CREDIT AGREEMENT among TIME WARNER TELECOM INC., TIME WARNER TELECOM HOLDINGS INC., as Borrower, The Several Lenders from Time to Time Parties Hereto, LEHMAN COMMERCIAL PAPER INC., as Administrative Agent and Collateral Agent, MORGAN STANLEY SENIOR...

EXHIBIT 10.19

EXECUTION COPY

$150,000,000

CREDIT AGREEMENT

among

TIME WARNER TELECOM INC.,

TIME WARNER TELECOM HOLDINGS INC.,

as Borrower,

The Several Lenders

from Time to Time Parties Hereto,

XXXXXX COMMERCIAL PAPER INC.,

as Administrative Agent and Collateral Agent,

XXXXXX XXXXXXX SENIOR FUNDING, INC.,

as Syndication Agent,

and

WACHOVIA BANK, NATIONAL ASSOCIATION and

BEAR XXXXXXX CORPORATE LENDING INC.,

as Co-Documentation Agents

Dated as of February 20, 2004

XXXXXX BROTHERS INC. and

XXXXXX XXXXXXX SENIOR FUNDING, INC.,

as Joint Lead Arrangers and Joint Bookrunners

WACHOVIA CAPITAL MARKETS, LLC (d/b/a WACHOVIA SECURITIES) and

BEAR, XXXXXXX & CO. INC.,

as Co-Arrangers

TABLE OF CONTENTS


		Page

SECTION 1.	DEFINITIONS	1

1.1.	Defined Terms	1
1.2.	Other Definitional Provisions	20

SECTION 2.	AMOUNT AND TERMS OF COMMITMENTS	21

2.1.	Revolving Commitments; Additional Commitments; Incremental Facility	21
2.2.	Procedure for Borrowing	22
2.3.	Repayment of Loans	23
2.4.	Swingline Commitment	23
2.5.	Procedure for Swingline Borrowing; Refunding of Swingline Loans	23
2.6.	Commitment Fees, etc.	25
2.7.	Optional Termination or Reduction of Revolving Commitments	25
2.8.	Optional Prepayments	25
2.9.	Conversion and Continuation Options	25
2.10.	Limitations on Eurodollar Loans	26
2.11.	Interest Rates and Payment Dates	26
2.12.	Computation of Interest and Fees	26
2.13.	Inability to Determine Interest Rate	27
2.14.	Pro Rata Treatment and Payments	27
2.15.	Requirements of Law	28
2.16.	Taxes	29
2.17.	Indemnity	31
2.18.	Change of Lending Office	31
2.19.	Replacement of Lenders	32
2.20.	Change of Control	32

SECTION 3.	LETTERS OF CREDIT	32

3.1.	L/C Commitment	32
3.2.	Procedure for Issuance of Letter of Credit	33
3.3.	Fees and Other Charges	33
3.4.	L/C Participations	33
3.5.	Reimbursement Obligation of the Borrower	34
3.6.	Obligations Absolute	34
3.7.	Letter of Credit Payments	35
3.8.	Applications	35

SECTION 4.	REPRESENTATIONS AND WARRANTIES	35

4.1.	Financial Condition	35
4.2.	No Change	36


4.3.	Existence; Compliance with Law	36
4.4.	Power; Authorization; Enforceable Obligations	36
4.5.	No Legal Bar	36
4.6.	Litigation	37
4.7.	No Default	37
4.8.	Ownership of Property; Liens	37
4.9.	Intellectual Property	37
4.10.	Taxes	37
4.11.	Federal Regulations	37
4.12.	Labor Matters	38
4.13.	ERISA	38
4.14.	Investment Company Act; Other Regulations	38
4.15.	Subsidiaries	38
4.16.	Use of Proceeds	38
4.17.	Environmental Matters	39
4.18.	Accuracy of Information, etc.	39
4.19.	Security Documents	40
4.20.	Solvency	40
4.21.	Certain Documents	40
4.22.	Priority Lien Debt	40

SECTION 5.	CONDITIONS PRECEDENT	40

5.1.	Conditions to Effectiveness	40
5.2.	Conditions to Initial Extension of Credit	41
5.3.	Conditions to Each Extension of Credit	43

SECTION 6.	AFFIRMATIVE COVENANTS	44

6.1.	Financial Statements	44
6.2.	Certificates; Other Information	45
6.3.	Payment of Obligations	46
6.4.	Maintenance of Existence; Compliance	46
6.5.	Maintenance of Property; Insurance	46
6.6.	Inspection of Property; Books and Records; Discussions	46
6.7.	Notices	46
6.8.	Environmental Laws	47
6.9.	Additional Collateral; Additional Subsidiary Guarantors, etc.	47

SECTION 7.	NEGATIVE COVENANTS	49

7.1.	Financial Condition Covenants	50
7.2.	Indebtedness	50
7.3.	Liens	53
7.4.	Fundamental Changes	55
7.5.	Disposition of Property	55
7.6.	Restricted Payments	56
7.7.	Capital Expenditures	57
7.8.	Investments	57


7.9.	Optional Payments, Refinancings and Modifications of Certain Debt Instruments	58
7.10.	Transactions with Affiliates	59
7.11.	Sales and Leasebacks	59
7.12.	Changes in Fiscal Periods	59
7.13.	Negative Pledge Clauses	59
7.14.	Clauses Restricting Subsidiary Distributions	60
7.15.	Lines of Business; Holding Company Status	60
7.16.	Modifications to Time Warner Arrangements and Material Rights and Privileges	60

SECTION 8.	EVENTS OF DEFAULT	60

SECTION 9.	THE AGENTS	63

9.1.	Appointment	63
9.2.	Delegation of Duties	63
9.3.	Exculpatory Provisions	64
9.4.	Reliance by Administrative Agent and Collateral Agent	64
9.5.	Notice of Default	64
9.6.	Non-Reliance on Agents and Other Lenders	65
9.7.	Indemnification	65
9.8.	Agent in Its Individual Capacity	65
9.9.	Successor Administrative Agent	65
9.10.	Successor Collateral Agent	66
9.11.	Syndication Agent and Co-Documentation Agents	66

SECTION 10.	MISCELLANEOUS	66

10.1.	Amendments and Waivers	66
10.2.	Notices	68
10.3.	No Waiver; Cumulative Remedies	69
10.4.	Survival of Representations and Warranties	69
10.5.	Payment of Expenses and Taxes	69
10.6.	Successors and Assigns; Participations and Assignments	70
10.7.	Adjustments; Set-off	72
10.8.	Counterparts	73
10.9.	Severability	73
10.10.	Integration	73
10.11.	GOVERNING LAW	73
10.12.	Submission To Jurisdiction; Waivers	74
10.13.	Acknowledgments	74
10.14.	Releases of Guarantees and Liens	74
10.15.	Confidentiality	75
10.16.	WAIVERS OF JURY TRIAL	75

iii

ANNEX:


A		Pricing Grid

SCHEDULES:

1.1A		Revolving Commitments
4.4		Consents, Authorizations, Filings and Notices
4.15		Subsidiaries
7.2(e)		Existing Indebtedness
7.3(f)		Existing Liens
7.10		Affiliate Transactions

EXHIBITS:


A		Form of Guarantee and Collateral Agreement
B		Form of Compliance Certificate
C		Form of Closing Certificate
D-1		Form of New Lender Supplement
D-2		Form of Increased Facility Activation Notice
E		Form of Assignment and Acceptance
F		Form of Exemption Certificate
G		Form of Intercreditor Agreement
H		Form of Intercompany Subordinated Note
I		Form of Note

CREDIT AGREEMENT, dated as of February 20, 2004, among TIME WARNER TELECOM INC., a Delaware corporation (“TWTC”), TIME WARNER TELECOM HOLDINGS INC., a Delaware corporation (the “Borrower”), the several banks and other financial institutions or entities from time to time parties to this Agreement (the “Lenders”), XXXXXX XXXXXXX SENIOR FUNDING, INC., as syndication agent (in such capacity, the “Syndication Agent”), WACHOVIA BANK, NATIONAL ASSOCIATION and BEAR XXXXXXX CORPORATE LENDING INC., as co-documentation agents (in such capacities, the “Co-Documentation Agents”), and XXXXXX COMMERCIAL PAPER INC. (“LCPI”), as administrative agent (in such capacity, the “Administrative Agent”), and as collateral agent (in such capacity, the “Collateral Agent”).

