respect
of, any Governmental Authority or any other Person is required to be obtained or
made by or on behalf of the Borrower in connection with the borrowings or other
extensions of credit hereunder or with the execution, delivery, performance,
validity or enforceability of the Credit Documents to which the Borrower is a
party, except for consents, authorizations, notices and filings described in
Schedule 5.4, all of which have been obtained or made or have the status
described in such Schedule 5.4. This Credit Agreement has been, and each other
Credit Document to which the Borrower is a party will be, duly executed and
delivered on behalf of the Borrower. This Credit Agreement constitutes, and each
other Credit Document to which the Borrower is a party when executed and
delivered will constitute, a legal, valid and binding obligation of the Borrower
enforceable against such party in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).

5.5 No Conflicts.

Neither the execution and delivery of the Credit Documents, nor the consummation
of the transactions contemplated therein, nor performance of and compliance with
the terms and provisions thereof by the Borrower will (a) violate or conflict
with any provision of its articles or certificate of incorporation or bylaws or
other organizational or governing documents of such Person, (b) violate,
contravene or materially conflict with any Requirement of Law or any other law,
regulation (including, without limitation, Regulation U or Regulation X), order,
writ, judgment, injunction, decree or permit applicable to it, (c) violate,
contravene or conflict with contractual provisions of, or cause an event of
default under, any material indenture, loan agreement, mortgage, deed of trust,
contract or other agreement or instrument to which it is a party or by which it
may be bound or (d) result in or require the creation of any Lien (other than
those contemplated in or created in connection with the Credit Documents) upon
or with respect to its properties.

5.6 No Default.

No Consolidated Party is in default in any respect under any contract, lease,
loan agreement, indenture, mortgage, security agreement or other agreement or
obligation to which it is a party or by which any of its properties is bound
which default could reasonably be expected to have a Material Adverse Effect. No
Default or Event of Default has occurred or exists except as previously
disclosed in writing to the Lenders.

5.7 Ownership.

Each Consolidated Party is the owner of, and has good and marketable title to,
all of its respective assets and none of such assets is subject to any Lien
other than Permitted Liens.

5.8     Indebtedness.

                                    Page 51
<PAGE>

Except as otherwise permitted under Section 7.1, the Consolidated Parties have
no Indebtedness.

5.9 Litigation.

Except as disclosed in Schedule 5.9, there does not exist any pending or
threatened action, suit or legal, equitable, arbitration or administrative
proceeding against any Consolidated Party which could reasonably be expected to
have a Material Adverse Effect.

5.10 Taxes.

Each Consolidated Party has filed, or caused to be filed, all material tax
returns (Federal, state, local and foreign) required to be filed and paid (a)
all amounts of taxes shown thereon to be due (including interest and penalties)
and (b) all other material taxes, fees, assessments and other governmental
charges (including mortgage recording taxes, documentary stamp taxes and
intangibles taxes) owing by it, except for such taxes (i) which are not yet
delinquent or (ii) that are being contested in good faith and by proper
proceedings, and against which adequate reserves are being maintained in
accordance with GAAP. The Borrower is not aware as of the Closing Date of any
proposed tax assessments against it or any other Consolidated Party.

5.11 Compliance with Law.

Each Consolidated Party is in compliance with all Requirements of Law and all
other laws, rules, regulations, orders and decrees (including without limitation
Environmental Laws) applicable to it, or to its properties, unless such failure
to comply could not reasonably be expected to have a Material Adverse Effect. No
Requirement of Law could reasonably be expected to cause a Material Adverse
Effect.

5.12 ERISA.

Except as disclosed and described in Schedule 5.12 attached hereto or as could
not reasonably be expected to result in a Material Adverse Effect:

(a) During the five-year period prior to the date on which this representation
is made or deemed made: (i) no ERISA Event has occurred, and, to the best
knowledge of the Executive Officers of the Borrower, no event or condition has
occurred or exists as a result of which any ERISA Event could reasonably be
expected to occur, with respect to any Plan; (ii) no "accumulated funding
deficiency," as such term is defined in Section 302 of ERISA and Section 412 of
the Code, whether or not waived, has occurred with respect to any Plan; (iii)
each Plan has been maintained, operated, and funded in compliance with its terms
and in material compliance with the provisions of ERISA, the Code, and any other
applicable Federal or state laws; and (iv) no Lien in favor of the PBGC or a
Plan has arisen or is reasonably expected by the Executive Officers of the
Borrower to arise on account of any Plan. To the extent the foregoing
representations relate to a Multiemployer Plan or a Multiple Employer Plan, they
are made to the best knowledge of the Executive Officers of the Borrower.

(b) The actuarial present value of all "benefit liabilities" (as defined in
Section 4001(a)(16) of ERISA), whether or not vested, under each Single Employer
Plan, as of the last annual valuation date prior to the date on which this
representation is made or deemed made (determined, in each case, in accordance
with Financial Accounting Standards Board Statement 87, utilizing the actuarial
assumptions used in such Plan's most recent actuarial valuation report), did not
exceed as of such valuation date the fair market value of the assets of such
Plan.

                                    Page 52
<PAGE>

(c) Neither any Consolidated Party nor any ERISA Affiliate has incurred, or, to
the best knowledge of the Executive Officers of the Borrower, could be
reasonably expected to incur, any withdrawal liability under ERISA to any
Multiemployer Plan or Multiple Employer Plan. Neither any Consolidated Party nor
any ERISA Affiliate would become subject to any withdrawal liability under ERISA
if any Consolidated Party or any ERISA Affiliate were to withdraw completely
from all Multiemployer Plans and Multiple Employer Plans as of the valuation
date most closely preceding the date on which this representation is made or
deemed made. Neither any Consolidated Party nor any ERISA Affiliate has received
any notification that any Multiemployer Plan is in reorganization (within the
meaning of Section 4241 of ERISA), is insolvent (within the meaning of Section
4245 of ERISA), or has been terminated (within the meaning of Title IV of
ERISA), and no Multiemployer Plan is, to the best knowledge of the Executive
Officers of the Borrower, reasonably expected to be in reorganization,
insolvent, or terminated.

(d) No prohibited transaction (within the meaning of Section 406 of ERISA or
Section 4975 of the Code) other than a transaction that is exempted from the
prohibitions of such sections by Section 408 of ERISA or Section 4975 of the
Code (or any administrative or regulatory exemption issued thereunder) or breach
of fiduciary responsibility has occurred with respect to a Plan which has
subjected or may subject any Consolidated Party or any ERISA Affiliate to any
liability under Sections 406, 409, 502(i), or 502(l) of ERISA or Section 4975 of
the Code, or under any agreement or other instrument pursuant to which any
Consolidated Party or any ERISA Affiliate has agreed or is required to indemnify
any Person against any such liability.

(e) Neither any Consolidated Party nor any ERISA Affiliates has any material
liability with respect to "expected post-retirement benefit obligations" within
the meaning of the Financial Accounting Standards Board Statement 106. Each Plan
which is a welfare plan (as defined in Section 3(1) of ERISA) to which Sections
601-609 and 701-732 of ERISA and Sections 4980B and 9801-9833 of the Code apply
has been administered in compliance in all material respects with the applicable
requirements of such sections.

(f) Neither the execution and delivery of this Credit Agreement nor the
consummation of the financing transactions contemplated thereunder will involve
any transaction which is subject to the prohibitions of Section 406(a)(1)(A)-(D)
of ERISA or in connection with which a tax could be imposed pursuant to Section
4975 of the Code as a result of a prohibited transaction within the meaning of
Section 4975(c)(1)(A)-(D) of the Code. The representation by the Borrower in the
preceding sentence is made in reliance upon and subject to the accuracy of the
Lenders' representation and warranty in Section 10.15 with respect to their
source of funds and is subject, in the event that the source of the funds used
by the Lenders in connection with this transaction is an insurance company's
general asset account, to the application of Prohibited Transaction Class
Exemption 95-60, 60 Fed. Reg. 35,925 (1995), compliance with the regulations
issued under Section 401(c)(1)(A) of ERISA, or the issuance of any other
prohibited transaction exemption or similar relief, to the effect that assets in
an insurance company's general asset account do not constitute assets of an
"employee benefit plan" within the meaning of Section 3(3) of ERISA or a "plan"
within the meaning of Section 4975(e)(1) of the Code.

5.13 Corporate Structure; Capital Stock, Etc.

The corporate capital and ownership structure of the Consolidated Parties as of
the Closing Date is as described in Schedule 5.13. Set forth on

                                    Page 53
<PAGE>

Schedule 5.13 is a complete and accurate list as of the Closing Date with
respect to each of the Borrower's direct and indirect Subsidiaries of (i)
jurisdiction of incorporation, (ii) number of shares of each class of Capital
Stock outstanding, (iii) number and percentage of outstanding shares of each
class owned (directly or indirectly) by the Consolidated Parties and (iv) number
and effect, if exercised, of all outstanding options, warrants, rights of
conversion or purchase and all other similar rights with respect thereto as of
the Closing Date. The outstanding Capital Stock of all such Persons is validly
issued, fully paid and non-assessable and is owned by the Consolidated Parties,
directly or indirectly, in the manner set forth on Schedule 5.13, free and clear
of all Liens (other than those arising under or contemplated in connection with
the Credit Documents). Other than as set forth in Schedule 5.13, none of the
Borrower's Subsidiaries has outstanding any securities convertible into or
exchangeable for its Capital Stock nor does any such Person have outstanding any
rights to subscribe for or to purchase or any options for the purchase of, or
any agreements providing for the issuance (contingent or otherwise) of, or any
calls, commitments or claims of any character relating to its Capital Stock.

5.14 Governmental Regulations, Etc.

(a) None of the transactions contemplated by this Credit Agreement (including,
without limitation, the direct or indirect use of the proceeds of the Loans)
will violate or result in a violation of the Securities Act, the Securities
Exchange Act or any of Regulations U and X. If requested by any Lender or the
Agent, the Borrower will furnish to the Agent and each Lender a statement, in
conformity with the requirements of FR Form U-1 referred to in Regulation U,
that no part of the Letters of Credit or proceeds of the Loans will be used,
directly or indirectly, for the purpose of "buying" or "carrying" any "margin
stock" within the meaning of Regulations U and X, or for the purpose of
purchasing or carrying or trading in any securities.

(b) None of the Consolidated Parties is (i) an "investment company", or a
company "controlled" by an "investment company", within the meaning of the
Investment Company Act of 1940, as amended, (ii) a "holding company" as defined
in, or otherwise subject to regulation under, the Public Utility Holding Company
Act of 1935, as amended or (iii) subject to regulation under any other Federal
or state statute or regulation which limits its ability to incur Indebtedness.

5.15 Purpose of Loans and Letters of Credit.

The proceeds of the Loans hereunder shall be used solely by the Borrower (a) to
refinance existing Indebtedness (to which end $20,000,000 of the Revolving Loans
made on the Closing Date shall be deposited on the Closing Date into an escrow
account, which amount shall be used to pay the outstanding principal amount of
the senior notes maturing on August 15, 2002) and (b) to provide for working
capital, commercial paper back up and any other lawful corporate purposes of the
Borrower and its Subsidiaries (including, without limitation, Permitted
Acquisitions). The Letters of Credit shall be used only for or in connection
with credit support required for bonds issued in respect of financings for which
a Borrower is responsible for, directly or indirectly, repayment, appeal bonds,
reimbursement obligations arising in connection with surety and reclamation
bonds, reinsurance and obligations not otherwise aforementioned relating to
transactions entered into by the applicable account party in the ordinary course
of business.

5.16 Environmental Matters.

Except as disclosed and described in Schedule 5.16 or except as could not

                                    Page 54
<PAGE>

reasonably be expected to result in a Material Adverse Effect:

(a) Each of the Real Properties and all operations at the Real Properties are in
compliance with all applicable Environmental Laws, there is no violation of any
Environmental Law with respect to the Real Properties or the Businesses, and to
the best knowledge of the Executive Officers of the Borrower, there are no
conditions relating to the Real Properties or the Businesses that could give
rise to liability under any applicable Environmental Laws.

(b) None of the Real Properties contains, or to the best knowledge of the
Executive Officers of the Borrower, has previously contained, any Materials of
Environmental Concern at, on or under the Real Properties in amounts or
concentrations that constitute or constituted a violation of, or could give rise
to liability under, Environmental Laws.

(c) No Consolidated Party has received any written or verbal notice of, or
inquiry from any Governmental Authority alleging any violation, non-compliance,
liability or potential liability pursuant to, or regarding compliance with,
Environmental Laws with regard to any of the Real Properties or the Businesses,
nor does any Executive Officer of the Borrower have knowledge or reason to
believe that any such notice will be received or is being threatened.

(d) Materials of Environmental Concern have not been transported or disposed of
from the Real Properties, or generated, treated, stored or disposed of at, on or
under any of the Real Properties or any other location, in each case by or on
behalf of any Consolidated Party in violation of, or in a manner that to the
best knowledge of the Executive Officers of the Borrower could give rise to
liability under, any applicable Environmental Law.

(e) No judicial proceeding or governmental or administrative action is pending
or, to the best knowledge of the Executive Officers of the Borrower, threatened,
under any Environmental Law to which any Consolidated Party is or will be named
as a party, nor are there any consent decrees or other decrees, consent orders,
administrative orders or other orders, or other administrative or judicial
requirements outstanding under any Environmental Law with respect to the
Consolidated Parties, the Real Properties or the Businesses.

(f) There has been no release, or threat of release, of Materials of
Environmental Concern at or from the Real Properties, or arising from or related
to the operations (including, without limitation, disposal) of any Consolidated
Party in connection with the Real Properties or otherwise in connection with the
Businesses, in violation of or in amounts or in a manner that to the best
knowledge of the Executive Officers of the Borrower could give rise to liability
under Environmental Laws.

5.17 Intellectual Property.

Each Consolidated Party owns, or has the legal right to use, all trademarks,
service marks, trade names, trade dress, patents, copyrights, technology,
know-how and processes necessary for each of them to conduct its business as
currently conducted except for those the failure to own or have such legal right
to use could not reasonably be expected to have a Material Adverse Effect.

5.18 Solvency.

The Borrower is Solvent.

                                    Page 55
<PAGE>

5.19 Investments.

All Investments of each Consolidated Party are Permitted Investments.

5.20    Disclosure.

Neither this Credit Agreement nor any financial statements delivered to the
Lenders nor any other document, certificate or statement furnished to the
Lenders by or on behalf of any Consolidated Party in connection with the
transactions contemplated hereby contains any untrue statement of a material
fact or omits to state a material fact necessary in order to make the statements
contained therein or herein not misleading.

5.21 No Burdensome Restrictions.

No Consolidated Party is a party to any agreement or instrument or subject to
any other obligation or any charter or corporate restriction or any provision of
any applicable law, rule or regulation which, individually or in the aggregate,
could reasonably be expected to have a Material Adverse Effect.

5.22 Brokers' Fees.

No Consolidated Party has any obligation to any Person in respect of any
finder's, broker's, investment banking or other similar fee in connection with
any of the transactions contemplated under the Credit Documents.

5.23 Labor Matters.

None of the Consolidated Parties has suffered any strikes, walkouts, work
stoppages or other material labor difficulty within the last five years which
has had or could reasonably be expected to have a Material Adverse Effect.

SECTION 6

AFFIRMATIVE COVENANTS

The Borrower hereby covenants and agrees that until such time as this
Credit Agreement has been terminated in accordance with the terms of
Section 10.13:

6.1 Information Covenants.

The Borrower will furnish, or cause to be furnished, to the Agent and each of
the Lenders each of the documents listed below. Reports required to be delivered
pursuant to this Section 6.1 shall be deemed to have been delivered on the same
Business Day that such report is posted electronically on IntraLinks/IntraAgency
by the Agent at the request of the Borrower; provided that (x) upon the request
of the Agent or any Lender, the Borrower shall deliver paper copies of such
reports to the Agent or any Lender who makes a request for such paper copies,
(y) the Borrower shall notify by facsimile the Agent and each Lender of the
posting of any such reports and (z) the Borrower shall continue to provide paper
copies of the compliance certificates required by Section 6.1(c) to the Agent
and each of the Lenders. Except for the compliance certificates required by
Section 6.1(c), the Agent shall have no obligation to request the delivery of or
to keep copies of the reports referred to herein, and shall have no obligation
whatsoever to monitor the Borrower's compliance with any request by a Lender to
provide such reports. Each Lender shall be solely responsible for requesting
delivery of or maintaining copies of any such reports.

                                    Page 56
<PAGE>

(a) Annual Financial Statements. As soon as available, and in any event within
90 days after the close of each fiscal year of the Consolidated Parties, a
consolidated balance sheet and income statement of the Consolidated Parties as
of the end of such fiscal year, together with related consolidated statements of
retained earnings and cash flows for such fiscal year, in each case setting
forth in comparative form consolidated figures for the preceding fiscal year,
all such financial information described above to be in reasonable form and
detail and audited by independent certified public accountants of recognized
national standing reasonably acceptable to the Agent and whose opinion shall be
to the effect that such financial statements have been prepared in accordance
with GAAP (except for changes with which such accountants concur) and shall not
be limited as to the scope of the audit or qualified as to the status of the
Consolidated Parties as a going concern or any other material qualifications or
exceptions.

(b) Quarterly Financial Statements. As soon as available, and in any event
within 60 days after the close of each of the first three fiscal quarters of
each fiscal year of the Consolidated Parties, a consolidated balance sheet and
income statement of the Consolidated Parties as of the end of such fiscal
quarter, together with related consolidated statements of retained earnings and
cash flows for such fiscal quarter, in each case setting forth in comparative
form consolidated figures for the corresponding period of the preceding fiscal
year, all such financial information described above to be in reasonable form
and detail and reasonably acceptable to the Agent, and accompanied by a
certificate of an Executive Officer of the Borrower to the effect that such
quarterly financial statements fairly present in all material respects the
financial condition of the Consolidated Parties and have been prepared in
accordance with GAAP, subject to changes resulting from audit and normal
year-end audit adjustments.

(c) Officer's Certificate. At the time of delivery of the financial statements
provided for in Sections 6.1(a) and 6.1(b) above, a certificate of an Executive
Officer of the Borrower substantially in the form of Exhibit 6.1(c), (i)
demonstrating compliance with the financial covenants contained in Section 6.10
by calculation thereof as of the end of each such fiscal period, (ii) stating
that no Default or Event of Default exists, or if any Default or Event of
Default does exist, specifying the nature and extent thereof and what action the
Borrower propose to take with respect thereto, (iii) demonstrating pursuant to a
Pro Forma Compliance Certificate that, upon giving effect on a Pro Forma Basis
to each Asset Disposition in excess of $10,000,000 consummated in the applicable
period, the Borrower would be in compliance with the financial covenants set
forth in Section 6.10(a)-(c) and (iv) in the case of the certificate delivered
with the financial statements provided for in Section 6.1(a) only, setting forth
information regarding the amount of all Asset Dispositions, Equity Issuances and
Debt Issuances that were made during the applicable fiscal year.

(d) Accountant's Certificate. Within the period for delivery of the annual
financial statements provided in Section 6.1(a), a certificate of the
accountants conducting the annual audit stating that they have reviewed this
Credit Agreement as it relates to accounting and other financial matters and
stating further whether, in the course of their audit, they have become aware of
any Default or Event of Default and, if any such Default or Event of Default
exists, specifying the nature and extent thereof, provided that such accountants
shall not be liable by reason of any failure to obtain knowledge of any such
Default or Event of Default that would not be disclosed in the course of their
audit examination.

                                    Page 57
<PAGE>

(e) Reports. Promptly upon transmission or receipt thereof, (i) copies of any
filings and registrations with, and reports to or from, the Securities and
Exchange Commission, or any successor agency, and copies of all financial
statements, proxy statements, notices and reports as any Consolidated Party
shall send to its shareholders and all notices (e.g., notices of default) as any
Consolidated Party shall send to a holder of any Indebtedness owed by any
Consolidated Party in its capacity as such a holder and (ii) upon the reasonable
request of the Agent, all statements and reports (including compliance
information) as any Consolidated Party shall send to a holder of any
Indebtedness owed by any Consolidated Party in its capacity as such a holder,
all reports and material written information to and from the United States
Environmental Protection Agency, or any state or local agency responsible for
environmental matters, the United States Occupational Health and Safety
Administration, or any state or local agency responsible for health and safety
matters, or any successor agencies or authorities concerning environmental,
health or safety matters.

(f) Notices. Upon any Executive Officer of the Borrower obtaining knowledge
thereof, the Borrower will give written notice to the Agent and the Lenders
immediately of (i) the occurrence of an event or condition consisting of a
Default or Event of Default, specifying the nature and existence thereof and
what action the Borrower propose to take with respect thereto, and (ii) the
occurrence of any of the following with respect to any Consolidated Party (A)
the pendency or commencement of any litigation, arbitral or governmental
proceeding against such Person which if adversely determined is likely to have a
Material Adverse Effect or (B) the institution of any proceedings against such
Person with respect to, or the receipt of notice by such Person of potential
liability or responsibility for violation, or alleged violation of any Federal,
state or local law, rule or regulation, including but not limited to,
Environmental Laws, the violation of which could have a Material Adverse Effect.

(g) ERISA. Promptly (and in any event within 15 Business Days) after any
Executive Officer of the Borrower obtaining knowledge thereof, the Borrower will
give written notice to the Agent of: (i) any event or condition, including, but
not limited to, any Reportable Event, that constitutes, or could reasonably be
expected to lead to, an ERISA Event; (ii) with respect to any Multiemployer
Plan, the receipt of notice as prescribed in ERISA or otherwise of any
withdrawal liability assessed against the Borrower or any ERISA Affiliates, or
of a determination that any Multiemployer Plan is in reorganization or insolvent
(both within the meaning of Title IV of ERISA); (iii) the failure to make full
payment on or before the due date (including extensions) thereof of all amounts
which any Consolidated Party or any ERISA Affiliate is required to contribute to
each Plan that is subject to the funding requirements of Section 302 of ERISA
and Section 412 of the Code pursuant to its terms and as required to meet the
minimum funding standard set forth in ERISA and the Code with respect thereto;
or (iv) any change in the funding status of any Plan that could reasonably be
expected to have a Material Adverse Effect, together with a description of any
such event or condition or a copy of any such notice and a statement by an
Executive Officer of the Borrower briefly setting forth the details regarding
such event, condition, or notice, and the action, if any, which has been or is
being taken or is proposed to be taken by the Borrower with respect thereto.
Promptly upon request, the Borrower shall furnish the Agent and the Lenders with
such additional information concerning any Plan as may be reasonably requested,
including, but not limited to, copies of each annual report/return (Form 5500
series), as well as all schedules and attachments thereto required to be filed
with the Department of Labor and/or the Internal Revenue Service pursuant to
ERISA and the Code, respectively, for each "plan year" (within the meaning of
Section 3(39)

                                    Page 58
<PAGE>

of ERISA).

(h) Environmental. Upon the reasonable written request of the Required Lenders,
the Borrower will furnish or cause to be furnished to the Agent, at the
Borrower' expense, a report of an environmental assessment of reasonable scope,
form and depth, (including, where appropriate, invasive soil or groundwater
sampling) by a consultant reasonably acceptable to the Agent as to the nature
and extent of the presence of any Materials of Environmental Concern on any Real
Properties (as defined in Section 5.16) and as to the compliance by any
Consolidated Party with Environmental Laws at such Real Properties. If the
Borrower fails to deliver such an environmental report within seventy-five (75)
days after receipt of such written request then the Agent may arrange for same,
and the Consolidated Parties hereby grant to the Agent and their representatives
access to the Real Properties believed to be affected to reasonably undertake
such an assessment (including, where appropriate, invasive soil or groundwater
sampling). The reasonable cost of any assessment arranged for by the Agent
pursuant to this provision will be payable by the Borrower on demand.

(i) Other Information. With reasonable promptness upon any such request, such
other information regarding the business, properties or financial condition of
any Consolidated Party as the Agent or any Lender may reasonably request.

6.2 Preservation of Existence and Franchises.

Except as a result of or in connection with a dissolution, merger or disposition
of a Subsidiary not prohibited by Section 7.4 or Section 7.5, the Borrower will,
and will cause each of its Subsidiaries to, do all things necessary to preserve
and keep in full force and effect its existence, and, where failure to do so
could reasonably be expected to have a Material Adverse Effect, its rights,
franchises and authority.

6.3 Books and Records.

The Borrower will, and will cause each of its Subsidiaries to, keep complete and
accurate books and records of its transactions in accordance with good
accounting practices on the basis of GAAP (including the establishment and
maintenance of appropriate reserves).

6.4 Compliance with Law.

The Borrower will, and will cause each of its Subsidiaries to, comply with all
laws, rules, regulations and orders, and all applicable restrictions imposed by
all Governmental Authorities, applicable to it and its Property if noncompliance
with any such law, rule, regulation, order or restriction could reasonably be
expected to have a Material Adverse Effect.

6.5 Payment of Taxes and Other Claims.

The Borrower will, and will cause each of its Subsidiaries to, pay and discharge
(a) all taxes, assessments and governmental charges or levies imposed upon it,
or upon its income or profits, or upon any of its properties, before they shall
become delinquent and (b) all lawful claims (including claims for labor,
materials and supplies) which, if unpaid, might give rise to a Lien upon any of
its properties; provided, however, that no Consolidated Party shall be required
to pay any such tax, assessment, charge, levy or claim which is being contested
in good faith by appropriate proceedings and as to which adequate reserves
therefor have been established in accordance with GAAP, unless the failure to
make any such payment (i) could give rise to an immediate right for completion

                                    Page 59
<PAGE>

of a foreclosure sale on a Lien securing such amounts or (ii) could reasonably
be expected to have a Material Adverse Effect.

6.6 Insurance.

(a) The Borrower will, and will cause each of its Subsidiaries to, at all times
maintain in full force and effect insurance (including worker's compensation
insurance, liability insurance, casualty insurance and business interruption
insurance) in such amounts, covering such risks and liabilities and with such
deductibles or self-insurance retentions as are in accordance with normal
industry practice, and as required by Applicable Law.

(b) In the event that the Consolidated Parties receive Net Cash Proceeds in
excess of $5,000,000 in aggregate amount during any fiscal year of the
Consolidated Parties ("Excess Proceeds") on account of Involuntary Dispositions,
the Borrower shall, within the period of 360 days following the date of receipt
of such Excess Proceeds, apply (or cause to be applied) an amount equal to such
Excess Proceeds to (i) make Eligible Reinvestments (including but not limited to
the repair or replacement of the related Property) or (ii) prepay the Loans (and
cash collateralize LOC Obligations) in accordance with the terms of Section
3.3(b)(ii)(B); provided, however, that such Person shall not undertake
replacement or restoration of such Property unless, after giving pro forma
effect to any Funded Indebtedness to be incurred in connection with such
replacement or restoration, the Borrower would be in compliance with the
financial covenants set forth in Section 6.10(a)-(c) as of the most recent
fiscal quarter end preceding the date of determination with respect to which the
Agent has received the Required Financial Information (assuming, for purposes
hereof, that such Funded Indebtedness was incurred as of the first day of the
four fiscal-quarter period ending as of such fiscal quarter end). Pending final
application of any Excess Proceeds, the Borrower may apply such Excess Proceeds
to temporarily reduce the Revolving Loans or to make Permitted Investments.

6.7 Maintenance of Property; Management of Timberlands.

The Borrower will, and will cause each of its Subsidiaries to, maintain and
preserve its properties and equipment material to the conduct of its business in
good repair, working order and condition, normal wear and tear and Involuntary
Dispositions excepted, and will make, or cause to be made, in such properties
and equipment from time to time all repairs, renewals, replacements, extensions,
additions, betterments and improvements thereto as may be needed or proper, to
the extent and in the manner customary for companies in similar businesses. The
Borrower will, and will cause each of its Subsidiaries to, manage its
timberlands in accordance with the guidelines established by the American Forest
& Paper Association's Sustainable Forestry Initiative effective as of the
Closing Date.

6.8 Use of Proceeds.

The Borrower will use the proceeds of the Loans and will use the Letters of
Credit solely for the purposes set forth in Section 5.15.

6.9 Audits/Inspections.

Upon reasonable notice and during normal business hours, the Borrower will, and
will cause each of its Subsidiaries to, permit representatives appointed by the
Agent or the Required Lenders, including, without limitation, independent
accountants, agents, attorneys, and appraisers to visit and inspect its
property, including its books and records, its accounts receivable and
inventory, its facilities and its other business

                                    Page 60
<PAGE>

assets, and to make photocopies or photographs thereof and to write down and
record any information such representative obtains and shall permit the Agent or
its representatives to investigate and verify the accuracy of information
provided to the Lenders and to discuss all such matters with the officers,
employees and representatives of such Person.

6.10 Financial Covenants.

(a) Funded Indebtedness to Capitalization Ratio. The Funded Indebtedness to
Capitalization Ratio, as of the last day of each fiscal quarter of the
Consolidated Parties, shall be less than or equal to:

<TABLE>
<CAPTION>
                      Period                            Ratio
<S>                                                     <C>
Closing Date through and including July 31, 2002        62.5%
August 1, 2002 through and including July 31, 2003      60.0%
August 1, 2003 through and including July 31, 2004      57.5%
August 1, 2004 and thereafter                           55.0%
</TABLE>

(b) Consolidated Net Worth. At all times, the Consolidated Net Worth of the
Borrower shall be equal to or greater than $365,200,000, increased on a
cumulative basis as of the end of each fiscal quarter of the Consolidated
Parties, commencing with the fiscal quarter ending January 31, 2002, by an
amount equal to (x) 50% of Consolidated Net Income (to the extent positive) for
such fiscal quarter and (y) 100% of the Net Cash Proceeds of any Equity
Issuances consummated during such fiscal quarter.

(c) Fixed Charge Coverage Ratio. The Fixed Charge Coverage Ratio, as of the last
day of each fiscal quarter of the Consolidated Parties, shall be greater than or
equal to:

<TABLE>
<CAPTION>
                      Period                              Ratio
<S>                                                  <C>
Closing Date through and including July 31, 2002     1.15 to 1.00
August 1, 2002 through and including July 31, 2003   1.25 to 1.00
August 1, 2003 and thereafter                        1.35 to 1.00
</TABLE>

6.11 Notice of Ratings Change.

The Borrower shall, no later than fifteen Business Days after any Executive
Officer obtains knowledge of any such change, give notice to the Agent (which
may be by telephone, followed promptly by written notice transmitted by
facsimile with a hard copy sent promptly thereafter) of any change (either
expressly or pursuant to a letter from S&P or Moody's stating an "implied"
rating) in rating by S&P or Moody's in respect of the Borrower's senior
unsecured non-credit enhanced long-term debt, together with the details thereof,
and of any announcement by S&P or Moody's that its rating in respect of such
senior unsecured non-credit enhanced long-term debt is "under review" or that
any such debt rating has been placed on a "CreditWatch List"r or "watch list" or
that any similar action has been taken by S&P or Moody's.

6.12 Performance of Obligations.

The Borrower will, and will cause each of its Subsidiaries to, perform in all
material respects in accordance with customary trade practices all of its
obligations under the terms of all material agreements, indentures, mortgages,
security agreements or other debt instruments to which it is a party or by which
it is bound; provided, however, that the Borrower or such Subsidiary may contest
any such obligation in good faith and by proper proceedings so long as adequate
reserves are maintained with respect thereto to the extent required by GAAP.

                                    Page 61
<PAGE>

SECTION 7

NEGATIVE COVENANTS

The Borrower hereby covenants and agrees that until such time as this
Credit Agreement has been terminated in accordance with the terms of
Section 10.13:

7.1 Indebtedness.

The Borrower will not permit any of its Subsidiaries to contract, create, incur,
assume or permit to exist any Indebtedness, except:

(a) Indebtedness arising under this Credit Agreement and the other Credit
Documents;

(b) Indebtedness of the Subsidiaries set forth in Schedule 7.1 (and renewals,
refinancings and extensions thereof on terms and conditions no less favorable to
such Person than such existing Indebtedness and in amounts no greater than such
existing Indebtedness at the time of such renewal, refinancing or extension);

(c) purchase money Indebtedness (including obligations in respect of Capital
Leases or Synthetic Leases) hereafter incurred by the Subsidiaries to finance
the purchase of fixed assets provided that (i) the total of all such
Indebtedness (other than Indebtedness set forth in Schedule 7.1) for all such
Persons taken together shall not exceed an aggregate principal amount of
$10,000,000 at any one time outstanding; (ii) such Indebtedness when incurred
shall not exceed the purchase price of the asset(s) financed; and (iii) no such
Indebtedness shall be refinanced for a principal amount in excess of the
principal balance outstanding thereon at the time of such refinancing;

(d) obligations of the Subsidiaries in respect of Hedging Agreements entered
into in order to manage existing or anticipated interest rate or exchange rate
risks and not for speculative purposes;

(e) intercompany Indebtedness and Guarantees permitted under Section 7.6;

(f) in addition to the Indebtedness otherwise permitted by this Section 7.1,
other Indebtedness hereafter incurred by the Subsidiaries, provided that (i) the
loan documentation with respect to such Indebtedness shall not contain covenants
or default provisions relating to any Consolidated Party that are more
restrictive than the covenants and default provisions contained in the Credit
Documents, (ii) no Default or Event of Default shall exist before or after
giving effect on a Pro Forma Basis to the incurrence thereof, (iii) the
aggregate principal amount of such Indebtedness shall not exceed $2,000,000 at
any time and (iv) such Indebtedness is permitted under the Senior Subordinated
Note Indenture.

7.2 Liens.

The Borrower will not permit any Consolidated Party to contract, create, incur,
assume or permit to exist any Lien with respect to any of its Property, whether
now owned or hereafter acquired, except for:

(a) Liens in favor of the Agent, if any, to secure the Obligations;

(b) Liens (other than Liens created or imposed under ERISA) for taxes,
assessments or governmental charges or levies not yet due or Liens for taxes
being contested in good faith by appropriate proceedings for which adequate
reserves determined in accordance with GAAP have been

                                    Page 62
<PAGE>

established (and as to which the Property subject to any such Lien is not yet
subject to foreclosure, sale or loss on account thereof);

(c) statutory Liens of landlords and Liens of carriers, warehousemen, mechanics,
materialmen and suppliers and other Liens imposed by law or pursuant to
customary reservations or retentions of title arising in the ordinary course of
business, provided that such Liens secure only amounts not yet due and payable
or, if due and payable, are unfiled and no other action has been taken to
enforce the same or are being contested in good faith by appropriate proceedings
for which adequate reserves determined in accordance with GAAP have been
established (and as to which the Property subject to any such Lien is not yet
subject to foreclosure, sale or loss on account thereof);

(d) Liens (other than Liens created or imposed under ERISA) incurred or deposits
made by any Consolidated Party in the ordinary course of business in connection
with workers' compensation, unemployment insurance and other types of social
security, or to secure the performance of tenders, statutory obligations, bids,
leases, government contracts, performance and return-of-money bonds and other
similar obligations (exclusive of obligations for the payment of borrowed
money);

(e) Liens in connection with attachments or judgments (including judgment or
appeal bonds) provided that the judgments secured shall, within 30 days after
the entry thereof, have been discharged or execution thereof stayed pending
appeal, or shall have been discharged within 30 days after the expiration of any
such stay;

(f) easements, rights-of-way, restrictions (including zoning restrictions),
encumbrances in the nature of leases or subleases granted to others, minor
defects or irregularities in title, reservations of mineral, oil and gas and
water or other similar rights existing on the date of acquisitions of any
property by the Borrower or any Subsidiary, encroachments or questions of
locations, boundary and area which an accurate survey may disclose, exceptions
and reservations in United States patents or state deeds, any prohibition or
limitation on the use, occupancy or improvement of land resulting from the
rights of the public or riparian owners to use any waters which may cover the
land and other similar charges or encumbrances, in each case incidental to, and
not interfering with, the ordinary conduct of the business of the Borrower or
any Subsidiary;

(g) Liens on Property of any Person securing purchase money Indebtedness
(including Capital Leases and Synthetic Leases) of such Person permitted under
Section 7.1(c), provided that any such Lien attaches to such Property
concurrently with or within 90 days after the acquisition thereof;

(h) leases or subleases granted to others not interfering in any material
respect with the business of any Consolidated Party;

(i) any interest of title of a lessor under, and Liens arising from UCC
financing statements (or equivalent filings, registrations or agreements in
foreign jurisdictions) relating to, leases permitted by this Credit Agreement;

(j) Liens in favor of customs and revenue authorities arising as a matter of law
to secure payment of customs duties in connection with the importation of goods;

(k) Liens deemed to exist in connection with Investments in repurchase
agreements permitted under Section 7.6;

                                    Page 63
<PAGE>

(l) normal and customary rights of setoff upon deposits of cash in favor of
banks or other depository institutions;

(m) Liens of a collection bank arising under Section 4-210 of the Uniform
Commercial Code on items in the course of collection;

(n) Liens of sellers of goods to the Borrower and any of its Subsidiaries
arising under Article 2 of the Uniform Commercial Code or similar provisions of
applicable law in the ordinary course of business, covering only the goods sold
and securing only the unpaid purchase price for such goods and related expenses;

(o) any interest of title of a buyer in connection with, and Liens arising from
UCC financing statements relating to, a sale of receivables permitted by this
Credit Agreement;

(p) Liens existing as of the Closing Date and set forth on Schedule 7.2;

(q) Liens on property of a Person existing at the time such Person is merged
with or into or consolidated with the Borrower or any Subsidiary of the
Borrower; provided that such Liens were in existence prior to the contemplation
of such merger or consolidation and do not extend to any assets other than those
of the Person merged into or consolidated with the Borrower or the Subsidiary;

(r) Liens on property existing at the time of acquisition of the property by the
Borrower or any Subsidiary of the Borrower, provided that such Liens were in
existence prior to the contemplation of such acquisition;

(s) Liens created or assumed in the ordinary course of business of exploring
for, developing or producing oil, gas or other minerals (including borrowings in
connection therewith) on, or any interest in, or on any proceeds from the sale
of, property acquired for such purposes, production therefrom (including the
proceeds thereof), or material or equipment located thereon;

(t) Liens arising from the pledge of any bonds, debentures, notes or similar
instruments which are purchased and held by any remarketing agent for the
account of, or as agent for, the Borrower;

(u) any extension, renewal or replacement, in whole or in part, of any Lien
described in the foregoing clauses (a) through (u); provided that any such
extension, renewal or replacement shall be no more restrictive in any material
respect than the Lien extended, renewed or replaced and shall not extend to any
other Property of the Consolidated Parties other than such item of Property
originally covered by such Lien or by improvement thereof or additions or
accessions thereto;

(v) loggers' Liens and stumpage Liens arising in the ordinary course of business
of the Borrower and its Subsidiaries; and

(w) Liens which are permitted under the Senior Subordinated Note Indenture and
which secure Indebtedness incurred after the Closing Date in compliance with
this Credit Agreement, provided the aggregate principal amount outstanding of
such Indebtedness does not at any time exceed five percent (5%) of the book
value of the Property of the Consolidated Parties, measured as of the most
recently ended fiscal quarter for which the officer's certificate required under
Section 6.1(c) has been delivered.

7.3 Nature of Business.

The Borrower will not permit any Consolidated Party to substantively

                                    Page 64
<PAGE>

alter the character or conduct of the business conducted by such Person as of
the Closing Date.

7.4 Consolidation, Merger, Dissolution, etc.

Except in connection with a Permitted Asset Disposition, the Borrower will not
permit any Consolidated Party to enter into any transaction of merger or
consolidation or liquidate, wind up or dissolve itself (or suffer any
liquidation or dissolution); provided that, notwithstanding the foregoing
provisions of this Section 7.4, (a) the Borrower may merge or consolidate with
any of its Subsidiaries, provided that the Borrower shall be the continuing or
surviving corporation, (b) any Subsidiary of the Borrower may be merged or
consolidated with or into any other Subsidiary of the Borrower, (c) any
Subsidiary of the Borrower may merge with any Person that is not the Borrower in
connection with an Asset Disposition permitted under Section 7.5, (d) the
Borrower or any Subsidiary of the Borrower may merge with any Person other than
a Consolidated Party in connection with a Permitted Acquisition, provided that,
if such transaction involves the Borrower, the Borrower shall be the continuing
or surviving corporation and (e) any Wholly Owned Subsidiary of the Borrower may
dissolve, liquidate or wind up its affairs at any time provided that such
dissolution, liquidation or winding up, as applicable, could not have a Material
Adverse Effect.

7.5 Asset Dispositions.

The Borrower will not permit any Consolidated Party to make any Asset
Disposition unless (a) such Asset Disposition constitutes an exchange of
Property in the ordinary course of such Consolidated Party's business or the
consideration paid in connection therewith is in cash or Cash Equivalents and in
an amount not less than the fair market value of the Property disposed of, (b)
if such transaction is a Sale and Leaseback Transaction, such transaction is not
prohibited by the terms of Section 7.13, (c) such transaction does not involve
the sale or other disposition of a minority equity interest in any Consolidated
Party, (d) such transaction does not involve a sale or other disposition of
receivables other than receivables owned by or attributable to other Property
concurrently being disposed of in a transaction otherwise permitted under this
Section 7.5, (e) the aggregate proceeds received in cash or Cash Equivalents by
the Consolidated Parties from all of the assets sold or otherwise disposed of by
the Consolidated Parties in any fiscal year shall not exceed $75,000,000, (f) if
such Asset Disposition is for consideration (cash and non-cash) in excess of
$10,000,000, no later than five (5) Business Days prior to such Asset
Disposition, the Borrower shall have delivered to the Agent (i) a Pro Forma
Compliance Certificate demonstrating that, upon giving effect on a Pro Forma
Basis to such transaction, the Borrower would be in compliance with the
financial covenants set forth in Section 6.10(a)-(c) and (ii) notification from
the Borrower in form and substance satisfactory to the Agent and specifying the
anticipated date of such Asset Disposition, briefly describing the assets to be
sold or otherwise disposed of and setting forth the net book value of such
assets, the aggregate consideration and the Net Cash Proceeds to be received for
such assets in connection with such Asset Disposition, (g) the Borrower shall,
to the extent required under this Credit Agreement, apply (or cause to be
applied) an amount equal to the Net Cash Proceeds of such Asset Disposition to,
as applicable, (i) prepay or retire debt in accordance with clause (c) of the
definition of Net Cash Proceeds, (ii) make Eligible Reinvestments or (iii)
prepay the Loans (and cash collateralize LOC Obligations) in accordance with the
terms of Section 3.3(b)(ii)(A), (h) such Asset Disposition is permitted under
the Senior Subordinated Note Indenture and (i) no Default or Event of Default
shall exist before or after giving effect to such Asset Disposition. Pending
final

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<PAGE>

application of the Net Cash Proceeds of any Asset Disposition, the Consolidated
Parties may apply such Net Cash Proceeds to temporarily reduce the Revolving
Loans or to make Investments in Cash Equivalents.

7.6 Investments.

The Borrower will not permit any Consolidated Party to make any Investments,
except for:

(a) Investments consisting of cash and Cash Equivalents;

(b) Investments consisting of accounts receivable created, acquired or made by
any Consolidated Party in the ordinary course of business and payable or
dischargeable in accordance with customary trade terms;

(c) Investments consisting of Capital Stock, obligations, securities or other
property received by any Consolidated Party in settlement of accounts receivable
(created in the ordinary course of business) from bankrupt obligors;

(d) Investments existing as of the Closing Date and set forth in Schedule 7.6;

(e) Investments consisting of advances or loans to labor or material suppliers
or customers in the ordinary course of business that do not exceed $10,000,000
in the aggregate at any one time outstanding;

(f) Investments consisting of advances or loans to directors, officers,
employees or agents in the ordinary course of business that do not exceed
$2,000,000 in the aggregate at any one time outstanding;

(g) Investments (i) in the Borrower, (ii) by a Subsidiary of the Borrower in a
Wholly Owned Subsidiary of the Borrower and (iii) so long as the Borrower is in
compliance with Section 7.16, by the Borrower in its Subsidiaries and/or by the
Borrower or any of its Subsidiaries in any Person to the extent required for the
Borrower or any Subsidiary to conduct business with such Person, provided such
Investments pursuant to this cause (iii) do not exceed $5,000,000 in the
aggregate at any one time outstanding;

(h) any Eligible Reinvestment of the proceeds of any Involuntary Disposition as
contemplated by Section 6.6(b) or of any Asset Disposition as contemplated by
Section 7.5(g); or

(i) So long as the Borrower is in compliance with Section 7.16, Investments
consisting of an Acquisition by the Borrower or any Subsidiary of the Borrower,
provided that (i) the Property acquired (or the Property of the Person acquired)
in such Acquisition is used or useful in the same or a similar line of business
as the Borrower and its Subsidiaries were engaged in on the Closing Date (or any
reasonable extensions or expansions thereof), (ii) in the case of an Acquisition
of the Capital Stock of another Person, the board of directors (or other
comparable governing body) of such other Person shall have duly approved such
Acquisition, (iii) the Borrower shall have delivered to the Agent, with respect
to each such Acquisition for an Investment involving consideration (cash and
non-cash) in excess of $10,000,000, (A) a Pro Forma Compliance Certificate
demonstrating that, upon giving effect to such Acquisition on a Pro Forma Basis,
the Consolidated Parties would be in compliance with the financial covenants set
forth in Section 6.10(a)-(c) and (B) a certificate of an Executive Officer of
the Borrower (1) demonstrating that at least 90% of Consolidated EBITDDA for the
most recently ended fiscal year period for each of the Consolidated Parties and
the acquired Person or Property preceding the date of such

                                    Page 66
<PAGE>

Acquisition with respect to which the Agent shall have received the Required
Financial Information has been audited in accordance with GAAP, in the case of
the Borrower, as required by Section 6.1(a) and, in the case of the acquired
Person or Property, by an independent certified public accountants of recognized
national standing reasonably acceptable to the Agent (whose opinion shall not be
limited as to the scope or qualified as to going concern status or any other
material qualifications or exceptions) and (2) to the extent that audited
financial information for the acquired Person or Property is required under the
terms of the foregoing clause (1), certifying that the quarterly financial
statements with respect to the Person or Property acquired for each fiscal
quarter period ending after the date of the last audit and immediately prior to
the date of such Acquisition have been prepared in accordance with GAAP (subject
to audit adjustments and the absence of footnotes) and reviewed by independent
certified public accountants of recognized national standing reasonably
acceptable to the Agent, (iv) the representations and warranties made by the
Borrower in any Credit Document shall be true and correct in all material
respects at and as if made as of the date of such Acquisition (before and after
giving effect thereto) except to the extent such representations and warranties
expressly relate to an earlier date, (v) if such transaction involves the
purchase of an interest in a partnership between the Borrower (or a Subsidiary
of the Borrower) as a general partner and entities unaffiliated with the
Borrower or such Subsidiary as the other partners, such transaction shall be
effected by having such equity interest acquired by a corporate holding company
directly or indirectly wholly-owned by the Borrower newly formed for the sole
purpose of effecting such transaction and (vi) the aggregate consideration
(including cash and non-cash consideration and any assumption of Indebtedness,
but excluding consideration consisting of any Capital Stock of the Borrower
issued to the seller of the Capital Stock or Property acquired in such
Acquisition and consideration consisting of the proceeds of any Equity Issuance
by the Borrower consummated subsequent to the Closing Date and the proceeds of
any Asset Disposition, or Involuntary Disposition consummated subsequent to the
Closing Date) paid by the Consolidated Parties for all such Acquisitions
occurring after the Closing Date shall not exceed ten percent (10%) of
Consolidated Tangible Net Worth; or

(j) Investments in Joint Ventures that do not exceed $50,000,000 in the
aggregate during the term of this Credit Agreement.