W I T N E S S E T H:

WHEREAS, the Borrower has requested the Lenders to make available the credit facilities described herein; and

WHEREAS, the Lenders are willing to make such credit facilities available to the Borrower upon and subject to the terms and conditions hereinafter set forth;

NOW, THEREFORE, in consideration of the premises and the agreements hereinafter set forth, the parties hereby agree as follows:

SECTION 1. DEFINITIONS

1.1. Defined Terms. As used in this Agreement, the terms listed in this Section 1.1 shall have the respective meanings set forth in this Section 1.1.

“ABR”: for any day, a rate per annum (rounded upwards, if necessary, to the next 1/16 of 1%) equal to the greater of (a) the Prime Rate in effect on such day and (b) the Federal Funds Effective Rate in effect on such day plus ½ of 1%. For purposes hereof: “Prime Rate” shall mean the prime lending rate as set forth on the British Banking Association Telerate Page 5 (or such other comparable publicly available page as may, in the reasonable opinion of the Administrative Agent after notice to the Borrower, replace such page for the purpose of displaying such rate if such rate no longer appears on the British Bankers Association Telerate page 5), as in effect from time to time. The Prime Rate is a reference rate and does not necessarily represent the lowest or best rate actually available. Any change in the ABR due to a change in the Prime Rate or the Federal Funds Effective Rate shall be effective as of the opening of business on the effective day of such change in the Prime Rate or the Federal Funds Effective Rate, respectively

“ABR Loans”: Loans the rate of interest applicable to which is based upon the ABR.

“Accelerated Revolving Termination Date”: April 14, 2008.

“Adjustment Date”: as defined in the Pricing Grid.

“Administrative Agent”: as defined in the preamble hereto.

“Affiliate”: as to any Person, any other Person that, directly or indirectly, is in control of, is controlled by, or is under common control with, such Person. For purposes of this definition, “control” of a Person means the power, directly or indirectly, either to (a) vote 10% or more of the securities having ordinary voting power for the election of directors (or persons performing similar functions) of such

Person or (b) direct or cause the direction of the management and policies of such Person, whether by contract or otherwise.

“Agents”: the collective reference to the Syndication Agent, the Co-Documentation Agents, the Collateral Agent and the Administrative Agent.

“Aggregate Exposure”: with respect to any Lender at any time, the amount of such Lender’s Revolving Commitment then in effect or, if the Revolving Commitments have been terminated, the amount of such Lender’s Revolving Extensions of Credit then outstanding.

“Aggregate Exposure Percentage”: with respect to any Lender at any time, the ratio (expressed as a percentage) of such Lender’s Aggregate Exposure at such time to the Aggregate Exposure of all Lenders at such time.

“Agreement”: this Credit Agreement, as amended, supplemented or otherwise modified from time to time.

“Annualized Consolidated EBITDA”: for any fiscal quarter, an amount equal to Consolidated EBITDA for such period multiplied by four.

“Applicable Margin”: means, for any day, the applicable rate per annum set forth in the Pricing Grid; provided that prior to the first Adjustment Date occurring after the date that is six months following the Effective Date, such applicable rate shall be (a) in the case of ABR Loans, 1.75%, and (b) in the case of Eurodollar Loans, 3.00%.

“Application”: an application, in such form as the Issuing Lender may specify from time to time, requesting the Issuing Lender to open a Letter of Credit.

“Approved Fund”: with respect to any Lender that is a fund or similar investment vehicle, any other fund or similar investment vehicle that is managed or advised by the same investment advisor as such Lender or by an Affiliate of such investment advisor.

“Assignee”: as defined in Section 10.6(c).

“Assignment and Acceptance”: an Assignment and Acceptance, substantially in the form of Exhibit E.

“Assignor”: as defined in Section 10.6(c).

“Available Revolving Commitment”: as to any Revolving Lender at any time, an amount equal to the excess, if any, of (a) such Lender’s Revolving Commitment then in effect over (b) such Lender’s Revolving Extensions of Credit then outstanding; provided, that solely for the purpose of determining such Lender’s Available Revolving Commitment pursuant to Section 2.6(a), (x) for each Lender other than the Swingline Lender, the aggregate principal amount of Swingline Loans then outstanding shall be deemed to be zero and (y) for the Swingline Lender, the aggregate principal amount of Swingline Loans then outstanding shall be considered for the purpose of determining the Swingline Lender’s Available Revolving Commitment.

“Benefitted Lender”: as defined in Section 10.7(a).

“Board”: the Board of Governors of the Federal Reserve System of the United States (or any successor).

“Borrower”: as defined in the preamble hereto.

“Borrowing Date”: any Business Day specified by the Borrower as a date on which the Borrower requests the relevant Lenders to make Loans hereunder.

“Business”: as defined in Section 4.17(b).

“Business Day”: a day other than a Saturday, Sunday or other day on which commercial banks in New York City are authorized or required by law to close, provided, that with respect to notices and determinations in connection with, and payments of principal and interest on, Eurodollar Loans, such day is also a day for trading by and between banks in Dollar deposits in the interbank eurodollar market.

“Capital Expenditures”: for any period, with respect to any Person, the aggregate of all expenditures by such Person and its Subsidiaries for the acquisition or leasing (pursuant to a capital lease) of fixed or capital assets or additions to equipment (including replacements, capitalized repairs and improvements during such period) that should be capitalized under GAAP on a consolidated balance sheet of such Person and its Subsidiaries.

“Capital Lease Obligations”: as to any Person, the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP and, for the purposes of this Agreement, the amount of such obligations at any time shall be the capitalized amount thereof at such time determined in accordance with GAAP.

“Capital Stock”: any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all equivalent ownership interests in a Person (other than a corporation) and any and all warrants, rights or options to purchase any of the foregoing.

“Cash Equivalents”: (a) marketable direct obligations issued by, or unconditionally guaranteed by, the United States Government or issued by any agency thereof or backed by the full faith and credit of the United States, in each case maturing within one year from the date of acquisition; (b) certificates of deposit, time deposits, eurodollar time deposits, overnight bank deposits or bankers acceptances having maturities of one year or less from the date of acquisition issued by any Lender or by any commercial bank organized under the laws of the United States or any state thereof having combined capital and surplus of not less than $500,000,000; (c) commercial paper of an issuer rated at least A-1 by S&P or P-1 by Xxxxx’x, or carrying an equivalent rating by a nationally recognized rating agency, if both of the two named rating agencies cease publishing ratings of commercial paper issuers generally, and maturing within nine months from the date of acquisition; (d) repurchase obligations of any Lender or of any commercial bank satisfying the requirements of clause (b) of this definition, having a term of not more than 30 days, with respect to securities issued or fully guaranteed or insured by the United States government; (e) securities with maturities of one year or less from the date of acquisition issued or fully guaranteed by any state, commonwealth or territory of the United States, by any political subdivision or taxing authority of any such state, commonwealth or territory or by any foreign government, the securities of which state, commonwealth, territory, political subdivision, taxing authority or foreign government (as the case may be) are rated at least A by S&P or A by Xxxxx’x; (f) securities with maturities of six months

or less from the date of acquisition backed by standby letters of credit issued by any Lender or any commercial bank satisfying the requirements of clause (b) of this definition; (g) corporate debt securities with maturities of 18 months or less from the date of acquisition and which are rated at least A3 by Xxxxx’x or A1 by S&P; or (h) shares of money market mutual or similar funds which invest substantially exclusively in assets satisfying the requirements of clauses (a) through (g) of this definition.