7.7 Restricted Payments.

The Borrower will not permit any Consolidated Party to directly or indirectly,
declare, order, make or set apart any sum for or pay any Restricted Payment,
except (a) to make dividends or other distributions payable to the Borrower
(directly or indirectly through Subsidiaries), (b) as expressly permitted by
Section 7.6 or Section 7.9 and (c) to pay dividends to the Borrower's
shareholders and/or repurchase shares of the Borrower's Capital Stock, provided
(i) such payments are permitted under the Senior Subordinated Note Indenture,
(ii) no Default or Event of Default shall exist on the date of, or shall result
from, the making of any such payments, (iii) the aggregate amount paid in any
fiscal year of the Borrower to make such dividends to the Borrower's
shareholders and/or repurchase shares of the Borrower's Capital Stock shall not
exceed Consolidated Net Income for such fiscal year and (iv) the amount of any
payment to make such dividends to the Borrower's shareholders and/or repurchase
shares of the Borrower's Capital Stock shall not, when aggregated with all other
such payments made during the term of this Credit Agreement, exceed the sum of
(I) $10,000,000 and (II) 50% of cumulative Consolidated Net Income since
February 1, 2002 (measured as of the most recently ended fiscal quarter for
which the officer's certificate required under Section 6.1(c) has been

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<PAGE>

delivered).

7.8 Limitation on Actions with Respect to Other Indebtedness.

The Borrower will not, nor will it permit any of its Subsidiaries to:

(a) (i) amend or modify any of the terms of any Indebtedness of such Person
(other than Indebtedness arising under the Credit Documents) if such amendment
or modification would add or change any terms in a manner materially adverse to
the Lenders, or (ii) materially shorten the final maturity or average life to
maturity of any such Indebtedness or require any payment thereon to be made
sooner than originally scheduled or increase the interest rate or fees
applicable thereto above applicable market rates, or (iii) make (or give any
notice with respect thereto) any voluntary or optional payment or prepayment of
any such Indebtedness that, as of the Closing Date, has a maturity date after
the Maturity Date, or make (or give any notice with respect thereto) any
redemption or acquisition for value or defeasance (including without limitation,
by way of depositing money or securities with the trustee with respect thereto
before due for the purpose of paying when due), refund, refinance or exchange
with respect thereto, other than (A) prepayments made by the Borrower in
connection with any Asset Disposition permitted under Section 7.5, in the amount
necessary to prepay or retire any Indebtedness either secured by a Permitted
Lien (ranking senior to any Lien of the Agent) on the related Property or
incurred in connection with the acquisition of any Property that is disposed of
in connection with such Asset Disposition, (B) redemptions and/or prepayments in
connection with a refinancing of such Indebtedness permitted under this Credit
Agreement and (C) redemptions and/or prepayments that do not exceed $20,000,000
in the aggregate after the Closing Date and that are reasonably deemed necessary
by the Borrower to consummate amendments (which are permitted hereunder) to the
Borrower's senior note Indebtedness generally;

(b) after the issuance thereof, amend or modify any of the terms of any
Subordinated Indebtedness of such Person if such amendment or modification would
(i) add or change any terms in a manner materially adverse to such Person or to
the Lenders, (ii) materially shorten the final maturity or average life to
maturity thereof, (iii) require any payment thereon to be made sooner than
originally scheduled, (iv) increase the interest rate or fees applicable thereto
or (v) change any subordination provision thereof in a manner adverse to the
Lenders;

(c) make interest payments in respect of any Subordinated Indebtedness in
violation of the applicable subordination provisions;

(d) make (or give any notice with respect thereto) any voluntary or optional
payment or prepayment in respect of any Subordinated Indebtedness;

(e) make (or give any notice with respect thereto) any redemption, acquisition
for value or defeasance (including without limitation, by way of depositing
money or securities with the trustee with respect thereto before due for the
purpose of paying when due), refund, refinance or exchange of any Subordinated
Indebtedness; provided, however, that the Consolidated Parties may exchange the
Senior Subordinated Notes issued on the Closing Date for new Senior Subordinated
Notes with substantially identical terms that will be registered under the
Securities Act solely in connection with the exchange offer contemplated under
the Senior Subordinated Note Indenture and consummated in accordance with the
terms of the Registration Rights Agreement (as defined in the Senior
Subordinated Note Indenture, and as in effect on the Closing Date); or

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(f) designate any other Indebtedness of such Person as "Designated Senior Debt"
(as such term is used in the Senior Subordinated Note Indenture) other than
Indebtedness designated as "Designated Senior Debt" as of the Closing Date and
identified as such on Schedule 7.1.

7.9 Transactions with Affiliates.

The Borrower will not permit any Consolidated Party to enter into or permit to
exist any transaction or series of transactions with any officer, director,
shareholder, Subsidiary or Affiliate of such Person other than (a) advances of
working capital to the Borrower, (b) transfers of cash and assets to the
Borrower, (c) intercompany transactions expressly permitted by Section 7.1,
Section 7.4, Section 7.5, Section 7.6, or Section 7.7, (d) normal compensation
and reimbursement of expenses of officers and directors, (e) agreements and
arrangements entered into with employees of the Borrower in connection with
termination of their employment therewith, and (f) except as otherwise
specifically limited in this Credit Agreement, other transactions which are
entered into in the ordinary course of such Person's business on terms and
conditions substantially as favorable to such Person as would be obtainable by
it in a comparable arms-length transaction with a Person other than an officer,
director, shareholder, Subsidiary or Affiliate.

7.10 Fiscal Year; Organizational Documents.

The Borrower will not permit any Consolidated Party to (a) change its fiscal
year or (b) amend, modify or change its articles of incorporation (or corporate
charter or other similar organizational document) or bylaws (or other similar
document) to the extent such change, amendment or modification could reasonably
be expected to have a Material Adverse Effect.

7.11 Limitation on Restricted Actions.

The Borrower will not permit any Consolidated Party to directly or indirectly,
create or otherwise cause or suffer to exist or become effective any encumbrance
or restriction on the ability of any such Person to (a) pay dividends or make
any other distributions to the Borrower on its Capital Stock or with respect to
any other interest or participation in, or measured by, its profits, (b) pay any
Indebtedness or other obligation owed to the Borrower, (c) make loans or
advances to the Borrower, (d) sell, lease or transfer any of its Property to the
Borrower, or (e) act as the Borrower and pledge its assets pursuant to the
Credit Documents or any renewals, refinancings, exchanges, refundings or
extension thereof, except (in respect of any of the matters referred to in
clauses (a)-(d) above) for such encumbrances or restrictions existing under or
by reason of (i) this Credit Agreement and the other Credit Documents, (ii) the
Senior Subordinated Note Indenture and the Senior Subordinated Notes, in each
case as in effect as of the Closing Date, (iii) applicable law, (iv) any
document or instrument governing Indebtedness incurred pursuant to Section
7.1(c), provided that any such restriction contained therein relates only to the
asset or assets constructed or acquired in connection therewith, (v) any
Permitted Lien or any document or instrument governing any Permitted Lien,
provided that any such restriction contained therein relates only to the asset
or assets subject to such Permitted Lien or (vi) customary restrictions and
conditions contained in any agreement relating to the sale of any Property
permitted under Section 7.5 pending the consummation of such sale.

7.12 Ownership of Subsidiaries.

Notwithstanding any other provisions of this Credit Agreement to the contrary,
the Borrower will not permit any Consolidated Party to

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(i) permit any Person (other than the Borrower or any Wholly Owned Subsidiary of
the Borrower) to own any Capital Stock of any Subsidiary of the Borrower, except
(A) to qualify directors where required by applicable law or to satisfy other
requirements of applicable law with respect to the ownership of Capital Stock of
Foreign Subsidiaries or (B) as a result of or in connection with a dissolution,
merger, consolidation or disposition of a Subsidiary not prohibited by Section
7.4 or Section 7.5, (ii) permit any Subsidiary of the Borrower to issue or have
outstanding any shares of preferred Capital Stock or (iii) permit, create,
incur, assume or suffer to exist any Lien on any Capital Stock of any Subsidiary
of the Borrower, except for Permitted Liens.

7.13 Sale Leasebacks.

The Borrower will not permit any Consolidated Party to enter into any Sale and
Leaseback Transaction, except for such transactions that do not involve lease
obligations which in the aggregate would exceed $5,000,000 in any fiscal year
and which are otherwise permitted under this Credit Agreement.

7.14 No Further Negative Pledges.

The Borrower will not permit any Consolidated Party to enter into, assume or
become subject to any agreement prohibiting or otherwise restricting the
existence of any Lien upon any of its Property in favor of the Agent (for the
benefit of the Lenders) for the purpose of securing the Obligations, whether now
owned or hereafter acquired, or requiring the grant of any security for any
obligation if such Property is given as security for the Obligations, except (a)
in connection with any document or instrument governing Indebtedness incurred
pursuant to Section 7.1(c), provided that any such restriction contained therein
relates only to the asset or assets constructed or acquired (or proceeds
thereof) in connection therewith, (b) in connection with any Permitted Lien or
any document or instrument governing any Permitted Lien, provided that any such
restriction contained therein relates only to the asset or assets subject to
such Permitted Lien (or proceeds thereof), (c) pursuant to customary
restrictions and conditions contained in any agreement relating to the sale of
any Property permitted under Section 7.5, pending the consummation of such sale,
(d) in connection with any document or instrument governing other Indebtedness
the issuance of which would not cause a Default or Event of Default hereunder,
provided that the aggregate amount of each Transaction (for the purposes hereof,
"Transaction" means each class of Indebtedness having separate voting rights)
for the incurrence of such Indebtedness is in excess of $20,000,000, (e)
customary non-assignment provisions in contracts and (f) pursuant to the terms
and conditions contained in the Senior Subordinate Note Indenture.

7.15 Operating Lease Obligations.

The Borrower will not permit any Consolidated Party to enter into, assume or
permit to exist any obligations for the payment of rental under Operating Leases
which in the aggregate for all such Persons would exceed $10,000,000 in any
fiscal year.

7.16 Subsidiaries.

The Borrower will not create, acquire or permit to exist any Subsidiaries to the
extent that the fair market value of Investments (measured on the date such
Investments were made and without giving effect to subsequent changes in value)
by the Borrower and any of its Subsidiaries in all Subsidiaries would exceed in
the aggregate $5,000,000.

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SECTION 8

EVENTS OF DEFAULT

8.1 Events of Default.

An Event of Default shall exist upon the occurrence and during the continuance
of any of the following specified events (each an "Event of Default"):

(a) Payment. The Borrower shall

(i) default in the payment when due of any principal of any of the Loans or of
any reimbursement obligations arising from drawings under Letters of Credit, or

(ii) default, and such default shall continue for three (3) or more Business
Days, in the payment when due of any interest on the Loans or on any
reimbursement obligations arising from drawings under Letters of Credit, or of
any Fees or other amounts owing hereunder, under any of the other Credit
Documents or in connection herewith or therewith; or

(b) Representations. Any representation, warranty or statement made or deemed to
be made by the Borrower herein, in any of the other Credit Documents, or in any
statement or certificate delivered or required to be delivered pursuant hereto
or thereto shall prove untrue in any material respect on the date as of which it
was deemed to have been made; or

(c) Covenants. The Borrower shall

(i) default in the due performance or observance of any term, covenant or
agreement contained in Sections 6.2, 6.8, 6.10, or Section 7;

(ii) default in the due performance or observance of any term, covenant or
agreement contained in Sections 6.1(a), (b), (c), (d) or (f) and such default
shall continue unremedied for a period of at least 5 Business Days after the
earlier of an Executive Officer of the Borrower becoming aware of such default
or written notice thereof by the Agent or any Lender; or

(iii) default in the due performance or observance by it of any term, covenant
or agreement (other than those referred to in subsections (a), (b), (c)(i) or
(c)(ii) of this Section 8.1) contained in this Credit Agreement or any other
Credit Document and such default shall continue unremedied for a period of at
least 30 days (or such longer period of time as may be provided for in the
relevant Credit Document) after the earlier of an Executive Officer of the
Borrower becoming aware of such default or written notice thereof by the Agent
or any Lender; or

(d) Other Credit Documents. Except as a result of or in connection with a
dissolution, merger or disposition of a Subsidiary not prohibited by Section 7.4
or Section 7.5, any Credit Document shall fail to be in full force and effect or
to give the Agent and/or the Lenders the Liens (if any), rights, powers and
privileges purported to be created thereby, or the Borrower shall so state in
writing; or

(e) Bankruptcy, etc. Any Bankruptcy Event shall occur with respect to any
Consolidated Party; or

(f) Defaults under Other Agreements.

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(i) Any Consolidated Party shall default in the performance or observance
(beyond the applicable grace period with respect thereto, if any) or any
material obligation or condition of any contract or lease material to the
Consolidated Parties taken as a whole if such default could reasonably be
expected to have a Material Adverse Effect; or

(ii) With respect to any Indebtedness (other than Indebtedness outstanding under
this Credit Agreement) in excess of $5,000,000 in the aggregate for the
Consolidated Parties taken as a whole, (A) either (1) default in any payment
shall occur and continue (beyond the applicable grace period with respect
thereto, if any) with respect to any such Indebtedness, or (2) a default in the
observance or performance relating to such Indebtedness or contained in any
instrument or agreement evidencing, securing or relating thereto, or any other
event or condition shall occur or exist, the effect of which default or other
event or condition is to cause, or permit, the holder or holders of such
Indebtedness (or trustee or agent on behalf of such holders) to cause, any such
Indebtedness to become due prior to its stated maturity (beyond any applicable
grace period with respect thereto); or (B) any such Indebtedness shall be
declared due and payable, or required to be prepaid other than by a regularly
scheduled required prepayment, prior to the stated maturity thereof; or

(g) Judgments. One or more judgments or decrees shall be entered against one or
more of the Consolidated Parties involving a liability of $5,000,000 or more in
the aggregate (to the extent not paid or fully covered by insurance provided by
a carrier who has acknowledged coverage and has the ability to perform) and any
such judgments or decrees shall not have been vacated, discharged or stayed or
bonded pending appeal within 30 days from the entry thereof; or

(h) ERISA. Any of the following events or conditions, if such event or condition
could reasonably be expected to result in taxes, penalties, and other
liabilities to any Consolidated Party in an aggregate amount greater than
$5,000,000: (i) any "accumulated funding deficiency," as such term is defined in
Section 302 of ERISA and Section 412 of the Code, whether or not waived, shall
exist with respect to any Plan, or any lien shall arise on the assets of any
Consolidated Party or any ERISA Affiliate in favor of the PBGC or a Plan; (ii)
an ERISA Event shall occur with respect to a Single Employer Plan, which is, in
the reasonable opinion of the Agent, likely to result in the termination of such
Plan for purposes of Title IV of ERISA; (iii) an ERISA Event shall occur with
respect to a Multiemployer Plan or Multiple Employer Plan, which is, in the
reasonable opinion of the Agent, likely to result in (A) the termination of such
Plan for purposes of Title IV of ERISA, or (B) any Consolidated Party or any
ERISA Affiliate incurring any liability in connection with a withdrawal from,
reorganization of (within the meaning of Section 4241 of ERISA), or insolvency
(within the meaning of Section 4245 of ERISA) of such Plan; or (iv) any
prohibited transaction (within the meaning of Section 406 of ERISA or Section
4975 of the Code), other than a transaction that is exempted from the
prohibitions of such sections by Section 408 of ERISA or Section 4975 of the
Code (or any administrative or regulatory exemption issued thereunder) or breach
of fiduciary responsibility shall occur which could reasonably be expected to
subject any Consolidated Party or any ERISA Affiliate to any liability under
Sections 406, 409, 502(i), or 502(l) of ERISA or Section 4975 of the Code, or
under any agreement or other instrument pursuant to which any Consolidated Party
or any ERISA Affiliate has agreed or is required to indemnify any person against
any such liability; or

(i) Senior Subordinated Debt Documentation. (i) There shall occur and be
continuing any "Event of Default" (or any comparable term) under, and as defined
in the documents evidencing or governing any Subordinated

                                    Page 72
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Debt, (ii) any of the Obligations for any reason shall cease to be "Designated
Senior Debt" (or any comparable term) under, and as defined in the documents
evidencing or governing any Subordinated Indebtedness, (iii) any Indebtedness
other than the Obligations shall constitute "Designated Senior Indebtedness" (or
any comparable term) under, and as defined in, the Senior Subordinated Note
Indenture or any other documents evidencing or governing any Subordinated
Indebtedness or (iv) the subordination provisions of the documents evidencing or
governing any Subordinated Indebtedness shall, in whole or in part, terminate,
cease to be effective or cease to be legally valid, binding and enforceable
against any holder of the applicable Subordinated Indebtedness; or

(j) Ownership. There shall occur a Change of Control.

8.2 Acceleration; Remedies.

Upon the occurrence and during the continuance of an Event of Default, the Agent
may or, upon the request and direction of the Required Lenders, shall, by
written notice to the Borrower take any of the following actions:

(a) Termination of Commitments. Declare the Commitments terminated whereupon the
Commitments shall be immediately terminated.

(b) Acceleration. Declare the unpaid Obligations to be due, whereupon the same
shall be immediately due and payable without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by the Borrower.

(c) Cash Collateral. Direct the Borrower to pay (and the Borrower hereby
promises to pay, upon receipt of such notice) to the Agent additional cash, to
be held by the Agent, for the benefit of the Lenders, in a cash collateral
account as additional security for the LOC Obligations in respect of subsequent
drawings under all then outstanding Letters of Credit in an amount equal to the
maximum aggregate amount which may be drawn under all Letters of Credits then
outstanding.

(d) Enforcement of Rights. Enforce any and all rights and interests created and
existing under the Credit Documents.

Notwithstanding the foregoing, if an Event of Default specified in Section 8.1
(e) shall occur with respect to the Borrower, then, without the giving of any
notice or other action by the Agent or the Lenders, (i) the Commitments
automatically shall terminate, (ii) all of the outstanding Obligations
automatically shall immediately become due and payable and (iii) the Borrower
automatically shall be obligated (and hereby promises) to pay to the Agent
additional cash, to be held by the Agent, for the benefit of the Lenders, in a
cash collateral account as additional security for the LOC Obligations in
respect of subsequent drawings under all then outstanding Letters of Credit in
an amount equal to the maximum aggregate amount which may be drawn under all
Letters of Credits then outstanding.

SECTION 9

AGENCY PROVISIONS

9.1 Appointment and Authorization of Agent.

(a) Each Lender hereby irrevocably (subject to Section 9.9) appoints, designates
and authorizes the Agent to take such action on its behalf under the provisions
of this Credit Agreement and each other Credit

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Document and to exercise such powers and perform such duties as are expressly
delegated to it by the terms of this Credit Agreement or any other Credit
Document, together with such powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary contained elsewhere herein or in
any other Credit Document, the Agent shall not have any duties or
responsibilities, except those expressly set forth herein, nor shall the Agent
have or be deemed to have any fiduciary relationship with any Lender or
participant, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Credit Agreement or any other
Credit Document or otherwise exist against the Agent. Without limiting the
generality of the foregoing sentence, the use of the term "Agent" herein and in
the other Credit Documents with reference to the 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 Issuing Lender 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 Agent may agree at the request of the
Required Lenders to act for the Issuing Lender with respect thereto; provided,
however, that the Issuing Lender shall have all of the benefits and immunities
(i) provided to the Agent in this Section 9 with respect to any acts taken or
omissions suffered by the Issuing Lender 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 "Agent" as used in this Section 9 included the Issuing Lender with respect
to such acts or omissions, and (ii) as additionally provided herein with respect
to the Issuing Lender.

9.2 Delegation of Duties.

The Agent may execute any of its duties under this Credit Agreement or any other
Credit 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 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.

9.3 Liability of 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 Credit Agreement or any
other Credit 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
the Borrower or any officer thereof, contained herein or in any other Credit
Document, or in any certificate, report, statement or other document referred to
or provided for in, or received by the Agent under or in connection with, this
Credit Agreement or any other Credit Document, or the validity, effectiveness,
genuineness, enforceability or sufficiency of this Credit Agreement or any other
Credit Document, or for any failure of the Borrower or any other party to any
Credit 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

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the agreements contained in, or conditions of, this Credit Agreement or any
other Credit Document, or to inspect the properties, books or records of the
Borrower or any Affiliate thereof.

9.4 Reliance by Agent.

(a) The 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 the Borrower), independent accountants and other experts selected by
the Agent. The Agent shall be fully justified in failing or refusing to take any
action under any Credit 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 Agent shall in all cases be
fully protected in acting, or in refraining from acting, under this Credit
Agreement or any other Credit Document in accordance with a request or 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 Credit Agreement expressly
permits or prohibits an action unless the Required Lenders otherwise determine,
the Agent shall, and in all other instances, the 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 4.1, each Lender that has signed this Credit 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 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.

9.5 Notice of Default.

The 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 the Agent for the account
of the Lenders, unless the Agent shall have received written notice from a
Lender or the Borrower referring to this Credit Agreement, describing such
Default or Event of Default and stating that such notice is a "notice of
default". The Agent will notify the Lenders of its receipt of any such notice.
The Agent shall take such action with respect to such Default or Event of
Default as may be directed by the Required Lenders in accordance with Section
8.2; provided, however, that unless and until the Agent has received any such
direction, the 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 the Lenders.

9.6 Credit Decision; Disclosure of Information by Agent.

Each Lender acknowledges that no Agent-Related Person has made any
representation or warranty to it, and that no act by the Agent hereinafter
taken, including any consent to and acceptance of any

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<PAGE>

assignment or review of the affairs of the Borrower 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 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 Borrower and its respective
Subsidiaries, and all applicable Requirements of Law relating to the
transactions contemplated hereby, and made its own decision to enter into this
Credit Agreement and to extend credit to the 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 Credit
Agreement and the other Credit 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.
Except for notices, reports and other documents expressly required to be
furnished to the Lenders by the Agent herein, the 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 the Borrower or any of its respective
Affiliates which may come into the possession of any Agent-Related Person.

9.7 Indemnification of 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 the Borrower and without limiting the obligation
of the Borrower to do so), pro rata, and hold harmless each Agent-Related Person
from and against any and all claims, damages, losses, liabilities, costs, and
expenses (including, without limitation, reasonable attorneys' fees) that may be
incurred by or asserted or awarded against any Agent-Related Person, in each
case arising out of or in connection with or by reason of (including, without
limitation, in connection with any investigation, litigation, or proceeding or
preparation of defense in connection therewith) the Credit Documents, any of the
transactions contemplated herein or the actual or proposed use of the proceeds
of the Loans, except to the extent such claim, damage, loss, liability, cost, or
expense is found in a final, non-appealable judgment by a court of competent
jurisdiction to have resulted from such Agent-Related Person's breach of
contract, gross negligence or willful misconduct; provided, however, that no
action taken in accordance with the directions of the Required Lenders shall be
deemed to constitute breach of contract, gross negligence or willful misconduct
for purposes of this Section. Without limitation of the foregoing, each Lender
shall reimburse the Agent upon demand for its ratable share of any costs or
out-of-pocket expenses (including reasonable attorneys fees and the allocated
costs of internal counsel) incurred by the 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 Credit
Agreement, any other Credit Document, or any document contemplated by or
referred to herein, to the extent that the Agent is not reimbursed for such
expenses by or on behalf of the Borrower. The undertaking in this Section shall
survive termination of the Commitments, the payment of all Obligations

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hereunder and the resignation or replacement of the Agent.

9.8 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 the Borrower and its respective Affiliates as though Bank
of America were not the Agent or the Issuing Lender 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
the Borrower or its Affiliates (including information that may be subject to
confidentiality obligations in favor of the Borrower or such Affiliate) and
acknowledge that the 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 Credit Agreement as any other Lender and may
exercise such rights and powers as though it were not the Agent or the Issuing
Lender, and the terms "Lender" and "Lenders" include Bank of America in its
individual capacity.

9.9 Successor Agent.

The Agent may resign as Agent upon 30 days' notice to the Lenders. If the Agent
resigns under this Credit 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 Agent, the 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, such
successor administrative agent shall succeed to all the rights, powers and
duties of the retiring Agent and the term "Agent" shall mean such successor
administrative 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 Section 9 and Sections 10.4 and 10.9 shall inure
to its benefit as to any actions taken or omitted to be taken by it while it was
Agent under this Credit Agreement. If no successor administrative 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 the Lenders shall perform all of the
duties of the Agent hereunder until such time, if any, as the Required Lenders
appoint a successor agent as provided for above.

9.10 Other Agents; Lead Managers.

None of the Lenders identified on the facing page or signature pages of this
Credit Agreement as a "syndication agent", "documentation agent", "co-agent",
"lead arranger" or "book manager" shall have any right, power, obligation,
liability, responsibility or duty under this Credit Agreement other than those
applicable to all Lenders as such. Without limiting the foregoing, none of the
Lenders 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 Credit
Agreement or in taking or not taking action hereunder.

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<PAGE>

SECTION 10

MISCELLANEOUS

10.1 Notices.

Except as otherwise expressly provided herein, all notices and other
communications shall have been duly given and shall be effective (a) when
delivered, (b) when transmitted via telecopy (or other facsimile device) to the
number set out below, (c) the Business Day following the day on which the same
has been delivered prepaid (or pursuant to an invoice arrangement) to a
reputable national overnight air courier service, or (d) the third Business Day
following the day on which the same is sent by certified or registered mail,
postage prepaid, in each case to the respective parties at the address, in the
case of the Borrower and the Agent, set forth below, and, in the case of the
Lenders, set forth on Schedule 2.1(a), or at such other address as such party
may specify by written notice to the other parties hereto:

if to the Borrower:

Longview Fibre Company
300 Fibre Way
Longview, Washington 98632
Attn: Senior Vice President Finance
Telephone: (360) 425-1550
Telecopy:  (360) 575-5928

if to the Agent:

For payments:
Bank of America, N.A.
1850 Gateway Boulevard
Concord, California 94520
Attention: Agency Administrative Services
ABA# 111000012
Account #: 3750836479
Reference: Longview Fibre Company

For Notices of Borrowing and Notices of Extension/Conversion
Bank of America, N.A.
Agency Administrative Services
1850 Gateway Boulevard, 5th Floor
Mail Code: CA4-706-05-09
Concord, California 94520
Attention:  Mark Garcia
Telephone: (925) 675-8416
Telecopy:  (888) 969-2297

For Letter of Credit Applications:

Bank of America, N.A.
Attn: William Pinsel
Mail Code: CA9-703-19-23
333 South Beaudry Street
Los Angeles, CA 90071
Telephone: (213) 345-0365
Telecopy:  (213) 345-0248
william.pinsel@bankofamerica.com

For all other notices:

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<PAGE>

Bank of America, N.A.
San Francisco Credit Products
Mail Code: CA5-705-12-12
555 California Street - 12th Floor
San Francisco, California 94104
Attn:  Kevin Sullivan
Telephone: (415) 622-4567
Telecopy:  (415) 622-4585

10.2 Right of Set-Off; Adjustments.

Upon the occurrence and during the continuance of any Event of Default, each
Lender (and each of its Affiliates) is hereby authorized at any time and from
time to time, 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 and other indebtedness at any time owing by such Lender (or any of
its Affiliates) to or for the credit or the account of the Borrower against any
and all of the obligations of such Person now or hereafter existing under this
Credit Agreement, under the Notes, under any other Credit Document or otherwise,
irrespective of whether such Lender shall have made any demand hereunder or
thereunder and although such obligations may be unmatured. Each Lender agrees
promptly to notify the Borrower 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. The rights of each Lender
under this Section 10.2 are in addition to other rights and remedies (including,
without limitation, other rights of set-off) that such Lender may have.

10.3 Successors and Assigns.

(a) The provisions of this Credit 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 nor 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 Credit Agreement,
expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby
and, to the extent expressly contemplated hereby, the Indemnified Parties) any
legal or equitable right, remedy or claim under or by reason of this Credit
Agreement.

(b) Any Lender may assign to one or more Eligible Assignees all or a portion of
its rights and obligations under this Credit Agreement (including all or a
portion of its Commitment and the Loans (including for purposes of this
subsection (b), its Participation Interests) 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), determined as of the date
the Assignment and Acceptance with respect to such assignment is delivered to
the Agent, shall not be less than $5,000,000 unless each of the Agent and, so
long as no Default or 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 the assigning Lender's rights and obligations under
this Credit Agreement with respect to the Loans or the Commitments (other

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<PAGE>

than the Swingline Commitment) assigned, and (iii) the parties to each
assignment shall execute and deliver to the Agent an Assignment and Acceptance,
together with a processing and recordation fee of $3,500, provided that the
Borrower shall have no obligation for any such fee. Subject to acceptance and
recording thereof by the Agent pursuant to subsection (c), from and after the
effective date specified in each Assignment and Acceptance, the Eligible
Assignee thereunder shall be a party hereto and, to the extent of the interest
assigned by such Assignment and Acceptance, have the rights and obligations of a
Lender under this Credit Agreement, and the assigning Lender thereunder shall,
to the extent of the interest assigned by such Assignment and Acceptance, be
released from its obligations under this Credit Agreement (and, in the case of
an Assignment and Acceptance covering all of the assigning Lender's rights and
obligations under this Credit Agreement, such Lender shall cease to be a party
hereto but shall continue to be entitled to the benefits of Sections 3.11, 3.12
and 10.5). 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 Credit
Agreement that does not comply with this subsection shall be treated for
purposes of this Credit 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 Agent, acting solely for this purpose as an agent of the Borrower, shall
maintain at is address referred to in Section 10.1 a copy of each Assignment and
Acceptance delivered to it and a register for the recordation of the names and
addresses of the Lenders, and the Commitments of, and principal amount of the
Loans and LOC Obligations owing to, each Lender pursuant to the terms hereof
from time to time (the "Register"). The entries in the Register shall be
conclusive absent manifest error, and the Borrower, the 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 Credit 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, without the consent of, or notice to, the Borrower or the
Agent, sell participations to one or more banks or other entities (a
"Participant") in all or a portion of such Lender's rights and/or obligations
under this Credit Agreement (including all or a portion of its Commitments
and/or the Loans (including such Lender's Participation Interests) owing to it);
provided that (i) such Lender's obligations under this Credit 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 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
Credit 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 Credit Agreement and to approve any amendment, modification or
waiver of any provision of this Credit 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, (iii) except as the result of or in connection with
a dissolution, merger or disposition of a Consolidated Party not prohibited by
Section 7.4 or 7.5, release all or substantially all of the Guarantors from
their obligations under the Credit Documents or (iv) except as the

                                    Page 80
<PAGE>

result of or in connection with an Asset Disposition not prohibited by Section
7.5, release all or substantially all of the Collateral. Subject to subsection
(e) of this Section, the Borrower agrees that each Participant shall be entitled
to the benefits of Sections 3.6, 3.9, 3.11 and 3.12 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 10.2 as though it were a Lender, provided
such Participant agrees to be subject to Section 3.14 as though it were a
Lender.

(e) A Participant shall not be entitled to receive any greater payment under
Section 3.6, 3.7 or 3.11 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 is not a United States person under Section
7701(a)(30) of the Code shall not be entitled to the benefits of Section 3.11
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 3.11(d) 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 Credit 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 or a bank in the farm
credit banking system; provided that no such pledge or assignment shall release
a Lender from any of its obligations hereunder or substitute any such pledgee or
assignee for such Lender as a party hereto.

(g) If the consent of the Borrower to an assignment or to an Eligible Assignee
is required hereunder (including a consent to an assignment which does not meet
the minimum assignment threshold specified in clause (i) of the proviso to the
first sentence of Section 10.3(b)), the Borrower shall be deemed to have given
its consent five Business Days after the date notice thereof has been delivered
by the assigning Lender (through the Agent) unless such consent is expressly
refused by the Borrower prior to such fifth Business Day.

(h) Notwithstanding anything to the contrary contained herein, if at any time
Bank of America assigns all of its Commitment and Loans pursuant to subsection
(b) above, Bank of America may (i) upon 30 days' notice to the Borrower and the
Lenders, resign as Issuing Lender and/or (ii) upon 5 days' notice to Borrower
terminate the Swingline Commitment. In the event of any such resignation as
Issuing Lender or termination of the Swingline Commitment, the Borrower shall be
entitled to appoint from among the Lenders a successor Issuing Lender and/or
Swingline Lender hereunder (subject to the consent of such Lender so appointed);
provided, however, that no failure by the Borrower to appoint any such successor
shall affect the resignation of Bank of America as Issuing Lender or termination
of the Swingline Commitment. If Bank of America terminates its Swingline
Commitment, it shall retain all the rights of the Swingline Lender provided
hereunder with respect to Swingline Loans made by it and outstanding as of the
effective date of such termination, including the right to require the Lenders
to make Revolving Loans or fund their Participation Interests in outstanding
Swingline Loans pursuant to Section 2.3(d). Bank of America shall retain all the
rights and obligations of the Issuing Lender hereunder with respect to all
Letters of Credit outstanding as of the effective date of its resignation as
Issuing Lender and all LOC Obligations with respect thereto (including the right
to require the Lenders to make

                                    Page 81
<PAGE>

Revolving Loans or fund their Participation Interests pursuant to Section 2.2).

(i) (i) Notwithstanding anything to the contrary contained herein, any Lender (a
"Designating Lender") may grant to one or more special purpose funding vehicles
(each, an "SPV"), identified as such in writing from time to time by the
Designating Lender to the Agent and the Borrower, the option to provide to the
Borrower all or any part of any Loan that such Designating Lender would
otherwise be obligated to make to the Borrower pursuant to this Credit
Agreement; provided that (A) nothing herein shall constitute a commitment by any
SPV to make any Loan, (B) if an SPV elects not to exercise such option or
otherwise fails to provide all or any part of such Loan, the Designating Lender
shall be obligated to make such Loan pursuant to the terms hereof, (C) the
Designating Lender shall remain liable for any indemnity or other payment
obligation with respect to its Commitments hereunder and (D) each such SPV would
satisfy the requirements of Section 3.11 if such SPV was a Lender hereunder. The
making of a Loan by an SPV hereunder shall utilize the Commitment of the
Designating Lender to the same extent as a Loan made by, and as if such Loan
were made by, such Designating Lender.

(ii) As to any Loans or portion thereof made by it, each SPV shall have all the
rights that a Lender making such Loans or portion thereof would have had under
this Credit Agreement; provided, however that each SPV shall have granted to its
Designating Lender an irrevocable power of attorney, to deliver and receive all
communications and notices under this Agreement (and any related documents),
including, without limitation, any Notice of Borrowing and any Notice of
Extension/Conversion, and to exercise on such SPV's behalf, all of such SPV's
voting rights under this Credit Agreement. No additional Note shall be required
to evidence the Loans or portion thereof made by an SPV; and the related
Designating Lender shall be deemed to hold its Note as agent for such SPV to the
extent of the Loans or portion thereof funded by such SPV. In addition, any
payments for the account of any SPV shall be paid to its Designating Lender as
agent for such SPV.

(iii) Each party hereto hereby agrees that no SPV shall be liable for any
indemnity or payment under this Credit Agreement for which a Lender would
otherwise be liable for so long as, and to the extent, the Designating Lender
provides such indemnity or makes such payment. In furtherance of the foregoing,
each party hereto hereby agrees (which agreement shall survive the termination
of this Credit Agreement) that, prior to the date that is one year and one day
after the payment in full of all outstanding prior indebtedness of any SPV, it
will not institute against, or join any other person in instituting against,
such SPV any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings or similar proceedings under the laws of the United States or any
State thereof.

(iv) In addition, notwithstanding anything to the contrary contained in this
Section 10.3 or otherwise in this Credit Agreement, any SPV may (A) at any time
and without paying any processing fee therefor, assign or participate all or a
portion of its interest in any Loans to the Designating Lender (or to any other
SPV of such Designating Lender) or to any financial institutions providing
liquidity and/or credit support to or for the account of such SPV to support the
funding or maintenance of Loans and (B) disclose on a confidential basis any
non-public information relating to its Loans to any rating agency, commercial
paper dealer or provider of any surety, guarantee or credit or liquidity
enhancements to such SPV. This Section 10.3 may not be amended without the
written consent of any Designating Lender affected thereby.

                                    Page 82
<PAGE>

10.4 No Waiver; Remedies Cumulative.

No failure or delay on the part of the Agent or any Lender in exercising any
right, power or privilege hereunder or under any other Credit Document and no
course of dealing between the Agent or any Lender and the Borrower shall operate
as a waiver thereof; nor shall any single or partial exercise of any right,
power or privilege hereunder or under any other Credit Document preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege hereunder or thereunder. The rights and remedies provided herein are
cumulative and not exclusive of any rights or remedies which the Agent or any
Lender would otherwise have. No notice to or demand on the Borrower in any case
shall entitle the Borrower to any other or further notice or demand in similar
or other circumstances or constitute a waiver of the rights of the Agent or the
Lenders to any other or further action in any circumstances without notice or
demand.

10.5 Expenses; Indemnification.

(a) The Borrower agrees to pay on demand all costs and expenses of the Agent in
connection with the syndication, preparation, execution, delivery,
administration, modification, and amendment of this Credit Agreement, the other
Credit Documents, and the other documents to be delivered hereunder, including,
without limitation, the reasonable fees and expenses of counsel for the Agent
(including the cost of internal counsel) with respect thereto and with respect
to advising the Agent as to its rights and responsibilities under the Credit
Documents. The Borrower agrees to pay on demand all costs and expenses of the
Agent and the Lenders, if any (including, without limitation, reasonable
attorneys' fees and expenses and the cost of internal counsel), in connection
with any work-out or restructuring relating to the Credit Facilities or any
enforcement (whether through negotiations, legal proceedings, or otherwise) of
any of the Credit Documents.

(b) The Borrower agrees to indemnify and hold harmless each Agent-Related Person
and each Lender and each of their Affiliates and their respective officers,
directors, employees, agents, trustees and advisors (each, an "Indemnified
Party") from and against any and all claims, damages, losses, liabilities,
costs, and expenses (including, without limitation, reasonable attorneys' fees)
that may be incurred by or asserted or awarded against any Indemnified Party, in
each case arising out of or in connection with or by reason of (including,
without limitation, in connection with any investigation, litigation, or
proceeding or preparation of defense in connection therewith) the Credit
Documents, any of the transactions contemplated herein or the actual or proposed
use of the proceeds of the Loans, except to the extent such claim, damage, loss,
liability, cost, or expense is found in a final, non-appealable judgment by a
court of competent jurisdiction to have resulted from such Indemnified Party's
breach of contract, gross negligence or willful misconduct. In the case of an
investigation, litigation or other proceeding to which the indemnity in this
Section 10.5 applies, such indemnity shall be effective whether or not such
investigation, litigation or proceeding is brought by the Borrower, its
directors, shareholders or creditors or an Indemnified Party or any other Person
or any Indemnified Party is otherwise a party thereto and whether or not the
transactions contemplated hereby are consummated. The Borrower agrees not to
assert any claim against any Agent-Related Party, any Lender, any of their
Affiliates, or any of their respective directors, officers, employees,
attorneys, agents, and advisers, on any theory of liability, for special,
indirect, consequential, or punitive damages arising out of or otherwise
relating to the Credit Documents, any of the transactions contemplated herein or

                                    Page 83
<PAGE>

the actual or proposed use of the proceeds of the Loans.

(c) Upon receipt by an Indemnified Party of actual notice of an action or
proceeding against such Indemnified Party with respect to which indemnity may be
sought under this letter, such Indemnified Party shall promptly notify the
Borrower in writing; provided that failure so to notify the Borrower shall not
relieve the Borrower from any liability which it may have on account of this
indemnity or otherwise, except to the extent the Borrower shall have been
materially prejudiced by such failure. The Borrower shall, at its option or if
requested, assume the defense of any such action or proceeding, including the
employment of counsel reasonably acceptable to the applicable Indemnified
Party(ies). Any Indemnified Party shall have the right to employ separate
counsel in any such action and participate in the defense thereof, but the fees
and expenses of such counsel shall be at the expense of such Indemnified Party,
unless: (i) the Borrower has failed with reasonable promptness to assume the
defense and employ counsel or (ii) the named parties to any such action or
proceeding (including any impleaded parties) include such Indemnified Party, and
such Indemnified Party shall have been advised by counsel that there may be one
or more legal defenses available to it which are different from or in addition
to those available to the Borrower and which it cannot assert, in a manner
reasonably acceptable to such Indemnified Party, on behalf of or while assuming
the defense of such Indemnified Party; provided that the Borrower shall not in
such event be responsible hereunder for the fees and expenses of more than one
firm of separate counsel in connection with any action or proceeding in the same
jurisdiction, or for additional local counsel. Notwithstanding the foregoing,
the Borrower shall not be liable for any settlement of any action effected
without its written consent. In addition, the Borrower will not, without prior
written consent of such Indemnified Party, settle, compromise or consent to the
entry of any judgment in or otherwise seek to terminate any pending or
threatened action or proceeding in respect of which indemnification may be
sought hereunder (whether or not the Borrower is a party thereto) unless such
settlement, compromise, consent or termination includes an unconditional release
of each Indemnified Party from all losses, claims, damages, liabilities and
expenses arising out of such action or proceeding.

(d) Without prejudice to the survival of any other agreement of the Borrower
hereunder, the agreements and obligations of the Borrower contained in this
Section 10.5 shall survive the repayment of the Obligations and the termination
of the Commitments hereunder.

10.6 Amendments, Waivers and Consents.

Neither this Credit Agreement nor any other Credit Document nor any of the terms
hereof or thereof may be amended, changed, waived, discharged or terminated
unless such amendment, change, waiver, discharge or termination is in writing
entered into by, or approved in writing by, the Borrower and the Required
Lenders, provided, however, that:

(a) without the written consent of each Lender affected thereby, neither this
Credit Agreement nor any other Credit Document may be amended, changed, waived,
discharged or terminated so as to

(i) extend any Commitment or the final maturity of any Loan or of any
reimbursement obligation, or any portion thereof, arising from drawings under
Letters of Credit, or extend or waive any Loan, or any portion thereof,

(ii) reduce the rate or extend the time of payment of interest on any

                                    Page 84
<PAGE>

Loan or of any reimbursement obligation, or any portion thereof, arising from
drawings under Letters of Credit (other than as a result of waiving the
applicability of any post-default increase in interest rates) or of any Fees,

(iii) reduce or waive the principal amount of any Loan or of any reimbursement
obligation, or any portion thereof, arising from drawings under Letters of
Credit,

(iv) increase the Commitment of a Lender over the amount thereof in effect (it
being understood and agreed that a waiver of any condition precedent set forth
in Section 4.2 or of any Default or Event of Default or mandatory reduction in
the Commitments shall not constitute a change in the terms of any Commitment of
any Lender),

(v) release the Borrower from its obligations under the Credit Documents,

(vi) amend, modify or waive any provision of Section 3.13,

(vii) amend, modify or waive any provision of this Section 10.6, provided that
the class vote provisions of Section 10.6 can be amended by written approval of
each class (without the need for the approval of each member of each class),

(viii) reduce any percentage specified in the definition of Required Lenders, or

(ix) consent to the assignment or transfer by the Borrower of any of its rights
and obligations under (or in respect of) the Credit Documents except as
permitted thereby;

(b) without the written consent of Required Lenders (other than Defaulting
Lenders), no Default or Event of Default may be waived for purposes of Section
4.2(d);

(c) without the written consent of the Agent, no provision of Section 9 may be
amended, changed, waived, discharged or terminated;

(d) without the written consent of the Issuing Lender, no provision of Section
2.2 may be amended, changed, waived, discharged or terminated; and

(e) without the written consent of the Swingline Lender, no provision of Section
2.3 may be amended, changed, waived, discharged or terminated.