“Cash Management Obligations”: all obligations and liabilities of TWTC and its Subsidiaries (whether directly or as a guarantor) arising under or in connection with treasury, depositary, cash management, custodial, automated clearinghouse or transfer of funds services or arrangements or similar services and arrangements.

“Cash Pay Preferred Stock”: any class or series of Capital Stock of any Person that by its terms or otherwise (i) is required to be redeemed prior to the date (the “Expiration Date”) which is one year after the Initial Revolving Termination Date (or, if extended, the final maturity date of the Loans and the expiration of the Revolving Commitments hereunder), (ii) is redeemable at the option of the holder of such class or series of Capital Stock at any time prior to the Expiration Date, (iii) is convertible into or exchangeable for (unless solely at the option of such Person) Capital Stock referred to in clause (i) or (ii) above or Indebtedness having a scheduled maturity prior to the Expiration Date or that would require cash payment of interest prior to the Expiration Date or (iv) provides for payment of dividends (other than dividends payable solely in common stock or in Non-Cash Pay Preferred Stock of TWTC) prior to the Expiration Date; provided, that no Capital Stock shall constitute Cash Pay Preferred Stock as a result of containing provisions that give holders the right to require such Person to repurchase or redeem such Capital Stock upon the occurrence of (x) a “change of control” (or similar event, however defined) or (y) the sale of all or substantially all of such Person’s assets (or similar event, however defined).

“Change of Control”: (i) (A) the Former Parent Companies as a group cease to have the ability to elect a majority of the members of the Board of Directors of TWTC (other than TWTC’s chief executive officer and independent directors; provided, however, that independent directors shall be included in calculating whether the foregoing majority requirement is satisfied if the directors nominated by the Former Parent Companies do not constitute a majority of the committee that selects the Board of Directors’ nominees for independent directors) and (B) a “Person” or “group” (within the meaning of Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) (other than the Former Parent Companies) has become the ultimate “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act) of more than 50% of the total voting power of TWTC’s voting stock, on a fully diluted basis; (ii) individuals who on the Effective Date constitute the Board of Directors of TWTC (together with any new directors whose election by such Board of Directors or whose nomination by such Board of Directors for election by the stockholders or members, as the case may be, of TWTC was approved by a vote of at least two-thirds of the members of such Board of Directors then in office who either were members of such Board of Directors on the Effective Date or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of the members of such Board of Directors then in office; or (iii) TWTC ceases to own and control, of record and beneficially, directly, 100% of each class of outstanding Capital Stock of the Borrower free and clear of all Liens (except Liens (x) created by the Guarantee and Collateral Agreement and (y) securing the Second Lien Notes).

“Change of Control Triggering Event”: the occurrence of both a Change of Control and a Rating Decline.

“Code”: the Internal Revenue Code of 1986, as amended from time to time.

“Co-Documentation Agents”: as defined in the preamble hereto.

“Collateral”: all property of the Loan Parties, now owned or hereafter acquired, upon which a Lien is created by any Security Document; it being understood and agreed that such property shall cease to be Collateral for all purposes of this Agreement and each other Loan Document when such property is released from such Lien in accordance with the provisions of this Agreement or of such Security Document, including, without limitation, Section 10.14 hereof.

“Collateral Agent”: as defined in the preamble hereto.

“Collateral Base Date”: as defined in Section 5.2.

“Commitment Fee Rate”: ½ of 1% per annum.

“Commonly Controlled Entity”: an entity, whether or not incorporated, that together with the Borrower is treated as a single employer under Section 414(b) or (c) of the Code or, solely for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a single employer under Section 414 of the Code.

“Compliance Certificate”: a certificate duly executed by a Responsible Officer substantially in the form of Exhibit B.

“Conduit Lender”: any special purpose corporation organized and administered by any Lender for the purpose of making or participating in Loans and other extensions of credit hereunder which are otherwise required to be made by such Lender and designated by such Lender in a written instrument, subject to the consent of the Administrative Agent and the Borrower (which consent, in each case, shall not be unreasonably withheld); provided, that the designation by any Lender of a Conduit Lender shall not relieve the designating Lender of any of its obligations to fund or participate in a Loan or other extension of credit under this Agreement if, for any reason, its Conduit Lender fails to fund any such Loan (or any such participation, as the case may be), and the designating Lender (and not the Conduit Lender) shall have the sole right and responsibility to deliver all consents and waivers required or requested under or in connection with this Agreement or any other Loan Document with respect to its Conduit Lender; and provided, further, that (1) no Conduit Lender shall (a) be entitled to receive any greater amount pursuant to Section 2.15, 2.16, 2.17 or 10.5 than the designating Lender would have been entitled to receive in respect of the extensions of credit made by such Conduit Lender or (b) be deemed to have any Revolving Commitment hereunder and (2) each Conduit Lender shall be subject to all of the obligations as its designating Lender hereunder and each of the other Loan Documents, including, without limitation, Sections 2.16, 2.18, 2.19, 10.7 and 10.15 hereof.

“Confidential Information Memorandum”: the Confidential Information Memorandum dated January 2004 and furnished to the Lenders, including all attachments, exhibits and supplements thereto furnished on or prior to the Effective Date.

“Consolidated EBITDA”: for any period, Consolidated Net Income for such period plus, without duplication and to the extent reflected as a charge in the statement of such Consolidated Net Income for such period, the sum of (a) income tax expense, (b) interest expense, amortization or writeoff of debt discount and debt issuance costs and commissions, discounts and other fees and charges associated with Indebtedness (including the Loans), (c) depreciation and amortization expense, (d) amortization of intangibles (including, but not limited to, goodwill) and organization costs, (e) any extraordinary, unusual or non-recurring non-cash expenses or losses (including, whether or not otherwise

includable as a separate item in the statement of such Consolidated Net Income for such period, non-cash losses on sales of assets outside of the ordinary course of business), provided, that the amounts referred to in this clause (e) shall not, in the aggregate, exceed $20,000,000 for any fiscal year of TWTC, plus, in the case of such non-cash losses on sales of assets or any non-cash losses on minority investments or investments in unconsolidated Subsidiaries, $30,000,000 for the period from the Effective Date through the Revolving Termination Date, (f) any non-cash asset impairment charges resulting from the application of the statement on Accounting for the Impairment or Disposal of Long-Lived Assets (SFAS 144) or similar accounting rules or policies, provided, that the amounts referred to in this clause (f) shall not, in the aggregate, exceed (i) $100,000,000 at any time up to and including December 31, 2004 and (ii) $50,000,000 for any fiscal year of TWTC thereafter; provided further, that (x) up to $50,000,000 of the fiscal year limit in clause (f)(ii), if not utilized in the fiscal year for which it is permitted, may be carried over for use in the next succeeding fiscal year and (y) for purposes of applying the limit in clause (f)(ii), any amounts referred to in this clause (f) shall be deemed added to “Consolidated EBITDA”, first, in respect of amounts permitted for such fiscal year as provided above and, second, in respect of amounts carried over from the prior fiscal year pursuant to clause (x) of this proviso, and (g) any non-cash compensation expenses solely related to stock-based compensation, provided, that, to the extent any non-cash expense under this clause (g) subsequently requires any cash disbursement, such non-cash expense will be subtracted from Consolidated EBITDA; and minus, to the extent included in the statement of such Consolidated Net Income for such period, the sum of (a) interest income and (b) any extraordinary, unusual or non-recurring income or gains (other than any reciprocal compensation income or gains to the extent included in operating income), including, whether or not otherwise includable as a separate item in the statement of such Consolidated Net Income for such period, gains on the sales of assets outside of the ordinary course of business.

“Consolidated Interest Coverage Ratio”: for any period, the ratio of (a) Consolidated EBITDA for such period to (b) Consolidated Interest Expense for such period.

“Consolidated Interest Expense”: for any period, total cash interest expense (including that attributable to Capital Lease Obligations) of TWTC and its Subsidiaries for such period with respect to all outstanding Indebtedness (and cash dividends on Cash Pay Preferred Stock) of TWTC and its Subsidiaries (including all commissions, discounts and other fees and charges owed with respect to letters of credit and bankers’ acceptance financing and net costs under Hedge Agreements, less any net receipts in respect of Hedge Agreements, to the extent such net costs are allocable to such period in accordance with GAAP and less interest income and capitalized interest).

“Consolidated Net Income”: for any period, the consolidated net income (or loss) of TWTC and its Subsidiaries, determined on a consolidated basis in accordance with GAAP; provided that there shall be excluded (a) the income (or deficit) of any Person accrued prior to the date it becomes a Subsidiary of TWTC or is merged into or consolidated with TWTC or any of its Subsidiaries, (b) the income (or deficit) of any Person (other than a Subsidiary of TWTC) in which TWTC or any of its Subsidiaries has an ownership interest, except to the extent that any such income is actually received by TWTC or such Subsidiary in the form of dividends or similar distributions and (c) the undistributed earnings of any Subsidiary of TWTC to the extent that the declaration or payment of dividends or similar distributions by such Subsidiary is not at the time permitted by the terms of any Contractual Obligation (other than under any Loan Document) or Requirement of Law applicable to such Subsidiary.

“Consolidated Net Senior Secured Debt”: as of any day, the excess of (i) Consolidated Senior Secured Debt at such date over (ii) the aggregate amount of cash and Cash Equivalents reflected on a consolidated balance sheet of TWTC at such date in excess of $50,000,000.

“Consolidated Net Total Debt”: as of any day, the excess of (i) Consolidated Total Debt at such date over (ii) the aggregate amount of cash and Cash Equivalents reflected on a consolidated balance sheet of TWTC at such date in excess of $50,000,000.

“Consolidated Senior First Lien Secured Leverage Ratio”: as of any day, the ratio of (a) Consolidated Net Senior Secured Debt on such day to (b) Annualized Consolidated EBITDA for the most recent complete fiscal quarter of TWTC.

“Consolidated Senior Secured Debt”: at any date, the aggregate principal amount of all Senior Secured Indebtedness (other than, in the case of contingent obligations of the type described in clause (f) of the definition of “Indebtedness”, any such obligations not constituting L/C Obligations (i.e., L/C Obligations shall be included in the calculation of Consolidated Senior Secured Debt)) of TWTC and its Subsidiaries at such date taken as a whole, determined on a consolidated basis in accordance with GAAP.

“Consolidated Total Debt”: at any date, the aggregate principal amount of all Indebtedness (other than, in the case of contingent obligations of the type described in clause (f) of the definition of “Indebtedness”, any such obligations not constituting L/C Obligations) of TWTC and its Subsidiaries at such date, determined on a consolidated basis in accordance with GAAP.

“Consolidated Total Leverage Ratio”: as of any day, the ratio of (a) Consolidated Net Total Debt on such day to (b) Annualized Consolidated EBITDA for the most recent complete fiscal quarter of TWTC.

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

“Current Liquidity”: on any date, the sum of (i) the aggregate amount of cash and Cash Equivalents that would be reflected on a consolidated balance sheet of TWTC and its Subsidiaries prepared as of such date in accordance with GAAP and (ii) the aggregate amount of Available Revolving Commitments of all Lenders on such date (provided that such amount shall be deemed to be zero if a Default has occurred and is continuing on such date).

“Default”: any of the events specified in Section 8, whether or not any requirement for the giving of notice, the lapse of time, or both, has been satisfied.

“Disposition”: with respect to any property, any sale, lease, sale and leaseback, assignment, conveyance, transfer or other disposition thereof, including pursuant to an exchange for other property. The terms “Dispose” and “Disposed of” shall have correlative meanings.

“Dollars” and “$”: dollars in lawful currency of the United States.

“Domestic Subsidiary”: any Subsidiary of TWTC organized under the laws of any jurisdiction within the United States.

“Effective Date”: the date specified by the Administrative Agent in a notice to each of the parties hereto as the date on or as of which each of the conditions precedent set forth in Section 5.1 shall have been satisfied, which date shall not be later than February 20, 2004 (or such later date as the Borrower, the Administrative Agent and the Required Lenders shall agree).

“Environmental Laws”: any and all applicable foreign, Federal, state, local or municipal laws, rules, orders, regulations, statutes, ordinances, codes, decrees, requirements of any Governmental Authority or other Requirements of Law (including common law) regulating, relating to or imposing liability or standards of conduct concerning protection of human health (as relating to exposure to Materials of Environmental Concern) or the environment.

“ERISA”: the Employee Retirement Income Security Act of 1974, as amended from time to time.

“Eurocurrency Reserve Requirements”: for any day as applied to a Eurodollar Loan, the aggregate (without duplication) of the maximum rates (expressed as a decimal fraction) of reserve requirements in effect on such day (including basic, supplemental, marginal and emergency reserves under any regulations of the Board or other Governmental Authority having jurisdiction with respect thereto) dealing with reserve requirements prescribed for eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in Regulation D of the Board) maintained by a member bank of the Federal Reserve System.

“Eurodollar Base Rate”: with respect to each day during each Interest Period pertaining to a Eurodollar Loan, the rate per annum determined on the basis of the rate for deposits in Dollars for a period equal to such Interest Period commencing on the first day of such Interest Period appearing on Page 3750 of the Telerate screen as of 11:00 A.M., London time, two Business Days prior to the beginning of such Interest Period. In the event that such rate does not appear on Page 3750 of the Telerate screen (or otherwise on such screen), the “Eurodollar Base Rate” shall be determined by reference to such other comparable publicly available service for displaying eurodollar rates as may be selected by the Administrative Agent or, in the absence of such availability, by reference to the rate at which the Administrative Agent is offered Dollar deposits at or about 11:00 A.M., New York City time, two Business Days prior to the beginning of such Interest Period in the interbank eurodollar market where its eurodollar and foreign currency and exchange operations are then being conducted for delivery on the first day of such Interest Period for the number of days comprised therein.

“Eurodollar Loans”: Loans the rate of interest applicable to which is based upon the Eurodollar Rate.

“Eurodollar Rate”: with respect to each day during each Interest Period pertaining to a Eurodollar Loan, a rate per annum determined for such day in accordance with the following formula (rounded upward to the nearest 1/100th of 1%):

Eurodollar Base Rate

1.00 - Eurocurrency Reserve Requirements

“Eurodollar Tranche”: the collective reference to Eurodollar Loans the then current Interest Periods with respect to all of which begin on the same date and end on the same later date (whether or not such Loans shall originally have been made on the same day).

“Event of Default”: any of the events specified in Section 8, provided that any requirement for the giving of notice, the lapse of time, or both, has been satisfied.