Notwithstanding the fact that the consent of all the Lenders is required in
certain circumstances as set forth above, (x) each Lender is entitled to vote as
such Lender sees fit on any bankruptcy reorganization plan that affects the
Loans, and each Lender acknowledges that the provisions of Section 1126(c) of
the Bankruptcy Code supersedes the unanimous consent provisions set forth herein
and (y) the Required Lenders shall determine whether or not to allow the
Borrower to use cash collateral in the context of a bankruptcy or insolvency
proceeding and such determination shall be binding on all of the Lenders.

10.7 Counterparts.

This Credit Agreement may be executed in any number of counterparts, each of
which when so executed shall be an original, but all of which shall constitute
one and the same instrument. It shall not be necessary in making proof of this
Credit Agreement to produce or account for more than one such counterpart for
each of the parties hereto. Delivery by

                                    Page 85
<PAGE>

facsimile by any of the parties hereto of an executed counterpart of this Credit
Agreement shall be as effective as an original executed counterpart hereof and
shall be deemed a representation that an original executed counterpart hereof
will be delivered.

10.8 Headings.

The headings of the sections hereof are provided for convenience only and shall
not in any way affect the meaning or construction of any provision of this
Credit Agreement.

10.9 Survival.

All indemnities set forth herein, including, without limitation, in Section
2.2(i), 3.11, 3.12, 10.5 or 10.5 shall survive the execution and delivery of
this Credit Agreement, the making of the Loans, the issuance of the Letters of
Credit, the repayment of the Loans, LOC Obligations and other obligations under
the Credit Documents and the termination of the Commitments hereunder, and all
representations and warranties made by the Borrower herein shall survive until
this Credit Agreement shall be terminated in accordance with the terms of
Section 10.13(b).

10.10 Governing Law; Submission to Jurisdiction; Venue; Waiver of Jury Trial.

(a) THIS CREDIT AGREEMENT AND, UNLESS OTHERWISE EXPRESSLY PROVIDED THEREIN, THE
OTHER CREDIT DOCUMENTS AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
AND THEREUNDER SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK. Any legal action or proceeding with
respect to this Credit Agreement or any other Credit Document may be brought in
the courts of the State of New York in New York County, or of the United States
for the Southern District of New York, and, by execution and delivery of this
Credit Agreement, the Borrower hereby irrevocably accepts for itself and in
respect of its property, generally and unconditionally, the nonexclusive
jurisdiction of such courts. The Borrower further irrevocably consents to the
service of process out of any of the aforementioned courts in any such action or
proceeding by the mailing of copies thereof by registered or certified mail,
postage prepaid, to it at the address set out for notices pursuant to Section
10.1, such service to become effective three (3) days after such mailing.
Nothing herein shall affect the right of the Agent or any Lender to serve
process in any other manner permitted by law or to commence legal proceedings or
to otherwise proceed against the Borrower in any other jurisdiction.

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

(c) EACH PARTY TO THIS CREDIT 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 CREDIT
DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING
OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR 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

                                    Page 86
<PAGE>

THIS CREDIT 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.

10.11 Severability.

If any provision of any of the Credit Documents is determined to be illegal,
invalid or unenforceable, such provision shall be fully severable and the
remaining provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or unenforceable
provisions.

10.12 Entirety.

This Credit Agreement together with the other Credit Documents represent the
entire agreement of the parties hereto and thereto, and supersede all prior
agreements and understandings, oral or written, if any, including any commitment
letters or correspondence relating to the Credit Documents or the transactions
contemplated herein and therein.

10.13 Binding Effect; Termination.

(a) This Credit Agreement shall become effective at such time on or after the
Closing Date when it shall have been executed by the Borrower and the Agent, and
the Agent shall have received copies hereof (telefaxed or otherwise) which, when
taken together, bear the signatures of each Lender, and thereafter this Credit
Agreement shall be binding upon and inure to the benefit of the Borrower, the
Agent and each Lender and their respective successors and assigns.

(b) The term of this Credit Agreement shall be until the Obligations are Fully
Satisfied.

10.14 Confidentiality.

Each of the 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 regulations or by any subpoena or
similar legal process; (d) to any other party to this Credit Agreement; (e) in
connection with the exercise of any remedies hereunder or any suit, action or
proceeding relating to this Credit Agreement or the enforcement of rights
hereunder; (f) subject to an agreement containing provisions substantially the
same as those of this Section 10.14, 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 Credit 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; (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 10.14 or (ii)
becomes available to the Agent or any Lender on a nonconfidential basis from a
source other than the Consolidated Parties; 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

                                    Page 87
<PAGE>

ratings issued with respect to such Lender or its Affiliates. For the purposes
of this Section, "Information" means all information received from the Borrower
relating to the Consolidated Parties or their business, other than any such
information that is available to the Agent or any Lender on a nonconfidential
basis prior to disclosure by the Consolidated Parties. Any Person required to
maintain the confidentiality of Information as provided in this Section 10.14
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.

10.15 Source of Funds.

Each of the Lenders hereby represents and warrants to the Borrower that at least
one of the following statements is an accurate representation as to the source
of funds to be used by such Lender in connection with the financing hereunder:

(a) the source is an insurance company's general asset account (as defined in
Prohibited Transaction Class Exemption ("PTE") 95-60, 60 Fed. Reg. 35,925
(1995)), and (i) to the extent the assets in such account support any policy
issued by such insurance company before January 1, 1999, such insurance company
has complied with all of the requirements of the regulations issued under
Section 401(c)(1)(A) of ERISA, and (ii) if the assets in such account support
any policy issued on or after January 1, 1999, the aggregate amount of such
general account's reserves and liabilities for the contracts held by or on
behalf of any employee benefit plan does not exceed 10% of the total reserves
and liabilities of such account (as determined in accordance with PTE 95-60,
excluding any separate account liabilities, but including any applicable
surplus) (and, for purposes of this clause (a), all employee benefit plans
maintained by the same employer or any affiliate thereof or by the same employee
organization are deemed to be a single plan);

(b) the source is an insurance company's pooled separate account (as defined in
PTE 90-1, 54 Fed. Reg. 31,092 (1989)) or a bank's collective investment fund (as
defined in PTE 91-38, 56 Fed. Reg. 4,856 (1991)) and (i) the Lender has
disclosed to the Borrower the name of each employee benefit plan whose assets in
such account or fund exceed 10% of the total assets of such account and (ii) the
Lender will comply with the requirements specified in Section III(b) and (c) of
PTE 90-1 or 91-38, as applicable (and, for purposes of this clause (b), all
employee benefit plans maintained by the same employer or any affiliate thereof
or by the same employee organization are deemed to be a single plan);

(c) the source is a governmental plan, as defined in Section 3(32) of ERISA and
Section 414(d) of the Code; or

(d) the source does not include assets of any employee benefit plan that is not
exempt from the coverage of ERISA or any plan that is not exempt from the
coverage of Section 4975 of the Code. As used in this Section 10.15, the terms
"employee benefit plan" and "separate account" shall have the respective
meanings assigned to such terms in Section 3 of ERISA and the term "plan" shall
have the meaning assigned to such term in Section 4975(e)(1) of the Code.

10.16   Regulation D.

Each of the Lenders hereby represents and warrants to the Borrower that
it is a commercial lender, other financial institution or other
"accredited" investor (as defined in SEC Regulation D) which makes or
acquires or loans on the ordinary course of business and that it will
make or acquire Loans for its own account in the ordinary course of

                                    Page 88
<PAGE>

business.

10.17 Conflict.

To the extent that there is a conflict or inconsistency between any provision
hereof, on the one hand, and any provision of any Credit Document, on the other
hand, this Credit Agreement shall control.

[Signature Pages to Follow

IN WITNESS WHEREOF, the parties hereto have caused their duly authorized
officers to execute and deliver this Credit Agreement as of the date first above
written.

BORROWER:                               LONGVIEW FIBRE COMPANY

By:
Name:
Title:

LENDERS:                                BANK OF AMERICA, N.A.,
Individually, as Administrative Agent, as an Issuing Lender and as Swingline
Lender

By:
Name:
Title:

                                    Page 89

<PAGE>
                                 SCHEDULE 2.1(a)

                                     Lenders

<TABLE>
<CAPTION>
Lender                                  Commitment Amount     Commitment Percentage
<S>                                     <C>                   <C>
Bank of America, N.A.                      $ 32,500,000            13.000000000%

Credit Contact:
San Francisco Credit Products
Mail Code: CA5-705-12-12
555 California Street, 12th Floor
San Francisco, CA 94104
Attn:  Kevin Sullivan
Telephone: (415) 622-4567
Facsimile:  (415) 622-4585

Operations Contact:
Agency Administrative Services
1850 Gateway Blvd., 5th Floor
Mail Code: CA4-706-05-09
Concord, California 94520
Attn:  Mark Garcia
Telephone: (925) 675-8416
Facsimile:  (888) 969-2297

The Bank of Nova Scotia                    $ 31,000,000            12.400000000%

Credit Contact:
The Bank of Nova Scotia
888 S.W. 5th Avenue, Suite 750
Portland, OR 97204-2078
Attn:  Pat Norris
Telephone: (503) 222-4169
Facsimile:  (503) 222-5502

Operations Contact:
The Bank of Nova Scotia
600 Peachtree Street, N.E. #2700
Atlanta, GA 30308
Attn:  Arnetta Poindexter
Telephone: (404) 877-1574
Facsimile:  (404) 888-8998
</TABLE>

<TABLE>
<CAPTION>
Lender                                  Commitment Amount     Commitment Percentage
<S>                                     <C>                   <C>
Wells Fargo Bank, N.A.                     $ 31,000,000            12.400000000%

Credit Contact:
Wells Fargo Bank, N.A.
1300 SW Fifth Avenue, 13th Floor
Portland, OR 97201
Attn:  Julie Wilson
Telephone: (503) 886-2062
Facsimile:  (503) 886-2039

Operations Contact:
Wells Fargo Bank, N.A.
1740 Braodway
Denver, CO 80274
Attn:  Tanya Ivie
Telephone: (303) 863-6102
</TABLE>

                                     Page 1
<PAGE>
<TABLE>
<S>                                     <C>                   <C>
Facsimile:  (303) 863-2729

Northwest Farm Credit Services, PCA       $  40,000,000            16.000000000%

Credit Contact:
Northwest Farm Credit Services, PCA
1700 South Assembly Street
Spokane, WA 99224
Attn:  Jim D. Allen
Telephone: (509) 340-5555
Facsimile:  (509) 340-5503

Operations Contact:
Northwest Farm Credit Services, PCA
1700 South Assembly Street
Spokane, WA 99224
Attn:  Technical Accounting
Telephone: (800) 216-4535
Facsimile:  (509) 340-5364
</TABLE>

<TABLE>
<CAPTION>
Lender                                  Commitment Amount     Commitment Percentage
<S>                                     <C>                   <C>
U.S. Bank National Association             $ 30,500,000            12.200000000%

Credit Contact:
U.S. Bank National Association
555 SW Oak Street, Suite 400
Mail Code: PD-OR-P4CB
Portland, OR 97204
Attn:  Janice T. Thede
Telephone: (503) 275-4942
Facsimile:  (503) 275-5428

Operations Contact:
U.S. Bank National Association
555 SW Oak Street, PL-7
Mail Code: PD-OR-P7LN
Portland, OR 97204
Attn:  David Richoux
Telephone: (503) 275-4560
Facsimile:  (503) 275-4600

Union Bank of California, N.A.             $ 25,000,000            10.000000000%

Credit Contact:
Union Bank of California, N.A.
350 California Street, 6th Floor
San Francisco, CA 94104
Attn:  J. William Bloore
Telephone: (415) 705-5041
Facsimile:  (415) 705-7556

Operations Contact:
Union Bank of California, N.A.
1980 Saturn Street
Monterey Park, CA 91755
Attn:  Ruby Gonzales
Telephone: (323) 720-7055
Facsimile:  (323) 724-6198
</TABLE>

                                     Page 2
<PAGE>
<TABLE>
<CAPTION>
Lender                                  Commitment Amount     Commitment Percentage
<S>                                     <C>                   <C>
Cooperatieve Centrale Raiffeisin -         $ 20,000,000             8.000000000%

Boerenleenbank B.A., "Rabobank
Nederland" New York Branch

Credit Contact:
Rabobank International
4 Embarcadero Center, Suite 3200
San Francisco, CA 94111
Attn:  John J. McHugh
Telephone: (415) 782-9810
Facsimile:  (415) 986-8349

Operations Contact:
Rabobank International
10 Exchange Place, 16th Floor
Jersey City, NJ 07302
Attn: Christine Dell'Aira
Telephone: (201) 499-5319
Facsimile:  (201) 499-5326

GreenStone Farm Credit Services,           $ 20,000,000             8.000000000%
FLCA

Credit Contact:
GreenStone Farm Credit Services, FLCA
1760 Abbey Road, Suite 200
East Lansing, MI 48823
Attn:  Al Compton
Telephone: (517) 318-4128
Facsimile:  (517) 318-1240

Operations Contact:
GreenStone Farm Credit Services, FLCA
1760 Abbey Road, Suite 200
East Lansing, MI 48823
Attn:  Thomas Moskal
Telephone: (517) 318-4122
Facsimile:  (517) 318-1240
</TABLE>

<TABLE>
<CAPTION>
Lender                                  Commitment Amount     Commitment Percentage
<S>                                     <C>                   <C>
American AgCredit, PCA                     $ 10,000,000             4.000000000%

Credit Contact:
American AgCredit, PCA
924 E. Blanco Road
Salinas, CA 93901
Attn:  James Cooper
Telephone: (831) 424-1756
Facsimile:  (831) 424-5963

Operations Contact:
American AgCredit, PCA
P.O. Box 1120
Santa Rosa, CA 95402
Attn:  Tina Anaya
Telephone: (707) 545-1200
Facsimile:  (707) 545-4446

West Coast Bank                            $ 10,000,000             4.000000000%

Credit Contact:
</TABLE>

                                     Page 3
<PAGE>
<TABLE>
<S>                                     <C>                   <C>
West Coast Bank
1000 SW Broadway, Suite 1100
Portland, OR 97205
Attn: Richard L. Ferguson
Telephone: (503) 279-3158
Facsimile:  (503) 224-9030

Operations Contact:
West Coast Bank
P.O. Box 8000
Wilsonville, OR 97070
Attn:  Diane Gookin
Telephone: (800) 964-6333 ext. 3334
Facsimile:  (503) 454-3349

Totals:                                    $250,000,000.00        100.000000000%
</TABLE>

                                 SCHEDULE 2.2(a)

                           Existing Letters of Credit

<TABLE>
<CAPTION>
Issued Under
Credit Agreement
Dated                   Beneficiary                   Date       Expiry Date        Amount
<S>          <C>                                     <C>         <C>            <C>
2/24/00      The Travelers Indemnity Company         9/17/01       10/31/02     $2,300,000.00
             L/C number 3040692, Bank of America

2/24/00      Warren Rural Electric                    2/7/01         2/6/02         25,000.00
             L/C number 3034757, Bank of America
</TABLE>

                                 Schedule 2.2(l)

                            Reimbursement Agreements

<TABLE>
<CAPTION>
Issued Under
Credit Agreement
Dated                   Beneficiary                    Date      Expiry Date       Amount
<S>           <C>                                     <C>        <C>            <C>
2/24/00       The Travelers Indemnity Company         9/17/01      10/31/02     $2,300,000.00
              L/C number 3040692, Bank of America

2/24/00       Warren Rural Electric                   2/07/01      02/06/02         25,000.00
              L/C number 3034757, Bank of America
</TABLE>

                                  Schedule 5.4

             Required Consents, Authorizations, Notices and Filings

None

                                     Page 4
<PAGE>
                                  Schedule 5.9

                                   Litigation

None

                                  Schedule 5.12

                                      ERISA

None

                                  Schedule 5.13

                                  Subsidiaries

<TABLE>
<CAPTION>
                         Jurisdiction of    Percentage of Voting Stock Owned by
Name                     Incorporation      the Company and each Other
                                            Subsidiary
<S>                       <C>               <C>
Longfibre Limited         Barbados           100%
Longtimber Company of
Oregon                    Oregon             100%
</TABLE>

                                  SCHEDULE 5.16

                            Environmental Disclosures

None

                                  SCHEDULE 7.1

                       Indebtedness as of January 24, 2002

A. Short-Term Borrowing

1. Line of credit between Longview Fibre Company and Marshall and Ilsley Bank
which cannot exceed $15,000,000.

Principal Amount Outstanding:

Balance as of January 24, 2002    $5,000,000

         B. Long-Term Borrowing

         Industrial Revenue Bond Financing Agreements:

1. Port of Longview Industrial Development Corporation Bond Financing
Agreements, including Loan Agreement, Security Agreement, Reimbursement
Agreement, Remarketing Agreement and Tender Agent Agreement dated December 1,
1984.

Secured by one (1) barge unloading crane, conveyors, stackers and related
equipment in Longview, Washington.

Principal Amount Outstanding:

$5,000,000

                                     Page 5
<PAGE>
2. Industrial Development Authority of the County of Alameda Industrial
Revenue Bond Refinancing Agreements, including Bond Purchase Agreement, Loan
Agreement, Security Agreement, Reimbursement Agreement, Remarketing Agreement
and Trust Agreement dated February 1, 1988.

Secured by one (1) S. A. Martin Flexo Folder Glue Transline 1228 with five
(5) colors and die cut unit, together with related equipment in Oakland,
California.

Principal Amount Outstanding:

$1,750,000

3. Industrial Development Corporation of the City of Seattle Industrial
Revenue Bond Refinancing Agreements, including Bond Purchase Agreement, Loan
Agreement, Security Agreement, Reimbursement Agreement, Remarketing Agreement
and Trust Agreement Dated February 1, 1988.

Secured by one (1) S. A. Martin Flexo Folder Gluer Supermini 718 with two (2)
colors and die cut unit, one (1) S. A. Martin Flexo Folder Gluer Midline 924
with five (5) colors and die cut unit, together with related equipment in
Seattle, Washington.

Principal Amount Outstanding:

$2,500,000

4. City of Milwaukee, Wisconsin, Industrial Revenue Bond Refinancing Agreement,
including Bond Purchase Agreements, Loan Agreement, Security Agreement,
Reimbursement Agreement, Remarketing Agreement and Trust Agreement dated
December 1, 1987.

Secured by one (1) S. A. Martin Flexo Folder Gluer Supermini 718 with two (2)
colors and die cut unit, and one (1) S. A. Martin Flexo Folder Gluer Transline
1228 with four (4) colors, together with related equipment in Milwaukee,
Wisconsin.

Principal Amount Outstanding:

$1,960,000

5. City of Fridley Industrial Development Revenue Bond Refinancing Agreements,
including Loan Agreement, Bond Purchase Agreement, Security Agreement,
Reimbursement Agreement, Remarketing Agreement and Trust Agreement dated
February 1, 1988.

Secured by one (1) S. A. Martin Flexo Folder Gluer Supermini 718 with two (2)
colors and die cut unit, and one (1) S. A. Martin Flexo Folder Gluer Transline
1228 with four (4) colors and die cut unit, together with related equipment in
Fridley, Minnesota.

Principal Amount Outstanding:

$2,240,000

6. Massachusetts Industrial Financial Agency Industrial Revenue Bond Refinancing
Agreements, including Bond Purchase Agreement, Loan Agreement, Security
Agreement, Reimbursement Agreement, Remarketing Agreement and Trust Agreement
dated December 1, 1987.

Secured by one (1) S. A. Martin Flexo Folder Gluer Transline 1228 Rapidset
Flexo-Graphic Printer, Folder-Gluer, with four (4) color Rapidset Printing

                                     Page 6
<PAGE>
System and Rotary Die cutter and one (1) S. A. Martin Miniline 718 Rapidset
Flexo-Graphic Printer, Folder-Gluer, with two (2) color Rapidset Printing system
together with related equipment at Springfield, Massachusetts.

Principal Amount Outstanding:

$2,070,000

7. City of Amsterdam Industrial Development Agency Industrial Revenue Bond
Refinancing Agreements, including Installment Sale Agreement, Bond Purchase
Agreement, Security Agreement, Reimbursement Agreement, Remarketing Agreement
and Trust Agreement dated December 1, 1987.

Secured by one (1) S. A. Martin Flexo Folder Gluer Supermini 718 with two (2)
colors and die cut unit, and one (1) S. A. Martin Flexo Folder Gluer Transline
1228 with four (4) colors and die cut unit, together with related equipment in
Amsterdam, New York.

Principal Amount Outstanding:

$1,880,000

8. City of Twin Falls Industrial Development Bond Financing Agreements,
including Loan Agreement, Security Agreement, Letter of Credit Agreement,
Remarketing Agreement and Tender Agent Agreement dated December 1, 1985.

Secured by one (1) 98" width BHS Heavy Duty Corrugator and associated equipment
in Twin Falls, Idaho.

Principal Amount Outstanding:

$4,500,000

9. Yakima County Industrial Development Revenue Bond Financing Agreements,
including Bond Purchase Agreement, Security Agreement, Reimbursement Agreement,
Remarketing Agreement and Trust Agreement dated May 1, 1988.

Secured by equipment to update the wet end and dry end of a corrugator and
includes acquisition and installation of a Paser 60G B flute, double glue
machine, auto slitter scorer, double downstackers and allied equipment, one (1)
S. A. Martin FFG Supermini 718 with four (4) colors and die cut unit, and one
(1) S. A. Martin FFG Supermini 718 with two (2) colors and die cut unit,
together with related equipment.

Principal Amount Outstanding:

$5,000,000

Senior Notes:

10. Note agreement dated March 31, 1998 between Longview Fibre Company and the
purchasers of the Company's 6.77% Senior Notes due March 31, 2006.

Principal Amount Outstanding:

$13,000,000

11. Note agreement dated March 31, 1998 between Longview Fibre Company and the
purchasers of the Company's 6.92% Senior Notes due March 31, 2008.

                                     Page 7
<PAGE>
Principal Amount Outstanding:

$24,000,000

12. Note agreement dated March 31, 1998 between Longview Fibre Company and the
purchasers of the Company's 7.00% Senior Notes due March 31, 2010.

Principal Amount Outstanding:

$15,000,000

13. Note agreement dated December 1, 1994 between Longview Fibre Company and the
purchasers of the Company's 8.84% Senior Notes due December 15, 2004.

Principal Amount Outstanding:

$30,000,000

14. Note agreement dated October 21, 1996 between Longview Fibre Company and the
purchasers of the Company's 7.55% Senior Notes due October 21, 2003.

Principal Amount Outstanding:

$30,000,000

15. Note agreement dated August 25, 1997 between Longview Fibre Company and the
purchasers of the Company's 6.76% Senior Notes due August 15, 2002.

Principal Amount Outstanding:

$20,000,000

16. Note agreement dated September 8, 1997 between Longview Fibre Company and
the purchasers of the Company's 6.86% Senior Notes due September 8, 2003.

Principal Amount Outstanding:

$20,000,000

17. Note agreement dated June 28, 2001 between Longview Fibre Company and the
purchasers of the Company's 8.83% Senior Notes due June 28, 2006.

Principal Amount Outstanding:

$67,500,000

18. Note agreement dated June 28, 2001 between Longview Fibre Company and the
purchasers of the Company's Floating Rate Senior Notes due June 28, 2006.

Principal Amount Outstanding:

$5,000,000

19. $215 million aggregate principal amount of 10% Senior Subordinated Notes due
2009 issued pursuant to an Indenture, dated as of January 25, 2002, between
Longview Fibre Company and U.S. Bank National Association, as Trustee.

Principal Amount at Close January 25, 2002:

$215,000,000

TOTAL:  $471,400,000

                                     Page 8
<PAGE>
                                  SCHEDULE 7.2

                                      Liens

All items below are also listed on Schedule 7.1 items B.1-B.9

1. Port of Longview Industrial Development Corporation Bond Financing
Agreements, including Loan Agreement, Security Agreement, Reimbursement
Agreement, Remarketing Agreement and Tender Agent Agreement dated December 1,
1984.

Secured by one (1) barge unloading crane, conveyors, stackers and related
equipment in Longview, Washington.

Principal Amount Outstanding:

$5,000,000

2. Industrial Development Authority of the County of Alameda Industrial Revenue
Bond Refinancing Agreements, including Bond Purchase Agreement, Loan Agreement,
Security Agreement, Reimbursement Agreement, Remarketing Agreement and Trust
Agreement dated February 1, 1988.

Secured by one (1) S. A. Martin Flexo Folder Glue Transline 1228 with five (5)
colors and die cut unit, together with related equipment in Oakland, California.

Principal Amount Outstanding:

$1,750,000

3. Industrial Development Corporation of the City of Seattle Industrial Revenue
Bond Refinancing Agreements, including Bond Purchase Agreement, Loan Agreement,
Security Agreement, Reimbursement Agreement, Remarketing Agreement and Trust
Agreement Dated February 1, 1988.

Secured by one (1) S. A. Martin Flexo Folder Gluer Supermini 718 with two (2)
colors and die cut unit, one (1) S. A. Martin Flexo Folder Gluer Midline 924
with five (5) colors and die cut unit, together with related equipment in
Seattle, Washington.

Principal Amount Outstanding:

$2,500,000

4. City of Milwaukee, Wisconsin, Industrial Revenue Bond Refinancing Agreement,
including Bond Purchase Agreements, Loan Agreement, Security Agreement,
Reimbursement Agreement, Remarketing Agreement and Trust Agreement dated
December 1, 1987.

Secured by one (1) S. A. Martin Flexo Folder Gluer Supermini 718 with two (2)
colors and die cut unit, and one (1) S. A. Martin Flexo Folder Gluer Transline
1228 with four (4) colors, together with related equipment in Milwaukee,
Wisconsin.

Principal Amount Outstanding:

$1,960,000

5. City of Fridley Industrial Development Revenue Bond Refinancing Agreements,
including Loan Agreement, Bond Purchase Agreement, Security

                                     Page 9
<PAGE>
Agreement, Reimbursement Agreement, Remarketing Agreement and Trust Agreement
dated February 1, 1988.

Secured by one (1) S. A. Martin Flexo Folder Gluer Supermini 718 with two (2)
colors and die cut unit, and one (1) S. A. Martin Flexo Folder Gluer
Transline 1228 with four (4) colors and die cut unit, together with related
equipment in Fridley, Minnesota.

Principal Amount Outstanding:

$2,240,000

6. Massachusetts Industrial Financial Agency Industrial Revenue Bond Refinancing
Agreements, including Bond Purchase Agreement, Loan Agreement, Security
Agreement, Reimbursement Agreement, Remarketing Agreement and Trust Agreement
dated December 1, 1987.

Secured by one (1) S. A. Martin Flexo Folder Gluer Transline 1228 Rapidset
Flexo-Graphic Printer, Folder-Gluer, with four (4) color Rapidset Printing
System and Rotary Die cutter and one (1) S. A. Martin Miniline 718 Rapidset
Flexo-Graphic Printer, Folder-Gluer, with two (2) color Rapidset Printing system
together with related equipment at Springfield, Massachusetts.

Principal Amount Outstanding:

$2,070,000

7. City of Amsterdam Industrial Development Agency Industrial Revenue Bond
Refinancing Agreements, including Installment Sale Agreement, Bond Purchase
Agreement, Security Agreement, Reimbursement Agreement, Remarketing Agreement
and Trust Agreement dated December 1, 1987.

Secured by one (1) S. A. Martin Flexo Folder Gluer Supermini 718 with two (2)
colors and die cut unit, and one (1) S. A. Martin Flexo Folder Gluer Transline
1228 with four (4) colors and die cut unit, together with related equipment in
Amsterdam, New York.

Principal Amount Outstanding:

$1,880,000

8. City of Twin Falls Industrial Development Bond Financing Agreements,
including Loan Agreement, Security Agreement, Letter of Credit Agreement,
Remarketing Agreement and Tender Agent Agreement dated December 1, 1985.

Secured by one (1) 98" width BHS Heavy Duty Corrugator and associated equipment
in Twin Falls, Idaho.

Principal Amount Outstanding:

$4,500,000

9. Yakima County Industrial Development Revenue Bond Financing Agreements,
including Bond Purchase Agreement, Security Agreement, Reimbursement Agreement,
Remarketing Agreement and Trust Agreement dated May 1, 1988.

Secured by equipment to update the wet end and dry end of a corrugator and
includes acquisition and installation of a Paser 60G B flute, double glue
machine, auto slitter scorer, double downstackers and allied equipment, one (1)
S. A. Martin FFG Supermini 718 with four (4) colors and die cut unit, and one
(1) S. A. Martin FFG Supermini 718 with two (2) colors and die cut unit,
together with related equipment.

                                    Page 10
<PAGE>
Principal Amount Outstanding:

$5,000,000

                                  SCHEDULE 7.6

                                   Investments

<TABLE>
<CAPTION>
As of 01/23/02
<S>                                                  <C>
Investments in County Clubs                          $  57,710.00

Stock - United Merchants and Manufacturers Inc.              1.00

Stock - AG Supply Company                               43,473.30

Stock - Pacific Coast Farm Credit Services, ACA          1,000.00

Stock - I F Nursery                                    283,299.00

TOTAL                                                $ 385,483.30
</TABLE>

                                EXHIBIT 2.1(b)(i)

                           FORM OF NOTICE OF BORROWING

TO:         BANK OF AMERICA, N.A., as Administrative Agent
            Agency Administrative Services
            1850 Gateway Boulevard, 5th Floor
            Mail Code: CA4-706-05-09
            Concord, California 94520
            Attention:  Mark Garcia

RE: Credit Agreement dated as of January ___, 2002 among Longview Fibre
Company (the "Borrower"), the Lenders from time to time party thereto and
Bank of America, N.A., as Administrative Agent for the Lenders (in such
capacity, the "Agent") (as amended, modified, restated or supplemented from
time to time, the "Credit Agreement").

DATE:   ___________________, 200_

1. This Notice of Borrowing is made pursuant to the terms of the Credit
Agreement. All capitalized terms used herein unless otherwise defined shall have
the meanings set forth in the Credit Agreement.

2. Please be advised that the Borrower is requesting a Revolving Loan in the
amount of $_________________ to be funded on ___________________, 200_ at the
interest rate option set forth in paragraph 3 below.

3. The interest rate option applicable to the requested Revolving Loan shall be
equal to:

        a.                   the Adjusted Base Rate
              ---------

        b.                   the Adjusted Eurodollar Rate for an Interest Period
              ---------
                      of:

                                             one month
                             -----------

                                    Page 11
<PAGE>
                                             two months
                             -----------
                                             three months
                             -----------
                                             six months
                             -----------

4. On the date of the requested Revolving Loan, immediately after giving effect
to the funding and the application thereof, the aggregate amount of Revolving
Loans outstanding plus the aggregate amount of LOC Obligations outstanding plus
the aggregate amount of Swingline Loans outstanding will be less than or equal
to the then Revolving Committed Amount.

5. On and as of the date of the requested Revolving Loan, immediately after
giving effect to the funding and the application thereof, the representations
and warranties made by the Borrower in any Credit Document are true and correct
in all material respects except to the extent they expressly relate to an
earlier date.

6. On and as of the date of the requested Revolving Loan, both immediately
before and immediately after giving effect to the funding and application
thereof, no Default or Event of Default has occurred or is continuing or would
reasonably be expected to be caused by this Notice of Borrowing.

                                            LONGVIEW FIBRE COMPANY

                                            By:
                                            Name:
                                            Title:

                                 EXHIBIT 2.1(e)

                             FORM OF REVOLVING NOTE

                                                               January ___, 2002

     FOR VALUE RECEIVED, LONGVIEW FIBRE COMPANY, a Washington corporation (the
"Borrower"), hereby promises to pay to the order of _____________________, its
successors and assigns (the "Lender"), at the office of Bank of America, N.A.,
as Agent (the "Agent"), at 1850 Gateway Boulevard, Concord, California 94520 (or
at such other place or places as the holder hereof may designate), at the times
set forth in the Credit Agreement dated as of January __, 2002 among the
Borrower, the Lenders and the Agent (as it may be amended, modified, restated or
supplemented from time to time, the "Credit Agreement"; all capitalized terms
not otherwise defined herein shall have the meanings set forth in the Credit
Agreement), but in no event later than the Maturity Date, in Dollars and in
immediately available funds, as provided in the Credit Agreement, such Lender's
Revolving Commitment or, if less, the aggregate unpaid principal amount of all
Revolving Loans made by the Lender to the Borrower pursuant to the Credit
Agreement, and to pay interest from the date hereof on the unpaid principal
amount hereof, in like money, at said office, on the dates and at the rates
selected in accordance with Section 2.1(d) of the Credit Agreement.

     Upon the occurrence and during the continuance of an Event of Default,
the balance outstanding hereunder shall bear interest as provided in Section 3.1
of the Credit Agreement. Further, in the event the payment of all sums due
hereunder is accelerated under the terms of the Credit Agreement, this Note, and
all other indebtedness of the Borrower to the Lender shall become immediately
due and payable, without presentment, demand, protest or notice of any kind, all
of which are hereby waived by the Borrower.

     In the event this Note is not paid when due at any stated or accelerated

                                    Page 12
<PAGE>
maturity, the Borrower agrees to pay, in addition to the principal and interest,
all costs of collection, including reasonable attorney's fees.

    This Note and the Loans evidenced hereby may be transferred in whole or in
part only by registration of such transfer on the Register maintained by or on
behalf of the Borrower as provided in Section 10.3(c) of the Credit Agreement.

     IN WITNESS WHEREOF, the Borrower has caused this Note to be duly executed
by its duly authorized officer as of the day and year first above written.

                                    LONGVIEW FIBRE COMPANY,
                                    a Washington corporation

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

                                 EXHIBIT 2.3(b)

                         FORM OF SWINGLINE LOAN REQUEST

TO:         BANK OF AMERICA, N.A., as Administrative Agent
            Agency Administrative Services
            1850 Gateway Boulevard, 5th Floor
            Mail Code: CA4-706-05-09
            Concord, California 94520
            Attention:  Mark Garcia

RE: Credit Agreement dated as of January__, 2002 among Longview Fibre Company
(the "Borrower"), the Lenders from time to time party thereto and Bank of
America, N.A., as Administrative Agent for the Lenders (in such capacity, the
"Agent") (as amended, modified, restated or supplemented from time to time, the
"Credit Agreement").

DATE: ___________________, 200_

1. This Swingline Loan Request is made pursuant to the terms of the Credit
Agreement. All capitalized terms used herein unless otherwise defined shall have
the meanings set forth in the Credit Agreement.

2. Please be advised that the Borrower is requesting a Swingline Loan on the
terms set forth below:

            (A)  Date of requested Swingline Loan

            (B)  Principal amount of requested
                 Swingline Loan

3. On the date of the requested Swingline Loan, immediately after giving effect
to the funding and the application thereof, (a) the aggregate amount of
Revolving Loans outstanding plus the aggregate amount of LOC Obligations
outstanding plus the aggregate amount of Swingline Loans outstanding will be
$______________________, which is less than or equal to the then Revolving
Committed Amount and (b) the sum of the aggregate amount of Swingline Loans
outstanding will be $_________________, which is less than or equal to the
Swingline Committed Amount.

4. On and as of the date of the requested Swingline Loan, immediately

                                    Page 13
<PAGE>
after giving effect to the funding and application thereof, the representations
and warranties made by the Borrower in any Credit Document are true and correct
in all material respects except to the extent they expressly relate to an
earlier date.

5. On and as of the date of the requested Swingline Loan, both immediately
before and immediately after giving effect to the funding and application
thereof, no Default or Event of Default has occurred or is continuing or would
be caused by this requested Swingline Loan.

                                            LONGVIEW FIBRE COMPANY

                                            By:
                                            Name:
                                            Title:

                                 EXHIBIT 2.3(e)

                           FORM OF SWINGLINE LOAN NOTE

$______________                                                __________, 200__

    FOR VALUE RECEIVED, LONGVIEW FIBRE COMPANY, (the "Borrower") hereby promises
to pay to the order of ____________________________ (the "Lender"), at the
office of Bank of America, N.A. (the "Administrative Agent") as set forth in
that certain Credit Agreement dated as of January __, 2002 among the Borrower,
the Lenders named therein (including the Lender), and Bank of America, N.A., as
Administrative Agent (as the same may be amended, modified, extended or restated
from time to time, the "Credit Agreement") (or at such other place or places as
the holder of this Swingline Loan Note may designate), the principal amount of
_________________ ($____________) or, if less, the aggregate principal amount of
all advances made by the Lender as Swingline Loans (and not otherwise repaid),
in lawful money and in immediately available funds, on the dates and in the
principal amounts provided in the Credit Agreement, and to pay interest on the
unpaid principal amount of each Swingline Loan made by the Lender, at such
office, in like money and funds, for the period commencing on the date of each
Swingline Loan until each Swingline Loan shall be paid in full, at the rates
mutually agreeable to the Swingline Lender and the Borrower at the time of the
borrowing.

    This Note is one of the Notes referred to in the Credit Agreement and
evidences Swingline Loans made by the Lender thereunder. The Lender shall be
entitled to the benefits of the Credit Agreement. Capitalized terms used in this
Swingline Loan Note have the respective meanings assigned to them in the Credit
Agreement and the terms and conditions of the Credit Agreement are expressly
incorporated herein and made a part hereof.

    The Credit Agreement provides for the acceleration of the maturity of the
Swingline Loans evidenced by this Swingline Loan Note upon the occurrence of
certain events (and for payment of collection costs in connection therewith) and
for prepayments of Swingline Loans upon the terms and conditions specified
therein. In the event this Swingline Loan Note is not paid when due at any
stated or accelerated maturity, the Borrower agrees to pay, in addition to the
principal and interest, all costs of collection, including reasonable attorney
fees.

    Except as permitted by Section 10.3(b) of the Credit Agreement, this
Swingline Loan Note may not be assigned by the Lender to any other Person.

                                    Page 14
<PAGE>
    The date, amount, type, interest rate and duration of Interest Period (if
applicable) of each Swingline Loan made by the Lender to the Borrower, and each
payment made on account of the principal thereof, shall be recorded by the
Administrative Agent on its books; provided that the failure of the
Administrative Agent to make any such recordation shall not affect the
obligations of the Borrower to make a payment when due of any amount owing
thereunder or under this Swingline Loan Note in respect of the Swingline Loans
to be evidenced by this Swingline Loan Note, and each such recordation shall be
prima facie evidence of the obligations owing under this Swingline Loan Note
absent manifest error.

    This Swingline Loan Note shall be governed by, and construed in accordance
with, the laws of the state of New York.

    IN WITNESS WHEREOF, the Borrower has caused this Swingline Loan Note to be
executed as of the date first above written.

                                            LONGVIEW FIBRE COMPANY

                                            By:
                                            Name:
                                            Title:

                                EXHIBIT 3.2

                     FORM OF NOTICE OF EXTENSION/CONVERSION

TO:    BANK OF AMERICA, N.A., as Administrative Agent
       Agency Administrative Services
       1850 Gateway Boulevard, 5th Floor
       Mail Code: CA4-706-05-09
       Concord, California 94520
       Attention:  Mark Garcia

RE: Credit Agreement dated as of January __, 2002 among Longview Fibre Company
(the "Borrower"), the Lenders from time to time party thereto and Bank of
America, N.A., as Administrative Agent for the Lenders (in such capacity, the
"Agent") (as amended, modified, restated or supplemented from time to time, the
"Credit Agreement").

DATE:   ___________________, 200_

1. This Notice of Extension/Conversion is made pursuant to the terms of the
Credit Agreement. All capitalized terms used herein unless otherwise defined
shall have the meanings set forth in the Credit Agreement.

2. Please be advised that the Borrower is requesting that a portion of the
current outstanding Revolving Loans in the amount of $______________ be extended
or converted at the interest rate option set forth in paragraph 3 below.

3. The interest rate option applicable to the extension or conversion of all or
part of the existing Revolving Loans shall be equal to:

a.              the Adjusted Base Rate
      --------
b.              the Adjusted Eurodollar Rate for an Interest Period of:
      --------
                            one month
                  --------
                            two months
                  --------

                                    Page 15
<PAGE>
                            three months
                  --------
                            six months
                  --------

4. Subsequent to the extension or conversion of all or part of the existing
Revolving Loans, the aggregate amount of Revolving Loans outstanding plus the
aggregate amount of LOC Obligations outstanding plus the aggregate amount of
Swingline Loans outstanding will be $______________, which is less than or equal
to the then Revolving Committed Amount.

5. No Default or Event of Default has occurred or is continuing or would be
caused by this Notice of Extension/Conversion.

                                            LONGVIEW FIBRE COMPANY

                                            By:
                                            Name:
                                            Title:

                                 EXHIBIT 6.1(c)

                    FORM OF OFFICER'S COMPLIANCE CERTIFICATE

     This Certificate is delivered in accordance with the provisions of
Section 6.1(c) of that Credit Agreement dated as of January __, 2002 (as
amended, modified and supplemented, the "Credit Agreement") among Longview Fibre
Company, a Washington corporation (the "Borrower"), the Lenders identified
therein, and Bank of America, N.A., as Administrative Agent. Terms used but not
otherwise defined herein shall have the same meanings provided in the Credit
Agreement.

     The undersigned, being an Executive Officer of Longview Fibre Company, a
Washington corporation, hereby certifies, in my official capacity and not in
my individual capacity, that to the best of my knowledge and belief:

      (a)  the detailed calculations on the schedule(s) accompanying this
Certificate demonstrate compliance by the Consolidated Parties with the
financial covenants contained in Section 6.10 of the Credit Agreement;

      (b)  no Default or Event of Default has occurred under the Credit
Agreement (except as indicated on a separate page attached hereto, together with
an explanation of the action taken or proposed to be taken by the Borrower with
respect thereto); and

      (d)  if this Certificate is being delivered in connection with the
financial statements provided for in Section 6.1(a), the accompanying
schedule(s) set forth information regarding the amount of all Asset
Dispositions, Equity Issuances and Debt Issuances that were made during the
applicable fiscal year.

     This the _______________ day of ________________________, 200_.

                                            LONGVIEW FIBRE COMPANY

                                            By:
                                            Name:
                                            Title:

                       Attachment to Officer's Certificate

                                    Page 16
<PAGE>
                       Computation of Financial Covenants

                                  EXHIBIT 10.3

                        FORM OF ASSIGNMENT AND ACCEPTANCE

This Assignment and Acceptance Agreement (this "Assignment") is dated as of
the Effective Date set forth below and is entered into by and between [Insert
name of Assignor] (the "Assignor") and [Insert name of Assignee] (the
"Assignee").  Capitalized terms used but not defined herein shall have the
meanings given to them in the Credit Agreement identified below (the "Credit
Agreement"), receipt of a copy of which is hereby acknowledged by the
Assignee.  The Standard Terms and Conditions set forth in Annex 1 attached
hereto are hereby agreed to and incorporated herein by reference and made a
part of this Assignment as if set forth herein in full.

For an agreed consideration, the Assignor hereby irrevocably sells and
assigns to the Assignee, and the Assignee hereby irrevocably purchases and
assumes from the Assignor, subject to and in accordance with the Standard
Terms and Conditions and the Credit Agreement, as of the Effective Date
inserted by the Administrative Agent as contemplated below, the interest in
and to all of the Assignor's rights and obligations under the Credit
Agreement and any other documents or instruments delivered pursuant thereto
that represents the amount and percentage interest identified below of all of
the Assignor's outstanding rights and obligations under the respective
facilities identified below (including, to the extent included in any such
facilities, Letters of Credit and Swingline Loans) (the "Assigned Interest").
Such sale and assignment is without recourse to the Assignor and, except as
expressly provided in this Assignment, without representation or warranty by
the Assignor.

1.    Assignor:
                        ------------------------------

2.    Assignee:                                       [, which is an
                        ------------------------------
                                                         Affiliate/Approved
                                                         Fund 1]

3.    Borrower(s):      Longview Fibre Company

4.    Administrative
      Agent:            Bank of America, N.A., as the administrative agent
                        under the Credit Agreement

5. Credit Agreement:    The Credit Agreement dated as of January __, 2002
                        among Longview Fibre Company, the Lenders from time to
                        time party thereto and Bank of America, as
                        Administrative Agent.

1 Select as applicable.

6.    Assigned Interest:

                                    Page 17
<PAGE>
<TABLE>
<CAPTION>
     Credit            Aggregate
Facility Assigned      Amount of             Amount of                Percentage
                   Commitment/Loans       Commitment/Loans           Assigned of
                    for all Lenders          Assigned             Commitment/Loans 2
<S>                <C>                    <C>                     <C>
_____________      $________________      $________________       ______________%
_____________      $________________      $________________       ______________%
_____________      $________________      $________________       ______________%
</TABLE>

Effective Date: __________________, 20__ [TO BE INSERTED BY ADMINISTRATIVE
AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE
REGISTER THEREFOR.]

2 Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans of
all Lenders thereunder.

3 Fill in the appropriate terminology for the types of facilities under the
Credit Agreement that are being assigned under this Assignment (e.g. "364 Day
Facility Commitment", "Multi-Year Facility Commitment",etc.).