“Exchange”: any exchange of operating assets for other operating assets in a Permitted Line of Business and, subject to the last sentence of this definition, of comparable value and use to those assets being exchanged, including (a) exchanges involving the transfer or acquisition (or both transfer and

acquisition) of Capital Stock of a Person so long as 100% of the Capital Stock of such Person is transferred or acquired, as the case may be, and (b) fiber capacity and network swaps. It is understood that exchanges of the kind described above as to which a portion of the consideration paid or received is in the form of cash shall nevertheless constitute “Exchanges” for the purposes of this Agreement so long as the aggregate consideration received by any Subsidiary of TWTC in connection with such exchange represents fair market value for the assets and cash being transferred by TWTC and its Subsidiaries.

“Existing Credit Agreement”: the Amended and Restated Credit Agreement, dated as of January 10, 2001, as amended, among TWTC, the Borrower, the lenders parties thereto, the co-syndication agents and documentation agent named therein, and JPMorgan Chase Bank (formerly known as The Chase Manhattan Bank), as administrative agent.

“Existing Senior Note Indentures”: the Indentures entered into by TWTC in connection with the issuance of the Existing Senior Notes, together with all instruments and other agreements entered into by TWTC in connection therewith, as the same may be amended, supplemented or otherwise modified from time to time in accordance with Section 7.9.

“Existing Senior Notes”: the collective reference to (a) the Existing 2008 Senior Notes and (b) the Existing 2011 Senior Notes.

“Existing 2008 Senior Notes”: the 9 3/4% Senior Notes due 2008 of TWTC.

“Existing 2011 Senior Notes”: the 10 1/8% Senior Notes due 2011 of TWTC.

“Expiration Date”: as defined in the definition of the term “Cash Pay Preferred Stock”.

“FCC”: the Federal Communications Commission and any successor thereto.

“FCC License”: any community antenna relay service, broadcast auxiliary license, earth station registration, business radio, microwave or special safety radio service license issued by the FCC pursuant to the Communications Act of 1934, as amended.

“Federal Funds Effective Rate”: for any day, the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers, as published on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if such rate is not so published for any day that is a Business Day, the average of the quotations for the day of such transactions received by the Administrative Agent from three federal funds brokers of recognized standing selected by it.

“Foreign Subsidiary”: any Subsidiary of TWTC (whether now or hereafter existing or acquired) that is not a Domestic Subsidiary.

“Former Parent Companies”: Time Warner Inc., Advance/Xxxxxxxx Partnership and the Affiliates of each of the foregoing.

“Funded Debt”: as to any Person, all Indebtedness of such Person that matures more than one year from the date of its creation or matures within one year from such date but is renewable or extendible, at the option of such Person, to a date more than one year from such date or arises under a revolving credit or similar agreement that obligates the lender or lenders thereunder to extend credit during a period of more than one year from such date, including all current maturities and current sinking

fund payments in respect of such Indebtedness whether or not required to be paid within one year from the date of its creation and, in the case of the Borrower, Indebtedness in respect of the Loans.

“Funding Office”: the office of the Administrative Agent specified in Section 10.2 or such other office as may be specified from time to time by the Administrative Agent as its funding office by written notice to the Borrower and the Lenders.

“GAAP”: generally accepted accounting principles in the United States as in effect from time to time, except that for purposes of Section 7.1, GAAP shall be determined on the basis of such principles in effect on the date hereof and consistent with those used in the preparation of the most recent audited financial statements referred to in Section 4.1(b). In the event that any “Accounting Change” (as defined below) shall occur and such change results in a change in the method of calculation of financial covenants, standards or terms in this Agreement, then TWTC and the Administrative Agent agree to enter into negotiations in order to amend such provisions of this Agreement so as to equitably reflect such Accounting Changes with the desired result that the criteria for evaluating TWTC’s financial condition shall be the same after such Accounting Changes as if such Accounting Changes had not been made. Until such time as such an amendment shall have been executed and delivered by TWTC, the Borrower, the Administrative Agent and the Required Lenders, all financial covenants, standards and terms in this Agreement shall continue to be calculated or construed as if such Accounting Changes had not occurred. “Accounting Changes” refers to changes in accounting principles required by the promulgation of any rule, regulation, pronouncement or opinion by the Financial Accounting Standards Board of the American Institute of Certified Public Accountants or, if applicable, the SEC.

“Governmental Authority”: any nation or government, any state or other political subdivision thereof, any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative functions of or pertaining to government, any securities exchange and any self-regulatory organization (including the National Association of Insurance Commissioners).

“Gross Consolidated Senior First Lien Secured Leverage Ratio”: as of any day, the ratio of (a) Consolidated Senior Secured Debt on such day to (b) Annualized Consolidated EBITDA for the most recent complete fiscal quarter of TWTC.

“Guarantee and Collateral Agreement”: the Guarantee and Collateral Agreement to be executed and delivered by TWTC, the Borrower and each Subsidiary Guarantor, substantially in the form of Exhibit A, as the same may be amended, supplemented or otherwise modified from time to time.

“Guarantee Obligation”: as to any Person (the “guaranteeing person”), any obligation of (a) the guaranteeing person or (b) another Person (including any bank under any letter of credit) to induce the creation of which the guaranteeing person has issued a reimbursement, counterindemnity or similar obligation, in either case guaranteeing or in effect guaranteeing any Indebtedness, leases, dividends or other obligations (the “primary obligations”) of any other third Person (the “primary obligor”) in any manner, whether directly or indirectly, including any obligation of the guaranteeing person, whether or not contingent, (i) to purchase any such primary obligation or any property constituting direct or indirect security therefor, (ii) to advance or supply funds (1) for the purchase or payment of any such primary obligation or (2) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor, (iii) to purchase property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation or (iv) otherwise to assure or hold harmless the owner of any such primary obligation against loss in respect thereof; provided, however, that the term

Guarantee Obligation shall not include endorsements of instruments for deposit or collection in the ordinary course of business. The amount of any Guarantee Obligation of any guaranteeing person shall be deemed to be the lower of (a) an amount equal to the stated or determinable amount of the primary obligation in respect of which such Guarantee Obligation is made and (b) the maximum amount for which such guaranteeing person may be liable pursuant to the terms of the instrument embodying such Guarantee Obligation, unless such primary obligation and the maximum amount for which such guaranteeing person may be liable are not stated or determinable, in which case the amount of such Guarantee Obligation shall be such guaranteeing person’s maximum reasonably anticipated liability in respect thereof as determined by the Borrower in good faith.

“Hedge Agreements”: all interest rate or currency swaps, caps or collar agreements, foreign exchange agreements, commodity contracts or similar arrangements entered into by TWTC or its Subsidiaries providing for protection against fluctuations in interest rates, currency exchange rates, commodity prices or the exchange of nominal interest obligations, either generally or under specific contingencies.

“High Yield Indentures”: the collective reference to the New Senior Note Indenture and the Second Lien Note Indenture.

“High Yield Notes”: the collective reference to the New Senior Notes and the Second Lien Notes.

“Immaterial Subsidiary”: any Subsidiary designated as an “Immaterial Subsidiary” by the Borrower in a written notice to the Administrative Agent which, when considered together with all other Immaterial Subsidiaries previously so designated by the Borrower which have not lost their designation as an “Immaterial Subsidiary” under the terms of the proviso below, have assets whose book value is not greater than 5% of the book value of the consolidated assets of TWTC and its Subsidiaries as shown on the most recent financial statements furnished by the Borrower under Section 6 of this Agreement; provided, however, that, any Subsidiary designated as an Immaterial Subsidiary under the method described above shall continue to be an Immaterial Subsidiary unless and until (a) the Borrower provides written notice to the Administrative Agent that such Immaterial Subsidiary shall no longer constitute an Immaterial Subsidiary or (b) the financial statements of the Borrower furnished under Section 6 of this Agreement at any time after the designation of such Subsidiary as an Immaterial Subsidiary shall demonstrate that, in the aggregate, Subsidiaries designated by the Borrower as Immaterial Subsidiaries have assets whose book value is greater than 5% of the book value of the consolidated assets of TWTC and its Subsidiaries as reflected on such newly delivered financial statements and, in such circumstance, the Borrower shall promptly select one or more Immaterial Subsidiaries to be designated as not being Immaterial Subsidiaries such that the 5% threshold described above would no longer be violated and any Subsidiary so selected by the Borrower shall cease to be an Immaterial Subsidiary for all purposes of this Agreement and the other Loan Documents and shall promptly become a party to the Guarantee and Collateral Agreement and the Intercreditor Agreement in accordance with, and shall take such other actions as required by, Section 6.9, unless and until such Subsidiary is re-designated as an Immaterial Subsidiary as provided above.

“Increased Facility Activation Notice”: a notice substantially in the form of Exhibit D-2.

“Increased Facility Closing Date”: any Business Day designated as such in an Increased Facility Activation Notice.

“Incremental Facility”: as defined in Section 2.1(c).

“Incremental Loans”: as defined in Section 2.1(c).

“Indebtedness”: of any Person at any date, without duplication, (a) all indebtedness of such Person for borrowed money, (b) all obligations of such Person for the deferred purchase price of property or services (other than current trade payables incurred in the ordinary course of such Person’s business), (c) all obligations of such Person evidenced by notes, bonds, debentures or other similar instruments, (d) all indebtedness created or arising under any conditional sale or other title retention agreement with respect to property acquired by such Person (even though the rights and remedies of the seller or lender under such agreement in the event of default are limited to repossession or sale of such property), (e) all Capital Lease Obligations of such Person, (f) all obligations of such Person, contingent or otherwise, as an account party or applicant under or in respect of acceptances, letters of credit, surety bonds or similar arrangements, (g) all obligations of such Person with respect to Cash Pay Preferred Stock, (h) all Guarantee Obligations of such Person in respect of obligations of the kind referred to in clauses (a) through (g) above, (i) all obligations of the kind referred to in clauses (a) through (h) above secured by (or for which the holder of such obligation has an existing right, contingent or otherwise, to be secured by) any Lien on property (including accounts and contract rights) owned by such Person, whether or not such Person has assumed or become liable for the payment of such obligation, and (j) for the purposes of Sections 7.2 and 8(e) only, all obligations of such Person in respect of derivative transactions (including, without limitation, Hedge Agreements). For purposes of this definition, the principal amount of any Cash Pay Preferred Stock shall be deemed to be its liquidation value. The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such entity, except to the extent the terms of such Indebtedness expressly provide that such Person is not liable therefor.

“Indentures”: the collective reference to the Existing Senior Note Indentures, the New Senior Note Indenture and the Second Lien Note Indenture.

“Initial Funding Date”: the first date on which both (a) the conditions precedent set forth in Section 5.2 shall have been satisfied and (b) the Borrower shall have received the proceeds of a Loan requested hereunder.

“Initial Revolving Termination Date”: February 20, 2009.

“Insolvency”: with respect to any Multiemployer Plan, the condition that such Plan is insolvent within the meaning of Section 4245 of ERISA.

“Insolvent”: pertaining to a condition of Insolvency.

“Intellectual Property”: the collective reference to all rights, priorities and privileges relating to intellectual property, whether arising under United States, multinational or foreign laws or otherwise, including copyrights, copyright licenses, patents, patent licenses, trademarks, trademark licenses, technology, know-how and processes, and all rights to xxx at law or in equity for any infringement or other impairment thereof, including the right to receive all proceeds and damages therefrom.

“Intercompany Subordinated Note”: a promissory note of the Borrower or a Wholly Owned Subsidiary Guarantor, substantially in the form of Exhibit H.

“Intercreditor Agreement”: the Intercreditor Agreement to be executed and delivered by the Collateral Agent, the Second Lien Trustee, TWTC, the Borrower and the Subsidiary Guarantors, substantially in the form of Exhibit G, as the same may be amended, supplemented or otherwise modified from time to time.

“Interest Payment Date”: (a) as to any ABR Loan, the last day of each March, June, September and December while such Loan is outstanding and the Revolving Termination Date, (b) as to any Eurodollar Loan having an Interest Period of three months or less, the last day of such Interest Period, (c) as to any Eurodollar Loan having an Interest Period longer than three months, each day that is three months, or a whole multiple thereof, after the first day of such Interest Period and the last day of such Interest Period and (d) as to any Loan (other than any Revolving Loan that is an ABR Loan and any Swingline Loan), the date of any repayment or prepayment made in respect thereof.

“Interest Period”: as to any Eurodollar Loan, (a) initially, the period commencing on the borrowing, continuation or conversion date, as the case may be, with respect to such Eurodollar Loan and ending one, two, three or six (or, with the consent of all Lenders, nine or twelve) months thereafter, as selected by the Borrower in its notice of borrowing, notice of continuation or notice of conversion, as the case may be, given with respect thereto; and (b) thereafter, each period commencing on the last day of the next preceding Interest Period applicable to such Eurodollar Loan and ending one, two, three or six (or, with the consent of all Lenders, nine or twelve) months thereafter, as selected by the Borrower by irrevocable notice to the Administrative Agent not less than three Business Days prior to the last day of the then current Interest Period with respect thereto; provided that, all of the foregoing provisions relating to Interest Periods are subject to the following:

(i) if any Interest Period would otherwise end on a day that is not a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless the result of such extension would be to carry such Interest Period into another calendar month in which event such Interest Period shall end on the immediately preceding Business Day;

(ii) the Borrower may not select an Interest Period that would extend beyond the Revolving Termination Date;

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

(iv) the Borrower shall select Interest Periods so as not to require a payment or prepayment of any Eurodollar Loan during an Interest Period for such Loan.

“Investments”: as defined in Section 7.8.

“Issuing Lender”: any Revolving Lender that has agreed in its sole discretion to act as an “Issuing Lender” hereunder and that has been approved in writing by the Administrative Agent as an “Issuing Lender” hereunder, in each case in its capacity as issuer of any Letter of Credit.

“Joint Lead Arrangers”: the collective reference to Xxxxxx Brothers Inc. and Xxxxxx Xxxxxxx Senior Funding, Inc.

“L/C Commitment”: $25,000,000.

“L/C Fee Payment Date”: the last day of each March, June, September and December and the last day of the Revolving Commitment Period.

“L/C Obligations”: at any time, an amount equal to the sum of (a) the aggregate then undrawn and unexpired amount of the then outstanding Letters of Credit and (b) the aggregate amount of drawings under Letters of Credit that have not then been reimbursed pursuant to Section 3.5.

“L/C Participants”: the collective reference to all the Revolving Lenders other than the Issuing Lender.

“LCPI”: as defined in the preamble hereto.

“Lenders”: as defined in the preamble hereto; provided, that unless the context otherwise requires, each reference herein to the Lenders shall be deemed to include any Conduit Lender.

“Letters of Credit”: as defined in Section 3.1(a).

“Lien”: any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge or other security interest or any preference, priority or other security agreement or preferential arrangement of any kind or nature whatsoever (including any conditional sale or other title retention agreement and any capital lease having substantially the same economic effect as any of the foregoing).

“Loan”: any loan made by any Lender pursuant to this Agreement.

“Loan Documents”: this Agreement, the Security Documents, the Intercreditor Agreement and the Notes.

“Loan Parties”: TWTC, the Borrower and each Subsidiary Guarantor; it being expressly understood and agreed that from and after the date that a Subsidiary Guarantor has been released, whether pursuant to Section 10.14 or otherwise, such Person shall not thereafter be considered a Loan Party for purposes of this Agreement or any other Loan Document.