The terms set forth in this Assignment are hereby agreed to:

                                           ASSIGNOR

                                           [NAME OF ASSIGNOR]

                                           By:
                                           Title:

                                           ASSIGNEE

                                           [NAME OF ASSIGNEE]

                                           By:
                                           Title:

[Consented to and]  Accepted:

BANK OF AMERICA, N.A.,
as Administrative Agent

By:
Title:

[Consented to:]

LONGVIEW FIBRE COMPANY,
a Washington corporation

By:
Title:

                 ANNEX 1 TO ASSIGNMENT AND ACCEPTANCE AGREEMENT

Credit Agreement dated as of January 25, 2002 in favor of Longview Fibre
Company

STANDARD TERMS AND CONDITIONS FOR ASSIGNMENT AND ACCEPTANCE AGREEMENT

1. Representations and Warranties.

1.1. Assignor. The Assignor (a) represents and warrants that (i) it is the legal
and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is
free and clear of any lien, encumbrance or other adverse claim and (iii) it has
full power and authority, and has taken all action

                                    Page 18
<PAGE>
necessary, to execute and deliver this Assignment and to consummate the
transactions contemplated hereby; and (b) assumes no responsibility with respect
to (i) any statements, warranties or representations made in or in connection
with any Loan Document, (ii) the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Credit Agreement or any other
instrument or document delivered pursuant thereto, other than this Assignment
(herein collectively the "Loan Documents"), or any collateral thereunder, (iii)
the financial condition of the Borrower, any of its Subsidiaries or Affiliates
or any other Person obligated in respect of any Loan Document or (iv) the
performance or observance by the Borrower, any of its Subsidiaries or Affiliates
or any other Person of any of their respective obligations under any Loan
Document.

1.2. Assignee. The Assignee (a) represents and warrants that (i) it has full
power and authority, and has taken all action necessary, to execute and deliver
this Assignment and to consummate the transactions contemplated hereby and to
become a Lender under the Credit Agreement, (ii) it meets all requirements of an
Eligible Assignee under the Credit Agreement, (iii) from and after the Effective
Date, it shall be bound by the provisions of the Credit Agreement and, to the
extent of the Assigned Interest, shall have the obligations of a Lender
thereunder, (iv) it has received a copy of the Credit Agreement, together with
copies of the most recent financial statements delivered pursuant to Section 6.1
thereof, as applicable, and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
this Assignment and to purchase the Assigned Interest on the basis of which it
has made such analysis and decision, and (v) if it is a Foreign Lender, attached
hereto is any documentation required to be delivered by it pursuant to the terms
of the Credit Agreement, duly completed and executed by the Assignee; and (b)
agrees that (i) it will, independently and without reliance on the
Administrative Agent, the Assignor 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 decisions in taking or not taking action under the Loan
Documents, and (ii) it will perform in accordance with their terms all of the
obligations which by the terms of the Loan Documents are required to be
performed by it as a Lender.

1.3 Assignee's Address for Notices, etc. Attached hereto as Schedule 1 is all
contact information, address, account and other administrative information
relating to the Assignee.

2. Payments. From and after the Effective Date, the Administrative Agent shall
make all payments in respect of the Assigned interest (including payments of
principal, interest, fees and other amounts) to the Assignee whether such
amounts have accrued prior to or on or after the Effective Date. The Assignor
and the Assignee shall make all appropriate adjustments in payments by the
Administrative Agent for periods prior to the Effective Date or with respect to
the making of this assignment directly between themselves.

3. General Provisions. This Assignment shall be binding upon, and inure to the
benefit of, the parties hereto and their respective successors and assigns. This
Assignment may be executed in any number of counterparts, which together shall
constitute one instrument. Delivery of an executed counterpart of a signature
page of this Assignment by telecopy shall be effective as delivery of a manually
executed counterpart of this Assignment. This Assignment shall be governed by,
and construed in accordance with, the law of the State of New York.

                                    Page 19
<PAGE>
                SCHEDULE 1 TO ASSIGNMENT AND ACCEPTANCE AGREEMENT

                             ADMINISTRATIVE DETAILS

(Assignee to list names of operations and credit contacts, addresses, phone and
facsimile numbers, electronic mail addresses and account and payment
information)

                                    Page 20<PAGE>
                                                                     EXHIBIT 4.2

                        VOICESTREAM WIRELESS CORPORATION
                    VOICESTREAM WIRELESS HOLDINGS CORPORATION

                                       To

                 HARRIS TRUST COMPANY OF CALIFORNIA, AS TRUSTEE

                                    Indenture

                          Dated as of November 9, 1999

                              Up to $2,200,000,000

                          10-3/8% Senior Notes Due 2009
<PAGE>
      INDENTURE, dated as of November 9, 1999, between (i) VoiceStream Wireless
Corporation, a corporation duly organized and existing under the laws of the
State of Washington ("VoiceStream") and VoiceStream Wireless Holding
Corporation, a corporation duly incorporated and existing under the laws of the
State of Delaware ("VoiceStream Holdings")(unless otherwise provided by Section
803, VoiceStream and VoiceStream Holdings shall hereinafter be referred to as
the "Issuers"), each having its principal office at 3650 131st Avenue SE,
Bellevue, Washington 98006, and (ii) Harris Trust Company of California, a trust
company duly organized and existing under the laws of the State of California,
as Trustee (the "Trustee").

                             RECITALS OF THE ISSUER

      The Issuers have duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of up to $2,200,000,000
aggregate principal amount of their 10-3/8% Senior Notes Due 2009 (the
"Securities") of substantially the tenor and amount hereinafter set forth.

      All things necessary to make the Securities, when executed by the Issuers
and authenticated and delivered hereunder and duly issued by the Issuers, the
valid obligations of the Issuers, and to make this Indenture a valid agreement
of the Issuers, in accordance with their and its terms, have been done.

      NOW, THEREFORE, THIS INDENTURE WITNESSETH:

      For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually covenanted and agreed, for the
equal and proportionate benefit of all Holders of the Securities, as
follows:ARTICLE ONE

                                   ARTICLE 1
                       DEFINITIONS AND OTHER PROVISIONS OF
                               GENERAL APPLICATION

      Section 1.1. Definitions.

      For all purposes of this Indenture, except as otherwise expressly provided
or unless the context otherwise requires:

      -     the terms defined in this Article have the meanings assigned to them
            in this Article and include the plural as well as the singular;

      -     all other terms used herein which are defined in the Trust Indenture
            Act, either directly or by reference therein, have the meanings
            assigned to them therein;

      -     all accounting terms not otherwise defined herein have the meanings
            assigned to them in accordance with generally accepted accounting
            principles (whether or not such is indicated herein), and, except as
            otherwise herein expressly provided, the term "generally accepted
<PAGE>
            accounting principles" with respect to any computation required or
            permitted hereunder shall mean such accounting principles as are
            generally accepted at the date of such computation;

      -     unless otherwise specifically set forth herein, all calculations or
            determinations of a Person shall be performed or made on a
            consolidated basis in accordance with generally accepted accounting
            principles but shall not include the accounts of Unrestricted
            Subsidiaries, except to the extent of dividends and distributions
            actually paid to the Issuers or one of their Wholly Owned Restricted
            Subsidiaries; and

      -     the words "herein," "hereof" and "hereunder" and other words of
            similar import refer to this Indenture as a whole and not to any
            particular Article, Section or other subdivision.

      Certain terms, used principally in Article Six, are defined in that
Article.

      "Acquired Indebtedness" means, with respect to any specified Person:

      -     Indebtedness of any other Person existing at the time such other
            Person is merged with or into or became a Subsidiary of such
            specified Person, including, without limitation, Indebtedness
            incurred in connection with, or in contemplation of, such other
            Person merging with or into or becoming a Subsidiary of such
            specified Person; and

      -     Indebtedness secured by a Lien encumbering any asset acquired by
            such specified Person.

      "Act," when used with respect to any Holder, has the meaning specified in
Section 104.

      "Adjusted Treasury Rate" will be determined on the third business day
preceding any applicable redemption date and is the sum of:

      -     the arithmetic mean of the yields under the heading "Week Ending"
            published in the Statistical Release most recently published prior
            to the date of determination under the caption "Treasury Constant
            Maturities" for the maturity (rounded to the nearest month)
            corresponding to the remaining life to maturity, as of the
            redemption date, of the principal being redeemed; and

      -     0.50%;

provided, however, that if no maturity set forth under such heading exactly
corresponds to the maturity of such principal, yields for the two published
maturities most closely corresponding to the maturity of such principal will be
calculated as provided immediately above, and the Adjusted Treasury Rate will be
interpolated or extrapolated

                                       2
<PAGE>
from such yields on a straight-line basis, rounding in each of the relevant
periods to the nearest month.

      "Administrative Agent" means the Person or Persons designated as such
under the Credit Facility or, if the Omnipoint Reorganization is completed, the
Anticipated New Credit Facility.

      "Aerial" means Aerial Communications, Inc., a Delaware corporation.

      "Aerial Reorganization" means the reorganization and related transactions
contemplated by the Agreement and Plan of Reorganization, dated as of September
17, 1999, among VoiceStream, VoiceStream Holdings, VoiceStream Subsidiary II
Corporation, Aerial and Telephone and Data Systems, Inc.

      "Affiliate" of any Person means any other Person directly or indirectly
controlling or controlled by or under direct or indirect common control with
such Person. For the purposes of this definition, "control" when used with
respect to any Person means the power to direct the management and policies of
such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.

      "Agent Member" means any member of, or participant in, the Depositary.

      "Anticipated New Credit Facility" means the new credit facility to be
entered into upon and assuming completion of the Omnipoint Reorganization by a
wholly-owned subsidiary of VoiceStream Holdings, together with a subsidiary of
Omnipoint, which the Issuers are currently negotiating with a consortium of
lenders, but for which the Issuers have not received commitments.

      "Applicable Procedures" means, with respect to any transfer or transaction
involving a Global Security or beneficial interest therein, the rules and
procedures of the Depositary for such Security, Euroclear and Cedel, in each
case to the extent applicable to such transaction and as in effect from time to
time.

      "Asset Disposition" by any Person means any transfer, conveyance, sale,
lease or other disposition by such Person or any of its Restricted Subsidiaries
(including a consolidation or merger or other sale of any such Restricted
Subsidiaries with, into or to another Person in a transaction in which such
Restricted Subsidiary ceases to be a Restricted Subsidiary, but excluding a
disposition by a Subsidiary of such Person to such Person or a Wholly Owned
Restricted Subsidiary of such Person or by such Person to a Wholly Owned
Restricted Subsidiary of such Person) of (i) shares of Capital Stock (other than
directors' qualifying shares) or other ownership interests of a Subsidiary of
such Person, (ii) substantially all of the assets of such Person or any of its
Subsidiaries representing a division or line of business or (iii) other assets
or rights of such Person or any of its Subsidiaries.

      Notwithstanding the preceding, the following items shall not be deemed to
be Asset Dispositions:

                                       3
<PAGE>
      -     any single transaction or series of related transactions that (a)
            involves assets having a Fair Market Value of less than $15 million;
            or (b) results in net proceeds to either Issuer or any of its
            respective Restricted Subsidiaries of less than $15 million;

      -     a Restricted Payment that is permitted under Section 1010;

      -     sales or other dispositions of inventory in the ordinary course of
            business and of receivables;

      -     substantially simultaneous exchanges by either Issuer or any of its
            Restricted Subsidiaries of Telecommunications Assets for other
            Telecommunications Assets, provided that the Telecommunications
            Assets received by such Issuer or such Restricted Subsidiary have at
            least substantially equal or greater value to such Issuer or such
            Restricted Subsidiary (as determined by the Board of Directors whose
            good faith determination shall be conclusive and evidenced by a
            Board Resolution);

      -     any sale or other disposition of any or all the Capital Stock of an
            Unrestricted Subsidiary; or

      -     any sale or other disposition of Temporary Cash Investments.

Additionally, the contribution of Telecommunications Assets to an Unrestricted
Subsidiary whereby an Issuer or a Restricted Subsidiary of an Issuer receives
Capital Stock of an Unrestricted Subsidiary shall be deemed a Restricted Payment
only and shall not be deemed an Asset Disposition.

      "Attributable Value" means, as to any particular lease under which any
Person is at the time liable other than a Capital Lease Obligation, and at any
date as of which the amount thereof is to be determined, the total net amount of
rent required to be paid by such Person under such lease during the initial term
thereof as determined in accordance with generally accepted account principles,
discounted from the last date of such initial term to the date of determination
at a rate per annum equal to the discount rate which would be applicable to a
Capital Lease Obligation with like term in accordance with generally accepted
accounting principles. The net amount of rent required to be paid under any such
lease for any such period shall be the aggregate amount of rent payable by the
lessee with respect to such period after excluding amounts required to be paid
on account of insurance, taxes, assessments, utility, operating and labor costs
and similar charges. In the case of any lease which is terminable by the lessee
upon the payment of penalty, such net amount shall also include the lesser of
the amount of such penalty (in which case no rent shall be considered as
required to be paid under such lease subsequent to the first date upon which it
may be so terminated) or the rent which would otherwise be required to be paid
if such lease is not so terminated. "Attributable Value" means, as to a Capital
Lease Obligation, the principal amount thereof.

                                       4
<PAGE>
      "Authenticating Agent" means any Person authorized by the Trustee to act
on behalf of the Trustee to authenticate Securities.

      "Average Life" means, as of the date of determination, with respect to any
Indebtedness, the quotient obtained by dividing (i) the sum of the products of
the numbers of years from the date of determination to the dates of each
successive scheduled principal payment of such Indebtedness and the amount of
such principal payment, by (ii) the sum of all such principal payments.

      "Board of Directors" means, with respect to an Issuer, either the board of
directors of such Issuer or any duly authorized committee of that board.

      "Board Resolution" means a copy of a resolution certified by the Secretary
or an Assistant Secretary of VoiceStream, VoiceStream Holdings or one of their
subsidiaries, as the case may be, to have been duly adopted by the Board of
Directors, to be in full force and effect on the date of such certification and
delivered to the Trustee.

      "Business Day" means each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in New York City, the State of
Washington, the State of Illinois or the State of California are authorized or
obligated by law or executive order to close.

      "Capital Lease Obligation" of any Person means the obligation to pay rent
or other payment amounts under a lease of (or other Indebtedness arrangements
conveying the right to use) real or personal property of such Person which is
required to be classified and accounted for as a capital lease or a liability on
the face of a balance sheet of such Person in accordance with generally accepted
accounting principles (a "Capital Lease"). The stated maturity of such
obligation shall be the date of the last payment of rent or any other amount due
under such lease prior to the first date upon which such lease may be terminated
by the lessee without payment of a penalty. The principal amount of such
obligation shall be the capitalized amount thereof that would appear on the face
of a balance sheet of such Person in accordance with generally accepted
accounting principles.

      "Capital Stock" means:

      -     in the case of a corporation, corporate stock;

      -     in the case of an association or business entity, any and all
            shares, interests, participations, rights or other equivalents
            (however designated) of corporate stock;

      -     in the case of a partnership or limited liability company,
            partnership or membership interests (whether general or limited);
            and

      -     any other interest or participation that confers on a Person the
            right to receive a share of the profits and losses of, or
            distributions of assets of, the issuing Person.

                                       5
<PAGE>
      "Cedel" means Cedel Bank, S.A. (or any successor securities clearing
agency).

      "Change of Control" means

      -     directly or indirectly a sale, transfer or other conveyance of all
            or substantially all the assets of VoiceStream or VoiceStream
            Holdings, as the case may be, on a consolidated basis, to any
            "person" or "group" (as such terms are used for purposes of Sections
            13(d) and 14(d) of the Exchange Act, whether or not applicable),
            excluding transfers or conveyances to or among such Issuer or such
            Issuers' Wholly Owned Restricted Subsidiaries, as an entirety or
            substantially as an entirety in one transaction or series of related
            transactions, in each case with the effect that any Person or group
            of Persons that, as of the date of this Indenture, are not Initial
            Investors or Affiliates of the Initial Investors, own more than 50%
            of the total Voting Power entitled to vote in the election of
            directors, managers or trustees of the transferee entity immediately
            after such transaction;

      -     the adoption of a plan relating to the liquidation or dissolution of
            VoiceStream or VoiceStream Holdings, as the case may be;

      -     any "person" or "group" (as such terms are used for purposes of
            Sections 13(d) and 14(d) of the Exchange Act, whether or not
            applicable), other than the Initial Investors (or any Person or
            group of Persons that, as of the date of this Indenture, are
            Affiliates of the Initial Investors), is or becomes the "beneficial
            owner" (as that term is used in Rules 13d-3 and 13d-5 under the
            Exchange Act, whether or not applicable, except that a Person shall
            be deemed to have "beneficial ownership" of all shares that any such
            Person has the right to acquire, whether such right is exercisable
            immediately or only after the passage of time), directly or
            indirectly, of more than 50% of the total Voting Power of
            VoiceStream or VoiceStream Holdings, as the case may be; or

      -     during any period of 24 consecutive months, individuals who at the
            beginning of such period constituted the Board of Directors of
            VoiceStream or VoiceStream Holdings, as the case may be (together
            with any new directors whose election by such Board or whose
            nomination for election by the stockholders of the applicable Issuer
            was approved by a vote of a majority of the directors then still in
            office who were either directors at the beginning of such period or
            whose election or nomination for election was previously so
            approved), cease for any reason to constitute a majority of the
            Board of Directors of VoiceStream or VoiceStream Holdings, as the
            case may be, then in office.

      "Change of Control Payment Date" has the meaning specified in Section
1016.

      "Change of Control Triggering Event" has the meaning specified in Section
1016.

                                       6
<PAGE>
      "Closing Date" means November 9, 1999.

      "Commission" means the Securities and Exchange Commission, as from time to
time constituted, created under the Exchange Act, or, if at any time after the
execution of this instrument such Commission is not existing and performing the
duties now assigned to it under the Trust Indenture Act, then the body
performing such duties at such time.

      "Common Stock" of any Person means Capital Stock of such Person that does
not rank prior, as to the payment of dividends or as to the distribution of
assets upon any voluntary or involuntary liquidation, dissolution or winding up
of such Person, to shares of Capital Stock of any other class of such Person.

      "Consolidated Income Tax Expense" of any Person means for any period the
provision for income taxes of such Person and its Consolidated Restricted
Subsidiaries for such period.

      "Consolidated Indebtedness" of any Person means at any date the
Indebtedness of such Person and its Consolidated Restricted Subsidiaries at such
date.

      "Consolidated Interest Expense" of any Person means for any period the
interest expense included in an income statement (taking into account the effect
of any Interest Rate Agreements but without deduction of interest income) of
such Person and its Consolidated Restricted Subsidiaries for such period,
including without limitation or duplication (or, to the extent not so included,
with the addition of), (i) the portion of any rental obligation in respect of
any Capital Lease Obligation allocable to interest expense in accordance with
generally accepted accounting principles; (ii) the amortization of Indebtedness
discounts; (iii) any payments or fees with respect to letters of credit, bankers
acceptances or similar facilities; (iv) fees with respect to Interest Rate
Agreements; (v) the portion of any rental obligations in respect of any Sale and
Leaseback Transaction allocable to interest expense (determined as if such were
treated as a Capital Lease Obligation); and (vi) Preferred Stock dividends
declared and payable in cash.

      "Consolidated Net Income" of any Person means for any period the net
income (or loss) of such Person for such period determined on a consolidated
basis in accordance with generally accepted accounting principles; provided that
there shall be excluded therefrom (to the extent included and without
duplication) (i) the net income (or loss) of any Person acquired by such Person
or a Restricted Subsidiary of such Person after the date of this Indenture in a
pooling-of-interests transaction for any period prior to the date of such
transaction, (ii) the net income (or loss) of any Person that is not a
Consolidated Restricted Subsidiary of such Person except to the extent of the
amount of dividends or other distributions actually paid to such Person by such
other Person during such period, (iii) gains or losses from sales of assets
other than sales of assets acquired and held for resale in the ordinary course
of business and (iv) all extraordinary gains and extraordinary losses.

                                       7
<PAGE>
      "Consolidated Restricted Subsidiary" of any Person means all other Persons
that would be accounted for as consolidated Persons in such Person's financial
statements in accordance with generally accepted accounting principles other
than Unrestricted Subsidiaries.

      "Corporate Trust Office" means the principal office of the Trustee in Los
Angeles, California at which at any particular time its corporate trust business
shall be administered or its operations center in Chicago, Illinois, or such
other location designated by the Trustee in a report pursuant to Section 703(a).

      "corporation" means a corporation, association, company, joint-stock
company, partnership or business trust.

      "Credit Facility" means the Loan Agreement, dated as of June 26, 1998,
among VoiceStream PCS Holding L.L.C. (as successor in interest to Western PCS
Holding Corporation), Toronto-Dominion Bank (Texas), Inc., as Administrative
Agent, and the other financial institutions named therein, as it may be amended,
supplemented, restated or otherwise modified from time to time.

      "Cumulative EBITDA" means EBITDA of the Issuers and their respective
Consolidated Restricted Subsidiaries for the period beginning on January 1,
2001, through and including the end of the last fiscal quarter preceding the
date of any proposed Restricted Payment.

      "Cumulative Interest Expense" means the total amount of Consolidated
Interest Expense of the Issuers and their respective Consolidated Restricted
Subsidiaries for the period beginning on January 1, 2001, through and including
the end of the last fiscal quarter preceding the date of any proposed Restricted
Payment.

      "Currency Protection Agreements" means any currency swap, cap, collar,
floor, caption or swaption agreements, or any similar arrangements designed to
hedge against a risk in the fluctuation of the exchange rate of a currency in
which a payment to be made or received by either Issuer or any of its Restricted
Subsidiaries is denominated, arising at any time between either Issuer or any of
its Restricted Subsidiaries, on the one hand, and any Person (other than an
Affiliate of either Issuer or any of its Restricted Subsidiaries), on the other
hand, as such agreement or arrangement may be modified, supplemented and in
effect from time to time.

      "Defaulted Interest" has the meaning specified in Section 308.

      "Depositary" means a clearing agency registered under the Exchange Act
that is designated to act as Depositary for the Securities until a successor
Depositary shall have become such pursuant to the applicable provisions of this
Indenture, and thereafter "Depositary" shall mean such successor Depositary. The
Depositary initially is DTC.

      "Disqualified Stock" of any person means any Capital Stock of such Person
which, by its terms (or by the terms of any security into which it is
convertible of or for which it is exchangeable), or upon the happening of any
event, matures or is mandatorily

                                       8
<PAGE>
redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable
at the option of such Person, any Restricted Subsidiary of such Person or the
holder thereof, in whole or in part, on or prior to the final Stated Maturity of
the Securities; provided, however, that any Preferred Stock which would not
constitute Disqualified Stock but for provisions thereof giving holders thereof
the right to require either Issuer to repurchase or redeem such Preferred Stock
upon the occurrence of a Change of Control occurring prior to the final Stated
Maturity of the Securities shall not constitute Disqualified Stock if the change
of control provisions applicable to such Preferred Stock specifically provide
that such Issuer will not repurchase or redeem any such stock pursuant to such
provisions prior to the Issuers' repurchase of such Securities as are required
to be repurchased pursuant to Section 1016.

      "DTC" means The Depository Trust Company, a New York corporation.

      "EBITDA" of any Person means for any period the Consolidated Net Income
for such period increased by the sum of (i) Consolidated Interest Expense of
such Person for such period, plus (ii) Consolidated Income Tax Expense of such
Person for such period, plus (iii) the consolidated depreciation and
amortization expense included in the income statement of such Person and its
Consolidated Restricted Subsidiaries for such period, plus (iv) all other
non-cash charges and expenses that were deducted in determining Consolidated Net
Income for such period, minus (v) all non-cash revenues and gains to the extent
included in Consolidated Net Income for such period.

      "Eligible Institution" means a commercial banking institution that has
combined capital and surplus of not less than $500 million or its equivalent in
foreign currency, whose debt is rated "A-3" or higher, "A-" or higher or "A-" or
higher according to Moody's Investors Service, Inc., Standard & Poor's Ratings
Group or Duff & Phelps Credit Rating Co. (or such similar equivalent rating by
at least one "nationally recognized statistical rating organization" (as defined
in Rule 436 under the Securities Act) respectively, at the time as of which any
investment or rollover therein is made.

      "Equity Interests" means Capital Stock and all warrants, options or other
rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).

      "Euroclear" means the Euroclear Clearance System (or any successor
securities clearing agency).

      "Event of Default" has the meaning specified in Section 501.

      "Exchange Act" refers to the Securities Exchange Act of 1934 as it may be
amended and any successor act thereto.

      "Exchange Offer" means an offer made pursuant to an effective registration
statement under the Securities Act by the Issuers to exchange securities
substantially identical to Outstanding Securities (except for the differences
provided for herein) for Outstanding Securities.

                                       9
<PAGE>
      "Exchange and Registration Rights Agreement" means the Exchange and
Registration Rights Agreement, dated as of November 4, 1999, among the Issuers
and the Initial Purchasers, as such agreement may be amended from time to time.

      "Exchange Registration Statement" means a registration statement of the
Issuers under the Securities Act registering Exchange Securities for
distribution pursuant to the Exchange Offer.

      "Exchange Securities" means the Securities issued pursuant to the Exchange
Offer or sold pursuant to the Resale Registration Statement and their Successor
Securities.

      "Expiration Date" has the meaning specified in the definition of Offer to
Purchase.

      "Fair Market Value" means, with respect to any assets or Person, the price
which could be negotiated in an arm's-length free market transaction, for cash,
between a willing seller and a willing buyer, neither of whom is under undue
pressure or compulsion to complete the transaction. Fair Market Value will be
determined (i) if such Person or assets has a Fair Market Value of less than $5
million, by any officer of VoiceStream or VoiceStream Holdings, as the case may
be, and evidenced by an Officers' Certificate, dated within 30 days of the
relevant transaction, or (ii) if such Person or assets has a Fair Market Value
of $5 million or more, by a majority of the Board of Directors of VoiceStream or
VoiceStream Holdings, as the case may be, and evidenced by a Board Resolution,
dated within 30 days of the relevant transaction

      "Global Security" means a Security that evidences all or part of the
Securities of any series and bears the applicable legend set forth in Section
202.

      "Government Securities" means direct obligations of, or obligations
guaranteed by, the United States of America for the payment of which obligations
or guarantee the full faith and credit of the United States is pledged and which
have a remaining weighted average life to maturity of not more than one year
from the date of Investment therein.

      "Gradation" means a gradation within a Rating Category or a change to
another Rating Category, which shall include:

      -     "+" and "-" in the case of S&P's current Rating Categories (e.g., a
            decline from BB+ to BB would constitute a decrease of one
            gradation);

      -     1, 2 and 3 in the case of Moody's current Rating Categories (e.g., a
            decline from Ba1 to Ba2 would constitute a decrease of one
            gradation); or

      -     the equivalent in respect of successor Rating Categories of S&P or
            Moody's or Rating Categories used by Rating Agencies other that S&P
            or Moody's.

                                       10
<PAGE>
      "Guarantee" by any Person means any obligation, contingent or otherwise,
of such Person guaranteeing any Indebtedness of any other Person (the "primary
obligor") in any manner, whether directly or indirectly, and including, without
limitation, any obligation of such Person, (i) to purchase or pay (or advance or
supply funds for the purchase or payment of) such Indebtedness or to purchase
(or to advance or supply funds for the purchase of) any security for the payment
of such Indebtedness, (ii) to purchase property, securities or services for the
purpose of assuring the holder of such Indebtedness of the payment of such
Indebtedness or (iii) to maintain working capital, equity capital or other
financial statement condition or liquidity of the primary obligor so as to
enable the primary obligor to pay such Indebtedness (and "Guaranteed",
"Guaranteeing" and "Guarantor" shall have meanings correlative to the
foregoing); provided, however, that the Guarantee by any Person shall not
include endorsements by such Person for collection or deposit, in either case,
in the ordinary course of business.

      "Holder" means a Person in whose name a Security is registered in the
Security Register.

      "Incur" means, with respect to any Indebtedness or other obligation of any
Person, to create, issue, incur (by conversion, exchange or otherwise), assume,
Guarantee or otherwise become liable in respect of such Indebtedness or other
obligation or the recording, as required pursuant to generally accepted
accounting principles or otherwise, of any such Indebtedness or other obligation
on the balance sheet of such Person (and "Incurrence," "Incurred," "Incurrable"
and "Incurring" shall have meanings correlative to the foregoing); provided,
however, that a change in generally accepted accounting principles that results
in an obligation of such Person that exists at such time becoming Indebtedness
shall not be deemed an Incurrence of such Indebtedness.

      "Indebtedness" means (without duplication), with respect to any Person,
whether recourse is to all or a portion of the assets of such Person and whether
or not contingent, (i) every obligation of such Person for money borrowed, (ii)
every obligation of such Person evidenced by bonds, debentures, notes or similar
instruments, including obligations Incurred in connection with the acquisition
of property, assets or businesses, (iii) every reimbursement obligation of such
Person with respect to letters of credit, bankers' acceptances or similar
facilities issued for the account of such Person, (iv) every obligation of such
Person issued or assumed as the deferred purchase price of property or services
(but excluding trade accounts payable or accrued liabilities arising in the
ordinary course of business), (v) every Capital Lease Obligation of such Person,
(vi) the maximum fixed redemption or repurchase price of Redeemable Stock of
such Person at the time of determination, (vii) every obligation to pay rent or
other payment amounts of such Person with respect to any Sale and Leaseback
Transaction to which such Person is a party and (viii) every obligation of the
type referred to in Clauses (i) through (vii) of another Person and all
dividends of another Person the payment of which, in either case, such Person
has Guaranteed or is responsible or liable, directly or indirectly, as obligor,
Guarantor or otherwise.

      The amount of any Indebtedness outstanding as of any date shall be:

                                       11
<PAGE>
      -     the accreted value thereof, in the case of any Indebtedness that
            does not require current payments of interest; and

      -     the principal amount thereof, together with any interest thereon
            that is more than 30 days past due, in the case of any other
            Indebtedness.

      "Indebtedness to EBITDA Ratio" of any Person means at any date the ratio
of Consolidated Indebtedness outstanding on such date to the product calculated
by multiplying the aggregate EBITDA for the first full fiscal quarter
immediately preceding such date by four; provided, however, that, in the event
such Person or any of its Restricted Subsidiaries has acquired a Person during
or after such period in a pooling-of-interests transaction, such computation
shall be made on a pro forma basis as if the transaction had taken place on the
first day of such period.

      "Indenture" means this instrument as originally executed or as it may from
time to time be supplemented or amended by one or more indentures supplemental
hereto entered into pursuant to the applicable provisions hereof.

      "Initial Investors" means Hutchison Whampoa Limited and its Affiliates,
John W. Stanton and Theresa E. Gillespie and their Affiliates and Providence
Media Partners, L.P. and its Affiliates.

      "Initial Purchasers" means Goldman, Sachs & Co., Chase Securities Inc.,
Donaldson, Lufkin & Jenrette Securities Corporation, Salomon Smith Barney Inc.,
Banc of America Securities LLC, TD Securities (USA) Inc., Barclays Capital Inc.
and SG Cowen Securities Corporation.

      "Initial Regulation S Securities" means the Securities sold by the Initial
Purchasers in the initial offering contemplated by the Purchase Agreement in
reliance on Regulation S.

      "Interest Payment Date" means the Stated Maturity of an installment of
interest on the Securities.

      "Interest Rate Agreements" means any interest rate swap, cap, collar,
floor, caption or swaption agreements, or any similar arrangements designed to
hedge the risk of variable interest rate volatility or to reduce interest costs,
arising at any time between either Issuer or any Restricted Subsidiary, on the
one hand, and any Person (other than an Affiliate of either Issuer or any
Restricted Subsidiary), on the other hand, as such agreement or arrangement may
be modified, supplemented and in effect from time to time.

      "Investment" by any Person means any direct or indirect loan, advance or
other extension of credit or capital contribution (by means of transfers of cash
or other property to others or payments for property or services for the account
or use of others, or otherwise) to, or purchase or acquisition of Capital Stock,
bonds, notes, debentures or other securities or evidence of Indebtedness issued
by, any other Person, including any payment on a guarantee of any obligation of
such other Person, but shall not include trade

                                       12
<PAGE>
accounts receivable in the ordinary course of business on credit terms made
generally available to the customers of such Person.

      "Investment Grade" means a rating of at least BBB-, in the case of S&P, or
Baa3, in the case of Moody's.

      "Issuance Date" means the date of issuance of the Securities by the
Issuers.

      "Issuers" has the meaning specified in the preamble.

      "Issuer Request" or "Issuer Order" means a written request or order signed
in the name of VoiceStream or VoiceStream Holdings, as the case may be, by its
Chairman or Vice Chairman of the Board, its President or a Vice President, and
by its Treasurer, an Assistant Treasurer, its Secretary or an Assistant
Secretary, and delivered to the Trustee.

      "Lien" means, with respect to any property or assets, any mortgage or deed
of trust, pledge, hypothecation, assignment, deposit arrangement, security
interest, lien, charge, easement (other than any easement not materially
impairing usefulness or marketability), encumbrance, preference, priority or
other security agreement or preferential arrangement of any kind or nature
whatsoever on or with respect to such property or assets (including, without
limitation, any conditional sale or other title retention agreement having
substantially the same economic effect as any of the foregoing).

      "Maturity" means, when used with respect to any Security, the date on
which the principal of such Security becomes due and payable as therein or
herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption or otherwise.

      "Moody's" means Moody's Investors Service, Inc. or, if Moody's Investors
Service, Inc. shall cease rating debt securities having a maturity at original
issuance of at least one year and such ratings business shall have been
transferred to a successor Person, such successor Person; provided, however,
that if Moody's Investors Service, Inc. ceases rating debt securities having a
maturity at original issuance of at least one year and its rating business with
respect thereto shall not have been transferred to any successor Person, then
"Moody's" shall mean any other national recognized rating agency (other than
S&P) that rates debt securities having a maturity at original issuance of at
least one year and that shall have been designated by VoiceStream or VoiceStream
Holdings, as the case may be, by a written notice given to the trustee.

      "Net Available Proceeds" from any Asset Disposition means the aggregate
amount of cash (including any other consideration that is converted into cash)
received by an Issuer or any of its Restricted Subsidiaries in respect of such
an Asset Disposition, less the sum of (i) all fees, commissions and other
expenses Incurred in connection with such Asset Disposition, including the
amount of income taxes required to be paid by such Issuer or any of its
Restricted Subsidiaries in connection therewith and (ii) the aggregate amount of
cash so received which is used to retire any existing Indebtedness of such

                                       13
<PAGE>
Issuer or any of its Restricted Subsidiaries which is required to be repaid in
connection therewith.

      "Net Cash Proceeds" from the sale of Equity Interests means the aggregate
amount of cash (including any other consideration that is converted into cash)
received by an Issuer or any of its Restricted Subsidiaries in respect of such
sale of Equity Interests, less the sum of:

      -     all fees, commissions and other expenses incurred in connection with
            such sale of Equity Interests, including the amount of income taxes
            required to be paid by such Issuer or any of its Restricted
            Subsidiaries in connection therewith; and

      -     the aggregate amount of cash so received which is used to retire any
            existing Indebtedness of such Issuer or any of its Restricted
            Subsidiaries which is required to be repaid in connection therewith.

      "Non-Recourse Debt" means Indebtedness:

      -     as to which neither of the Issuers nor any of their respective
            Restricted Subsidiaries;

            (a)provides credit support of any kind (including any undertaking,
            agreement or instrument that would constitute Indebtedness);

            (b)is directly or indirectly liable (as a guarantor or otherwise);
            or

            (c)constitutes the lender;

      -     no default with respect to which (including any rights that the
            holders thereof may have to take enforcement action against an
            Unrestricted Subsidiary of such Issuer) would permit (upon notice,
            lapse of time or both) any holder of any other Indebtedness of
            either Issuer or any of its Restricted Subsidiaries to declare a
            default on such other Indebtedness or cause the payment thereof to
            be accelerated or payable prior to its stated maturity; and

      -     as to which the lenders have been notified in writing that they will
            not have any recourse to the stock or assets of either Issuer or any
            of its Restricted Subsidiaries.

      "Offer" has the meaning specified in the definition of Offer to Purchase.

      "Offer to Purchase" means a written offer (the "Offer") sent by the
Issuers by first class mail, postage prepaid, to each Holder at his address
appearing in the Security Register on the date of the Offer offering to purchase
up to the principal amount of Securities specified in such Offer at the purchase
price specified in such Offer (as determined pursuant to this Indenture). Unless
otherwise required by applicable law, the

                                       14
<PAGE>
Offer shall specify an expiration date (the "Expiration Date") of the Offer to
Purchase which, subject to any contrary requirements of applicable law, shall be
not less than 30 days nor more than 60 days after the date of such Offer to
Purchase and a settlement date (the "Purchase Date") for purchase of Securities
within five Business Days after the Expiration Date. The Issuers shall notify
the Trustee at least 15 Business Days (or such shorter period as is acceptable
to the Trustee) prior to the mailing of the Offer of the Issuers' obligation to
make an Offer to Purchase, and the Offer shall be mailed by the Issuers or, at
the Issuers' request, by the Trustee in the name and at the expense of the
Issuers. The Offer shall contain information concerning the business of the
Issuers and their respective Subsidiaries which the Issuers in good faith
believe will enable such Holders to make an informed decision with respect to
the Offer to Purchase (which at a minimum will include (i) the most recent
annual and quarterly financial statements and "Management's Discussion and
Analysis of Financial Condition and Results of Operations" contained in the
documents required to be filed with the Trustee pursuant to Section 704 (which
requirements may be satisfied by delivery of such documents together with the
Offer), (ii) a description of material developments in the Issuers' business
subsequent to the date of the latest of such financial statements referred to in
Clause (i) (including a description of the events requiring the Issuers to make
the Offer to Purchase), (iii) if applicable, appropriate pro forma financial
information concerning the Offer to Purchase and the events requiring the
Issuers to make the Offer to Purchase and (iv) any other information required by
applicable law to be included therein. The Offer shall contain all instructions
and materials necessary to enable such Holders to tender Securities pursuant to
the Offer to Purchase. The Offer shall also state:

      -     the Section of this Indenture pursuant to which the Offer to
            Purchase is being made;

      -     the Expiration Date and the Purchase Date;

      -     the aggregate principal amount of the Outstanding Securities offered
            to be purchased by the Issuers pursuant to the Offer to Purchase
            (including, if less than 100%, the manner by which such has been
            determined pursuant to the Section hereof requiring the Offer to
            Purchase) (the "Purchase Amount");

      -     the purchase price to be paid by the Issuers for each $1,000
            aggregate principal amount of Securities accepted for payment (as
            specified pursuant to this Indenture) (the "Purchase Price");

      -     that the Holder may tender all or any portion of the Securities
            registered in the name of such Holder and that any portion of a
            Security tendered must be tendered in an integral multiple of $1,000
            principal amount;

      -     the place or places where Securities are to be surrendered for
            tender pursuant to the Offer to Purchase;

                                       15
<PAGE>
      -     that on the Purchase Date the Purchase Price will become due and
            payable upon each Security accepted for payment pursuant to the
            Offer to Purchase and that interest thereon shall cease to accrue on
            and after the Purchase Date;

      -     that each Holder electing to tender a Security pursuant to the Offer
            to Purchase will be required to surrender such Security at the place
            or places specified in the Offer prior to the close of business on
            the Expiration Date (such Security being, if the Issuers or the
            Trustee so requires, duly endorsed by, or accompanied by a written
            instrument of transfer in form satisfactory to the Issuers and the
            Trustee duly executed by, the Holder thereof or his attorney duly
            authorized in writing);

      -     that Holders will be entitled to withdraw all or any portion of
            Securities tendered if the Issuers (or its Paying Agent) receives,
            not later than the close of business on the Expiration Date, a
            telegram, telex, facsimile transmission or letter setting forth the
            name of the Holder, the principal amount of the Security the Holder
            tendered, the certificate number of the Security the Holder tendered
            and a statement that such Holder is withdrawing all or a portion of
            his tender;

      -     that (a) if Securities in an aggregate principal amount less than or
            equal to the Purchase Amount are duly tendered and not withdrawn
            pursuant to the Offer to Purchase, the Issuers shall purchase all
            such Securities and (b) if Securities in an aggregate principal
            amount in excess of the Purchase Amount are tendered and not
            withdrawn pursuant to the Offer to Purchase, the Issuers shall
            purchase Securities having an aggregate principal amount equal to
            the Purchase Amount on a pro rata basis (with such adjustments as
            may be deemed appropriate so that only Securities in denominations
            of $1,000 or integral multiples thereof shall be purchased); and

      -     that in case of any Holder whose Security is purchased only in part,
            the Issuers shall execute, and the Trustee shall authenticate and
            deliver to the Holder of such Security without service charge, a new
            Security or Securities, of any authorized denomination as requested
            by such Holder, in an aggregate principal amount equal to and in
            exchange for the unpurchased portion of the Security so tendered.

Any Offer to Purchase shall be governed by and effected in accordance with the
Offer for such Offer to Purchase.

      "Officers' Certificate" means a certificate signed by two officers at
least one of whom shall be the principal executive officer, principal accounting
officer or principal financial officer of VoiceStream or VoiceStream Holdings,
as the case may be, and delivered to the Trustee."Omnipoint" means Omnipoint
Corporation, a Delaware corporation.

                                       16
<PAGE>
      "Omnipoint Reorganization" means the reorganization and related
transactions contemplated by that Agreement and Plan of Reorganization, dated as
of June 23, 1999, among VoiceStream, VoiceStream Holdings and Omnipoint.

      "Opinion of Counsel" means a written opinion of counsel, who may be
counsel for an Issuer, and who shall be reasonably acceptable to the Trustee and
delivered to the Trustee.

      "Original Securities" means all Securities other than Exchange Securities.

      "Outstanding," when used with respect to Securities, means, as of the date
of determination, all Securities theretofore authenticated and delivered under
this Indenture, except:

      -     Securities theretofore canceled by the Trustee or delivered to the
            Trustee for cancellation;

      -     Securities for whose payment or redemption money in the necessary
            amount has been theretofore deposited with the Trustee or any Paying
            Agent (other than the Issuers) in trust or set aside and segregated
            in trust by the Issuers (if the Issuers shall act as their own
            Paying Agent) for the Holders of such Securities; provided that, if
            such Securities are to be redeemed, notice of such redemption has
            been duly given pursuant to this Indenture or provision therefor
            satisfactory to the Trustee has been made; and

      -     Securities which have been paid pursuant to Section 307 or in
            exchange for or in lieu of which other Securities have been
            authenticated and delivered pursuant to this Indenture, other than
            any such Securities in respect of which there shall have been
            presented to the Trustee proof satisfactory to it that such
            Securities are held by a bona fide purchaser in whose hands such
            Securities are valid obligations of the Issuers;

provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Securities owned
by the Issuers or any other obligor upon the Securities or any Affiliate of the
Issuers or of such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be protected
in relying upon any such request, demand, authorization, direction, notice,
consent or waiver, only Securities which a Responsible Officer of the Trustee
has actual knowledge to be so owned shall be so disregarded. Securities so owned
which have been pledged in good faith may be regarded as Outstanding if the
pledgee establishes to the satisfaction of the Trustee the pledgee's right so to
act with respect to such Securities and that the pledgee is not an Issuer or any
other obligor upon the Securities or any Affiliate of the Issuers or of such
other obligor.

                                       17
<PAGE>
      "pari passu," when used with respect to the ranking of any Indebtedness of
any Person in relation to other Indebtedness of such Person, means that each
such Indebtedness (a) either (i) is not subordinated in right of payment to any
other Indebtedness of such Person or (ii) is subordinate in right of payment to
the same Indebtedness of such Person as is the other and is so subordinate to
the same extent and (b) is not subordinate in right of payment to the other or
to any Indebtedness of such Person as to which the other is not so subordinate.

      "Paying Agent" means any Person authorized by the Issuers to pay the
principal of (and premium, if any) or interest on any Securities on behalf of
the Issuers.

      "Permitted Investments" include:

      -     Investments in either Issuer or any Restricted Subsidiary of either
            Issuer;

      -     Investments in a Person such that the Person will become a
            Restricted Subsidiary after giving effect to the Investment or
            purchases of additional Equity Interests of a Restricted Subsidiary
            or of a Person who becomes a Restricted Subsidiary as a result of
            any such purchase;

      -     a Temporary Cash Investment;

      -     stock, obligations or other consideration received in satisfaction
            of judgments;

      -     an Investment in any Person to the extent such Investment represents
            the non-cash portion of the consideration received for an Asset
            Disposition as permitted under Section 1014;

      -     Investments (including acquisitions of other Telecommunications
            Businesses) not to exceed two times the Net Cash Proceeds from the
            sale of Equity Interests;

      -     Investments (including acquisitions of other Telecommunications
            Businesses) made with Capital Stock;

      -     Restricted Equity Investments;

      -     Strategic Investments;

      -     customary loans or advances made in the ordinary course of business
            to officers, directors or employees of an Issuer or any of its
            Restricted Subsidiaries for travel, entertainment and moving and
            other relocation expenses; and

      -     any other Investments not to exceed $100 million in the aggregate.

                                       18
<PAGE>
      "Person" means any individual, corporation, partnership, joint venture,
trust, unincorporated organization or government or any agency or political
subdivision thereof.

      "Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security; and, for the purposes of this definition, any Security
authenticated and delivered under Section 307 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Security shall be deemed to evidence the
same debt as the mutilated, destroyed, lost or stolen Security.

      "Preferred Stock," as applied to the Capital Stock of any Person, means
Capital Stock of such Person of any class or classes (however designated) that
ranks prior, as to the payment of dividends or as to the distribution of assets
upon any voluntary or involuntary liquidation, dissolution or winding up of such
Person, to shares of Capital Stock of any other class of such Person.

      "Public Equity Offering" means an underwritten primary public offering of
Common Stock pursuant to an effective registration statement under the
Securities Act.

      "Purchase Agreement" means the Purchase Agreement, dated as of November 4,
1999, among the Issuers and the Initial Purchasers, as such agreement may be
amended from time to time.

      "Purchase Amount" has the meaning specified in the definition of Offer to
Purchase.

      "Purchase Date" has the meaning specified in the definition of Offer to
Purchase.

      "Purchase Price" has the meaning specified in the definition of Offer to
Purchase.

      "Rating Agency" means (1) S&P and Moody's or (2) any other rating agencies
contemplated by the definitions of "S&P" and "Moody's".

      "Rating Category" means:

      -     with respect to S&P, any of the following categories (any of which
            may include a "+" or "-"): AAA, AA, A, BBB, BB, B, CCC, CC, C and D
            (or equivalent successor categories);

      -     with respect to Moody's, any of the following categories (any of
            which may include a "1", "2" or "3"); Aaa, Aa, A, Baa, Ba, B, Caa,
            Ca, C and D (or equivalent successor categories); and

      -     the equivalent of any such categories of S&P or Moody's used by
            another Rating Agency, if applicable.

      "Ratings Decline" has the meaning specified in Section 1016.

                                       19
<PAGE>
         "Redeemable Stock" of any Person means any equity security of such
Person that by its terms or otherwise is required to be redeemed prior to the
final Stated Maturity of the Securities or is redeemable at the option of the
holder thereof at any time prior to the final Stated Maturity of the Securities.

         "Redemption Date," when used with respect to any Security to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.

         "Redemption Price," when used with respect to any Security to be
redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.

         "Registered Securities" means the Exchange Securities and all other
Securities sold or otherwise disposed of pursuant to an effective registration
statement under the Securities Act, together with their respective Successor
Securities.

         "Registration Default" has the meaning specified in the form of the
Securities set forth in Section 202.

         "Regular Record Date" for the interest payable on any Interest Payment
Date means the May 1 or November 1 (whether or not a Business Day), as the case
may be, next preceding such Interest Payment Date.

         "Regulation S" means Regulation S under the Securities Act (or any
successor provision), as it may be amended from time to time.

         "Regulation S Certificate" means a certificate substantially in the
form set forth in Annex A.

         "Regulation S Global Security" has the meaning specified in Section
201.

         "Regulation S Legend" means a legend substantially in the form of the
legend required in the form of Security set forth in Section 202 to be placed
upon a Regulation S Global Security.

         "Regulation S Securities" means all Securities required pursuant to
Section 306(c) to bear a Regulation S Legend. Such term includes the Regulation
S Global Security.

         "Related Person" of any Person means any other Person owning (a) 5% or
more of the outstanding Common Stock of such Person or (b) 5% or more of the
Voting Power of such Person.

         "Reorganizations" means the Omnipoint Reorganization and the Aerial
Reorganization.

         "Resale Registration Statement" means a shelf registration statement
under the Securities Act filed by the Issuers, if required by, and meeting the
requirements of, the Exchange and Registration Rights Agreement, registering
Original Securities for resale.

                                       20
<PAGE>
         "Responsible Officer," when used with respect to the Trustee, means the
chairman or vice-chairman of the executive committee of the board of directors,
the president, any vice-president, any trust officer or assistant trust officer,
or any other officer of the Trustee customarily performing functions similar to
those performed by any of the above designated officers and also means, with
respect to a particular corporate trust matter, any other officer to whom such
matter is referred because of his or her knowledge of and familiarity with the
particular subject.

         "Restricted Entity" means, as applied to any Person, any corporation or
other entity:

         -        engaged in the acquisition, ownership, operation and
                  management of assets in the Telecommunications Business;

         -        over which such Person is responsible (either directly or
                  through a services agreement) for day-to-day operations or
                  otherwise has a technical services or comparable agreement
                  that provides such Person with such rights, duties and
                  obligations as are substantially similar to those rights,
                  duties and obligations of VoiceStream (as assignee of Western
                  Wireless Corporation) under that certain Technical Services
                  Agreement dated July 30, 1996, as amended, with respect to
                  Cook Inlet Western Wireless PV/SS PCS, L.P.;

         -        of which more than 40% of the outstanding Capital Stock (other
                  than directors' qualifying shares) having ordinary voting
                  power to elect its board of directors, regardless of the
                  existence at the time of a right of the holders of any class
                  or classes of securities of such corporation to exercise such
                  voting power by reason of the happening of any contingency, in
                  the case a corporation, or more than 40% of the outstanding
                  ownership interests, in the case of an entity other than a
                  corporation, is at the time owned directly or indirectly by
                  such Person, or by one or more Subsidiaries of such Person, or
                  by such Person and by one or more Subsidiaries of such Person;
                  and

         -        that is formed or the ownership in which is acquired pursuant
                  to an arms' length negotiation between such Person and the
                  Restricted Entity or the other investors in such Restricted
                  Entity that satisfies the requirements of Section 1013.

         "Restricted Equity Investments" means:

         -        any payment on account of the purchase, redemption, retirement
                  or acquisition of (a) any shares of Capital Stock or other
                  ownership interests in a Restricted Entity or (b) any option,
                  warrant or other right to acquire shares of Capital Stock or
                  ownership interests of a Restricted Entity; or

                                       21
<PAGE>
         -        any loan, advance, lease, capital contribution to, or
                  Investment in, or payment of a Guarantee of any obligation of
                  a Restricted Entity. "Restricted Global Security" has the
                  meaning specified in Section 201.

         "Restricted Payment" has the meaning specified in Section 1010.

         "Restricted Period" means the period of 41 consecutive days beginning
on and including the later of (i) the day on which Securities are first offered
to persons other than distributors (as defined in Regulation S) in reliance on
Regulation S and (ii) the day on which the closing of the offering of Securities
pursuant to the Purchase Agreement occurs.

         "Restricted Securities" means all Securities required pursuant to
Section 306(c) to bear a Restricted Securities Legend. Such term includes the
Restricted Global Security.

         "Restricted Securities Certificate" means a certificate substantially
in the form set forth in Annex B.

         "Restricted Securities Legend" means a legend substantially in the form
of the legend required in the form of Security set forth in Section 202 to be
placed upon a Restricted Security.

         "Restricted Subsidiary" of any Person means any Subsidiary of such
Person other than an Unrestricted Subsidiary.

         "Rule 144A" means Rule 144A under the Securities Act (or any successor
provision), as it may be amended from time to time.

         "Rule 144A Securities" means the Securities purchased by the Initial
Purchasers from the Issuers pursuant to the Purchase Agreement, other than the
Initial Regulation S Securities.

         "Sale and Leaseback Transaction" of any Person means an arrangement
with any lender or investor or to which such lender or investor is a party
providing for the leasing by such Person of any property or asset of such Person
which has been or is being sold or transferred by such Person more than 270 days
after the acquisition thereof or the completion of construction or commencement
of operation thereof to such lender or investor or to any person to whom funds
have been or are to be advanced by such lender or investor on the security of
such property or asset. The stated maturity of such arrangement shall be the
date of the last payment of rent or any other amount due under such arrangement
prior to the first date on which such arrangement may be terminated by the
lessee without payment of a penalty.

         "Securities" means securities designated in the first paragraph of the
recitals and includes the Exchange Securities.

         "Securities Act" refers to the Securities Act of 1933 as it may be
amended and any successor act thereto.

                                       22
<PAGE>
         "Securities Act Legend" means a Restricted Securities Legend or a
Regulation S Legend.

         "Security Registrar" and "Security Register" have the respective
meanings specified in Section 306.

         "Special Interest" has the meaning specified in the form of the
Securities set forth in Section 202.

         "S&P" means Standard & Poor's Rating Services or, if Standard & Poor's
Rating Services shall cease rating debt securities having a maturity at original
issuance of at least one year and such ratings business shall have been
transferred to a successor Person, such successor Person; provided, however,
that if Standard & Poor's Rating Services ceases rating debt securities having a
maturity at original issuance of at least one year and its rating business with
respect thereto shall not have been transferred to any successor Person, then
"S&P" shall mean any other national recognized rating agency (other than
Moody's) that rates debt securities having a maturity at original issuance of at
least one year and that shall have been designated by VoiceStream or VoiceStream
Holdings, as the case may be, by a written notice given to the Trustee.

         "Stated Maturity," when used with respect to any Security or any
installment of interest thereon, means the date specified in such Security as
the date on which the principal of such Security or such installment of interest
is due and payable.

         "Statistical Release" means the statistical release designated
"H.15(519)" or any successor publication which is published weekly by the
Federal Reserve System and which establishes yields on actively traded United
States government securities adjusted to constant maturities, or, if such
statistical release is not published at the time of any determination under this
Indenture, then such other reasonably comparable index which shall be designated
by VoiceStream or VoiceStream Holdings, as the case may be.

         "Step-Down Date" has the meaning specified in the form of the
Securities set forth in Section 202.

         "Step-Up" has the meaning specified in the form of the Securities set
forth in Section 202.

         "Strategic Equity Infusion" means an equity investment in VoiceStream
or VoiceStream Holdings, as the case may be, made by a Strategic Investor in an
aggregate amount of not less than $250 million.

         "Strategic Investment" means an Investment in one or more Persons
engaged in a Telecommunications Business, provided that the aggregate amount of
all such Investments does not exceed (1) $100 million or (2), provided that
after giving effect to such Strategic Investment the Issuers would comply with
the first paragraph of Section 1008, $175 million.

                                       23
<PAGE>
         "Strategic Investor" means a corporation, partnership or other entity
engaged in one or more Telecommunications Businesses that has, or 80% or more of
the voting stock of which is owned by a Person that has, an equity market
capitalization, at the time of its initial Investment in the applicable Issuer,
in excess of $1 billion.

         "Subsidiary" of any Person means (i) any corporation of which more than
fifty percent (50%) of the outstanding Capital Stock (other than directors'
qualifying shares) having ordinary Voting Power to elect its board of directors,
regardless of the existence at the time of a right of the holders of any class
or classes of securities of such corporation to exercise such Voting Power by
reason of the happening of any contingency, or any entity other than a
corporation of which more than fifty percent (50%) of the outstanding ownership
interests, is at the time owned directly or indirectly by such Person, or by one
or more Subsidiaries of such Person, or by such Person and one or more
Subsidiaries of such Person, or (ii) any other entity which is directly or
indirectly controlled or capable of being controlled by such Person, or by one
or more Subsidiaries of such Person, or by such Person and one or more
Subsidiaries of such Person.

         "Successor Security" of any particular Security means every Security
issued after, and evidencing all or a portion of the same debt as that evidenced
by, such particular Security; and, for the purposes of this definition, any
Security authenticated and delivered under Section 307 in exchange for or in
lieu of a mutilated, destroyed, lost or stolen Security shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Security.

         "Telecommunications Asset" means any asset of a Telecommunications
Business, including, without limitation, Equity Interests or joint venture,
partnership or membership interests of an entity engaged in the
Telecommunications Business.

         "Telecommunications Business" means the business of:

         -        transmitting, or providing services relating to the
                  transmission of, voice, video or data through owned or leased
                  wireline or wireless transmission facilities;

         -        creating, developing, acquiring, constructing, installing,
                  repairing, maintaining or marketing communications-related
                  systems, network equipment and facilities, software and other
                  products; or

         -        evaluating, owning, operating, participating in or pursuing
                  any other business that is primarily related to those
                  identified in clause (1) or (2) above (in the case of this
                  clause (3), however, in a manner consistent with VoiceStream's
                  and, assuming completion of either of the Reorganizations,
                  Omnipoint's or Aerial's, as applicable, manner of business on
                  the date of this Indenture), and shall, in any event, include
                  all businesses in which VoiceStream and, assuming completion
                  of either of the Reorganizations, Omnipoint or Aerial, as
                  applicable, or any of their Subsidiaries is engaged on the
                  date of this Indenture or has entered into agreements to
                  engage in or

                                       24
<PAGE>
                  to acquire a company to engage in or contemplate engaging in,
                  as expressly set forth in VoiceStream's Form 10/A filed with
                  the Commission on April 13, 1999 or its Form 10-Q for the
                  quarter ended June 30, 1999 or its current reports on Form 8-K
                  filed prior to October 15, 1999 (or not required to be
                  disclosed therein pursuant to the rules and regulations of the
                  Commission) and, assuming completion of the Reorganizations,
                  each of Omnipoint's and Aerial's Form 10-K for the fiscal year
                  ended December 31, 1998 and Forms 10-Q and 8-K filed during
                  calendar year 1999 prior to the date of the offering circular
                  associated with the Securities (or not required to be
                  disclosed therein pursuant to the rules and regulations of the
                  Commission); provided that the determination of what
                  constitutes a Telecommunications Business shall be made in
                  good faith by the Board of Directors of VoiceStream or
                  VoiceStream Holdings, as the case may be.

         "Telecommunications Indebtedness" means Indebtedness (including
Acquired Indebtedness) of an Issuer or any of its Restricted Subsidiaries that
is incurred for the (1) development, construction, acquisition, operations or
improvement by such Issuer or any of its Restricted Subsidiaries of
Telecommunications Assets (including any Indebtedness assumed in connection with
an acquisition of Telecommunications Assets) or (2) acquisition of Equity
Interests of a Person engaged in a Telecommunications Business; provided that
with respect to clause (1) the net proceeds of such Telecommunications
Indebtedness do not exceed 100% of the cost of construction, development,
acquisition, operations or improvement of the applicable Telecommunications
Assets.

         "Temporary Cash Investment" means:

         -        Government Securities;

         -        any time deposit account, money market deposit and certificate
                  of deposit maturing not more than 270 days after the date of
                  acquisition issued by, or time deposit of, an Eligible
                  Institution;

         -        commercial paper maturing not more than 270 days after the
                  date of acquisition issued by a corporation (other than an
                  Affiliate of either Issuer) with a rating, at the time as of
                  which any investment therein is made, of "P-1" or higher
                  according to Moody's Investors Service, Inc., "A-1" or higher
                  according to Standard & Poor's Ratings Group or "A-1" or
                  higher according to Duff & Phelps Credit Rating Co. (or such
                  similar equivalent rating by at least one "nationally
                  recognized statistical rating organization" (as defined in
                  Rule 436 under the Securities Act));

         -        any banker's acceptances or money market deposit accounts
                  issued or offered by an Eligible Institution;

         -        repurchase obligations with a term of not more than 7 days for
                  Government Securities entered into with an Eligible
                  Institution; and

                                       25
<PAGE>
         -        any fund investing exclusively in investments of the types
                  described in clauses (1) through (5) above.

         "Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean such successor Trustee.

         "Trust Indenture Act" means the Trust Indenture Act of 1939 as in force
at the date as of which this instrument was executed, except as provided in
Section 905; provided, however, that in the event the Trust Indenture Act of
1939 is amended after such date, "Trust Indenture Act" means, to the extent
required by any such amendment, the Trust Indenture Act of 1939 as so amended.

         "U.S. Government Obligations" has the meaning specified in Section
1204.

         "Unrestricted Securities Certificate" means a certificate substantially
in the form set forth in Annex C.

         "Unrestricted Subsidiary" of any Person means (i) any Subsidiary of
such Person that at the time of determination shall be designated an
Unrestricted Subsidiary by the Board of Directors of such Person in the manner
provided below and (ii) any Subsidiary of an Unrestricted Subsidiary. The Board
of Directors of any Person may designate any Restricted Subsidiary to be an
Unrestricted Subsidiary unless such Subsidiary owns any Common Stock or
Preferred Stock of, or owns or holds any Lien on any property of, such Person or
any Restricted Subsidiary; provided that either (A) the Subsidiary to be so
designated has total assets of $1,000 or less or (B) if such Subsidiary has
assets greater than $1,000, the Fair Market Value of the Subsidiary at the time
of such designation would be permitted as an investment under Section 1011. The
Board of Directors of any Person may designate any Unrestricted Subsidiary to be
a Restricted Subsidiary of such Person; provided that immediately after giving
effect to such designation (x) such Person would be permitted to Incur $1.00 of
additional Indebtedness pursuant to the first paragraph of Section 1008 and (y)
no Event of Default or event which with notice or lapse of time or both would
become an Event of Default has occurred and is continuing. Any such designation
by the Board of Directors shall be evidenced by a Board Resolution submitted to
the Trustee.

         "Vice President," when used with respect to VoiceStream or VoiceStream
Holdings, as the case may be, or the Trustee, means any vice president, whether
or not designated by a number or a word or words added before or after the title
"vice president."

         "VoiceStream" has the meaning set forth in the preamble.

         "VoiceStream Holdings" has the meaning set forth in the preamble.

         "Voting Power" of any Person means the aggregate number of votes of all
classes of Capital Stock of such Person which ordinarily has voting power for
the election of directors of such Person.

                                       26
<PAGE>
         "Wholly Owned Restricted Subsidiary" of any Person means a Restricted
Subsidiary of such Person all of the outstanding Capital Stock or other
ownership interests of which (other than directors' qualifying shares) shall at
the time be owned by such Person or by one or more Wholly Owned Restricted
Subsidiaries of such Person or by such Person and one or more Wholly Owned
Restricted Subsidiaries of such Person.

         Section 1.2. Compliance Certificates and Opinions.

         Upon any application or request by an Issuer to the Trustee to take any
action under any provision of this Indenture, such Issuer shall furnish to the
Trustee such certificates and opinions as may be required under the Trust
Indenture Act. Each such certificate or opinion shall be given in the form of an
Officers' Certificate, if to be given by an officer of such Issuer, or an
Opinion of Counsel, if to be given by counsel, and shall comply with the
requirements of the Trust Indenture Act and any other requirement set forth in
this Indenture.

         Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include

                           (1) a statement that each individual signing such
                  certificate or opinion has read such covenant or condition and
                  the definitions herein relating thereto;

                           (2) a brief statement as to the nature and scope of
                  the examination or investigation upon which the statements or
                  opinions contained in such certificate or opinion are based;

                           (3) a statement that, in the opinion of each such
                  individual, he has made such examination or investigation as
                  in its reasonable judgment is necessary to enable him to
                  express an informed opinion as to whether or not such covenant
                  or condition has been complied with; and

                           (4) a statement as to whether or not, in the opinion
                  of each such individual, such condition or covenant has been
                  complied with.

         Section 1.3. Form of Documents Delivered to Trustee.

         In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.

         Any certificate or opinion of an officer of an Issuer may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel,

                                       27
<PAGE>
unless such officer knows that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or opinion of counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of such Issuer stating that the
information with respect to such factual matters is in the possession of the
Issuers, unless such counsel knows that the certificate or opinion or
representations with respect to such matters are erroneous.

         Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.

         Section 1.4. Acts of Holders; Record Date.

         (a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by an agent(s)
duly appointed in writing; and, except as herein otherwise expressly provided,
such action shall become effective when such instrument or instruments are
received by the Trustee and, where it is hereby expressly required, by such
Issuer. Such instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the "Act" of the Holders
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Indenture and (subject to Section 601) conclusive in favor of
the Trustee and such Issuer, if made in the manner provided in this Section.

         (b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which the Trustee reasonably deems sufficient.

         (c) An Issuer may, in the circumstances permitted by the Trust
Indenture Act, fix any day as the record date for the purpose of determining the
Holders entitled to give or take any request, demand, authorization, direction,
notice, consent, waiver or other action, or to vote on any action, authorized or
permitted to be given or taken by Holders. If not set by such Issuer prior to
the first solicitation of a Holder made by any Person in respect of any such
action, or, in the case of any such vote, prior to such vote, the record date
for any such action or vote shall be the 30th day (or, if later, the date of the
most recent list of Holders required to be provided pursuant to Section 701)
prior to such first solicitation or vote, as the case may be. With regard to any
record date, only the Holders

                                       28
<PAGE>
on such date (or their duly designated proxies) shall be entitled to give or
take, or vote on, the relevant action.

         (d) The ownership of Securities shall be proved by the Security
Register.

         (e) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Security shall bind every future Holder
of the same Security and the Holder of every Security issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof in
respect of anything done, omitted or suffered to be done by the Trustee or an
Issuer in reliance thereon, whether or not notation of such action is made upon
such Security.

         Section 1.5. Notices, Etc., to Trustee and Issuer.

         Any request, demand, authorization, direction, notice, consent, waiver
or Act of Holders or other document provided or permitted by this Indenture to
be made upon, given or furnished to, or filed with,

                           (1) the Trustee by any Holder or by an Issuer shall
                  be sufficient for every purpose hereunder if made, given,
                  furnished or filed in writing to or with the Trustee at its
                  Corporate Trust Office, Attention: Trust Officer, or

                           (2) an Issuer by the Trustee or by any Holder shall
                  be sufficient for every purpose hereunder (unless otherwise
                  herein expressly provided) if in writing and mailed,
                  first-class postage prepaid, to such Issuer, Attention: Chief
                  Executive Officer, addressed to it at the address of its
                  principal office specified in the first paragraph of this
                  instrument or at any other address previously furnished in
                  writing to the Trustee by such Issuer with a copy to its
                  General Counsel.

         Section 1.6. Notice to Holders; Waiver.

         Where this Indenture provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to each Holder affected
by such event, at his address as it appears in the Security Register, not later
than the latest date (if any), and not earlier than the earliest date (if any),
prescribed for the giving of such notice. In any case where notice to Holders is
given by mail, neither the failure to mail such notice, nor any defect in any
notice so mailed, to any particular Holder shall affect the sufficiency of such
notice with respect to other Holders. Where this Indenture provides for notice
in any manner, such notice may be waived in writing by the Person entitled to
receive such notice, either before or after the event, and such waiver shall be
the equivalent of such notice. Waivers of notice by Holders shall be filed with
the Trustee, but such filing shall not be a condition precedent to the validity
of any action taken in reliance upon such waiver.

                                       29

<PAGE>

         In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as shall be made with the approval of the Trustee shall
constitute a sufficient notification for every purpose hereunder.

         Section 1.7. Conflict with Trust Indenture Act.

         If any provision hereof limits, qualifies or conflicts with a provision
of the Trust Indenture Act that is required under such Act to be part of and
govern this Indenture, the latter provision shall control. If any provision of
this Indenture modifies or excludes any provision of the Trust Indenture Act
that may be so modified or excluded, the provision of this Indenture shall be
deemed to apply.

         Section 1.8. Effect of Headings and Table of Contents.

         The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.

         Section 1.9. Successors and Assigns.

         All covenants and agreements in this Indenture by an Issuer shall bind
its successors and assigns, whether so expressed or not.

         Section 1.10. Separability Clause.

         In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.

         Section 1.11. Benefits of Indenture.

         Nothing in this Indenture or in the Securities, express or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder and the Holders of Securities, any benefit or any legal or equitable
right, remedy or claim under this Indenture.

         Section 1.12. Governing Law.

         This Indenture and the Securities shall be governed by and construed in
accordance with the laws of the State of New York without giving effect to
principles of conflicts of law.

         Section 1.13. Legal Holidays.

         In any case where any Interest Payment Date, Redemption Date, Purchase
Date or Stated Maturity of any Security shall not be a Business Day, then
(notwithstanding any other provision of this Indenture or of the Securities)
payment of interest or principal (and premium, if any) need not be made on such
date, but may be made on the next

                                       30
<PAGE>
succeeding Business Day with the same force and effect as if made on the
Interest Payment Date, Redemption Date or Purchase Date, or at the Stated
Maturity, provided that no interest shall accrue for the period from and after
such Interest Payment Date, Redemption Date, Purchase Date or Stated Maturity,
as the case may be.  ARTICLE TWO

                                   ARTICLE 2
                                 SECURITY FORMS

         Section 2.1. Forms Generally.

         The Securities and the Trustee's certificates of authentication shall
be in substantially the forms set forth in this Article, with such appropriate
insertions, omissions, substitutions and other variations as are required or
permitted by this Indenture, and may have such letters, numbers or other marks
of identification and such legends or endorsements placed thereon as may be
required to comply with the rules of any securities exchange or as may,
consistently herewith, be determined by the officers executing such Securities,
as evidenced by their execution of the Securities.

         The definitive Securities shall be printed, lithographed or engraved or
produced by any combination of these methods on steel engraved borders or may be
produced in any other manner permitted by the rules of any securities exchange
on which the Securities may be listed, all as determined by the officers
executing such Securities, as evidenced by their execution of such Securities.

         Upon their original issuance, Rule 144A Securities shall be issued in
the form of one or more Global Securities registered in the name of DTC, as
Depositary, or its nominee and deposited with the Trustee, as custodian for DTC,
for credit by DTC to the respective accounts of beneficial owners of the
Securities represented thereby (or such other accounts as they may direct). Such
Global Securities, together with their Successor Securities which are Global
Securities other than the Regulation S Global Security, are collectively herein
called the "Restricted Global Security".

         Upon their original issuance, Initial Regulation S Securities shall be
issued in the form of one or more Global Securities registered in the name of
DTC, as Depositary, or its nominee and deposited with the Trustee, as custodian
for DTC, for credit by DTC to the respective accounts of beneficial owners of
the Securities represented thereby (or such other accounts as they may direct),
provided that upon such deposit all such Securities shall be credited to or
through accounts maintained at DTC by or on behalf of Euroclear or Cedel. Such
Global Securities, together with their Successor Securities which are Global
Securities other than the Restricted Global Security, are collectively herein
called the "Regulation S Global Security".

         Section 2.2. Form of Face of Security.

         [If the Security is a Restricted Security, then insert -- THIS SECURITY
EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY NOT BE OFFERED, SOLD,
PLEDGED OR OTHERWISE

                                       31
<PAGE>
TRANSFERRED EXCEPT (A)(1) TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE
SECURITIES ACT PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (2)
IN AN OFFSHORE TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF REGULATION S
UNDER THE SECURITIES ACT, (3) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER
THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), (4) TO AN
INSTITUTIONAL ACCREDITED INVESTOR IN A TRANSACTION EXEMPT FROM REGISTRATION
UNDER THE SECURITIES ACT OR (5) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT, AND (B) IN EACH CASE, IN ACCORDANCE WITH ALL
APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED STATES AND OTHER
JURISDICTIONS.]

         [If the Security is a Regulation S Security, then insert -- THIS
SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), AND MAY NOT BE OFFERED, SOLD, OR DELIVERED IN
THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, ANY U.S. PERSON,
UNLESS THIS SECURITY IS REGISTERED UNDER THE SECURITIES ACT OR AN EXEMPTION FROM
THE REGISTRATION REQUIREMENTS THEREOF IS AVAILABLE.]

         [If the Security is a Global Security, then insert -- THIS SECURITY IS
A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO
AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF. THIS
SECURITY MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A SECURITY REGISTERED, AND
NO TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME
OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE THEREOF, EXCEPT IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.]

         [If the Security is a Global Security and The Depository Trust Company
is to be the Depositary therefor, then insert -- UNLESS THIS CERTIFICATE IS
PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW
YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.]

                                       32
<PAGE>
         10-3/8% SENIOR NOTES DUE 2009

         No. __________$________

         [If Restricted Global Security - CUSIP Number ___________]

         [If Regulation S Global Security - CUSIP Number ___________]

         [If Non-Global Security - CUSIP Number ___________]

         [If Registered Security - CUSIP Number ___________]

         VoiceStream Wireless Corporation, a corporation duly organized and
existing under the laws of Washington and VoiceStream Wireless Holding
Corporation, a corporation organized and existing under the laws of Delaware
(herein collectively referred to as the "Issuers," which term includes any
successor Person under the Indenture hereinafter referred to), for value
received, hereby promises to pay to _____________, or registered assigns, the
principal sum of ________ Dollars [if the Security is a Global Security, then
insert -- , or such other principal amount (which, when taken together with the
principal amounts of all other Outstanding Securities, shall not exceed
$2,200,000,000 in the aggregate at any time) as may be set forth in the records
of the Trustee hereinafter referred to in accordance with the Indenture,] on
November 15, 2009, and to pay interest thereon from the Issuance Date of this
Security or from the most recent Interest Payment Date to which interest has
been paid or duly provided for, semi-annually on May 15 and November 15 in each
year, commencing May 15, 2000, or in the case of Securities issued after the
Closing Date, on the first such date following the Issuance Date, at the rate of
10-3/8% per annum, until the principal hereof is paid or made available for
payment, and (to the extent that the payment of such interest shall be legally
enforceable) at the rate of 12-3/8% per annum on any overdue principal and
premium, if any, and on any overdue installment of interest until paid [if the
Security is an Original Security, then insert -- , provided that if (i) the
Issuers have not filed an Exchange Registration Statement under the Securities
Act registering a security substantially identical to this Security for
distribution pursuant to an Exchange Offer or, if applicable, a Resale
Registration Statement registering this Security for resale, in either case by
March 23, 2000, (ii) either the Exchange Registration Statement or, if
applicable, the Resale Registration Statement has not become or been declared
effective within 75 days after the filing of such Statement, (iii) the
expiration of the Exchange Offer has not occurred within 45 days after the date
on which the Exchange Registration Statement has become or been declared
effective initially or (iv) either the Exchange Registration Statement or, if
applicable, the Resale Registration Statement is filed and declared effective
but shall thereafter cease to be effective (except as specifically permitted
pursuant to the agreement referred to below) without being succeeded immediately
by an additional registration statement filed and declared effective, in each
case (i) through (iv) upon the terms and conditions set forth in the Exchange
and Registration Rights Agreement (each such event referred to in clauses (i)
through (iv), a "Registration Default"; provided that no more than one
Registration Default shall be deemed to be in effect at any one time), then
interest will accrue (in addition to the stated interest on this

                                       33
<PAGE>
Security) (the "Step-Up") at a rate of (i) 0.25% per annum for the first 90-day
period, (ii) 0.50% per annum for the second 90-day period, (iii) 0.75% per annum
for the third 90-day period and (iv) 1.00% per annum thereafter on the principal
amount of the Securities for the period from the occurrence of the Registration
Default until such time (the "Step-Down Date") as no Registration Default is in
effect (after which the interest rate will be restored to its initial rate). The
Issuers shall provide the Trustee with written notice of the date of any
Registration Default and the Step-Down Date. Interest accruing as a result of
the Step-Up is referred to herein as "Special Interest."] The interest so
payable, and punctually paid or duly provided for, on any Interest Payment Date
will, as provided in such Indenture, be paid to the Person in whose name this
Security (or one or more Predecessor Securities) is registered at the close of
business on the Regular Record Date for such interest, which shall be May 1 or
November 1 (whether or not a Business Day), as the case may be, next preceding
such Interest Payment Date [if the Security is an Original Security, then insert
--, provided that any accrued and unpaid interest (including Special Interest)
on this Security upon the issuance of an Exchange Security in exchange for this
Security shall cease to be payable to the Holder hereof and shall be payable on
the next Interest Payment Date for such Exchange Security to the Holder thereof
on the related Regular Record Date]. Any such interest not so punctually paid or
duly provided for will forthwith cease to be payable to the Holder on such
Regular Record Date and may either be paid to the Person in whose name this
Security (or one or more Predecessor Securities) is registered at the close of
business on a Special Record Date for the payment of such Defaulted Interest to
be fixed by the Trustee, notice whereof shall be given to Holders of Securities
not less than 10 days prior to such Special Record Date, or be paid at any time
in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities may be listed, and upon such notice
as may be required by such exchange, all as more fully provided in said
Indenture.

         If either Reorganization is completed, immediately upon completion of
such Reorganization, without any further act by any Person VoiceStream shall
cease to be an Issuer of the Securities and any or all of its obligations under
the Indenture as an Issuer shall effectively terminate, and VoiceStream Holdings
shall remain as the sole Issuer of the Securities. If both Reorganizations are
terminated, immediately upon the termination of the last of the Reorganizations
to be terminated, without any further act by any Person, VoiceStream Holdings
shall cease to be an Issuer of the Securities and any or all of its obligations
under the Indenture as an Issuer shall effectively terminate, and VoiceStream
shall remain as the sole Issuer of the Securities. Upon either of VoiceStream or
VoiceStream Holdings being the sole Issuer, the term "Issuers" hereunder shall
be deemed to be changed to "Issuer."

         Payment of the principal of (and premium, if any) and interest on this
Security will be made at the Corporate Trust Office or at the office or agency
of the Issuers maintained for that purpose in the Borough of Manhattan, New York
City, in such coin or currency of the United States of America as at the time of
payment is legal tender for payment of public and private debts; provided,
however, that at the option of the Issuers payment of interest may be made by
check mailed to the address of the Person entitled thereto as such address shall
appear in the Security Register.

                                       34
<PAGE>
         Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.

         Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.

         IN WITNESS WHEREOF, each of the Issuers have caused this instrument to
be duly executed.

         Dated:

                                           VoiceStream Wireless Corporation

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

         Attest:

         ------------------------------
         Title:

                                           VoiceStream Wireless Holding
                                           Corporation

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

         ------------------------------
         Title:

Section 2.3.      Form of Reverse of Security.

         This Security is one of a duly authorized issue of Securities of the
Issuers designated as their 10-3/8% Senior Notes Due 2009 (herein called the
"Securities"), limited in aggregate principal amount to $2,200,000,000, issued
and to be issued from time to time under an Indenture, dated as of November 9,
1999 (herein called the "Indenture"), between the Issuers and Harris Trust
Company of California, as Trustee (herein called the "Trustee," which term
includes any successor trustee under the Indenture), to which Indenture and all
indentures supplemental thereto reference is hereby made for a statement of the
respective rights, limitations of rights, duties and immunities thereunder of
the Issuers, the Trustee and the Holders of the Securities and of the terms upon
which the Securities are, and are to be, authenticated and delivered.

                                       35
<PAGE>
         Until November 15, 2002, the Issuers may on any one or more occasions
redeem up to 35% of the aggregate principal amount at maturity of the Securities
originally issued at a redemption price of 110.375% of principal amount of the
Securities to be redeemed on the redemption date with the net cash proceeds of
one or more Public Equity Offerings and/or Strategic Equity Infusions; provided
that:

                           (1) at least 65% of the aggregate principal amount of
                  Securities originally issued remains outstanding immediately
                  after the occurrence of such redemption (excluding Securities
                  held by the Issuers or any of their respective Subsidiaries);
                  and

                           (2) the redemption occurs within 60 days of the date
                  of the Public Equity Offering or Strategic Equity Infusion.

         Except pursuant to the preceding paragraph and the provisions of
Section 1016 of the Indenture, the Securities will not be redeemable at the
Issuers' option prior to November 15, 2004. On or after November 15, 2004, the
Issuers may redeem all or a part of the Securities upon not less than 30 nor
more than 60 days' notice, at the redemption prices (expressed as percentages of
principal amount) set forth below, plus accrued interest, if any, on the
Securities redeemed to the applicable Redemption Date (subject to the right of
Holders of record on the relevant record date to receive interest due on the
relevant interest payment date), if redeemed during the 12-month period
beginning on November 15 of the years indicated below:

<TABLE>
<CAPTION>
                                 Year                                Percentage
<S>                                                                  <C>
                                  2004                                 105.188%
                                  2005                                 103.458%
                                  2006                                 101.729%
                          2007 and thereafter                           100.0%
</TABLE>

         Notice of any optional redemption of any Securities (or portion
thereof) will be given to the Holders at their addresses appearing in the
Security Register not less than 30 nor more than 60 days prior to the date fixed
for redemption.

         The Securities do not have the benefit of any sinking fund obligations.

         In the event of redemption or purchase pursuant to an Offer to Purchase
of this Security in part only, a new Security or Securities for the unredeemed
or unpurchased portion hereof will be issued in the name of the Holder hereof
upon the cancellation hereof.

                                       36
<PAGE>
         If an Event of Default shall occur and be continuing, the principal of
all the Securities may be declared due and payable in the manner and with the
effect provided in the Indenture.

         The Indenture provides that, subject to certain conditions, if (i)
certain Net Available Proceeds are available to the Issuers as a result of Asset
Dispositions or (ii) a Change of Control Triggering Event occurs, the Issuers
shall be required to make an Offer to Purchase for Securities.

         The Indenture contains provisions for defeasance at any time of (i) the
entire indebtedness of this Security or (ii) certain restrictive covenants and
Events of Default with respect to this Security, in each case upon compliance
with certain conditions set forth therein.

         The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Issuers and the rights of the Holders of the Securities under the Indenture at
any time by the Issuers and the Trustee with the consent of the Holders of a
majority in aggregate principal amount of the Securities at the time
Outstanding. The Indenture also contains provisions permitting the Holders of
specified percentages in aggregate principal amount of the Securities at the
time Outstanding, on behalf of the Holders of all the Securities, to waive
compliance by the Issuers with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Security shall be conclusive and binding upon such
Holder and upon all future Holders of this Security and of any Security issued
upon the registration of transfer hereof or in exchange herefor or in lieu
hereof, whether or not notation of such consent or waiver is made upon this
Security.

         No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Issuers, which
is absolute and unconditional, to pay the principal of (and premium, if any) and
interest on this Security at the times, place and rate, and in the coin or
currency, herein prescribed.

         As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Security is registrable in the Security
Register, upon surrender of this Security for registration of transfer at the
Corporate Trust Office or at the office or agency of the Issuers in the Borough
of Manhattan, New York City, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Issuers and the Security
Registrar duly executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Securities, of authorized denominations
and for the same aggregate principal amount, will be issued to the designated
transferee or transferees.

         The Securities are issuable only in registered form without coupons in
denominations of $1,000 and any integral multiple thereof. As provided in the
Indenture and subject to certain limitations therein set forth, Securities are
exchangeable for a like

                                       37
<PAGE>
aggregate principal amount of Securities of a different authorized denomination,
as requested by the Holder surrendering the same.

         No service charge shall be made for any such registration of transfer
or exchange, but the Issuers may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.

         Prior to due presentment of this Security for registration of transfer,
the Issuers, the Trustee and any agent of the Issuers or the Trustee may treat
the Person in whose name this Security is registered as the owner hereof for all
purposes, whether or not this Security be overdue, and neither the Issuers, the
Trustee nor any such agent shall be affected by notice to the contrary.

         Interest on this Security shall be computed on the basis of a 360-day
year of twelve 30-day months; provided, however, that any Special Interest on
Original Securities shall be computed on the basis of a 365- or 366- day year,
as the case may be, and the number of days actually elapsed.

         All terms used in this Security which are defined in the Indenture
shall have the meanings assigned to them in the Indenture.

          The Indenture and this Security shall be governed by and construed in
accordance with the laws of the State of New York OPTION OF HOLDER TO ELECT
PURCHASE

         If you want to elect to have this Security purchased in its entirety by
the Issuers pursuant to Section 1014 or 1016 of the Indenture, check the box:

         [ ]

         If you want to elect to have only a part of this Security purchased by
the Issuers pursuant to Section 1014 or 1016 of the Indenture, state the amount:
$

         Dated:

                                      Your Signature:____________________
                                      (Sign exactly as name appears on
                                       the other side of this Security)

         Signature Guarantee:___________________________________
                            (Signature must be guaranteed by an
                            eligible guarantor institution which
                            is a member of or participation the
                            Securities Transfer Agent Medallion
                            Program)(STAMP)

         Section 2.4. Form of Trustee's Certificate of Authentication.

         This is one of the Securities referred to in the within-mentioned
Indenture.

                                       38
<PAGE>
                                        Harris Trust Company of
                                        California, as Trustee

                                        By _______________________________,
                                           Authorized Officer ARTICLE THREE

                                   ARTICLE 3
                                 THE SECURITIES

         Section 3.1. Title and Terms.

         The aggregate principal amount of Securities which may be authenticated
and delivered from time to time under this Indenture is limited to
$2,200,000,000, except for Securities authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, other Securities
pursuant to Section 304, 305, 306, 307, 906 or 1108 or in connection with an
Offer to Purchase pursuant to Section 1014 or 1016.

         The Securities shall be known and designated as the "10-3/8% Senior
Notes Due 2009" of the Issuers. Their Stated Maturity shall be November 15, 2009
and they shall bear interest at the rate of 10-3/8% per annum, from the Issuance
Date of the Securities or from the most recent Interest Payment Date to which
interest has been paid or duly provided for, as the case may be, payable
semi-annually on May 15 and November 15, commencing on May 15, 2000, or in the
case of Securities issued after the Closing Date, on the first such date
following the Issuance Date, to the Holders of record on the immediately
preceding May 1 and November 1, until the principal thereof is paid or made
available for payment; provided, however, with respect to Original Securities,
that if a Registration Default occurs (provided that no more than one
Registration Default shall be deemed to be in effect at any one time), then a
Step-Up will occur for the period from the occurrence of the Registration
Default until the Step-Down Date (after which the interest rate will be restored
to its initial rate). The Issuers shall provide the Trustee with written notice
of the date of any Registration Default and the Step-Down Date. The interest so
payable, and punctually paid or duly provided for, on any Interest Payment Date
will, as provided in such Indenture, be paid to the Person in whose name this
Security (or one or more Predecessor Securities) is registered at the close of
business on the Regular Record Date for such interest, which shall be May 1 or
November 1 (whether or not a Business Day), as the case may be, next preceding
such Interest Payment Date. Accrued Special Interest, if any, shall be paid in
cash in arrears semi-annually on May 15 and November 15 in each year and the
amount of accrued Special Interest shall be determined on the basis of the
number of days actually elapsed and computed as provided in Section 311.

          The principal of (and premium, if any) and interest on the Securities
shall be payable at the Corporate Trust Office or at the office or agency of the
Issuers in the City and State of New York maintained for such purpose; provided,
however, that at the option of the Issuers payment of interest may be made by
check mailed to the address of the Person entitled thereto as such address shall
appear in the Security Register.

                                       39

<PAGE>
         The Securities shall be subject to repurchase by the Issuers pursuant
to an Offer to Purchase as provided in Sections 1014 and 1016.

         The Securities shall be redeemable as provided in Article Eleven.

         The Securities shall be subject to defeasance at the option of the
Issuers as provided in Article Twelve.

         Section 3.2. Denominations.

         The Securities shall be issuable only in registered form without
coupons and only in denominations of $1,000 and any integral multiples thereof.

         Section 3.3. Execution, Authentication, Delivery and Dating.

         The Securities shall be executed on behalf of each of VoiceStream or
VoiceStream Holdings by its Chairman or Vice Chairman of the Board, its
President or one of its Vice Presidents, attested by its Secretary, one of its
Assistant Secretaries or its Chief Financial Officer. The signature of any of
these officers on the Securities may be manual or facsimile.

         Securities bearing the manual or facsimile signatures of individuals
who were at any time the proper officers of an Issuer shall bind such Issuer,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities.

         At any time and from time to time after the execution and delivery of
this Indenture, the Issuers may deliver Securities executed by the Issuers to
the Trustee for authentication, together with an Issuer Order for the
authentication and delivery of such Securities; and the Trustee in accordance
with such an Issuer Order shall authenticate and deliver such Securities as in
this Indenture provided and not otherwise.

         At any time and from time to time after the execution and delivery of
this Indenture and after the effectiveness of a registration statement under the
Securities Act with respect thereto, the Issuers may deliver Exchange Securities
executed by the Issuers to the Trustee for authentication, together with an
Issuer Order for the authentication and delivery of such Exchange Securities and
a like principal amount of Original Securities for cancellation in accordance
with Section 310 of this Indenture, and the Trustee in accordance with the
Issuer Order shall authenticate and deliver such Securities. Prior to
authenticating such Exchange Securities, and accepting any additional
responsibilities under this Indenture in relation to such Securities, the
Trustee shall be entitled to receive, if requested, and (subject to Section 601)
shall be fully protected in relying upon, an Opinion of Counsel stating in
substance

         (a) that all conditions hereunder precedent to the authentication and
delivery of such Exchange Securities have been complied with and that such
Exchange Securities, when such Securities have been duly authenticated and
delivered by the Trustee (and subject to any other conditions specified in such
Opinion of Counsel), have been duly

                                       40
<PAGE>

issued and delivered and will constitute valid and legally binding obligations
of the Issuers, as applicable, enforceable in accordance with their terms,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles; and

         (b) that the issuance of the Exchange Securities in exchange for
Original Securities has been effected in compliance with the Securities Act.

         Each Security shall be dated the date of its authentication.

         No Security shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose unless there appears on such Security a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature, and such certificate upon any
Security shall be conclusive evidence, and the only evidence, that such Security
has been duly authenticated and delivered hereunder.

         Section 3.4. Temporary Securities.

         Pending the preparation of definitive Securities, the Issuers may
execute, and upon Issuer Order the Trustee shall authenticate and deliver,
temporary Securities which are printed, lithographed, typewritten, mimeographed
or otherwise produced, in any authorized denomination, substantially of the
tenor of the definitive Securities in lieu of which they are issued and with
such appropriate insertions, omissions, substitutions and other variations as
the officers executing such Securities may determine, as evidenced by their
execution of such Securities.

         If temporary Securities are issued, the Issuers will cause definitive
Securities to be prepared without unreasonable delay. After the preparation of
definitive Securities, the temporary Securities shall be exchangeable for
definitive Securities upon surrender of the temporary Securities at any office
or agency of the Issuers designated pursuant to Section 1002, without charge to
the Holder. Upon surrender for cancellation of any one or more temporary
Securities the Issuers shall execute and the Trustee shall authenticate and
deliver in exchange therefor a like principal amount of definitive Securities of
authorized denominations. Until so exchanged the temporary Securities shall in
all respects be entitled to the same benefits under this Indenture as definitive
Securities.

         Section 3.5. Global Securities.

         (a) Each Global Security authenticated under this Indenture shall be
registered in the name of the Depositary designated by the Issuers for such
Global Security or a nominee thereof and delivered to such Depositary or a
nominee thereof or custodian therefor, and each such Global Security shall
constitute a single Security for all purposes of this Indenture.