“Material Adverse Effect”: a material adverse effect on (a) the business, property, operations or financial condition of TWTC and its Subsidiaries taken as a whole or (b) the validity or enforceability of this Agreement or any of the other Loan Documents or the rights or remedies of the Administrative Agent, the Collateral Agent or any Lender hereunder or thereunder.

“Materials of Environmental Concern”: 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 Law, including asbestos, polychlorinated biphenyls and urea-formaldehyde insulation.

“Moody’s”: Xxxxx’x Investors Service, Inc.

“Multiemployer Plan”: a Plan that is a multiemployer plan as defined in Section 4001(a)(3) of ERISA.

“Net Cash Proceeds”: in connection with any issuance or sale of equity securities or debt securities or instruments or the incurrence of loans, the cash proceeds received from such issuance or incurrence, net of attorneys’ fees, investment banking fees, accountants’ fees, underwriting discounts and commissions and other customary fees and expenses actually incurred in connection therewith.

“New Lender”: as defined in Section 2.1(d).

“New Lender Supplement”: as defined in Section 2.1(d).

“New Senior Note Indenture”: the Indenture entered into by the Borrower, TWTC and certain of its Subsidiaries in connection with the issuance of the New Senior Notes, together with all instruments and other agreements entered into by the Borrower, TWTC or such Subsidiaries in connection therewith, as the same may be amended, supplemented or otherwise modified from time to time in accordance with Section 7.9.

“New Senior Notes”: the 9 1/4% Senior Notes due 2014 of the Borrower issued on or about the Effective Date.

“Non-Cash Pay Preferred Stock”: any preferred stock of a Person that does not qualify as Cash Pay Preferred Stock.

“Non-Excluded Taxes”: as defined in Section 2.16(a).

“Non-U.S. Lender”: as defined in Section 2.16(d).

“Notes”: the collective reference to any promissory note, substantially in the form of Exhibit I, evidencing one or more Loans, as any such note may be amended, extended or otherwise modified from time to time.

“Obligations”: the collective reference to (a) the unpaid principal of and interest on (including interest accruing after the maturity of the Loans and Reimbursement Obligations and interest accruing after the filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or like proceeding, relating to the Borrower, whether or not a claim for post-filing or post-petition interest is allowed in such proceeding) the Loans and Reimbursement Obligations and all other obligations and liabilities of the Borrower to the Administrative Agent, the Collateral Agent or to any Lender (or, in the case of Hedge Agreements, any Affiliate of any Lender), whether direct or indirect, absolute or contingent, due or to become due, or now existing or hereafter incurred, which may arise under, out of, or in connection with, this Agreement, any other Loan Document, the Letters of Credit, any Hedge Agreement entered into with any Lender or any Affiliate of any Lender or any other document made, delivered or given in connection herewith or therewith, and (b) all Cash Management Obligations owed to any Lender or any Affiliate of any Lender, in each case, whether on account of principal, interest, reimbursement obligations, fees, indemnities, costs, expenses (including all fees, charges and disbursements of counsel to the Administrative Agent and the Collateral Agent or to any Lender that are required to be paid by the Borrower pursuant hereto) or otherwise.

“Other Taxes”: any and all present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies arising from any payment made hereunder or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement or any other Loan Document.

“Participant”: as defined in Section 10.6(b).

“PBGC”: the Pension Benefit Guaranty Corporation established pursuant to Subtitle A of Title IV of ERISA (or any successor).

“Permitted Line of Business”: as defined in Section 7.15(a).

“Person”: an individual, partnership, corporation, limited liability company, business trust, joint stock company, trust, unincorporated association, joint venture, Governmental Authority or other entity of whatever nature.

“Plan”: at a particular time, any employee benefit plan that is covered by ERISA and in respect of which the Borrower or a Commonly Controlled Entity is (or, if such plan were terminated at such time, would under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.

“Pricing Grid”: the pricing grid attached hereto as Annex A.

“Prime Rate”: as defined in the definition of “ABR”.

“Pro Forma Balance Sheet”: as defined in Section 4.1(a).

“Projections”: as defined in Section 6.2(c).

“Properties”: as defined in Section 4.17(a).

“Rating Categories”: (a) with respect to S&P, any of the following categories: BB, B, CCC, CC, C and D (or equivalent successor categories); (b) with respect to Moody’s, any of the following categories: Ba, B, Caa, Ca, C and D (or equivalent successor categories); and (c) the equivalent of any such category of S&P or Moody’s used by another rating agency. In determining whether the rating of the High Yield Notes has decreased by one or more gradations, gradations within Rating Categories (+ and – for S&P; 1, 2 and 3 for Moody’s; or the equivalent gradations for another rating agency) shall be taken into account (e.g., with respect to S&P, a decline in a rating from BB+ to BB, as well as from BB- to B+, will constitute a decrease of one gradation).

“Rating Decline”: (i) a decrease of one or more gradations (including gradations within Rating Categories as well as between Rating Categories) in the rating of the New Senior Notes or the Second Lien Notes by both Moody’s and S&P or (ii) a withdrawal of the rating of the New Senior Notes or the Second Lien Notes by Moody’s and S&P, in each case directly as a result of a Change of Control; provided, however, that such decrease or withdrawal occurs on, or within 45 days following, the date of public notice of the occurrence of a Change of Control or of the intention by the Borrower, TWTC or a stockholder of the Borrower or TWTC, as applicable, to effect a Change of Control, which period shall be extended so long as the rating of the New Senior Notes or the Second Lien Notes relating to the Change of Control as noted by the rating agency is under publicly announced consideration for downgrade by the applicable rating agency.

“Refinancing”: with respect to any Indebtedness, any refinancing, refunding, renewal or extension thereof. The term “Refinance” shall have the correlative meaning.

“Refunded Swingline Loans”: as defined in Section 2.5(b).

“Refunding Date”: as defined in Section 2.5(c).

“Register”: as defined in Section 10.6(d).

“Regulation U”: Regulation U of the Board as in effect from time to time.

“Reimbursement Obligation”: the obligation of the Borrower to reimburse the Issuing Lender pursuant to Section 3.5 for amounts drawn under Letters of Credit.

“Reorganization”: with respect to any Multiemployer Plan, the condition that such plan is in reorganization within the meaning of Section 4241 of ERISA.

“Reportable Event”: any of the events set forth in Section 4043(c) of ERISA, other than those events as to which the thirty day notice period is waived.

“Required Lenders”: at any time, the holders of more than 50% of the Total Revolving Commitments then in effect or, if the Revolving Commitments have been terminated, the Total Revolving Extensions of Credit then outstanding.

“Requirement of Law”: 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 any of its property or to which such Person or any of its property is subject.

“Responsible Officer”: the chief executive officer, president, treasurer, chief financial officer or chief accounting officer of TWTC or the Borrower, as applicable, but in any event, with respect to financial matters, the chief financial officer of TWTC or the Borrower, as applicable.

“Restricted Payments”: as defined in Section 7.6.

“Revolving Commitment”: as to any Lender, the obligation of such Lender, if any, to make Revolving Loans and to make or to participate in Swingline Loans and Letters of Credit in an aggregate principal and/or face amount not to exceed the amount set forth under the heading “Revolving Commitment” opposite such Lender’s name on Schedule 1.1A or in the Assignment and Acceptance pursuant to which such Lender became a party hereto, as the same may be changed from time to time pursuant to the terms hereof. The original amount of the Total Revolving Commitments is $150,000,000.

“Revolving Commitment Period”: the period from and including the Effective Date to the Revolving Termination Date.