         (b) Notwithstanding any other provision in this Indenture, no Global
Security may be exchanged in whole or in part for Securities registered, and no
transfer of a Global Security in whole or in part may be registered, in the name
of any Person other

                                       41
<PAGE>
than the Depositary for such Global Security or a nominee thereof unless (i)
such Depositary (A) has notified the Issuers that it is unwilling or unable to
continue as Depositary for such Global Security or (B) has ceased to be a
clearing agency registered as such under the Exchange Act, (ii) there shall have
occurred and be continuing an Event of Default or any event which after notice
or lapse of time or both would be an Event of Default with respect to such
Global Security, (iii) the Issuers execute and deliver to the Trustee an Issuer
Order stating that they elect to cause the issuance of the Securities in
certificated form and that all Global Securities shall be exchanged in whole for
Securities that are not Global Securities (in which case such exchange shall be
effected by the Trustee) or (iv) pursuant to the following sentence. All or any
portion of a Global Security may be exchanged for a Security that has a like
aggregate principal amount and is not a Global Security, upon 20 days' prior
request made by the Depositary or its authorized representative to the Trustee.

         (c) If any Global Security is to be exchanged for other Securities or
canceled in whole, it shall be surrendered by or on behalf of the Depositary or
its nominee to the Trustee, as Security Registrar, for exchange or cancellation
as provided in this Article Three. If any Global Security is to be exchanged for
other Securities or canceled in part, or if another Security is to be exchanged
in whole or in part for a beneficial interest in any Global Security, then
either (i) such Global Security shall be so surrendered for exchange or
cancellation as provided in this Article Three or (ii) the principal amount
thereof shall be reduced or increased by an amount equal to the portion thereof
to be so exchanged or canceled, or equal to the principal amount of such other
Security to be so exchanged for a beneficial interest therein, as the case may
be, by means of an appropriate adjustment made on the records of the Trustee, as
Security Registrar, whereupon the Trustee, in accordance with the Applicable
Procedures, shall instruct the Depositary or its authorized representative to
make a corresponding adjustment to its records. Upon any such surrender or
adjustment of a Global Security, the Trustee shall, subject to Section 305(b)
and as otherwise provided in this Article Three, authenticate and deliver any
Securities issuable in exchange for such Global Security (or any portion
thereof) to or upon the order of, and registered in such names as may be
directed by, the Depositary or its authorized representative. Upon the request
of the Trustee in connection with the occurrence of any of the events specified
in the preceding paragraph, the Issuers shall promptly make available to the
Trustee a reasonable supply of Securities that are not in the form of Global
Securities. The Trustee shall be entitled to rely upon any order, direction or
request of the Depositary or its authorized representative which is given or
made pursuant to this Article Three if such order, direction or request is given
or made in accordance with the Applicable Procedures.

         (d) Every Security authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Security or any portion
thereof, whether pursuant to this Article Three, Section 906, 1014 or 1016 or
otherwise, shall be authenticated and delivered in the form of, and shall be, a
Global Security, unless such Security is registered in the name of a Person
other than the Depositary for such Global Security or a nominee thereof.

                                       42
<PAGE>

         (e) The Depositary or its nominee, as registered owner of a Global
Security, shall be the Holder of such Global Security for all purposes under
this Indenture and the Securities, and owners of beneficial interests in a
Global Security shall hold such interests pursuant to the Applicable Procedures.
Accordingly, any such owner's beneficial interest in a Global Security will be
shown only on, and the transfer of such interest shall be effected only through,
records maintained by the Depositary or its nominee or its Agent Members.

         Section 3.6. Registration, Registration of Transfer and Exchange
                      Generally; Certain Transfers and Exchanges; Securities
                      Act Legends.

         (a) Registration, Registration of Transfer and Exchange Generally. The
Issuers shall cause to be kept at the Corporate Trust Office of the Trustee a
register (the register maintained in such office and in any other office or
agency designated pursuant to Section 1002 being herein sometimes collectively
referred to as the "Security Register") in which, subject to such reasonable
regulations as it may prescribe, the Issuers shall provide for the registration
of Securities and of transfers and exchanges of Securities. The Trustee is
hereby appointed "Security Registrar" for the purpose of registering Securities
and transfers and exchanges of Securities as herein provided. Such Security
Register shall distinguish between Original Securities and Exchange Securities.

         Upon surrender for registration of transfer of any Security at an
office or agency of the Issuers designated pursuant to Section 1002 for such
purpose, the Issuers shall execute, and the Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Securities of any authorized denominations, of a like aggregate principal
amount and bearing such restrictive legends as may be required by this
Indenture.

         At the option of the Holder, Securities may be exchanged for new
Securities of any authorized denominations, of a like aggregate principal amount
and bearing such restrictive legends as may be required by this Indenture, upon
surrender of the Securities to be exchanged at such office or agency. Whenever
any Securities are so surrendered for exchange, the Issuers shall execute, and
the Trustee shall authenticate and deliver, the Securities which the Holder
making the exchange is entitled to receive.

         All Securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Issuers, evidencing the same
debt, and (except for the differences between Original Securities and Exchange
Securities provided for herein) entitled to the same benefits under this
Indenture, as the Securities surrendered upon such registration of transfer or
exchange.

         Every Security presented or surrendered for registration of transfer or
for exchange shall (if so required by the Issuers or the Trustee) be duly
endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Issuers and the Security Registrar duly executed, by the
Holder thereof or his attorney duly authorized in writing.

                                       43
<PAGE>

         No service charge shall be made for any registration of transfer or
exchange of Securities, but the Issuers may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
with any registration of transfer or exchange of Securities, other than
exchanges pursuant to Section 304, 305, 306, 906, 1014 or 1016 not involving any
transfer.

         The Issuers shall not be required (i) to issue, register the transfer
of or exchange any Security during a period beginning at the opening of business
15 days before the day of the mailing of a notice of redemption of Securities
selected for redemption under Section 1104 and ending at the close of business
on the day of such mailing, or (ii) to register the transfer of or exchange any
Security so selected for redemption in whole or in part, except the unredeemed
portion of any Security being redeemed in part.

         (b) Certain Transfers and Exchanges. Notwithstanding any other
provision of this Indenture or the Securities, transfers and exchanges of
Securities and beneficial interests in a Global Security of the kinds specified
in this Section 306(b) shall be made only in accordance with this Section
306(b).

             (i) Restricted Global Security to Regulation S Global Security. If
         the owner of a beneficial interest in the Restricted Global Security
         wishes at any time to transfer such interest to a Person who wishes to
         take delivery thereof in the form of a beneficial interest in the
         Regulation S Global Security, such transfer may be effected only in
         accordance with the provisions of this Clause (b)(i) and Clause
         (b)(vii) below and subject to the Applicable Procedures. Upon receipt
         by the Trustee, as Security Registrar, of (A) an order given by the
         Depositary or its authorized representative directing that a beneficial
         interest in the Regulation S Global Security in a specified principal
         amount be credited to a specified Agent Member's account and that a
         beneficial interest in the Restricted Global Security in an equal
         principal amount be debited from another specified Agent Member's
         account and (B) a Regulation S Certificate, in the form of Annex A
         hereto, duly executed by the owner of such beneficial interest in the
         Restricted Global Security or his attorney duly authorized in writing,
         then the Trustee, as Security Registrar but subject to Clause (b)(vii)
         below, shall reduce the principal amount of the Restricted Global
         Security and increase the principal amount of the Regulation S Global
         Security by such specified principal amount as provided in Section
         305(c).

             (ii) Regulation S Global Security to Restricted Global Security. If
         the owner of a beneficial interest in the Regulation S Global Security
         wishes at any time to transfer such interest to a Person who wishes to
         take delivery thereof in the form of a beneficial interest in the
         Restricted Global Security, such transfer may be effected only in
         accordance with this Clause (b)(ii) and subject to the Applicable
         Procedures. Upon receipt by the Trustee, as Security Registrar, of (A)
         an order given by the Depositary or its authorized representative
         directing that a beneficial interest in the Restricted Global Security
         in a specified principal amount be credited to a specified Agent
         Member's account and that a beneficial interest in the Regulation S
         Global Security in an equal principal amount be debited from another
         specified Agent Member's account and (B) if such transfer is

                                       44
<PAGE>
         to occur during the Restricted Period, a Restricted Securities
         Certificate, in the form of Annex B hereto, duly executed by the owner
         of such beneficial interest in the Regulation S Global Security or his
         attorney duly authorized in writing, then the Trustee, as Security
         Registrar, shall reduce the principal amount of the Regulation S Global
         Security and increase the principal amount of the Restricted Global
         Security by such specified principal amount as provided in Section
         305(c).

             (iii) Restricted Non-Global Security to Restricted Global Security
         or Regulation S Global Security. If the Holder of a Restricted Security
         (other than a Global Security) wishes at any time to transfer all or
         any portion of such Security to a Person who wishes to take delivery
         thereof in the form of a beneficial interest in the Restricted Global
         Security or the Regulation S Global Security, such transfer may be
         effected only in accordance with the provisions of this Clause (b)(iii)
         and Clause (b)(vii) below and subject to the Applicable Procedures.
         Upon receipt by the Trustee, as Security Registrar, of (A) such
         Security as provided in Section 306(a) and instructions satisfactory to
         the Trustee directing that a beneficial interest in the Restricted
         Global Security or Regulation S Global Security in a specified
         principal amount not greater than the principal amount of such Security
         be credited to a specified Agent Member's account and (B) a Restricted
         Securities Certificate, if the specified account is to be credited with
         a beneficial interest in the Restricted Global Security, or a
         Regulation S Certificate, if the specified account is to be credited
         with a beneficial interest in the Regulation S Global Security, in
         either case satisfactory to the Trustee and duly executed by such
         Holder or his attorney duly authorized in writing, then the Trustee, as
         Security Registrar but subject to Clause (b)(vii) below, shall cancel
         such Security (and issue a new Security in respect of any untransferred
         portion thereof) as provided in Section 306(a) and increase the
         principal amount of the Restricted Global Security or the Regulation S
         Global Security, as the case may be, by the specified principal amount
         as provided in Section 305(c).

             (iv) Regulation S Non-Global Security to Restricted Global Security
         or Regulation S Global Security. If the Holder of a Regulation S
         Security (other than a Global Security) wishes at any time to transfer
         all or any portion of such Security to a Person who wishes to take
         delivery thereof in the form of a beneficial interest in the Restricted
         Global Security or the Regulation S Global Security, such transfer may
         be effected only in accordance with this Clause (b)(iv) and Clause
         (b)(vii) below and subject to the Applicable Procedures. Upon receipt
         by the Trustee, as Security Registrar, of (A) such Security as provided
         in Section 306(a) and instructions satisfactory to the Trustee
         directing that a beneficial interest in the Restricted Global Security
         or Regulation S Global Security in a specified principal amount not
         greater than the principal amount of such Security be credited to a
         specified Agent Member's account and (B) if the transfer is to occur
         during the Restricted Period and the specified account is to be
         credited with a beneficial interest in the Restricted Global Security,
         a Restricted Securities Certificate, in the form of Annex B hereto,
         duly executed by such Holder or his attorney duly authorized in
         writing, then the Trustee, as Security Registrar but subject to Clause
         (b)(vii) below, shall cancel such Security (and issue a new

                                       45
<PAGE>
         Security in respect of any untransferred portion thereof) as provided
         in Section 306(a) and increase the principal amount of the Restricted
         Global Security or the Regulation S Global Security, as the case may
         be, by the specified principal amount as provided in Section 305(c).

             (v) Non-Global Security to Non-Global Security. A Security that is
         not a Global Security may be transferred, in whole or in part, to a
         Person who takes delivery in the form of another Security that is not a
         Global Security as provided in Section 3.06(a), provided that, if the
         Security to be transferred in whole or in part is a Restricted
         Security, or is a Regulation S Security and the transfer is to occur
         during the Restricted Period, then the Trustee shall have received (A)
         a Restricted Securities Certificate, in the form of Annex B hereto,
         duly executed by the transferor Holder or his attorney duly authorized
         in writing, in which case the transferee Holder shall take delivery in
         the form of a Restricted Security, or (B) a Regulation S Certificate,
         satisfactory to the Trustee and duly executed by the transferor Holder
         or his attorney duly authorized in writing, in which case the
         transferee Holder shall take delivery in the form of a Regulation S
         Security (subject in each case to Section 306(c)).

             (vi) Exchanges between Global Security and Non-Global Security. A
         beneficial interest in a Global Security may be exchanged for a
         Security that is not a Global Security as provided in Section 305,
         provided that, if such interest is a beneficial interest in the
         Restricted Global Security, or if such interest is a beneficial
         interest in the Regulation S Global Security and such exchange is to
         occur during the Restricted Period, then such interest shall be
         exchanged for a Restricted Security (subject in each case to Section
         306(c)). A Security that is not a Global Security may be exchanged for
         a beneficial interest in a Global Security only if (A) such exchange
         occurs in connection with a transfer effected in accordance with Clause
         (b)(iii) or (iv) above or (B) such Security is a Regulation S Security
         and such exchange occurs after the Restricted Period.

             (vii) Regulation S Global Security to be Held Through Euroclear or
         Cedel during Restricted Period. The Issuers shall use their best
         efforts to cause the Depositary to ensure that, until the expiration of
         the Restricted Period, beneficial interests in the Regulation S Global
         Security may be held only in or through accounts maintained at the
         Depositary by Euroclear or Cedel (or by Agent Members acting for the
         account thereof), and no person shall be entitled to effect any
         transfer or exchange that would result in any such interest being held
         otherwise than in or through such an account; provided that this Clause
         (b)(vii) shall not prohibit any transfer or exchange of such an
         interest in accordance with Clause (b)(ii) or (vi) above.

         (c) Securities Act Legends. Rule 144A Securities and their Successor
Securities shall bear a Restricted Securities Legend, and Initial Regulation S
Securities and their Successor Securities shall bear a Regulation S Legend,
subject to the following:

                                       46
<PAGE>
             (i) subject to the following Clauses of this Section 306(c), a
         Security or any portion thereof which is exchanged, upon transfer or
         otherwise, for a Global Security or any portion thereof shall bear the
         Securities Act Legend borne by such Global Security while represented
         thereby;

             (ii) subject to the following Clauses of this Section 306(c), a new
         Security which is not a Global Security and is issued in exchange for
         another Security (including a Global Security) or any portion thereof,
         upon transfer or otherwise, shall bear the Securities Act Legend borne
         by such other Security, provided that, if such new Security is required
         pursuant to Section 306(b)(v) or (vi) to be issued in the form of a
         Restricted Security, it shall bear a Restricted Securities Legend and,
         if such new Security is so required to be issued in the form of a
         Regulation S Security, it shall bear a Regulation S Legend;

             (iii) Registered Securities shall not bear a Securities Act Legend;

             (iv) after November 9, 2001, a new Security which does not bear a
         Securities Act Legend may be issued in exchange for or in lieu of a
         Security (other than a Global Security) or any portion thereof which
         bears such a legend if the Trustee has received an Unrestricted
         Securities Certificate, in the form of Annex C hereto, duly executed by
         the Holder of such legended Security or his attorney duly authorized in
         writing, and after such date and receipt of such certificate, the
         Trustee shall authenticate and deliver such a new Security in exchange
         for or in lieu of such other Security as provided in this Article
         Three;

             (v) a new Security which does not bear a Securities Act Legend may
         be issued in exchange for or in lieu of a Security (other than a Global
         Security) or any portion thereof which bears such a legend if, in the
         Issuers' judgment, placing such a legend upon such new Security is not
         necessary to ensure compliance with the registration requirements of
         the Securities Act, and the Trustee, at the direction of the Issuers,
         shall authenticate and deliver such a new Security as provided in this
         Article Three; and

             (vi) notwithstanding the foregoing provisions of this Section
         306(c), a Successor Security of a Security that does not bear a
         particular form of Securities Act Legend shall not bear such form of
         legend unless the Issuers has reasonable cause to believe that such
         Successor Security is a "restricted security" within the meaning of
         Rule 144, in which case the Trustee, at the direction of the Issuers,
         shall authenticate and deliver a new Security bearing a Restricted
         Securities Legend in exchange for such Successor Security as provided
         in this Article Three.

         Section 3.7. Mutilated, Destroyed, Lost and Stolen Securities.

         If any mutilated Security is surrendered to the Trustee, the Issuers
shall execute and the Trustee shall authenticate and deliver in exchange
therefor a new Security of like tenor and principal amount and bearing a number
not contemporaneously outstanding.

                                       47
<PAGE>

         If there shall be delivered to the Issuers and the Trustee (i) evidence
to their satisfaction of the destruction, loss or theft of any Security and (ii)
such security or indemnity as may be required by them to save each of them and
any agent of either of them harmless, then, in the absence of notice to the
Issuers or the Trustee that such Security has been acquired by a bona fide
purchaser, the Issuers shall execute and upon its request the Trustee shall
authenticate and deliver, in lieu of any such destroyed, lost or stolen
Security, a new Security of like tenor and principal amount and bearing a number
not contemporaneously outstanding.

         In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, the Issuers in their discretion
may, instead of issuing a new Security, pay such Security.

         Upon the issuance of any new Security under this Section, the Issuers
may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.

         Every new Security issued pursuant to this Section in lieu of any
destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Issuers, whether or not the destroyed, lost or
stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities duly issued hereunder.

         The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities.

         Section 3.8. Payment of Interest; Interest Rights Preserved.

         Interest on any Security which is payable, and is punctually paid or
duly provided for, on any Interest Payment Date shall be paid to the Person in
whose name that Security (or one or more Predecessor Securities) is registered
at the close of business on the Regular Record Date for such interest.

         Any interest on any Security which is payable, but is not punctually
paid or duly provided for, on any Interest Payment Date (herein called
"Defaulted Interest") shall forthwith cease to be payable to the Holder on the
relevant Regular Record Date by virtue of having been such Holder, and such
Defaulted Interest may be paid by the Issuers, at its election in each case, as
provided in Clause (1) or (2) below:

                           (1) The Issuers may elect to make payment of any
                  Defaulted Interest to the Persons in whose names the
                  Securities (or their respective Predecessor Securities) are
                  registered at the close of business on a Special Record Date
                  for the payment of such Defaulted Interest, which shall be
                  fixed in the following manner. The Issuers shall notify the
                  Trustee in writing of the amount of Defaulted Interest
                  proposed to be paid on each Security and the

                                       48
<PAGE>

                  date of the proposed payment, and at the same time the Issuers
                  shall deposit with the Trustee an amount of money equal to the
                  aggregate amount proposed to be paid in respect of such
                  Defaulted Interest or shall make arrangements satisfactory to
                  the Trustee for such deposit prior to the date of the proposed
                  payment, such money when deposited to be held in trust for the
                  benefit of the Persons entitled to such Defaulted Interest as
                  in this Clause provided. Thereupon the Trustee shall fix a
                  Special Record Date for the payment of such Defaulted Interest
                  which shall be not more than 15 days and not less than 10 days
                  prior to the date of the proposed payment and not less than 10
                  days after the receipt by the Trustee of the notice of the
                  proposed payment. The Trustee shall promptly notify the
                  Issuers of such Special Record Date and, in the name and at
                  the expense of the Issuers, shall cause notice of the proposed
                  payment of such Defaulted Interest and the Special Record Date
                  therefor to be mailed, first-class postage prepaid, to each
                  Holder at his address as it appears in the Security Register,
                  not less than 10 days prior to such Special Record Date.
                  Notice of the proposed payment of such Defaulted Interest and
                  the Special Record Date therefor having been so mailed, such
                  Defaulted Interest shall be paid to the Persons in whose names
                  the Securities (or their respective Predecessor Securities)
                  are registered at the close of business on such Special Record
                  Date and shall no longer be payable pursuant to the following
                  Clause (2).

                           (2) The Issuers may make payment of any Defaulted
                  Interest in any other lawful manner not inconsistent with the
                  requirements of any securities exchange on which the
                  Securities may be listed, and upon such notice as may be
                  required by such exchange, if, after notice given by the
                  Issuers to the Trustee of the proposed payment pursuant to
                  this Clause, such manner of payment shall be deemed
                  practicable by the Trustee.

         Subject to the foregoing provisions of this Section, each Security
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Security shall carry the rights to interest accrued
and unpaid, and to accrue, which were carried by such other Security.

         Section 3.9. Persons Deemed Owners.

         Prior to due presentment of a Security for registration of transfer,
the Issuers, the Trustee and any agent of the Issuers or the Trustee may treat
the Person in whose name such Security is registered as the owner of such
Security for the purpose of receiving payment of principal of (and premium, if
any) and (subject to Section 308) interest on such Security and for all other
purposes whatsoever, whether or not such Security be overdue, and neither the
Issuers, the Trustee nor any agent of the Issuers or the Trustee shall be
affected by notice to the contrary.

                                       49
<PAGE>

         None of the Issuers, the Trustee, any Paying Agent or the Security
Registrar will have any responsibility or liability for any aspect of the
records relating to or payments made on account of beneficial ownership
interests of a Global Security or for maintaining, supervising or reviewing any
records relating to such beneficial ownership interests.

         Section 3.10. Cancellation.

         All Securities surrendered for payment, redemption, registration of
transfer or exchange or for credit against any Offer to Purchase pursuant to
Section 1014 or 1016 shall, if surrendered to any Person other than the Trustee,
be delivered to the Trustee and shall be promptly canceled by it. The Issuers
may at any time deliver to the Trustee for cancellation any Securities
previously authenticated and delivered hereunder which the Issuers may have
acquired in any manner whatsoever, and all Securities so delivered shall be
promptly canceled by the Trustee. No Securities shall be authenticated in lieu
of or in exchange for any Securities canceled as provided in this Section,
except as expressly permitted by this Indenture. All canceled Securities held by
the Trustee shall be disposed of as directed by an Issuer Order.

         Section 3.11. Computation of Interest.

         Interest on the Securities shall be computed on the basis of a 360-day
year of twelve 30-day months; provided, however, that any Special Interest on
Original Securities shall be computed on the basis of a 365- or 366- day year,
as the case may be, and the number of days actually elapsed.

                                   ARTICLE 4
                           SATISFACTION AND DISCHARGE

         Section 4.1. Satisfaction and Discharge of Indenture.

         This Indenture shall cease to be of further effect (except as to any
surviving rights of registration of transfer or exchange of Securities herein
expressly provided for), and the Trustee, on demand of and at the expense of the
Issuers, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when

                  (1)      either

             (A) all Securities theretofore authenticated and delivered (other
         than (i) Securities which have been destroyed, lost or stolen and which
         have been replaced or paid as provided in Section 307 and (ii)
         Securities for whose payment money has theretofore been deposited in
         trust or segregated and held in trust by the Issuers and thereafter
         repaid to the Issuers or discharged from such trust, as provided in
         Section 1003) have been delivered to the Trustee for cancellation; or

             (B) all such Securities not theretofore delivered to the Trustee
         for cancellation

                                       50
<PAGE>

             (i) have become due and payable, or

             (ii) will become due and payable at their Stated Maturity within
         one year, or

             (iii) are to be called for redemption within one year under
         arrangements satisfactory to the Trustee for the giving of notice of
         redemption by the Trustee in the name, and at the expense, of the
         Issuers,

             and the Issuers, in the case of (i), (ii) or (iii) above, have
             deposited or caused to be deposited with the Trustee as trust funds
             in trust for the purpose an amount sufficient to pay and discharge
             the entire indebtedness on such Securities not theretofore
             delivered to the Trustee for cancellation, for principal (and
             premium, if any) and interest to the date of such deposit (in the
             case of Securities which have become due and payable) or to the
             Stated Maturity or Redemption Date, as the case may be;

                          (2) the Issuers have paid or caused to be paid all
                other sums payable hereunder by the Issuers; and

                          (3) the Issuers have delivered to the Trustee an
                Officers' Certificate and an Opinion of Counsel, each stating
                that all conditions precedent herein provided for relating to
                the satisfaction and discharge of this Indenture have been
                complied with.

Notwithstanding the satisfaction and discharge of this Indenture pursuant to
this Article Four, the obligations of the Issuers to the Trustee under Section
607, the obligations of the Trustee to any Authenticating Agent under Section
614 and, if money shall have been deposited with the Trustee pursuant to
subclause (B) of Clause (1) of this Section, the obligations of the Trustee
under Section 402 and the last paragraph of Section 1003 shall survive.

         Section 4.2. Application of Trust Money.

         Subject to the provisions of the last paragraph of Section 1003, all
money deposited with the Trustee pursuant to Section 401 shall be held in trust
and applied by it, in accordance with the provisions of the Securities and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Issuers acting as their own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal (and premium, if
any) and interest for whose payment such money has been deposited with the
Trustee.

                                       51
<PAGE>

                                   ARTICLE 5
                                    Remedies

         Section 5.1. Events of Default.

         "Event of Default," wherever used herein, means any one of the
following events (whatever the reason for such Event of Default and whether it
be voluntary or involuntary or be effected by operation of law or pursuant to
any judgment, decree or order of any court or any order, rule or regulation of
any administrative or governmental body):

                          (1) default in the payment of the principal of (or
                premium, if any, on) any Security at its Maturity; or

                          (2) default in the payment of any interest upon any
                Security when it becomes due and payable, and continuance of
                such default for a period of 30 days; or

                          (3) default in the performance, or breach, of the
                provisions under Sections 801 and 802 of this Indenture; or

                          (4) default in the performance, or breach, of any
                covenant or agreement of the Issuers in this Indenture (other
                than a covenant or agreement a default in whose performance or
                whose breach is elsewhere in this Section specifically dealt
                with), and continuance of such default or breach for a period of
                30 days after there has been given, by registered or certified
                mail, to the Issuers by the Trustee or to the Issuers and the
                Trustee by the Holders of at least 25% in principal amount of
                the Outstanding Securities a written notice specifying such
                default or breach and requiring it to be remedied and stating
                that such notice is a "Notice of Default" hereunder; or

                          (5) a default or defaults under any bond(s),
                debenture(s), note(s) or other evidence(s) of Indebtedness by
                either Issuer or any of their respective Restricted Subsidiaries
                or under any mortgage(s), indenture(s) or instrument(s) under
                which there may be issued or by which there may be secured or
                evidenced any Indebtedness of such type by the Issuers or any of
                their respective Restricted Subsidiaries with a principal amount
                then outstanding, individually or in the aggregate, in excess of
                $25 million, whether such Indebtedness now exists or shall
                hereafter be created, which default or defaults shall constitute
                a failure to pay any portion of the principal of such
                Indebtedness at final maturity after the expiration of any
                applicable grace period with respect thereto or shall have
                resulted in such Indebtedness becoming or being declared due and
                payable prior to the date on which it would otherwise have
                become due and payable; or

                                       52
<PAGE>

                          (6) a final judgment or final judgments for the
                payment of money are entered against either Issuer or any of
                their respective Restricted Subsidiaries in an aggregate amount
                in excess of $25 million by a court or courts of competent
                jurisdiction, which judgments remain undischarged or unbonded
                for a period (during which execution shall not be effectively
                stayed) of 60 days after the right to appeal all such judgments
                has expired; or

                          (7) the entry by a court having jurisdiction in the
                premises of (A) a decree or order for relief in respect of
                either Issuer or any of their respective Restricted Subsidiaries
                in an involuntary case or proceeding under any applicable
                Federal or State bankruptcy, insolvency, reorganization or other
                similar law or (B) a decree or order adjudging either Issuer or
                any of their Restricted Subsidiaries a bankrupt or insolvent, or
                approving as properly filed a petition seeking reorganization,
                arrangement, adjustment or composition of or in respect of such
                Issuer or any such Restricted Subsidiary under any applicable
                Federal or State law, or appointing a custodian, receiver,
                liquidator, assignee, trustee, sequestrator or other similar
                official of such Issuer or any such Restricted Subsidiary or of
                any substantial part of the property of such Issuer or any such
                Restricted Subsidiary, or ordering the winding up or liquidation
                of the affairs of such Issuer or any such Restricted Subsidiary,
                and the continuance of any such decree or order for relief or
                any such other decree or order unstayed and in effect for a
                period of 60 consecutive days; or

                          (8) the commencement by either Issuer or any of their
                respective Restricted Subsidiaries of a voluntary case or
                proceeding under any applicable Federal or State bankruptcy,
                insolvency, reorganization or other similar law or of any other
                case or proceeding to be adjudicated a bankrupt or insolvent, or
                the consent by either Issuer or any of their respective
                Restricted Subsidiaries to the entry of a decree or order for
                relief in respect of such Issuer or any such respective
                Restricted Subsidiaries in an involuntary case or proceeding
                under any applicable Federal or State bankruptcy, insolvency,
                reorganization or other similar law or to the commencement of
                any bankruptcy or insolvency case or proceeding against such
                Issuer or any such Restricted Subsidiary, or the filing by
                either Issuer or any of their respective Restricted Subsidiaries
                of a petition or answer or consent seeking reorganization or
                relief under any applicable Federal or State law, or the consent
                by either Issuer or any of their respective Restricted
                Subsidiaries to the filing of such petition or to the
                appointment of or taking possession by a custodian, receiver,
                liquidator, assignee, trustee, sequestrator or similar official
                of such Issuer or any such Restricted Subsidiary or of any
                substantial part of the property of

                                       53
<PAGE>
                  such Issuer or any such Restricted Subsidiary, or the making
                  by either Issuer or any of their respective Restricted
                  Subsidiaries of an assignment for the benefit of creditors, or
                  the admission by either Issuer or any of their respective
                  Restricted Subsidiaries in writing of its inability to pay its
                  debts generally as they become due, or the taking of corporate
                  action by either Issuer or any of their respective Restricted
                  Subsidiaries in furtherance of any such action.

         Section 5.2. Acceleration of Maturity; Rescission and Annulment.

         If an Event of Default (other than an Event of Default specified in
Section 501(7) or (8)) occurs and is continuing, then and in every such case the
Trustee or the Holders of not less than 25% in principal amount of the
Outstanding Securities may declare the principal of all the Securities to be due
and payable immediately, by a notice in writing to the Issuers (and to the
Trustee if given by Holders), and upon any such declaration such principal and
any accrued interest shall become immediately due and payable. If an Event of
Default specified in Section 501(7) or (8) occurs, the principal of and any
accrued interest on the Securities then Outstanding shall ipso facto become
immediately due and payable without any declaration or other Act on the part of
the Trustee or any Holder.

         At any time after such a declaration of acceleration has been made and
before a judgment or decree for payment of the money due has been obtained by
the Trustee as hereinafter in this Article provided, the Holders of a majority
in principal amount of the Outstanding Securities, by written notice to the
Issuers and the Trustee, may rescind and annul such declaration and its
consequences if

                          (1) the Issuers have paid or deposited with the
                Trustee a sum sufficient to pay

                (A) all overdue interest on all Securities,

                (B) the principal of (and premium, if any, on) any Securities
         which have become due otherwise than by such declaration of
         acceleration (including any Securities required to have been purchased
         on the Purchase Date pursuant to an Offer to Purchase made by the
         Issuers) and, to the extent that payment of such interest is lawful,
         interest thereon at the rate provided by the Securities,

                (C) to the extent that payment of such interest is lawful,
         interest upon overdue interest at the rate provided by the Securities,
         and

                (D) all sums paid or advanced by the Trustee hereunder and the
         reasonable compensation, expenses, disbursements and advances of the
         Trustee, its agents and counsel;

         and

                                       54
<PAGE>

                          (2) all Events of Default, other than the non-payment
                of the principal of Securities which have become due solely by
                such declaration of acceleration, have been cured or waived as
                provided in Section 513.

         No such rescission shall affect any subsequent default or impair any
right consequent thereon.

         Section 5.3. Collection of Indebtedness and Suits for Enforcement by
Trustee.

         The Issuers covenant that if

                          (1) default is made in the payment of any interest on
                any Security when such interest becomes due and payable and such
                default continues for a period of 30 days, or

                          (2) default is made in the payment of the principal of
                (or premium, if any, on) any Security at the Maturity thereof
                or, with respect to any Security required to have been purchased
                pursuant to an Offer to Purchase made by the Issuers, at the
                Purchase Date thereof,

the Issuers will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities, the whole amount then due and payable on such
Securities for principal (and premium, if any) and interest, and, to the extent
that payment of such interest shall be legally enforceable, interest on any
overdue principal (and premium, if any) and on any overdue interest, at the rate
provided by the Securities, and, in addition thereto, such further amount as
shall be sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel.

         If the Issuers fail to pay such amounts forthwith upon such demand, the
Trustee, in its own name and as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, may
prosecute such proceeding to judgment or final decree and may enforce the same
against the Issuers or any other obligor upon the Securities and collect the
moneys adjudged or decreed to be payable in the manner provided by law out of
the property of the Issuers or any other obligor upon the Securities, wherever
situated.

         If an Event of Default occurs and is continuing, the Trustee may in its
discretion proceed to protect and enforce its rights and the rights of the
Holders by such appropriate judicial proceedings as the Trustee shall deem most
effectual to protect and enforce any such rights, whether for the specific
enforcement of any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other proper remedy.

                                       55
<PAGE>

         Section 5.4. Trustee May File Proofs of Claim.

         In case of any judicial proceeding relative to either Issuer (or any
other obligor upon the Securities), its property or its creditors, the Trustee
shall be entitled and empowered, by intervention in such proceeding or
otherwise, to take any and all actions authorized under the Trust Indenture Act
in order to have claims of the Holders and the Trustee allowed in any such
proceeding. In particular, the Trustee shall be authorized to collect and
receive any moneys or other property payable or deliverable on any such claims
and to distribute the same; and any custodian, receiver, assignee, trustee,
liquidator, sequestrator or other similar official in any such judicial
proceeding is hereby authorized by each Holder to make such payments to the
Trustee and, in the event that the Trustee shall consent to the making of such
payments directly to the Holders, to pay to the Trustee any amount due it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 607.

         No provision of this Indenture shall be deemed to authorize the Trustee
to authorize or consent to or accept or adopt on behalf of any Holder any plan
of reorganization, arrangement, adjustment or composition affecting the
Securities or the rights of any Holder thereof or to authorize the Trustee to
vote in respect of the claim of any Holder in any such proceeding; provided,
however, that the Trustee may, on behalf of the Holders, vote for the election
of a trustee in bankruptcy or similar official and may be a member of the
creditors' committee.

         Section 5.5. Trustee May Enforce Claims Without Possession of
Securities.

         All rights of action and claims under this Indenture or the Securities
may be prosecuted and enforced by the Trustee without the possession of any of
the Securities or the production thereof in any proceeding relating thereto, and
any such proceeding instituted by the Trustee shall be brought in its own name
as trustee of an express trust, and any recovery of judgment shall, after
provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Securities in respect of which such
judgment has been recovered.

         Section 5.6. Application of Money Collected.

         Any money collected by the Trustee pursuant to this Article shall be
applied in the following order, at the date or dates fixed by the Trustee and,
in case of the distribution of such money on account of principal (or premium,
if any) or interest, upon presentation of the Securities and the notation
thereon of the payment if only partially paid and upon surrender thereof if
fully paid:

         FIRST: To the payment of all amounts due the Trustee under Section 607;
and

         SECOND: To the payment of the amounts then due and unpaid for principal
of (and premium, if any) and interest on the Securities in respect of which or
for the benefit of which such money has been collected, ratably, without
preference or priority of any

                                       56
<PAGE>

kind, according to the amounts due and payable on
such Securities for principal (and premium, if any) and interest, respectively.

Section 5.7.      Limitation on Suits.

         No Holder of any Security shall have any right to institute any
proceeding, judicial or otherwise, with respect to this Indenture, or for the
appointment of a receiver or trustee, or for any other remedy hereunder, unless

                          (1) such Holder has previously given written notice to
                the Trustee of a continuing Event of Default;

                          (2) the Holders of not less than 25% in principal
                amount of the Outstanding Securities shall have made written
                request to the Trustee to institute proceedings in respect of
                such Event of Default in its own name as Trustee hereunder;

                          (3) such Holder or Holders have offered to the Trustee
                reasonable indemnity against the costs, expenses and liabilities
                to be incurred in compliance with such request;

                          (4) the Trustee for 60 days after its receipt of such
                notice, request and offer of indemnity has failed to institute
                any such proceeding; and

                          (5) no direction inconsistent with such written
                request has been given to the Trustee during such 60-day period
                by the Holders of a majority in principal amount of the
                Outstanding Securities;

it being understood and intended that no one or more Holders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this Indenture to affect, disturb or prejudice the rights of any other Holders,
or to obtain or to seek to obtain priority or preference over any other Holders
or to enforce any right under this Indenture, except in the manner herein
provided and for the equal and ratable benefit of all the Holders.

         Section 5.8. Unconditional Right of Holders to Receive Principal,
Premium and Interest.

         Notwithstanding any other provision in this Indenture, the Holder of
any Security shall have the right, which is absolute and unconditional, to
receive payment of the principal of (and premium, if any) and (subject to
Section 308) interest on such Security on the respective Stated Maturities
expressed in such Security (or, in the case of redemption, on the Redemption
Date or, in the case of an Offer to Purchase made by the Issuers and required to
be accepted as to such Security, on the Purchase Date) and to institute suit for
the enforcement of any such payment, and such rights shall not be impaired
without the consent of such Holder.

                                       57
<PAGE>

         Section 5.9. Restoration of Rights and Remedies.

         If the Trustee or any Holder has instituted any proceeding to enforce
any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case, subject to any
determination in such proceeding, the Issuers, the Trustee and the Holders shall
be restored severally and respectively to their former positions hereunder and
thereafter all rights and remedies of the Trustee and the Holders shall continue
as though no such proceeding had been instituted.

Section 5.10.     Rights and Remedies Cumulative.

         Except as otherwise provided with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Securities in the last paragraph of
Section 307, no right or remedy herein conferred upon or reserved to the Trustee
or to the Holders is intended to be exclusive of any other right or remedy, and
every right and remedy shall, to the extent permitted by law, be cumulative and
in addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.

         Section 5.11. Delay or Omission Not Waiver.

         No delay or omission of the Trustee or of any Holder of any Security to
exercise any right or remedy accruing upon any Event of Default shall impair any
such right or remedy or constitute a waiver of any such Event of Default or an
acquiescence therein. Every right and remedy given by this Article or by law to
the Trustee or to the Holders may be exercised from time to time, and as often
as may be deemed expedient, by the Trustee or by the Holders, as the case may
be.

         Section 5.12. Control by Holders.

         The Holders of a majority in principal amount of the Outstanding
Securities shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on the Trustee, provided that

                          (1) such direction shall not be in conflict with any
                rule of law or with this Indenture,

                          (2) the Trustee may take any other action deemed
                proper by the Trustee which is not inconsistent with such
                direction, and

                          (3) subject to the provisions of Section 601, the
                Trustee shall have the right to decline to follow any such
                direction if the Trustee, being advised by counsel, shall
                determine that the action or proceeding so directed may not
                lawfully be taken or if the

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                Trustee in good faith shall determine that the action or
                proceedings so directed might involve the Trustee in personal
                liability or if the Trustee in good faith shall so determine
                that the actions or forebearances specified in or pursuant to
                such direction shall be unduly prejudicial to the interest of
                holders of the Securities not joining in the giving of said
                direction, it being understood that the Trustee shall have no
                duty to ascertain whether or not such actions or forebearances
                are unduly prejudicial to such holders.

         Section 5.13. Waiver of Past Defaults.

         The Holders of not less than a majority in principal amount of the
Outstanding Securities may on behalf of the Holders of all the Securities waive
any default hereunder and its consequences, except a default

                          (1) in the payment of the principal of (or premium, if
                any) or interest on any Security (including any Security which
                is required to have been purchased pursuant to an Offer to
                Purchase which has been made by the Issuers), or

                          (2) in respect of a covenant or provision hereof which
                under Article Nine cannot be modified or amended without the
                consent of the Holder of each Outstanding Security affected.

         Upon any such waiver, such default shall cease to exist, and any Event
of Default arising therefrom shall be deemed to have been cured, for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other default or impair any right consequent thereon.

         Section 5.14. Undertaking for Costs.

         In any suit for the enforcement of any right or remedy under this
Indenture, or in any suit against the Trustee for any action taken, suffered or
omitted by it as Trustee, a court may require any party litigant in such suit to
file an undertaking to pay the costs of such suit, and may assess costs against
any such party litigant, in the manner and to the extent provided in the Trust
Indenture Act; provided, that neither this Section nor the Trust Indenture Act
shall be deemed to authorize any court to require such an undertaking or to make
such an assessment in any suit instituted by the Issuers.

         Section 5.15. Waiver of Stay or Extension Laws.

         The Issuers covenant (to the extent that they may lawfully do so) that
they will not at any time insist upon, or plead, or in any manner whatsoever
claim or take the benefit or advantage of, any stay or extension law wherever
enacted, now or at any time hereafter in force, which may affect the covenants
or the performance of this Indenture; and the Issuers (to the extent that they
may lawfully do so) hereby expressly waive all benefit or advantage of any such
law and covenant that they will not hinder, delay or

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impede the execution of any power herein granted to the Trustee, but will suffer
and permit the execution of every such power as though no such law had been
enacted.

                                    ARTICLE 6

                                  THE TRUSTEE

         Section 6.1. Certain Duties and Responsibilities.

         The duties and responsibilities of the Trustee shall be as provided by
the Trust Indenture Act. Notwithstanding the foregoing, no provision of this
Indenture shall require the Trustee to expend or risk its own funds or otherwise
incur any financial liability in the performance of any of its duties hereunder,
or in the exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it. Whether or not therein
expressly so provided, every provision of this Indenture relating to the conduct
or affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section.

         Section 6.2. Notice of Defaults.

         The Trustee shall give the Holders notice of any default hereunder as
and to the extent provided by the Trust Indenture Act; provided, however, that
in the case of any default of the character specified in Section 501(4), no such
notice to Holders shall be given until at least 30 days after the occurrence
thereof. For the purpose of this Section, the term "default" means any event
which is, or after notice or lapse of time or both would become, an Event of
Default.

         Section 6.3. Certain Rights of Trustee.

         Subject to the provisions of Section 601:

         (a) the Trustee may rely and shall be protected in acting or refraining
from acting upon any resolution, certificate, Officers' Certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed or presented by the proper
party or parties;

         (b) any request or direction of the Issuers mentioned herein shall be
sufficiently evidenced by an Issuer Request or an Issuer Order and any
resolution of the Board of Directors may be sufficiently evidenced by a Board
Resolution;

         (c) whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other evidence
be herein specifically prescribed) may, in the absence of bad faith on its part,
rely upon an Officers' Certificate;

         (d) before the Trustee acts or refrains from acting, the Trustee may
consult with counsel and the written advice of such counsel or any Opinion of
Counsel shall be

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full and complete authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in reliance thereon;

         (e) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders pursuant to this Indenture, unless such Holders shall have
offered to the Trustee reasonable security or indemnity against the costs,
expenses and liabilities which might be incurred by it in compliance with such
request or direction;

         (f) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document unless requested
to do so by the Holders of not less than a majority in principal amount of the
Securities then outstanding, but the Trustee, in its discretion, may make such
further inquiry or investigation into such facts or matters as it may see fit,
and, if the Trustee shall determine to make such further inquiry or
investigation, it shall be entitled to examine the books, records and premises
of the Issuers, personally or by agent or attorney;

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

         (h) the Trustee shall not be required to give any bond or surety in
respect of the performance of its powers and duties hereunder;

         (i) the Trustee shall not be bound to ascertain or inquire as to the
performance or observance of any covenants, conditions or agreements on the part
of the Issuers, except as otherwise provided herein, but the Trustee may require
of the Issuers full information and advice as to the performance of the
covenants, conditions and agreements contained herein and shall be entitled in
connection herewith to examine the books, records and premises of the Issuers;
and

         (j) except for (i) a default under Sections 501(1) or (2) hereof, or
(ii) any other event of which the Trustee has "actual knowledge" and which
event, with the giving of notice or the passage of time or both, would
constitute an Event of Default under this Indenture, the Trustee shall not be
deemed to have notice of any default or Event of Default unless specifically
notified in writing of such event by the Issuers or the Holders of not less than
25% in aggregate principal amount of the Securities then outstanding; as used
herein, the term "actual knowledge" means the actual fact or statement of
knowing, without any duty to make any investigation with regard thereto.

         Section 6.4. Not Responsible for Recitals or Issuance of Securities.

         The recitals contained herein and in the Securities, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Issuers, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the

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validity or sufficiency of this Indenture or of the Securities. The Trustee
shall not be accountable for the use or application by the Issuers of Securities
or the proceeds thereof.

         Section 6.5. May Hold Securities.

         The Trustee, any Authenticating Agent, any Paying Agent, any Security
Registrar or any other agent of the Issuers, in its individual or any other
capacity, may become the owner or pledgee of Securities and, subject to Sections
608 and 613, may otherwise deal with the Issuers with the same rights it would
have if it were not Trustee, Authenticating Agent, Paying Agent, Security
Registrar or such other agent.

         Section 6.6. Money Held in Trust.

         Money held by the Trustee in trust hereunder need not be segregated
from other funds except to the extent required by law. The Trustee shall be
under no liability for interest on any money received by it hereunder except as
otherwise agreed with the Issuers.

         Section 6.7. Compensation and Reimbursement.

         The Issuers agree

                         (1) to pay to the Trustee from time to time, and the
                Trustee shall be entitled to, reasonable compensation for all
                services rendered by it hereunder (which compensation shall not
                be limited by any provision of law in regard to the compensation
                of a trustee of an express trust);

                         (2) except as otherwise expressly provided herein, to
                reimburse the Trustee upon its request for all reasonable
                expenses, disbursements and advances incurred or made by the
                Trustee in accordance with any provision of this Indenture,
                including costs of collection (including the reasonable
                compensation and the expenses and disbursements of its agents
                and counsel), except any such expense, disbursement or advance
                as may be attributable to its negligence or willful misconduct;
                and

                         (3) to indemnify the Trustee for, and to hold it
                harmless against, any loss, liability or expense incurred
                without negligence or willful misconduct on its part, arising
                out of or in connection with the acceptance or administration of
                this trust, including the costs and expenses of defending itself
                against or investigating any claim or liability in connection
                with the exercise or performance of any of its powers or duties
                hereunder.

         The obligations of the Issuers under this Section shall survive the
satisfaction and discharge of this Indenture. As security for the performance of
such obligations of the Issuers, the Trustee shall have a claim prior to the
Securities upon all property and funds

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held or collected by the Trustee as such, except funds held in trust for the
payment of principal of (and premium, if any) and interest on particular
Securities. When the Trustee incurs expenses or renders services in connection
with an Event of Default specified in Article Five hereof, the expenses
(including reasonable fees and expenses of its counsel) and the compensation for
the services in connection therewith are intended to constitute expense of
administration under any applicable bankruptcy law.

         Section 6.8. Disqualification; Conflicting Interests.

         If the Trustee has or shall acquire a conflicting interest within the
meaning of the Trust Indenture Act, the Trustee shall either eliminate such
interest or resign, to the extent and in the manner provided by, and subject to
the provisions of, the Trust Indenture Act and this Indenture.

         Section 6.9. Corporate Trustee Required; Eligibility.

         There shall at all times be a Trustee hereunder which shall be a Person
that is eligible pursuant to the Trust Indenture Act to act as such and has (or
in the case of a Person included in a bank holding company system, the related
bank holding company shall have) a combined capital and surplus of at least
$50,000,000 and its Corporate Trust Office in New York City or Los Angeles. If
such Person publishes reports of condition at least annually, pursuant to law or
to the requirements of said supervising or examining authority, then for the
purposes of this Section, the combined capital and surplus of such Person shall
be deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. If at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section, it shall resign
immediately in the manner and with the effect hereinafter specified in this
Article.

         Section 6.10. Resignation and Removal; Appointment of Successor.

         (a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee under Section 611.

         (b) The Trustee may resign at any time by giving written notice thereof
to the Issuers. If an instrument of acceptance by a successor Trustee shall not
have been delivered to the Trustee within 30 days after the giving of such
notice of resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee.

         (c) The Trustee may be removed at any time by Act of the Holders of a
majority in principal amount of the Outstanding Securities, delivered to the
Trustee and to the Issuers.

         (d) If at any time:

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                           (1) the Trustee shall fail to comply with Section 608
                  after written request therefor by the Issuers or by any Holder
                  who has been a bona fide Holder of a Security for at least six
                  months, or

                           (2) the Trustee shall cease to be eligible under
                  Section 609 and shall fail to resign after written request
                  therefor by the Issuers or by any such Holder, or

                           (3) the Trustee shall become incapable of acting or
                  shall be adjudged a bankrupt or insolvent or a receiver of the
                  Trustee or of its property shall be appointed or any public
                  officer shall take charge or control of the Trustee or of its
                  property or affairs for the purpose of rehabilitation,
                  conservation or liquidation,

         then, in any such case, (i) the Issuers by a Board Resolution may
remove the Trustee, or (ii) subject to Section 514, any Holder who has been a
bona fide Holder of a Security for at least six months may, on behalf of himself
and all others similarly situated, petition any court of competent jurisdiction
for the removal of the Trustee and the appointment of a successor Trustee.

         (e) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause, the
Issuers, by a Board Resolution, shall promptly appoint a successor Trustee. If,
within one year after such resignation, removal or incapability, or the
occurrence of such vacancy, a successor Trustee shall be appointed by Act of the
Holders of a majority in principal amount of the Outstanding Securities
delivered to the Issuers and the retiring Trustee, the successor Trustee so
appointed shall, forthwith upon its acceptance of such appointment, become the
successor Trustee and supersede the successor Trustee appointed by the Issuers.
If no successor Trustee shall have been so appointed by the Issuers or the
Holders and accepted appointment in the manner hereinafter provided, any Holder
who has been a bona fide Holder of a Security for at least six months may, on
behalf of himself and all others similarly situated, petition any court of
competent jurisdiction for the appointment of a successor Trustee.

         (f) The Issuers shall give notice of each resignation and each removal
of the Trustee and each appointment of a successor Trustee to all Holders in the
manner provided in Section 106. Each notice shall include the name of the
successor Trustee and the address of its Corporate Trust Office.

         Section 6.11. Acceptance of Appointment by Successor.

         Every successor Trustee appointed hereunder shall execute, acknowledge
and deliver to the Issuers and to the retiring Trustee an instrument accepting
such appointment, and thereupon the resignation or removal of the retiring
Trustee shall become effective and such successor Trustee, without any further
act, deed or conveyance, shall become vested with all the rights, powers, trusts
and duties of the

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retiring Trustee; but, on request of the Issuers or the successor Trustee, such
retiring Trustee shall, upon payment of its charges, execute and deliver an
instrument transferring to such successor Trustee all the rights, powers and
trusts of the retiring Trustee and shall duly assign, transfer and deliver to
such successor Trustee all property and money held by such retiring Trustee
hereunder. Upon request of any such successor Trustee, the Issuers shall execute
any and all instruments for more fully and certainly vesting in and confirming
to such successor Trustee all such rights, powers and trusts.

         No successor Trustee shall accept its appointment unless at the time of
such acceptance such successor Trustee shall be qualified and eligible under
this Article.

         Section 6.12. Merger, Conversion, Consolidation or Succession to
Business.

         Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Securities shall have been authenticated,
but not delivered, by the Trustee then in office, any successor by merger,
conversion or consolidation to such authenticating Trustee may adopt such
authentication and deliver the Securities so authenticated with the same effect
as if such successor Trustee had itself authenticated such Securities.

         Section 6.13. Preferential Collection of Claims Against the Issuers.

         If and when the Trustee shall be or become a creditor of the Issuers
(or any other obligor upon the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims against
the Issuers (or any such other obligor).

         Section 6.14. Appointment of Authenticating Agent.

         The Trustee may appoint an Authenticating Agent or Agents which shall
be authorized to act on behalf of the Trustee to authenticate Securities issued
upon original issue and upon exchange, registration of transfer, partial
conversion or partial redemption or pursuant to Section 307, and Securities so
authenticated shall be entitled to the benefits of this Indenture and shall be
valid and obligatory for all purposes as if authenticated by the Trustee
hereunder. Wherever reference is made in this Indenture to the authentication
and delivery of Securities by the Trustee or the Trustee's certificate of
authentication, such reference shall be deemed to include authentication and
delivery on behalf of the Trustee by an Authenticating Agent and a certificate
of authentication executed on behalf of the Trustee by an Authenticating Agent.
Each Authenticating Agent shall be acceptable to the Issuers and shall at all
times be a corporation organized and doing business under the laws of the United
States of America, any State thereof or the District of Columbia, authorized
under such laws to act as Authenticating Agent, having (or in the

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case of a corporation included in a bank holding company system, the related
bank holding company having) a combined capital and surplus of not less than
$50,000,000 and subject to supervision or examination by Federal or State
authority. If such Authenticating Agent publishes reports of condition at least
annually, pursuant to law or to the requirements of said supervising or
examining authority, then for the purposes of this Section, the combined capital
and surplus of such Authenticating Agent shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. If at any time an Authenticating Agent shall cease to be eligible in
accordance with the provisions of this Section, such Authenticating Agent shall
resign immediately in the manner and with the effect specified in this Section.

         Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such corporation shall be otherwise eligible
under this Section, without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agent.

         An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to the Issuers. The Trustee may at any time terminate
the agency of an Authenticating Agent by giving written notice thereof to such
Authenticating Agent and to the Issuers. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Issuers and shall mail written notice of
such appointment by first-class mail, postage prepaid, to all Holders as their
names and addresses appear in the Security Register. Any successor
Authenticating Agent upon acceptance of its appointment hereunder shall become
vested with all the rights, powers and duties of its predecessor hereunder, with
like effect as if originally named as an Authenticating Agent. No successor
Authenticating Agent shall be appointed unless eligible under the provisions of
this Section.

         The Trustee agrees to pay to each Authenticating Agent from time to
time reasonable compensation for its services under this Section, and the
Trustee shall be entitled to be reimbursed for such payments, subject to the
provisions of Section 607.

         If an appointment is made pursuant to this Section, the Securities may
have endorsed thereon, in addition to the Trustee's certificate of
authentication, an alternative certificate of authentication in the following
form:

      This is one of the Securities described in the within-mentioned Indenture.

      Harris Trust Company of California, As Trustee

      By___________________________ ,As Authenticating Agent

      By___________________________ Authorized Officer

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                                   ARTICLE 7
                HOLDERS' LISTS AND REPORTS BY TRUSTEE AND ISSUERS

         Section 7.1. Issuers to Furnish Trustee Names and Addresses of Holders.

         The Issuers will furnish or cause to be furnished to the Trustee

         (a) semi-annually, not more than 15 days after each Regular Record
Date, a list, in such form as the Trustee may reasonably require, of the names
and addresses of the Holders as of such Regular Record Date, and

         (b) at such other times as the Trustee may request in writing, within
30 days after the receipt by the Issuers of any such request, a list of similar
form and content as of a date not more than 15 days prior to the time such list
is furnished;

excluding from any such list names and addresses received by the Trustee in its
capacity as Security Registrar.

         Section 7.2. Preservation of Information; Communications to Holders.

         (a) The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 701 and the names and
addresses of Holders received by the Trustee in its capacity as Security
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 701 upon receipt of a new list so furnished.

         (b) The rights of Holders to communicate with other Holders with
respect to their rights under this Indenture or under the Securities and the
corresponding rights and duties of the Trustee, shall be provided by the Trust
Indenture Act.

         (c) Every Holder of Securities, by receiving and holding the same,
agrees with the Issuers and the Trustee that neither the Issuers nor the Trustee
nor any agent of either of them shall be held accountable by reason of any
disclosure of information as to the names and addresses of Holders made pursuant
to the Trust Indenture Act.

         Section 7.3. Reports by Trustee.

         (a) The Trustee shall transmit to Holders such reports concerning the
Trustee and its actions under this Indenture as may be required pursuant to the
Trust Indenture Act at the times and in the manner provided pursuant thereto.

         (b) A copy of each such report shall, at the time of such transmission
to Holders, be filed by the Trustee with each stock exchange upon which the
Securities are listed, with the Commission and with the Issuers. The Issuers
will notify the Trustee when the Securities are listed on any stock exchange.

         Section 7.4. Reports by Issuers.

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         The Issuers shall file with the Trustee and the Commission, and
transmit to Holders, such information, documents and other reports, and such
summaries thereof, as may be required pursuant to the Trust Indenture Act at the
times and in the manner provided pursuant to such Act; provided that any such
information, documents or reports required to be filed with the Commission
pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 shall be
filed with the Trustee within 15 days after the same is so required to be filed
with the Commission.

                                   ARTICLE 8
              CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

         Section 8.1. Issuers May Consolidate, Etc. Only on Certain Terms.

         The Issuers (a) shall not consolidate with or merge into any other
Person; (b) shall not permit any other Person to consolidate with or merge into
either Issuer; and (c) shall not, directly or indirectly, transfer, convey,
sell, lease or otherwise dispose of all or substantially all of either Issuer's
properties and assets as an entirety; unless, in any such transaction:

                           (1) (a)such Issuer is the surviving entity or (b) in
                  the case such Issuer shall consolidate with or merge into
                  another Person or shall directly or indirectly transfer,
                  convey, sell, lease or otherwise dispose of all or
                  substantially all of its properties and assets as an entirety,
                  the Person formed by such consolidation or into which such
                  Issuer is merged or the Person which acquires by transfer,
                  conveyance, sale, lease or other disposition all or
                  substantially all of the properties and assets of such Issuer
                  as an entirety (for purposes of this Article Eight, a
                  "Successor Company") shall be a corporation, partnership or
                  trust, shall be organized and validly existing under the laws
                  of the United States of America, any State thereof or the
                  District of Columbia and shall expressly assume by an
                  indenture supplemental hereto executed and delivered to the
                  Trustee, in form satisfactory to the Trustee, the due and
                  punctual payment of the principal of (and premium, if any) and
                  interest on all the Securities and the performance of every
                  covenant of this Indenture on the part of such Issuer to be
                  performed or observed;

                           (2) immediately after giving effect to such
                  transaction and treating any Indebtedness Incurred by the
                  Issuers or any of their respective Restricted Subsidiaries as
                  a result of such transaction as having been Incurred by the
                  Issuers or such Restricted Subsidiary at the time of such
                  transaction, no Event of Default, and no event which, after
                  notice or lapse of time, or both, would become an Event of
                  Default, shall have happened and be continuing;

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                           (3) immediately after giving effect to such
                  transaction, and treating any Indebtedness Incurred by the
                  Issuers or any of their respective Restricted Subsidiaries as
                  a result of such transaction as having been Incurred at the
                  time of such transaction, the Issuers or the Successor Company
                  would be permitted to Incur at least $1.00 of additional
                  Indebtedness pursuant to the first paragraph under Section
                  1008 or (b) after giving effect to such transaction the
                  Indebtedness to EBITDA Ratio is not higher than the
                  Indebtedness to EBITDA Ratio prior to giving effect to such
                  transaction; and

                           (4) such Issuer has delivered to the Trustee an
                  Officer's Certificate and an Opinion of Counsel, each stating
                  that such consolidation, merger, conveyance, transfer, lease
                  or disposition and, if a supplemental indenture is required in
                  connection with such transaction, such supplemental indenture,
                  complies with this Article and that all conditions precedent
                  herein provided for relating to such transaction have been
                  complied with, and, with respect to such Officer's
                  Certificate, setting forth the manner of determination of the
                  ability to Incur Indebtedness in accordance with Clause (3) of
                  Section 801 or of the comparison of the Indebtedness to EBITDA
                  Ratio prior to and immediately after giving effect to the
                  transaction of such Issuer or, if applicable, of the Successor
                  Company as required pursuant to the foregoing.

         Section 8.2. Successor Substituted.

         Upon any consolidation of either Issuer with, or merger of either
Issuer into, any other Person or any transfer, conveyance, sale, lease or other
disposition of all or substantially all of the properties and assets of such
Issuer as an entirety in accordance with Section 801, the Successor Company
shall succeed to, and be substituted for, and may exercise every right and power
of, such Issuer under this Indenture with the same effect as if such successor
Person had been named as such Issuer herein, and thereafter, except in the case
of a lease, the predecessor Person shall be relieved of all obligations and
covenants under this Indenture and the Securities.

         Section 8.3. Effect of the Reorganizations.

         (a) VoiceStream and VoiceStream Holdings are the initial issuers of the
Securities. If either Reorganization is completed, immediately upon such
Reorganization without any further act by any Person, VoiceStream shall cease to
be an Issuer of the Securities and any or all of its obligations under this
Indenture as an Issuer shall effectively terminate, and VoiceStream Holdings
shall remain as the sole Issuer of the Securities. If both Reorganizations are
terminated, immediately upon the termination of the last of the Reorganizations
to be terminated, without any further act by any Person, VoiceStream Holdings
shall cease to be an Issuer of the Securities and any or all of its obligations
under this Indenture as an Issuer shall effectively terminate, and VoiceStream

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shall remain as the sole Issuer of the Securities. Upon either of VoiceStream or
VoiceStream Holdings being the sole Issuer, the term "Issuers" hereunder shall
be deemed to read "Issuer."

         (b) Notwithstanding anything contained in this Indenture to the
contrary, the Reorganizations and the transactions contemplated thereby shall be
deemed not to violate the provisions of this Indenture. The Issuers shall not be
required to take any actions they would otherwise be obligated to take under
this Indenture as a result of the Reorganizations and the transactions
contemplated thereby, nor will the provisions of this Indenture with respect to
Change of Control Triggering Event contained in Section 1016 or Asset
Dispositions contained in Section 1014 be applicable.

                                   ARTICLE 9
                             SUPPLEMENTAL INDENTURES

         Section 9.1. Supplemental Indentures Without Consent of Holders.

         Without the consent of any Holders, the Issuers, when authorized by a
Board Resolution, and the Trustee, at any time and from time to time, may enter
into one or more indentures supplemental hereto, in form satisfactory to the
Trustee, for any of the following purposes:

         (a) to evidence the succession of another Person to either Issuer and
the assumption by any such successor of the covenants of such Issuer herein and
in the Securities; or

         (b) to add to the covenants of the Issuers for the benefit of the
Holders, or to surrender any right or power herein conferred upon the Issuers;
or

         (c) to secure the Securities pursuant to the requirements of Section
1012 or otherwise; or

         (d) to comply with any requirements of the Commission in order to
effect and maintain the qualification of this Indenture under the Trust
Indenture Act; or

         (e) to cure any ambiguity, to correct or supplement any provision
herein which may be inconsistent with any other provision herein, or to make any
other provisions with respect to matters or questions arising under this
Indenture which shall not be inconsistent with the provisions of this Indenture,
provided such action pursuant to this Clause (5) shall not adversely affect the
interests of the Holders in any material respect.

         Section 9.2. Supplemental Indentures with Consent of Holders.

         With the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities, by Act of said Holders delivered
to the Issuers and the Trustee, the Issuers, when authorized by a Board
Resolution, and the Trustee may enter into an indenture or indentures
supplemental hereto for the purpose of adding any

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provisions to or changing in any manner or eliminating any of the provisions of
this Indenture or of modifying in any manner the rights of the Holders under
this Indenture; provided, however, that no such supplemental indenture shall,
without the consent of the Holder of each Outstanding Security affected thereby,

                           (1) change the Stated Maturity of the principal of,
                  or any instalment of interest on, any Security, or reduce the
                  principal amount thereof or the rate of interest thereon or
                  any premium payable thereon, or change the place of payment
                  where, or the coin or currency in which, any Security or any
                  premium or the interest thereon is payable, or impair the
                  right to institute suit for the enforcement of any such
                  payment on or after the Stated Maturity thereof (or, in the
                  case of redemption, on or after the Redemption Date or, in the
                  case of an Offer to Purchase which has been made, on or after
                  the applicable Purchase Date), or

                           (2) reduce the percentage in principal amount of the
                  Outstanding Securities, the consent of whose Holders is
                  required for any such supplemental indenture, or the consent
                  of whose Holders is required for any waiver (of compliance
                  with certain provisions of this Indenture or certain defaults
                  hereunder and their consequences) provided for in this
                  Indenture, or

                           (3) modify any of the provisions of this Section,
                  Section 513 or Section 1018, except to increase any such
                  percentage or to provide that certain other provisions of this
                  Indenture cannot be modified or waived without the consent of
                  the Holder of each Outstanding Security affected thereby, or

                           (4) following the mailing of an Offer with respect to
                  an Offer to Purchase pursuant to Sections 1014 or 1016, modify
                  the provisions of this Indenture with respect to such Offer to
                  Purchase in a manner adverse to such Holder.

         Notice shall be given to all Holders and the Trustee at least 10
Business Days prior to the adoption of any proposed amendment pursuant to this
Section 902. It shall not be necessary for any Act of Holders under this Section
to approve the particular form of any proposed supplemental indenture, but it
shall be sufficient if such Act shall approve the substance thereof.

         Section 9.3. Execution of Supplemental Indentures.

         In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Section 601) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by, and that all conditions

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precedent have been met under, this Indenture. The Trustee may, but shall not be
obligated to, enter into any such supplemental indenture which affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise.

         Section 9.4. Effect of Supplemental Indentures.

         Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.

         Section 9.5. Conformity with Trust Indenture Act.

         Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act.

         Section 9.6. Reference in Securities to Supplemental Indentures.

         Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article may bear a notation in form
approved by the Trustee as to any matter provided for in such supplemental
indenture. If the Issuers shall so determine, new Securities so modified as to
conform, in the opinion of the Trustee and the Issuers, to any such supplemental
indenture may be prepared and executed by the Issuers and authenticated and
delivered by the Trustee in exchange for Outstanding Securities.

         Section 9.7. Notice of Supplemental Indenture.

         Promptly after the execution by the Issuers and the Trustee of any
supplemental indenture pursuant to Section 902, the Issuers shall transmit to
the Holders a notice setting forth the substance of such supplemental indenture.

                                   ARTICLE 10
                                    COVENANTS

         Section 10.1. Payment of Principal, Premium and Interest.

         The Issuers will duly and punctually pay the principal of (and premium,
if any) and interest on the Securities in accordance with the terms of the
Securities and this Indenture.

         Section 10.2. Maintenance of Office or Agency.

         The Issuers will maintain in the Borough of Manhattan, New York City,
an office or agency where Securities may be presented or surrendered for
payment, where Securities may be surrendered for registration of transfer or
exchange and where notices and demands to or upon the Issuers in respect of the
Securities and this Indenture may be served. The Issuers will give prompt
written notice to the Trustee of the location, and

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any change in the location, of such office or agency. If at any time the Issuers
shall fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office of the
Trustee, and the Issuers hereby appoint the Trustee as their agent to receive
all such presentations, surrenders, notices and demands.

         The Issuers may also from time to time designate one or more other
offices or agencies (in or outside the Borough of Manhattan, New York City)
where the Securities may be presented or surrendered for any or all such
purposes and may from time to time rescind such designations; provided, however,
that no such designation or rescission shall in any manner relieve the Issuers
of their obligation to maintain an office or agency in the Borough of Manhattan,
The City of New York, for such purposes. The Issuers will give prompt written
notice to the Trustee of any such designation or rescission and of any change in
the location of any such other office or agency.

         Section 10.3. Money for Security Payments to be Held in Trust.

         If the Issuers shall at any time act as their own Paying Agent, they
will, on or before each due date of the principal of (and premium, if any) or
interest on any of the Securities, segregate and hold in trust for the benefit
of the Persons entitled thereto a sum sufficient to pay the principal (and
premium, if any) or interest so becoming due until such sums shall be paid to
such Persons or otherwise disposed of as herein provided and will promptly
notify the Trustee of their action or failure so to act.

         Whenever the Issuers shall have one or more Paying Agents, they will,
prior to each due date of the principal of (and premium, if any) or interest on
any Securities, deposit with a Paying Agent a sum sufficient to pay the
principal (and premium, if any) or interest so becoming due, such sum to be held
in trust for the benefit of the Persons entitled to such principal, premium or
interest, and (unless such Paying Agent is the Trustee) the Issuers will
promptly notify the Trustee of their action or failure so to act.

         The Issuers will cause each Paying Agent other than the Trustee to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee, subject to the provisions of this Section, that
such Paying Agent will:

                           (1) hold all sums held by it for the payment of the
                  principal of (and premium, if any) or interest on Securities
                  in trust for the benefit of the Persons entitled thereto until
                  such sums shall be paid to such Persons or otherwise disposed
                  of as herein provided;

                           (2) give the Trustee notice of any default by the
                  Issuers (or any other obligor upon the Securities) in the
                  making of any payment of principal (and premium, if any) or
                  interest; and

                           (3) at any time during the continuance of any such
                  default, upon the written request of the Trustee, forthwith
                  pay to the Trustee all sums so held in trust by such Paying
                  Agent.

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         The Issuers may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Issuer Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Issuers or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Issuers or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee,
such Paying Agent shall be released from all further liability with respect to
such money.

         Any money deposited with the Trustee or any Paying Agent, or then held
by the Issuers, in trust for the payment of the principal of (and premium, if
any) or interest on any Security and remaining unclaimed for two years after
such principal (and premium, if any) or interest has become due and payable
shall be paid to the Issuers on Issuer Request, or (if then held by the Issuers)
shall be discharged from such trust; and the Holder of such Security shall
thereafter, as an unsecured general creditor, look only to the Issuers for
payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money, and all liability of the Issuers as trustee
thereof, shall thereupon cease; provided, however, that the Trustee or such
Paying Agent, before being required to make any such repayment, may at the
expense of the Issuers cause to be published once, in a newspaper published in
the English language, customarily published on each Business Day and of general
circulation in New York City, notice that such money remains unclaimed and that,
after a date specified therein, which shall not be less than 30 days from the
date of such publication, any unclaimed balance of such money then remaining
will be repaid to the Issuers.

         Section 10.4. Existence.

         Subject to Article Eight, the Issuers will do or cause to be done all
things necessary to preserve and keep in full force and effect their existence,
rights (charter and statutory) and franchises; provided, however, that the
Issuers shall not be required to preserve any such right or franchise if the
Board of Directors in good faith shall determine that the preservation thereof
is no longer desirable in the conduct of the business of the Issuers and that
the loss thereof is not disadvantageous in any material respect to the Holders.

         Section 10.5. Maintenance of Properties.

         The Issuers will cause all properties used or useful in the conduct of
its business or the business of any Restricted Subsidiary of the Issuers to be
maintained and kept in good condition, repair and working order and supplied
with all necessary equipment and will cause to be made all necessary repairs,
renewals, replacements, betterments and improvements thereof, all as in the
judgment of the Issuers may be necessary so that the business carried on in
connection therewith may be properly and advantageously conducted at all times;
provided, however, that nothing in this Section shall prevent the Issuers from
discontinuing the operation or maintenance of any of such properties if such
discontinuance is, as determined by the Board of Directors in good faith,
desirable in the conduct of their business or the business of any Restricted
Subsidiary and not disadvantageous in any material respect to the Holders.

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         Section 10.6. Payment of Taxes and Other Claims.

         The Issuers will pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, (1) all taxes, assessments and
governmental charges levied or imposed upon the Issuers or any of their
Restricted Subsidiaries or upon the income, profits or property of the Issuers
or any of their Restricted Subsidiaries, and (2) all lawful claims for labor,
materials and supplies which, if unpaid, might by law become a lien upon the
property of the Issuers or any of their Restricted Subsidiaries; provided,
however, that the Issuers shall not be required to pay or discharge or cause to
be paid or discharged any such tax, assessment, charge or claim whose amount,
applicability or validity is being contested in good faith by appropriate
proceedings.

         Section 10.7. Maintenance of Insurance.

         The Issuers shall, and shall cause any of their Restricted Subsidiaries
to, keep at all times all of their properties which are of an insurable nature
insured against loss or damage with insurers believed by the Issuers to be
responsible to the extent that property of similar character is usually so
insured by corporations similarly situated and owning like properties in
accordance with good business practice.

         Section 10.8. Limitation on Consolidated Indebtedness.

         The Issuers shall not, and shall not permit any of their Restricted
Subsidiaries to, Incur any Indebtedness unless the Issuers' Indebtedness to
EBITDA Ratio at the end of the fiscal quarter immediately preceding the
Incurrence of such Indebtedness, after giving pro forma effect to the Incurrence
of such Indebtedness and any other Indebtedness Incurred since such date and the
receipt and application of the proceeds thereof, would be less than 8.0 to 1 for
the period ending December 31, 2005 and 7 to 1 thereafter.

         Notwithstanding the foregoing paragraph, the Issuers and/or any
Restricted Subsidiary of the Issuers, as the case may be, may Incur the
following Indebtedness:

                  (i) Indebtedness of an Issuer or any of its Restricted
         Subsidiaries, as the case may be, that is outstanding or committed at
         the time of the issuance of the Securities;

                  (ii) Indebtedness of an Issuer or any of its Restricted
         Subsidiaries, as the case may be, that is outstanding or committed at
         the date hereof under the Credit Facility of up to $1.2 billion or, if
         the Omnipoint Reorganization is completed, under the Anticipated New
         Credit Facility of up to $3.0 billion (including any letters of credit
         issued thereunder) and any renewal, extension, refinancing or refunding
         thereof in an amount which, together with any amount remaining
         outstanding or committed (x) under the Credit Facility, does not exceed
         $1.2 billion and (y) under the Anticipated New Credit Facility, does
         not exceed $3.0 billion, at any time outstanding; provided that this
         Clause (ii) shall not prohibit an Issuer or any of its Restricted
         Subsidiaries from Incurring additional Indebtedness under the Credit
         Facility or the Anticipated New Credit Facility otherwise permitted
         pursuant to this Section 1008;

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                  (iii) Telecommunications Indebtedness;

                  (iv) Acquired Indebtedness of an Issuer or any of its
         Restricted Subsidiaries in connection with the acquisition of assets or
         a new Subsidiary and the incurrence by either Issuer's Restricted
         Subsidiaries of Indebtedness as a result of the designation of an
         Unrestricted Subsidiary as a Restricted Subsidiary; provided that, in
         the case of any such incurrence of Acquired Indebtedness, such Acquired
         Indebtedness was incurred by the prior owner of such assets or such
         Restricted Subsidiary prior to such acquisition by the applicable
         Issuer or one of its Restricted Subsidiaries and was not incurred in
         connection with, or in contemplation of, the acquisition by the
         applicable Issuer or one of its Restricted Subsidiaries; and provided
         further that, in the case of any incurrence pursuant to this clause
         (iv), as a result of such acquisition by an Issuer or one of its
         Restricted Subsidiaries, the Issuers and their respective Restricted
         Subsidiaries would be permitted to incur an additional $1.00 of
         Indebtedness pursuant to the first paragraph of this Section 1008, as
         applicable;

                  (v) Indebtedness of an Issuer or any of its Restricted
         Subsidiaries represented by Capital Lease Obligations, mortgage
         financings or purchase money obligations, in each case incurred for the
         purpose of financing all or any part of the purchase price or cost of
         construction or improvement of property, plant or equipment used in the
         business of such Issuer or such Restricted Subsidiary, in an aggregate
         principal amount, including all Indebtedness incurred to refund,
         refinance or replace any other Indebtedness incurred pursuant to this
         clause (v), not to exceed $25 million at any one time outstanding;

                  (vi) Indebtedness owed by an Issuer to any Restricted
         Subsidiary of such Issuer (provided that such Indebtedness is at all
         times held by a Person which is a Restricted Subsidiary of the Issuer)
         or Indebtedness owed by a Restricted Subsidiary of such Issuer to such
         Issuer or a Restricted Subsidiary of such Issuer (provided that such
         Indebtedness is at all times held by such Issuer or a Person which is a
         Restricted Subsidiary of such Issuer); provided, however, that for
         purposes of this Section 1008, upon either (x) the transfer or other
         disposition by such Restricted Subsidiary or such Issuer of any
         Indebtedness so permitted to a Person other than such Issuer or another
         Restricted Subsidiary of such Issuer or (y) the issuance (other than
         directors' qualifying shares), sale, lease, transfer or other
         disposition of shares of Capital Stock (including by consolidation or
         merger) of such Restricted Subsidiary to a Person other than the Issuer
         or another such Restricted Subsidiary, the provisions of this Clause
         (vi) shall no longer be applicable to such Indebtedness and such
         Indebtedness shall be deemed to have been Incurred at the time of such
         transfer or other disposition;

                  (vii) Indebtedness of an Issuer or any of its Restricted
         Subsidiaries to renew, extend, refinance or refund any Indebtedness of
         such Issuer or any of its Restricted Subsidiaries outstanding or
         committed on the date of renewal, extension, refinancing or refunding
         other than Indebtedness Incurred pursuant to Clause (ii) or (vi) above;
         provided, however, that such Indebtedness does not

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         exceed the principal amount of outstanding or committed Indebtedness so
         renewed, extended, refinanced or refunded plus financing fees and other
         expenses (including make-whole or other repurchase payments or
         premiums) associated therewith; and provided further, that (A) such
         renewing, extending, refinancing or refunding Indebtedness has a final
         maturity date the same as or later than the final maturity date of the
         Indebtedness being renewed, extended, refinanced or refunded; (B) in
         the case of any refinancing or refunding of Indebtedness pari passu to
         the Securities, the refinancing or refunding Indebtedness is made pari
         passu or subordinated to the Securities and, in the case of any
         refinancing or refunding of Indebtedness subordinated to the
         Securities, the refinancing or refunding Indebtedness is made
         subordinate to the Securities to substantially the same extent as the
         Indebtedness refinanced or refunded; and (C) such renewing, extending,
         refinancing or refunding Indebtedness has an Average Life equal to or
         longer than the life of the Indebtedness being renewed, extended,
         refinanced or refunded;

                  (viii)any Guarantee by any Restricted Subsidiary of any
         Indebtedness incurred under the Credit Facility or the Anticipated New
         Credit Facility, as applicable, in compliance with this Section 1008;

                  (ix) Indebtedness of an Issuer of any of its Restricted
         Subsidiaries under (or constituting reimbursement obligations with
         respect to) letters of credit, performance or surety bonds or similar
         instruments issued in the ordinary course of a Telecommunications
         Business, including letters of credit in respect of workers'
         compensation claims or self-insurance, provided, however, that upon the
         drawing of any such letter of credit or other instrument, such
         obligations are reimbursed within 90 days following such drawing;

                  (x) Indebtedness arising from agreements providing for
         indemnification, purchase price adjustments or similar obligations, or
         from guarantees of letters of credit, surety bonds or performance bonds
         securing any obligation of an Issuer or any of its Restricted
         Subsidiaries pursuant to such agreements, in any case Incurred in
         connection with the disposition of any business, assets or Restricted
         Subsidiary of an Issuer (other than guarantees of Indebtedness Incurred
         by any Person acquiring all or any portion of such business, assets or
         Restricted Subsidiary of such Issuer for the purpose of financing such
         acquisition), in an amount not to exceed the gross proceeds actually
         received by such Issuer or any Restricted Subsidiary in connection with
         such disposition;

                  (xi) Indebtedness Incurred by an Issuer or any of its
         Restricted Subsidiary under Interest Rate Agreements or Currency
         Protection Agreements to hedge permitted Indebtedness;

                  (xii) Indebtedness of Omnipoint, Aerial or any of their
         respective Subsidiaries that is outstanding or committed at the time of
         the issuance of the Securities;

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                  (xiii) Indebtedness evidenced by the Securities or otherwise
         arising under this Indenture;

                  (xiv) Indebtedness due and owing to governmental entities in
         connection with telecommunication license fees or Indebtedness incurred
         to finance the payment of deposits with and licensing fees to the FCC
         in connection with FCC license auctions; and

                  (xv) Indebtedness of an Issuer or any of its Restricted
         Subsidiaries not otherwise permitted to be Incurred pursuant to Clauses
         (i) through (xiv) above, which, together with any other outstanding
         Indebtedness Incurred pursuant to this Clause (xv), has an aggregate
         principal amount not in excess of $50 million at any time outstanding
         or committed.

         Notwithstanding the foregoing, the maximum amount of Indebtedness that
either Issuer or any of its Restricted Subsidiaries may incur shall not be
deemed to be exceeded due solely to the result of fluctuations in the exchange
rates of currencies.

         For purposes of determining any particular amount of Indebtedness under
the foregoing clauses, (1) Guarantees, Liens or obligations with respect to
letters of credit supporting Indebtedness otherwise included in the
determination of such particular amount shall not be included and (2) any Liens
granted pursuant to the equal and ratable provisions of Section 1012 shall not
be treated as Indebtedness. For purposes of determining compliance with the
Indebtedness incurrence restriction, in the event that an item of Indebtedness
meets the criteria of more than one of the types of Indebtedness described in
the above clauses, VoiceStream or VoiceStream Holdings, as the case may be, in
its respective sole discretion shall classify such item of Indebtedness and only
be required to include the amount and type of such Indebtedness in one of such
clauses.

         Section 10.9. Limitation on Issuances and Sales of Capital Stock of
Restricted Subsidiaries.

         The Issuers shall not, and shall not permit any of their respective
Restricted Subsidiaries to, transfer, convey, sell, lease or otherwise dispose
of any Capital Stock of such Restricted Subsidiary or any other Restricted
Subsidiary to any Person other than the Issuers or a Restricted Subsidiary; and
will not permit any Restricted Subsidiary to issue shares of its Capital Stock
or securities convertible into, or warrants, rights or options, to subscribe for
or purchase shares of, its Capital Stock to any Person other than the Issuers or
a Restricted Subsidiary, unless, in each such case:

                           (1) immediately after giving effect to such issuance
                  or sale, such Restricted Subsidiary would no longer constitute
                  a Restricted Subsidiary and any Investment in such Person
                  remaining after giving effect to such issuance or sale would
                  have been permitted to be made under Section 1010; or

                           (2) if such sale or disposition is effected in
                  accordance with the provisions under Section 1014;

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         The foregoing shall not prohibit the issuance of Capital Stock of a
Restricted Subsidiary of either Issuer pursuant to an employee stock option plan
approved by the Boards of Directors of the Restricted Subsidiary and such
Issuer.

         Section 10.10. Limitation on Restricted Payments.

         Each of the Issuers (i) shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly, declare or pay any dividend,
or make any distribution, of any kind or character (whether in cash, property or
securities) in respect of any class of its or such Restricted Subsidiary's
Capital Stock or to the holders of any class of its or such Restricted
Subsidiary's Capital Stock (other than (a) any dividends or distributions
payable solely in shares of its or such Restricted Subsidiary's Capital Stock or
in options, warrants or other rights to acquire its or such Restricted
Subsidiary's Capital Stock, (b) any declaration or payment of a dividend or
other distribution by a Restricted Subsidiary to such Issuer or another
Restricted Subsidiary or (c) any declaration or payment of a dividend or other
distribution by a Restricted Subsidiary to any other shareholder of such
Restricted Subsidiary, so long as such Issuer or its Restricted Subsidiaries
receive their pro rata share of such dividends or distributions), (ii) shall
not, and shall not permit any of its Restricted Subsidiaries, directly or
indirectly, to purchase, redeem or otherwise acquire or retire for value (a) any
Capital Stock of such Issuer or any Related Person (other than a Restricted
Subsidiary) of such Issuer or (b) any options, warrants or rights to purchase or
acquire shares of Capital Stock of such Issuer or any Related Person (other than
a Restricted Subsidiary) of such Issuer, in each case other than pursuant to the
cashless exercise of options, (iii) shall not make, or permit any of its
Restricted Subsidiaries to make, any Investment other than a Permitted
Investment and (iv) shall not, and shall not permit any Restricted Subsidiary of
such Issuer to, redeem, defease (including, but not limited to, legal or
covenant defeasance), repurchase, retire or otherwise acquire or retire for
value prior to any scheduled maturity, repayment or sinking fund payment,
Indebtedness of such Issuer or such Restricted Subsidiary (other than the
Securities) which is subordinate in right of payment to the Securities (the
transactions described in Clauses (i) through (iv) being referred to herein as
"Restricted Payments"), if at the time thereof and giving effect thereto:

                           (1) an Event of Default, or an event that with the
                  lapse of time or the giving of notice, or both, would
                  constitute an Event of Default, shall have occurred and is
                  continuing;

                           (2) such Issuer would not be permitted to Incur an
                  additional $1.00 of Indebtedness pursuant to the first
                  paragraph of Section 1008; and

                           (3) the aggregate of all Restricted Payments made on
                  or after the date of this Indenture exceeds the sum of:

                  (B) Cumulative EBITDA less 1.6 times Cumulative Interest
         Expense;

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                  (C) 100% of the aggregate Net Cash Proceeds received by the
         Issuers since the date of this Indenture from the issue or sale of
         Equity Interests of VoiceStream and VoiceStream Holdings or of debt
         securities of VoiceStream and VoiceStream Holdings that have been
         converted into such Capital Stock (other than to a Restricted
         Subsidiary);

                  (D) an amount equal to the net reduction in Investments made
         by an Issuer or a Restricted Subsidiary subsequent to the date of this
         Indenture in any Person resulting from:

                  (E) payments of interest on debt, repayment of loans or
         advances, or other transfers or distributions of property, in each case
         to an Issuer or any Restricted Subsidiary from any Person;

                  (F) to the extent that any Investment is sold for cash or
         otherwise liquidated or repaid for cash, the after-tax cash return of
         capital with respect to such Investment (less the cost of disposition,
         if any); and

                  (G) the redesignation of any Unrestricted Subsidiary as a
         Restricted Subsidiary, in which case such aggregate amount of the net
         reduction in Investments will not exceed the amount of such Investments
         previously made by the Issuers and their respective Restricted
         Subsidiaries in such Person or Unrestricted Subsidiary, as the case may
         be, which were treated as Restricted Payments; and

                  (H) $50 million.

         So long as no Event of Default or event which with notice or lapse of
time or both would become an Event of Default has occurred and is continuing
(other than in the case of clause (2) below), the preceding provisions will not
prohibit:

                           (1) the payment of any dividend within 60 days after
                  declaration thereof if at the declaration date such payment
                  would have complied with the foregoing provision;

                           (2) the redemption, repurchase or other acquisition
                  or retirement for value of any Indebtedness of an Issuer
                  subordinated to the Securities in exchange for or out of the
                  proceeds of the substantially concurrent sale (other than to a
                  Restricted Subsidiary) of Equity Interests of VoiceStream or
                  VoiceStream Holdings, as the case may be, or from the
                  incurrence of Indebtedness pursuant to a refinancing permitted
                  under clause (vii) of Section 1008;

                           (3) the repurchase, redemption or other acquisition
                  or retirement for value of any Equity Interests of VoiceStream
                  or VoiceStream Holdings, as the case may be, in exchange for
                  or out of the proceeds of the substantially concurrent sale
                  (other than to a Restricted Subsidiary) of Equity Interests
                  (other than Disqualified

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                  Stock) of VoiceStream or VoiceStream Holdings, as the case may
                  be;

                           (4) the repurchase, redemption or other acquisition
                  of any Equity Interests of VoiceStream or VoiceStream
                  Holdings, as the case may be, held by present or former
                  employees, officers or directors of either Issuer or any of
                  their respective Subsidiaries; provided that the aggregate
                  price paid for all such repurchased, redeemed or otherwise
                  acquired Equity Interests shall not exceed $2.0 million in any
                  fiscal year;

                           (5) the repurchase, redemption or other acquisition
                  or retirement for value of any Equity Interests of VoiceStream
                  or VoiceStream Holdings, as the case may be, to the extent
                  necessary in the good faith judgment of the Board of Directors
                  evidenced by a Board Resolution delivered to the trustee to
                  prevent the loss or secure the renewal or reinstatement of any
                  material license or franchise held by VoiceStream or
                  VoiceStream Holdings, as the case may be, or any Restricted
                  Subsidiary from any government agency;

                           (6) the repurchase of Indebtedness subordinated to
                  the Securities at a purchase price not greater than 101% of
                  the principal amount thereof (plus accrued and unpaid
                  interest) pursuant to a mandatory offer to repurchase made
                  after a Change of Control Triggering Event, provided that the
                  Issuers first make an Offer to Purchase the Securities (and
                  repurchase all tendered Securities) pursuant to the provisions
                  of Section 1016;

                           (7) Permitted Investments; and

                           (8) payments or distributions to dissenting
                  stockholders pursuant to applicable law in connection with a
                  consolidation, merger or transfer of assets that complies with
                  the provisions of Section 801.

         Section 10.11. Limitations Concerning Distributions and Transfers By
Restricted Subsidiaries.

         The Issuers shall not, and shall not permit any of their Restricted
Subsidiaries to, create or otherwise cause or suffer to exist or become
effective any consensual restriction or prohibition on the ability of any
Restricted Subsidiary (i) to pay, directly or indirectly, dividends or make any
other distributions in respect of its Capital Stock or any other ownership
interest or participation in, or measured by, its profits, to the Issuers or any
of their respective Restricted Subsidiaries or pay any Indebtedness or other
obligation owed to either Issuer or any Restricted Subsidiary; (ii) to make
loans or advances to either Issuer or any of its Restricted Subsidiaries; or
(iii) to transfer any of its property or assets

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to either Issuer or any of its Restricted Subsidiaries, except, in any such
case, any restriction or prohibition:

         (a) pursuant to any agreement in effect on the date of this Indenture,
or

         (b) pursuant to an agreement relating to any Indebtedness of such
Restricted Subsidiary which was outstanding or committed prior to the date on
which such Restricted Subsidiary was acquired by the applicable Issuer other
than in anticipation of becoming a Restricted Subsidiary, or

         (c) pursuant to an agreement effecting a renewal, extension,
refinancing or refunding of any agreement described in Clauses (a), (b) or (d);
provided, however, that the provisions contained in such renewal, extension,
refinancing or refunding agreement relating to such encumbrance or restriction
are no more restrictive in any material respect than the provisions contained in
the agreement the subject thereof, or

         (d) pursuant to an agreement entered into after the date of this
Indenture relating to any Indebtedness the Incurrence of which is permitted
under this Indenture, provided, however, that the provisions contained in such
agreement relating to such encumbrance or restriction are, taken as a whole, no
more restrictive in any material respect than those contained in this Indenture
or are no more restrictive in any material respect than those contained in the
Credit Facility, or

         (e) pursuant to an agreement by which an Issuer or any of its
Restricted Subsidiaries obtains financing, provided that (A) such restriction is
not materially more restrictive than customary provisions in comparable
financing agreements and (B) management of such Issuer determines that at the
time such agreement is entered into such restriction will not materially impair
the Issuers' ability to make payments on the Securities, such determination to
be confirmed by an Officers' Certificate delivered to the Trustee, or

         (f) pursuant to applicable law, or

         (g) pursuant to customary provisions restricting subletting or
assignment of property subject to any lease governing any leasehold interest of
any Restricted Subsidiary of either Issuer, or

         (h) pursuant to purchase money obligations for property acquired in the
ordinary course of business that impose restrictions of the type referred to in
clause (iii) of this Section 1011, or

         (i) pursuant to restrictions of the type referred to in clause (iii) of
this Section 1011 contained in security agreements securing Indebtedness of
either Issuer or a Restricted Subsidiary of either Issuer to the extent that
such Liens were otherwise incurred in accordance with the provisions under
Section 1012 and restrict the transfer of the collateral subject to such
agreements without restricting the transfer of other property, or

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         (j) pursuant to an agreement that has been entered into for the sale or
disposition of all or substantially all of the Capital Stock of, or property and
assets of, a Restricted Subsidiary of an Issuer.

         Nothing contained in the foregoing clauses shall prevent either Issuer
or any of its Restricted Subsidiaries from (i) creating, incurring, assuming or
suffering to exist any Liens otherwise permitted under this Indenture or (ii)
restricting the sale or other disposition of property or assets of either Issuer
or any of its Restricted Subsidiaries that secure Indebtedness of such Issuer or
any of its Restricted Subsidiaries.

         Section 10.12. Limitation on Liens.

         (a) The Issuers shall not, and shall not permit any of their respective
Restricted Subsidiaries to, Incur or suffer to exist any Lien on or with respect
to any property or assets now owned or hereafter acquired to secure any
Indebtedness that is pari passu or subordinated to the Securities without
making, or causing such Restricted Subsidiary to make, effective provision for
securing the Securities (i) equally and ratably with such Indebtedness as to
such property for so long as such Indebtedness will be so secured or (ii) in the
event such Indebtedness is Indebtedness of an Issuer which is subordinate in
right of payment to the Securities, prior to such Indebtedness as to such
property for so long as such Indebtedness will be so secured.

         The foregoing restrictions will not apply to:

                  (i) Liens in respect of Indebtedness existing at the date of
         this Indenture or that is outstanding or permitted under the Credit
         Facility or, assuming the Omnipoint Reorganization is completed, under
         the Anticipated New Credit Facility;

                  (ii) Liens in favor of an Issuer or Liens in favor of a Wholly
         Owned Restricted Subsidiary of an Issuer on the assets or Capital Stock
         of another Wholly Owned Restricted Subsidiary of an Issuer;

                  (iii) Liens to secure Indebtedness outstanding or committed
         for the purpose of financing all or any part of the purchase price or
         the cost of construction or improvement of the equipment or other
         property subject to such Liens; provided, however, that (a) the
         principal amount of any Indebtedness secured by such a Lien does not
         exceed 100% of such purchase price or cost, (b) such Lien does not
         extend to or cover any other property other than such item of property
         and any improvements on such item and (c) the Incurrence of such
         Indebtedness is otherwise permitted by Section 1008;

                  (iv) Liens on property existing immediately prior to the time
         of acquisition thereof (and not Incurred in anticipation of the
         financing of such acquisition);

                  (v) Liens to secure Indebtedness to extend, renew, refinance
         or refund (or successive extensions, renewals, refinancings or
         refundings), in whole or in

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<PAGE>
         part, Indebtedness secured by any Lien referred to in the foregoing
         Clauses (i), (iii) and (iv) so long as such Lien does not extend to any
         other property and the principal amount of Indebtedness so secured is
         not increased except as otherwise permitted under Clause (ii) or (vii)
         of Section 1008;

                  (vi) Liens securing any Indebtedness of any of the Restricted
         Subsidiaries of an Issuer that was permitted by the provisions of this
         Indenture to be Incurred;

                  (vii) Liens on any Capital Stock of any Unrestricted
         Subsidiary of an Issuer securing Indebtedness of such Subsidiary that
         is Non-Recourse Indebtedness;

                  (viii)Liens to secure the performance of statutory
         obligations, surety or appeal bonds, performance bonds or other
         obligations of a like nature Incurred in the ordinary course of
         business (other than obligations for the payment of money);

                  (ix) Liens for taxes, assessments or governmental charges or
         claims that are not yet delinquent or that are being contested in good
         faith by appropriate proceedings promptly instituted and diligently
         conducted; provided that any reserve or other appropriate provision as
         shall be required in conformity with generally accepted accounting
         principles shall have been made therefor;

                  (x) Carriers', warehousemen's, mechanics', landlords',
         materialmen's, repairmen's or other like Liens arising in the ordinary
         course of business in respect of obligations that are not yet due, are
         bonded or are being contested in good faith by appropriate proceedings
         if adequate reserves with respect thereto are maintained on the books
         of the applicable Issuer or such Restricted Subsidiary, as the case may
         be, in conformity with generally accepted accounting principles; and

                  (xi) Liens securing Interest Rate Agreements entered into in
         the ordinary course of business on any property also securing the
         permitted Indebtedness to which such Interest Rate Agreements relate.

         Section 10.13. Limitation on Transactions with Affiliates and Related
Persons.

         The Issuers shall not, and shall not permit any of their respective
Restricted Subsidiaries to, directly or indirectly, enter into any transaction
(including, without limitation, any purchase, sale, lease or exchange of
property or rendering of any service) involving aggregate consideration in
excess of $5 million, with or to any Affiliate or Related Person (other than a
Restricted Subsidiary)(each of the foregoing, an "Affiliate Transaction"),
unless management of the applicable Issuer shall determine (evidenced by an
Officers' Certificate), that:

                           (1) such transaction is in the best interests of the
                  Issuers or such Restricted Subsidiary; and

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                           (2) such transaction is on terms no less favorable to
                  the Issuers or such Restricted Subsidiary than those that
                  could be obtained in a comparable arm's length transaction
                  with a third party at the time.

         In the event that any transaction contemplated by the preceding
paragraph involves aggregate consideration in excess of $10 million, a
determination by a majority of the disinterested members of the Board of
Directors of VoiceStream or VoiceStream Holdings, as the case may be (which
determination shall be evidenced by a Board Resolution) will be required with
respect to clause (1) and (2) above.

         Notwithstanding the foregoing, the following items will not be deemed
to be Affiliate Transactions:

                           (1) transactions between or among an Issuer and/or
                  its Restricted Subsidiaries (other than a Restricted
                  Subsidiary in which an Affiliate or Related Person of the
                  applicable Issuer, other than a Wholly Owned Restricted
                  Subsidiary, owns any Capital Stock or any option, warrant or
                  other right to purchase Capital Stock);

                           (2) customary payment of compensation to employees,
                  officers or consultants in the ordinary course of business and
                  payment of reasonable directors fees and customary
                  indemnification and insurance arrangements in favor of
                  directors, regardless of affiliation with the Issuers;

                           (3) Restricted Payments that are permitted by the
                  provisions of Section 1010;

                           (4) payments and other transactions required under or
                  contemplated by any agreement in effect on the date of this
                  Indenture and disclosed in VoiceStream's Form 10/A filed with
                  the SEC on April 13, 1999, its Form 10-Q for the quarter ended
                  June 30, 1999, its current reports on Form 8-K filed prior to
                  October 15, 1999 (or not required to be disclosed therein
                  pursuant to the rules and regulations of the Commission) and,
                  assuming completion of the Reorganizations, each of
                  Omnipoint's and Aerial's Form 10-K for the fiscal year ended
                  December 31, 1998 and Forms 10-Q and 8-K filed during calendar
                  year 1999 prior to the date of the offering circular
                  associated with the Securities (or not required to be
                  disclosed therein pursuant to the rules and regulations of the
                  Commission), or any agreement in effect at the time that an
                  entity becomes a Restricted Subsidiary or is merged into
                  either Issuer (and was not entered into in anticipation of
                  such acquisition), or any amendment thereto or replacement of
                  such agreement so long

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<PAGE>
                  as any such amendment or replacement is not disadvantageous to
                  the Holders in any material respect; and

                           (5) loans or advances to officers or employees of
                  either Issuer or any Restricted Subsidiary to pay business
                  related travel expenses or reasonable relocation costs of such
                  officers or employees in connection with their employment by
                  such Issuer or any of its Restricted Subsidiaries.

         Section 10.14. Limitation on Certain Asset Dispositions.

         (a) The Issuers will not, and will not permit any of their respective
Restricted Subsidiaries to, consummate an Asset Disposition unless:

                           (1) an Issuer (or the Restricted Subsidiary, as the
                  case may be) receives consideration at the time of such Asset
                  Disposition at least equal to the Fair Market Value of the
                  assets issued or sold or otherwise disposed of; and

                           (2) at least 75% of the consideration received in
                  such Asset Disposition by such Issuer or such Restricted
                  Subsidiary is in the form of cash or readily marketable cash
                  equivalents, the assumption of Indebtedness of an Issuer or
                  any Restricted Subsidiary or assets of a Telecommunications
                  Business.

         Within the applicable time period specified below, the Issuers or the
Restricted Subsidiary may apply Net Available Proceeds from an Asset Disposition
to (i) invest in assets of a Telecommunications Business or a Person engaged in
a Telecommunications Business; or (ii) permanently repay any Indebtedness of the
Issuers or any Indebtedness of a Restricted Subsidiary.

         Any Net Available Proceeds from Asset Dispositions that are not applied
or invested in accordance with the preceding paragraph within 365 days from the
date of such Asset Disposition, or within 18 months of such Asset Disposition if
the applicable Issuer or a Restricted Subsidiary has entered into a binding
agreement to invest in such assets or Person, will be deemed to constitute
Excess Proceeds. When the aggregate amount of Excess Proceeds exceeds $10
million (taking into account income earned on such Excess Proceeds), the Issuers
will be required to make an Offer to Purchase to all Holders of Securities and
all holders of other senior indebtedness of the Issuers containing provisions
similar to those set forth in this Indenture, on a pro rata basis according to
principal amount, to purchase the maximum principal amount (or Accreted Value,
as applicable) of Securities and such other senior indebtedness of the Issuers
that may be purchased out of the Excess Proceeds. The offer price in any Offer
to Purchase will be payable in cash and will be 100% of the principal amount of
the Securities plus any accrued but unpaid Special Interest to but excluding the
date of purchase. In the case of any other senior indebtedness, the offer price
will be 100% of the principal amount (or accreted value, as applicable) of the
indebtedness plus accrued and unpaid interest

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<PAGE>
thereon, if any, to the date of purchase. If the aggregate principal amount of
the Securities or other senior indebtedness surrendered for purchase exceeds the
amount of Excess Proceeds, then the Securities and the other senior indebtedness
of the Issuers will be purchased pro rata according to the outstanding principal
amount of such Securities and other senior indebtedness with such adjustments as
may be deemed appropriate by the Issuers so that only Securities in
denominations of $1,000 or integral multiples thereof shall be purchased. To the
extent that any portion of the amount of Net Available Proceeds remains after
compliance with the preceding sentence and provided that all Holders of
Securities and other senior indebtedness have been given the opportunity to
tender their Securities or other senior indebtedness for purchase pursuant to
the Offer to Purchase, the Issuers or the Restricted Subsidiary may use the
remaining amount at their own discretion.

         (b) Not later than the date of the Offer with respect to an Offer to
Purchase pursuant to this Section 1014, the Issuers shall deliver to the Trustee
an Officers' Certificate as to (i) the Purchase Amount, (ii) the allocation of
the Net Available Proceeds from the Asset Disposition pursuant to which such
Offer is being made, including, if amounts are invested in Telecommunications
Assets or a Person in the Telecommunications Business, the actual assets or
Person acquired and (iii) the compliance of such allocation with the provisions
of Clause (a).

         The Issuers and the Trustee shall perform their respective obligations
specified in the Offer to Purchase. On or prior to the Purchase Date, the
Issuers shall (i) accept for payment (on a pro rata basis, if necessary)
Securities or portions thereof tendered pursuant to the Offer, (ii) deposit with
the Paying Agent (or, if the Issuers are acting as their own Paying Agent,
segregate and hold in trust as provided in Section 1003) money sufficient to pay
the purchase price of all Securities or portions thereof so accepted and (iii)
deliver or cause to be delivered to the Trustee all Securities so accepted
together with an Officers' Certificate stating the Securities or portions
thereof accepted for payment by the Issuers. The Paying Agent (or the Issuers,
if so acting) shall promptly mail or deliver to Holders of Securities so
accepted payment in an amount equal to the purchase price, and the Trustee shall
promptly authenticate and mail or deliver to such Holders a new Security equal
in principal amount to any unpurchased portion of the Security surrendered. Any
Security not accepted for payment shall be promptly mailed or delivered by the
Issuers to the Holder thereof. The Issuers shall publicly announce the results
of the Offer on or as soon as practicable after the Purchase Date.

         (c) Notwithstanding the foregoing, this Section 1014 shall not apply to
any Asset Disposition which constitutes a transfer, conveyance, sale, lease or
other disposition of all or substantially all of the Issuers' properties or
assets within the meaning of Section 801 hereof.

         Section 10.15. Limitation on Sale and Leaseback Transactions.

         The Issuers shall not, and shall not permit any of their respective
Restricted Subsidiaries to, enter into any Sale and Leaseback Transaction with
respect to any

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property of an Issuer or any of its Restricted Subsidiaries (other than a Sale
and Leaseback Transaction between an Issuer or a Restricted Subsidiary or any of
them).

         The preceding paragraph shall not prohibit the Issuers or any of their
respective Restricted Subsidiaries from entering into a Sale and Leaseback
Transaction if:

                           (1) the Issuers and their respective Restricted
                  Subsidiaries would be entitled to create or incur a Lien to
                  secure Indebtedness pursuant to the provisions of Section 1012
                  equal in amount to the Attributable Value of the Sale and
                  Leaseback Transaction without equally and ratably securing the
                  Securities; and

                           (2) the Sale and Leaseback Transaction is treated as
                  an Asset Disposition and the provisions of Section 1014 are
                  satisfied with respect to such Sale and Leaseback Transaction.

         Section 10.16. Change of Control Triggering Event.

         (a) If a Change of Control Triggering Event occurs, the Issuers shall
have the right to repurchase in whole the Securities at a redemption price equal
to the greater of:

                           (1) 101% of the aggregate principal amount of the
                  Securities, plus accrued and unpaid interest and Special
                  Interest on the Securities, if any (subject to the right of
                  Holders of record on the relevant record date to receive
                  interest due on the relevant Interest Payment Date); and

                           (2) the sum of the present values of the remaining
                  scheduled payments of principal and interest thereon (not
                  including the portion of any such payments of interest accrued
                  as of the Redemption Date) discounted to the Redemption Date
                  on a semiannual basis at the Adjusted Treasury Rate, plus
                  accrued and unpaid interest and Special Interest on the
                  Securities, if any.

         A "Change of Control Triggering Event" will be deemed to have occurred
if a Change of Control and a Rating Decline occur. A "Rating Decline" will be
deemed to have occurred if at any time within the earlier of (1) 90 days after
the date of public notice of a Change of Control, or of the intention of an
Issuer or of any Person to effect a Change of Control and (2) the occurrence of
the Change of Control (which period shall in either event be extended so long as
the rating of the Securities is under publicly announced consideration for
possible downgrade by a Rating Agency), the rating of the Securities is
decreased by either Rating Agency by one or more Gradations and the rating by
both Rating Agencies on the Securities following such downgrade is below
Investment Grade.

         Within 30 days following any Change of Control Triggering Event, the
Issuers shall mail a notice to each Holder and each holder of senior
Indebtedness of the Issuers

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containing similar provisions to those set forth in this Indenture describing
the transaction or transactions that constitute the Change of Control Triggering
Event and indicating the Issuers' intention to repurchase the Securities and
such other senior Indebtedness (in which case the provisions of Clause (b) of
this Section 1016 shall not be applicable) on the Change of Control Payment Date
specified in the notice. The Change of Control Payment Date shall be no earlier
than 30 days and not later than 60 days from the date the notice is mailed,
pursuant to the procedures required by this Indenture and described in such
notice.

         (b) If a Change of Control Triggering Event occurs, each Holder of
Securities shall have the right to require the Issuers to repurchase all or any
part (equal to $1,000 or an integral multiple of $1,000) of such Holder's
Securities pursuant to an Offer to Purchase. The offer price in any Offer to
Purchase shall be payable in cash and shall be 101% of the aggregate principal
amount of the Securities, plus accrued and unpaid interest and Special Interest
on the Securities, if any (subject to the right of Holders of record on the
relevant record date to receive interest due on the relevant Interest Payment
Date), to the date of purchase. Within 30 days following any Change of Control
Triggering Event, the Issuers shall mail a notice to each Holder and each holder
of senior Indebtedness of the Issuers containing provisions similar to those set
forth in this Indenture describing the transaction or transactions that
constitute the Change of Control Triggering Event and offering to repurchase
Securities and such other senior Indebtedness on the Change of Control Payment
Date specified in the notice. The Change of Control Payment Date shall be no
earlier than 30 days and not later than 60 days from the date the notice is
mailed, pursuant to the procedures required by this Indenture and described in
such notice.

         On the Change of Control Payment Date, the Issuers shall, to the extent
lawful:

                           (1) accept for payment all Securities or portions of
                  Securities properly tendered pursuant to the Offer to
                  Purchase;

                           (2) deposit with the Paying Agent an amount equal to
                  the Change of Control Payment in respect of all Securities or
                  portions of Securities properly tendered; and

                           (3) deliver or cause to be delivered to the Trustee
                  the Securities so accepted together with an Officers'
                  Certificate stating the aggregate principal amount of
                  Securities or portions of the Securities being purchased by
                  the Issuers.

         The Paying Agent shall promptly mail to each Holder of Securities
properly tendered the Change of Control Payment for such Securities, and the
Trustee shall promptly authenticate and mail (or cause to be transferred by book
entry) to each Holder a new Security equal in principal amount to any
unpurchased portion of the Securities surrendered, if any; provided that the new
Security shall be in a principal amount of $1,000 or an integral multiple of
$1,000.

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<PAGE>
         (c) The provisions of this Section 1016 described above are applicable
whether or not any other provisions of this Indenture are applicable. The
Issuers shall comply with the requirements of Section 14(e) of the Exchange Act
and any other securities laws or regulations to the extent those laws and
regulations are applicable to any Offer to Purchase.

         Section 10.17. Statement by Officers as to Default; Compliance
Certificates.

         (a) Each Issuer shall deliver to the Trustee, within 90 days after the
end of each fiscal year, and within 60 days after the end of each fiscal quarter
(other than the fourth fiscal quarter), of such Issuer ending after the date
hereof an Officers' Certificate, stating whether or not to the best knowledge of
the signers thereof such Issuer is in default in the performance and observance
of any of the terms, provisions and conditions of Section 801 or Sections 1004
to 1016, inclusive, and if such Issuer shall be in default, specifying all such
defaults and the nature and status thereof of which they may have knowledge.

         (b) Each Issuer shall deliver to the Trustee, as soon as possible and
in any event within 10 days after such Issuer becomes aware or should reasonably
become aware of the occurrence of an Event of Default or an event which, with
notice or the lapse of time or both, would constitute an Event of Default, an
Officers' Certificate setting forth the details of such Event of Default or
default, the period of existence thereof and the action which such Issuer
proposes to take with respect thereto.

         (c) Each Issuer shall deliver to the Trustee within 90 days after the
end of each fiscal year a written statement by such Issuer's independent public
accountants stating (A) that their audit examination has included a review of
the terms of this Indenture and the Securities as they relate to accounting
matters, and (B) whether, in connection with their audit examination, any event
which, with notice or the lapse of time or both, would constitute an Event of
Default has come to their attention and, if such a default has come to their
attention, specifying the nature and period of the existence thereof.

         Section 10.18. Waiver of Certain Covenants.

         The Issuers may omit in any particular instance to comply with any
covenant or condition set forth in Section 801 and Sections 1004 to 1016, if
before the time for such compliance the Holders of at least a majority in
principal amount of the Outstanding Securities shall, by Act of such Holders,
either waive such compliance in such instance or generally waive compliance with
such covenant or condition, but no such waiver shall extend to or affect such
covenant or condition except to the extent so expressly waived, and, until such
waiver shall become effective, the obligations of the Issuers and the duties of
the Trustee in respect of any such covenant or condition shall remain in full
force and effect; provided, however, with respect to an Offer to Purchase as to
which an Offer has been mailed, no such waiver may be made or shall be effective
against any Holder tendering Securities pursuant to such Offer, and the Issuers
may not omit to comply with the terms of such Offer as to such Holder.

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         Section 10.19. Provision of Financial Information.

         Whether or not required by the Commission, so long as any Securities
are outstanding, VoiceStream or VoiceStream Holdings, as the case may be, shall
file with the Commission the annual reports, quarterly reports and other
documents which VoiceStream or VoiceStream Holdings, as the case may be, would
have been required to file with the Commission pursuant to such Section 13(a) or
15(d)or any successor provision thereto if VoiceStream or VoiceStream Holdings,
as the case may be, were so required, such documents to be filed with the
Commission on or prior to the respective dates (the "Required Filing Dates") by
which VoiceStream or VoiceStream Holdings, as the case may be, would have been
required so to file such documents if VoiceStream or VoiceStream Holdings, as
the case may be, were so required.

         In addition, whether or not required by the Commission, so long as any
Securities are outstanding, VoiceStream or VoiceStream Holdings, as the case may
be, shall furnish to the Holders of Securities and the Trustee within 15 days of
each Required Filing Date copies of the annual reports, quarterly reports and
other documents which VoiceStream or VoiceStream Holdings, as the case may be,
files with the Commission pursuant to such Section 13(a) or 15(d) or any
successor provision thereto or would have been required to file with the
Commission pursuant to such Section 13(a) or 15(d) or any successor provisions
thereto if VoiceStream or VoiceStream Holdings, as the case may be, were
required to be subject to such Sections. If filing such documents by VoiceStream
or VoiceStream Holdings, as the case may be, with the Commission is not
permitted under the Securities Exchange Act of 1934, the VoiceStream or
VoiceStream Holdings, as the case may be, shall promptly upon written request
supply copies of such documents to any prospective Holder.

                                   ARTICLE 11
                            REDEMPTION OF SECURITIES

         Section 11.1. Right of Redemption.

         The Issuers will not have the right to redeem any Securities prior to
November 15, 2004 (other than out of the Net Cash Proceeds of a Public Equity
Offering or Strategic Equity Infusion, as described below, or upon a Change of
Control Triggering Event). The Securities will be redeemable at the option of
the Issuers, in whole or in part, at any time on or after November 15, 2004, at
the Redemption prices specified in the form of Security hereinbefore set forth
together with any applicable accrued interest, if any, thereon to the Redemption
Date. At any time on or prior to November 15, 2002, the Issuers may redeem, on
one or more occasions, up to an aggregate of 35% of the aggregate principal
amount at Maturity of the Securities originally outstanding at a redemption
price equal to 110.375% of the principal amount thereof, together with accrued
and unpaid interest, if any, to the date of redemption, with cash from the Net
Cash Proceeds to the Issuers of one or more Public Equity Offerings or Strategic
Equity Infusions; provided, that at least 65% of the aggregate principal amount
of the Securities originally outstanding remain outstanding immediately after
the occurrence of each such redemption; provided, further, that such notice of
redemption shall be sent within 30 days

                                       91
<PAGE>
after the date of closing of any such Public Equity Offering or Strategic Equity
Infusion, and such redemption shall occur within 60 days after the date such
notice is sent.

         Section 11.2. Applicability of Article.

         Redemption of Securities at the election of the Issuers, as permitted
by any provision of this Indenture, shall be made in accordance with such
provision and this Article.

         Section 11.3. Election to Redeem; Notice to Trustee.

         The election of the Issuers to redeem any Securities pursuant to
Section 1101 shall be evidenced by a Board Resolution. In case of any redemption
at the election of the Issuers of less than all the Securities, the Issuers
shall, at least 60 days prior to the Redemption Date fixed by the Issuers
(unless a shorter notice shall be satisfactory to the Trustee), notify the
Trustee of such Redemption Date and of the principal amount of Securities to be
redeemed.

         Section 11.4. Selection by Trustee of Securities to Be Redeemed.

         If less than all the Securities are to be redeemed, the particular
Securities to be redeemed shall be selected not more than 60 days prior to the
Redemption Date by the Trustee, from the Outstanding Securities not previously
called for redemption, by prorating, as nearly as may be practicable, the
principal amount of Securities to be redeemed. In any proration pursuant to this
Section, the Trustee shall make such adjustments, reallocations and eliminations
as it shall deem proper (and in compliance with the requirements of the
principal national securities exchange, if any, on which the Securities are
listed) to the end that the principal amount of Securities so prorated shall be
$1,000 or a multiple thereof, by increasing or decreasing or eliminating the
amount which would be allocable to any Holder on the basis of exact proportion
by an amount not exceeding $1,000.

         The Trustee shall promptly notify the Issuers and each Security
Registrar in writing of the Securities selected for redemption and, in the case
of any Securities selected for partial redemption, the principal amount thereof
to be redeemed.

         For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities shall relate,
in the case of any Securities redeemed or to be redeemed only in part, to the
portion of the principal amount of such Securities which has been or is to be
redeemed.

         Section 11.5. Notice of Redemption.

         Notice of redemption shall be given by first-class mail, postage
prepaid, mailed not less than 30 nor more than 60 days prior to the Redemption
Date, to each Holder of Securities to be redeemed, at his address appearing in
the Security Register.

         All notices of redemption shall state:

                                       92
<PAGE>
                           (1) the Redemption Date,

                           (2) the Redemption Price,

                           (3) if less than all the Outstanding Securities are
                  to be redeemed, the identification (and, in the case of
                  partial redemption, the principal amounts) of the particular
                  Securities to be redeemed,

                           (4) that on the Redemption Date the Redemption Price
                  will become due and payable upon each such Security to be
                  redeemed and that interest thereon will cease to accrue on and
                  after said date, and

                           (5) the place or places where such Securities are to
                  be surrendered for payment of the Redemption Price.

         Notice of redemption of Securities to be redeemed at the election of
the Issuers shall be given by the Issuers or, at the Issuers' request, by the
Trustee in the name and at the expense of the Issuers.

         Section 11.6. Deposit of Redemption Price.

         Prior to any Redemption Date, the Issuers shall deposit with the
Trustee or with a Paying Agent (or, if the Issuers are acting as their own
Paying Agent, segregate and hold in trust as provided in Section 1003) an amount
of money sufficient to pay the Redemption Price of, and (except if the
Redemption Date shall be an Interest Payment Date) accrued interest on, all the
Securities which are to be redeemed on that date.

         Section 11.7. Securities Payable on Redemption Date.

         Notice of redemption having been given as aforesaid, the Securities so
to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified, and from and after such date (unless the
Issuers shall default in the payment of the Redemption Price and accrued
interest) such Securities shall cease to bear interest. Upon surrender of any
such Security for redemption in accordance with said notice, such Security shall
be paid by the Issuers at the Redemption Price, together with accrued interest
to the Redemption Date; provided, however, that installments of interest whose
Stated Maturity is on or prior to the Redemption Date shall be payable to the
Holders of such Securities, or one or more Predecessor Securities, registered as
such at the close of business on the relevant Record Dates according to their
terms and the provisions of Section 308.

         If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal (and premium, if any) shall,
until paid, bear interest from the Redemption Date at the rate provided by the
Security.

         Section 11.8. Securities Redeemed in Part.

                                       93
<PAGE>
         Any Security which is to be redeemed only in part shall be surrendered
at an office or agency of the Issuers designated for that purpose pursuant to
Section 1002 (with, if the Issuers or the Trustee so requires, due endorsement
by, or a written instrument of transfer in form satisfactory to the Issuers and
the Trustee duly executed by, the Holder thereof or his attorney duly authorized
in writing), and the Issuers shall execute, and the Trustee shall authenticate
and deliver to the Holder of such Security without service charge, a new
Security or Securities, of any authorized denomination as requested by such
Holder, in aggregate principal amount equal to and in exchange for the
unredeemed portion of the principal of the Security so surrendered.

                                   ARTICLE 12
                       DEFEASANCE AND COVENANT DEFEASANCE

         Section 12.1. Issuers' Option to Effect Defeasance or Covenant
                       Defeasance.

         The Issuers may at their option by Board Resolution, at any time, elect
to have either Section 1202 or Section 1203 applied to the Outstanding
Securities upon compliance with the conditions set forth below in this Article
Twelve.

         Section 12.2. Defeasance and Discharge.

         Upon the Issuers' exercise of the option provided in Section 1201
applicable to this Section, the Issuers shall be deemed to have been discharged
from their obligations with respect to the Outstanding Securities on the date
the conditions set forth below are satisfied (hereinafter, "defeasance"). For
this purpose, such defeasance means that the Issuers shall be deemed to have
paid and discharged the entire indebtedness represented by the Outstanding
Securities and to have satisfied all its other obligations under such Securities
and this Indenture insofar as such Securities are concerned (and the Trustee, at
the expense of the Issuers, shall execute proper instruments acknowledging the
same), except for the following which shall survive until otherwise terminated
or discharged hereunder: (A) the rights of Holders of such Securities to
receive, solely from the trust fund described in Section 1204 and as more fully
set forth in such Section, payments in respect of the principal of (and premium,
if any) and interest on such Securities when such payments are due, (B) the
Issuers' obligations with respect to such Securities under Sections 304, 305,
306, 307, 1002 and 1003, (C) the rights, powers, trusts, duties and immunities
of the Trustee hereunder and (D) this Article Twelve. Subject to compliance with
this Article Twelve, the Issuers may exercise its option under this Section 1202
notwithstanding the prior exercise of its option under Section 1203.

         Section 12.3. Covenant Defeasance.

         Upon the Issuers' exercise of the option provided in Section 1201
applicable to this Section, (i) the Issuers shall be released from its
obligations under Sections 1005 through 1016, inclusive, and Clauses (3) and (4)
of Section 801 and (ii) the occurrence of an event specified in Sections 501(3)
(with respect to Clauses (2), (3) or (4) of Section 801), 501(4) (with respect
to any of Sections 1005 through 1016, inclusive), 501(5) and 501(6) shall not be
deemed to be an Event of Default on and after the date the conditions

                                       94
<PAGE>
set forth below are satisfied (hereinafter, "covenant defeasance"). For this
purpose, such covenant defeasance means that the Issuers may omit to comply with
and shall have no liability in respect of any term, condition or limitation set
forth in any such Section, Clause or Article, whether directly or indirectly by
reason of any reference elsewhere herein to any such Section, Clause or Article
or by reason of any reference in any such Section, Clause or Article to any
other provision herein or in any other document, but the remainder of this
Indenture and such Securities shall be unaffected thereby.

         Section 12.4. Conditions to Defeasance or Covenant Defeasance.

         The following shall be the conditions to application of either Section
1202 or Section 1203 to the then Outstanding Securities:

                           (1) The Issuers shall irrevocably have deposited or
                  caused to be deposited with the Trustee (or another trustee
                  satisfying the requirements of Section 609 who shall agree to
                  comply with the provisions of this Article Twelve applicable
                  to it) as trust funds in trust for the purpose of making the
                  following payments, specifically pledged as security for, and
                  dedicated solely to, the benefit of the Holders of such
                  Securities, (A) money in an amount, or (B) U.S. Government
                  Obligations which through the scheduled payment of principal
                  and interest in respect thereof in accordance with their
                  terms, without the need for reinvestment, will provide, not
                  later than one day before the due date of any payment, money
                  in an amount, or (C) a combination thereof, sufficient, in the
                  opinion of a nationally recognized firm of independent public
                  accountants expressed in a written certification thereof
                  delivered to the Trustee, to pay and discharge, and which
                  shall be applied by the Trustee (or other qualifying trustee)
                  to pay and discharge, the principal of (and premium, if any),
                  and each installment of interest on the Securities on the
                  Stated Maturity of such principal or instalment of interest in
                  accordance with the terms of this Indenture and of such
                  Securities. For this purpose, "U.S. Government Obligations"
                  means securities that are (x) direct obligations of the United
                  States of America for the payment of which its full faith and
                  credit is pledged or (y) obligations of a Person controlled or
                  supervised by and acting as an agency or instrumentality of
                  the United States of America the payment of which is
                  unconditionally Guaranteed as a full faith and credit
                  obligation by the United States of America, which, in either
                  case, are not callable or redeemable at the option of the
                  issuer thereof, and shall also include a depository receipt
                  issued by a bank (as defined in Section 3(a)(2) of the
                  Securities Act of 1933, as amended) as custodian with respect
                  to any such U.S. Government Obligation or a specific payment
                  of principal of or interest on any such U.S. Government
                  Obligation held by such custodian for the account of the
                  holder of such depository receipt, provided that

                                       95
<PAGE>
                  (except as required by law) such custodian is not authorized
                  to make any deduction from the amount payable to the holder of
                  such depository receipt from any amount received by the
                  custodian in respect of the U.S. Government Obligation or the
                  specific payment of principal of or interest on the U.S.
                  Government Obligation evidenced by such depository receipt.

                           (2) In the case of an election under Section 1202,
                  the Issuers shall have delivered to the Trustee an Opinion of
                  Counsel stating that (x) the Issuers have received from, or
                  there has been published by, the Internal Revenue Service a
                  ruling, or (y) since the date of this Indenture there has been
                  a change in the applicable Federal income tax law, in either
                  case to the effect that, and based thereon such opinion shall
                  confirm that, the Holders of the Outstanding Securities will
                  not recognize gain or loss for Federal income tax purposes as
                  a result of such deposit, defeasance and discharge and will be
                  subject to Federal income tax on the same amount, in the same
                  manner and at the same times as would have been the case if
                  such deposit, defeasance and discharge had not occurred.

                           (3) In the case of an election under Section 1203,
                  the Issuers shall have delivered to the Trustee an Opinion of
                  Counsel to the effect that the Holders of the Outstanding
                  Securities will not recognize gain or loss for Federal income
                  tax purposes as a result of such deposit and covenant
                  defeasance and will be subject to Federal income tax on the
                  same amount, in the same manner and at the same times as would
                  have been the case if such deposit and covenant defeasance had
                  not occurred.

                           (4) The Issuers shall have delivered to the Trustee
                  an Officer's Certificate to the effect that the Securities, if
                  then listed on any securities exchange, will not be delisted
                  as a result of such deposit.

                           (5) Such defeasance or covenant defeasance shall not
                  cause the Trustee to have a conflicting interest as defined in
                  Section 608 and for purposes of the Trust Indenture Act with
                  respect to any securities of the Issuers.

                           (6) No Event of Default or event which with notice or
                  lapse of time or both would become an Event of Default shall
                  have occurred and be continuing on the date of such deposit
                  or, insofar as subsections 501(7) and (8) are concerned, at
                  any time during the period ending on the 121st day after the
                  date of such deposit (it being understood that this condition
                  shall not be deemed satisfied until the expiration of such
                  period).

                                       96
<PAGE>
                           (7) Such defeasance or covenant defeasance shall not
                  result in a breach or violation of, or constitute a default
                  under, any other agreement or instrument to which the Issuers
                  are a party or by which it is bound.

                           (8) The Issuers shall have delivered to the Trustee
                  an Officers' Certificate and an Opinion of Counsel, each
                  stating that all conditions precedent provided for relating to
                  either the defeasance under Section 1202 or the covenant
                  defeasance under Section 1203 (as the case may be) have been
                  complied with.

                           (9) Such defeasance or covenant defeasance shall not
                  result in the trust arising from such deposit constituting an
                  investment company as defined in the Investment Company Act of
                  1940, as amended, or such trust shall be qualified under such
                  act or exempt from regulation thereunder.

Section 12.5. Deposited Money and U.S. Government Obligations to be Held in
              Trust; Other Miscellaneous Provisions.

         Subject to the provisions of the last paragraph of Section 1003, all
money and U.S. Government Obligations (including the proceeds thereof) deposited
with the Trustee (or other qualifying trustee--collectively, for purposes of
this Section 1205, the "Trustee") pursuant to Section 1204 in respect of the
Securities shall be held in trust and applied by the Trustee, in accordance with
the provisions of such Securities and this Indenture, to the payment, either
directly or through any Paying Agent (including the Issuers acting as their own
Paying Agent) as the Trustee may determine, to the Holders of such Securities,
of all sums due and to become due thereon in respect of principal (and premium,
if any) and interest, but such money need not be segregated from other funds
except to the extent required by law.

         The Issuers shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the U.S. Government Obligations
deposited pursuant to Section 1204 or the principal and interest received in
respect thereof other than any such tax, fee or other charge which by law is for
the account of the Holders of the Outstanding Securities.

         Anything in this Article Twelve to the contrary notwithstanding, the
Trustee shall deliver or pay to the Issuers from time to time upon Issuers'
Request any money or U.S. Government Obligations held by it as provided in
Section 1204 which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee, are in excess of the amount thereof which would then
be required to be deposited to effect an equivalent defeasance or covenant
defeasance.

         Section 12.6. Reinstatement.

                                       97
<PAGE>
         If the Trustee or the Paying Agent is unable to apply any money in
accordance with Section 1202 or 1203 by reason of any order or judgment of any
court or governmental authority enjoining, restraining or otherwise prohibiting
such application, then the Issuers' obligations under this Indenture and the
Securities shall be revived and reinstated as though no deposit had occurred
pursuant to this Article Twelve until such time as the Trustee or Paying Agent
is permitted to apply all such money in accordance with Section 1202 or 1203;
provided, however, that if the Issuers make any payment of principal of (and
premium, if any) or interest on any Security following the reinstatement of
their obligations, the Issuers shall be subrogated to the rights of the Holders
of such Securities to receive such payment from the money held by the Trustee or
the Paying Agent.____________________

         This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument

                                       98
<PAGE>
         IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, all as of the day and year first above written.

                                       VOICESTREAM WIRELESS CORPORATION

                                       By______________________________
                                                Name:  Donald Guthrie
                                                Title:  Vice Chairman

Attest:

______________________________
Name:  Alan R. Bender

                                       VOICESTREAM WIRELESS HOLDING CORPORATION

                                       By______________________________
                                                Name:  Donald Guthrie
                                                Title:  Vice Chairman

Attest:

______________________________
Name:  Alan R. Bender

                                       Harris Trust Company of California, as
                                       Trustee

                                       By______________________________
                                                Authorized Officer
<PAGE>
                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                          Page
                                                                                                          ----
<S>                                                                                                       <C>
ARTICLE 1 - Definitions and Other Provisions of General Application.....................................    1

         Section 1.1.      Definitions..................................................................    1
         Section 1.2.      Compliance Certificates and Opinions.........................................   27
         Section 1.3.      Form of Documents Delivered to Trustee.......................................   27
         Section 1.4.      Acts of Holders; Record Date.................................................   28
         Section 1.5.      Notices, Etc., to Trustee and Issuer.........................................   29
         Section 1.6.      Notice to Holders; Waiver....................................................   29
         Section 1.7.      Conflict with Trust Indenture Act............................................   30
         Section 1.8.      Effect of Headings and Table of Contents.....................................   30
         Section 1.9.      Successors and Assigns.......................................................   30
         Section 1.10.     Separability Clause..........................................................   30
         Section 1.11.     Benefits of Indenture........................................................   30
         Section 1.12.     Governing Law................................................................   30
         Section 1.13.     Legal Holidays...............................................................   30

ARTICLE 2 - Security Forms..............................................................................   31

         Section 2.1.      Forms Generally..............................................................   31
         Section 2.2.      Form of Face of Security.....................................................   31
         Section 2.3.      Form of Reverse of Security..................................................   35
         Section 2.4.      Form of Trustee's Certificate of Authentication..............................   38

ARTICLE 3 - The Securities..............................................................................   39

         Section 3.1.      Title and Terms..............................................................   39
         Section 3.2.      Denominations................................................................   40
         Section 3.3.      Execution, Authentication, Delivery and Dating...............................   40
         Section 3.4.      Temporary Securities.........................................................   41
         Section 3.5.      Global Securities............................................................   41
         Section 3.6.      Registration, Registration of Transfer and Exchange Generally;
                           Certain Transfers and Exchanges; Securities Act Legends......................   43
         Section 3.7.      Mutilated, Destroyed, Lost and Stolen Securities.............................   47
         Section 3.8.      Payment of Interest; Interest Rights Preserved...............................   48
         Section 3.9.      Persons Deemed Owners........................................................   49
         Section 3.10.     Cancellation.................................................................   50
         Section 3.11.     Computation of Interest......................................................   50

ARTICLE 4 - Satisfaction and Discharge..................................................................   50

         Section 4.1.      Satisfaction and Discharge of Indenture......................................   50
         Section 4.2.      Application of Trust Money...................................................   51

ARTICLE 5 - Remedies....................................................................................   52

         Section 5.1.      Events of Default............................................................   52
         Section 5.2.      Acceleration of Maturity; Rescission and Annulment...........................   54
</TABLE>
<PAGE>
<TABLE>
<S>                                                                                                        <C>
         Section 5.3.      Collection of Indebtedness and Suits for Enforcement
                           by Trustee...................................................................   55
         Section 5.4.      Trustee May File Proofs of Claim.............................................   56
         Section 5.5.      Trustee May Enforce Claims Without Possession of Securities..................   56
         Section 5.6.      Application of Money Collected...............................................   56
         Section 5.7.      Limitation on Suits..........................................................   57
         Section 5.8.      Unconditional Right of Holders to Receive Principal,
                           Premium and Interest.........................................................   57
         Section 5.9.      Restoration of Rights and Remedies...........................................   58
         Section 5.10.     Rights and Remedies Cumulative...............................................   58
         Section 5.11.     Delay or Omission Not Waiver.................................................   58
         Section 5.12.     Control by Holders...........................................................   58
         Section 5.13.     Waiver of Past Defaults......................................................   59
         Section 5.14.     Undertaking for Costs........................................................   59
         Section 5.15.     Waiver of Stay or Extension Laws.............................................   59

ARTICLE 6 - The Trustee.................................................................................   60

         Section 6.1.      Certain Duties and Responsibilities..........................................   60
         Section 6.2.      Notice of Defaults...........................................................   60
         Section 6.3.      Certain Rights of Trustee....................................................   60
         Section 6.4.      Not Responsible for Recitals or Issuance of Securities.......................   61
         Section 6.5.      May Hold Securities..........................................................   62
         Section 6.6.      Money Held in Trust..........................................................   62
         Section 6.7.      Compensation and Reimbursement...............................................   62
         Section 6.8.      Disqualification; Conflicting Interests......................................   63
         Section 6.9.      Corporate Trustee Required; Eligibility......................................   63
         Section 6.10.     Resignation and Removal; Appointment of Successor............................   63
         Section 6.11.     Acceptance of Appointment by Successor.......................................   64
         Section 6.12.     Merger, Conversion, Consolidation or Succession to Business..................   65
         Section 6.13.     Preferential Collection of Claims Against the Issuers........................   65
         Section 6.14.     Appointment of Authenticating Agent..........................................   65

ARTICLE 7 - Holders' Lists and Reports by Trustee and Issuers...........................................   67

         Section 7.1.      Issuers to Furnish Trustee Names and Addresses of Holders....................   67
         Section 7.2.      Preservation of Information; Communications to Holders.......................   67
         Section 7.3.      Reports by Trustee...........................................................   67
         Section 7.4.      Reports by Issuers...........................................................   67

ARTICLE 8 - Consolidation, Merger, Conveyance, Transfer or Lease........................................   68

         Section 8.1.      Issuers May Consolidate, Etc. Only on Certain Terms..........................   68
         Section 8.2.      Successor Substituted........................................................   69
         Section 8.3.      Effect of the Reorganizations................................................   69

ARTICLE 9 - Supplemental Indentures.....................................................................   70

         Section 9.1.      Supplemental Indentures Without Consent of Holders...........................   70
         Section 9.2.      Supplemental Indentures with Consent of Holders..............................   70
         Section 9.3.      Execution of Supplemental Indentures.........................................   71
</TABLE>

                                       ii
<PAGE>
<TABLE>
<S>                                                                                                        <C>
         Section 9.4.      Effect of Supplemental Indentures............................................   72
         Section 9.5.      Conformity with Trust Indenture Act..........................................   72
         Section 9.6.      Reference in Securities to Supplemental Indentures...........................   72
         Section 9.7.      Notice of Supplemental Indenture.............................................   72

ARTICLE 10 - Covenants..................................................................................   72

         Section 10.1.     Payment of Principal, Premium and Interest...................................   72
         Section 10.2.     Maintenance of Office or Agency..............................................   72
         Section 10.3.     Money for Security Payments to be Held in Trust..............................   73
         Section 10.4.     Existence....................................................................   74
         Section 10.5.     Maintenance of Properties....................................................   74
         Section 10.6.     Payment of Taxes and Other Claims............................................   75
         Section 10.7.     Maintenance of Insurance.....................................................   75
         Section 10.8.     Limitation on Consolidated Indebtedness......................................   75
         Section 10.9.     Limitation on Issuances and Sales of Capital Stock
                           of Restricted Subsidiaries...................................................   78
         Section 10.10.    Limitation on Restricted Payments............................................   79
         Section 10.11.    Limitations Concerning Distributions and
                           Transfers By Restricted Subsidiaries.........................................   81
         Section 10.12.    Limitation on Liens..........................................................   83
         Section 10.13.    Limitation on Transactions with Affiliates and Related Persons...............   84
         Section 10.14.    Limitation on Certain Asset Dispositions.....................................   86
         Section 10.15.    Limitation on Sale and Leaseback Transactions................................   87
         Section 10.16.    Change of Control Triggering Event...........................................   88
         Section 10.17.    Statement by Officers as to Default; Compliance Certificates.................   90
         Section 10.18.    Waiver of Certain Covenants..................................................   90
         Section 10.19.    Provision of Financial Information...........................................   91

ARTICLE 11 - Redemption of Securities...................................................................   91

         Section 11.1.     Right of Redemption..........................................................   91
         Section 11.2.     Applicability of Article.....................................................   92
         Section 11.3.     Election to Redeem; Notice to Trustee........................................   92
         Section 11.4.     Selection by Trustee of Securities to Be Redeemed............................   92
         Section 11.5.     Notice of Redemption.........................................................   92
         Section 11.6.     Deposit of Redemption Price..................................................   93
         Section 11.7.     Securities Payable on Redemption Date........................................   93
         Section 11.8.     Securities Redeemed in Part..................................................   93

ARTICLE 12 - Defeasance and Covenant Defeasance.........................................................   94

         Section 12.1.     Issuers' Option to Effect Defeasance or Covenant Defeasance..................   94
         Section 12.2.     Defeasance and Discharge.....................................................   94
         Section 12.3.     Covenant Defeasance..........................................................   94
         Section 12.4.     Conditions to Defeasance or Covenant Defeasance..............................   95
         Section 12.5.     Deposited Money and U.S. Government Obligations
                           to be Held in Trust; Other Miscellaneous Provisions..........................   97
         Section 12.6.     Reinstatement................................................................   97
</TABLE>

                                      iii

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