“Revolving Extensions of Credit”: as to any Revolving Lender at any time, an amount equal to the sum of (a) the aggregate principal amount of all Revolving Loans held by such Lender then outstanding, (b) such Lender’s Revolving Percentage of the L/C Obligations then outstanding and (c) such Lender’s Revolving Percentage of the aggregate principal amount of Swingline Loans then outstanding.

“Revolving Lender”: each Lender that has a Revolving Commitment or that holds Revolving Loans.

“Revolving Loans”: as defined in Section 2.1(a).

“Revolving Percentage”: as to any Revolving Lender at any time, the percentage which such Lender’s Revolving Commitment then constitutes of the Total Revolving Commitments (or, at any time after the Revolving Commitments shall have expired or terminated, the percentage which the aggregate principal amount of such Lender’s Revolving Loans then outstanding constitutes of the aggregate principal amount of the Revolving Loans then outstanding).

“Revolving Termination Date”: (a) the Initial Revolving Termination Date or (b) if any of the Existing 2008 Senior Notes remain outstanding on April 14, 2008, the Accelerated Revolving Termination Date.

“SEC”: the Securities and Exchange Commission, any successor thereto and any analogous Governmental Authority.

“Second Lien Note Indenture”: the Indenture entered into by the Borrower, TWTC and certain of its Subsidiaries in connection with the issuance of the Second Lien Notes, together with all instruments and other agreements entered into by the Borrower, TWTC or such Subsidiaries in connection therewith, as the same may be amended, supplemented or otherwise modified from time to time in accordance with Section 7.9.

“Second Lien Notes”: the Second Priority Senior Secured Floating Rate Notes due 2011 of the Borrower issued on or about the Effective Date.

“Second Lien Trustee”: Xxxxx Fargo Bank, National Association, as trustee for the holders of the Second Lien Notes, and any successor thereto in such capacity.

“Secured Obligations”: as defined in the Guarantee and Collateral Agreement.

“Security Documents”: the collective reference to (a) the Guarantee and Collateral Agreement, (b) all other security documents (including mortgages or deeds of trust) hereafter delivered by a Loan Party to the Collateral Agent granting a first priority Lien on any property of such Loan Party to secure (inter alia) the Obligations and/or certain other Indebtedness or obligations secured on a pari passu basis with the Obligations and (c) the Intercreditor Agreement.

“Senior Secured Indebtedness”: of any Person at any date, any Indebtedness of such Person that (a) is not contractually subordinated to the Indebtedness under this Agreement and the other Loan Documents and (b) is secured by a first priority Lien on all or substantially all of the assets of such Person.

“Shell Subsidiary”: any Subsidiary of TWTC (x) that is a “shell” company having (a) assets (either directly or through any Subsidiary or other Capital Stock) with an aggregate value not exceeding $10,000 and (b) no business or operations or (y) that satisfies the requirements of clause (x)(a) above and is in the process of being liquidated or wound up in a voluntary liquidation.

“Single Employer Plan”: any Plan that is covered by Title IV of ERISA, but that is not a Multiemployer Plan.

“Solvent”: when used with respect to any Person, means that, as of any date of determination, (a) the amount of the “present fair saleable value” of the assets of such Person will, as of such date, exceed the amount of all “liabilities of such Person, contingent or otherwise” after giving effect to the expected value of rights of indemnity, contribution and subrogation, as of such date, as such quoted

terms are determined in accordance with applicable federal and state laws governing determinations of the insolvency of debtors, (b) the present fair saleable value of the assets of such Person will, as of such date, be greater than the amount that will be required to pay the liability of such Person on its debts as such debts become absolute and matured after giving effect to the expected value of rights of indemnity, contribution and subrogation, (c) such Person will not have, as of such date, an unreasonably small amount of capital with which to conduct its business, and (d) such Person will be able to pay its debts as they mature after giving effect to the expected value of rights of indemnity, contribution and subrogation. For purposes of this definition, (i) ”debt” means liability on a “claim”, and (ii) ”claim” means any (x) right to payment, whether or not such a right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured or (y) right to an equitable remedy for breach of performance if such breach gives rise to a right to payment, whether or not such right to an equitable remedy is reduced to judgment, fixed, contingent, matured or unmatured, disputed, undisputed, secured or unsecured.

“S&P”: Standard & Poor’s Ratings Services.

“Specified Change of Control”: a “Change of Control”, or like event, as defined in either High Yield Indenture (or any indenture governing any Refinancing of the Existing Senior Notes or the High Yield Notes or any indenture governing any Refinancing of any such refinancing Indebtedness).

“Specified Subsidiary”: Time Warner Telecom of Arizona LLC, Time Warner Telecom of Georgia, L.P., Time Warner Telecom of NY, L.P., Time Warner Telecom of New Jersey, L.P., Time Warner Telecom of Hawaii, L.P., Time Warner Telecom of Indiana, L.P. and Time Warner Telecom of the Mid-South L.L.C., and any other Subsidiary formed or acquired after the Effective Date and identified as a “Specified Subsidiary” by TWTC in a written notice to the Administrative Agent and for which the approvals of any Governmental Authority or of any third party (other than TWTC or a Subsidiary) required (x) to permit TWTC or a Subsidiary to pledge the Capital Stock of such Subsidiary under the Guarantee and Collateral Agreement and/or (y) to permit such Subsidiary to become a party to the Guarantee and Collateral Agreement and the Intercreditor Agreement are unable to be obtained within 30 days following the formation or acquisition thereof; provided, that if (and for so long as) any such Subsidiary shall become and be a party to the Guarantee and Collateral Agreement, it shall cease to be a “Specified Subsidiary”.

“Subsidiary”: as to any Person, a corporation, partnership, limited liability company or other entity of which shares of stock or other ownership interests having ordinary voting power (other than stock or such other ownership interests having such power only by reason of the happening of a contingency) to elect a majority of the board of directors or other managers of such corporation, partnership, limited liability company or other entity are at the time owned, or the management of which is otherwise controlled, directly or indirectly through one or more intermediaries, or both, by such Person. Unless otherwise qualified, all references to a “Subsidiary” or to “Subsidiaries” in this Agreement shall refer to a Subsidiary or Subsidiaries of TWTC.

“Subsidiary Guarantor”: each Subsidiary of TWTC other than (a) the Borrower, (b) any Foreign Subsidiary, (c) any Shell Subsidiary, (d) any Immaterial Subsidiary and (e) any Specified Subsidiary; provided, that a Subsidiary shall not be deemed to be a “Subsidiary Guarantor” until and unless it has become a party to the Guarantee and Collateral Agreement and the Intercreditor Agreement and shall cease to be a “Subsidiary Guarantor” from and after the date that it has been released, whether pursuant to Section 10.14 or otherwise.

“Supermajority Lenders”: at any time, the holders of more than 66 2/3% of the Total Revolving Commitments then in effect or, if the Revolving Commitments have been terminated, the Total Revolving Extensions of Credit then outstanding.

“Swingline Commitment”: the obligation of the Swingline Lender to make Swingline Loans pursuant to Section 2.4 in an aggregate principal amount at any one time outstanding not to exceed $15,000,000.

“Swingline Lender”: LCPI, in its capacity as the lender of Swingline Loans.

“Swingline Loans”: as defined in Section 2.4.

“Swingline Participation Amount”: as defined in Section 2.5(c).

“Syndication Agent”: as defined in the preamble hereto.

“Time Warner Arrangements”: the collective reference to the capacity license of optical fibers and other property from Time Warner Cable, the facilities lease and the trade name license agreement between TWTC and Time Warner Inc. and its affiliates.

“Total Revolving Commitments”: at any time, the aggregate amount of the Revolving Commitments then in effect.

“Total Revolving Extensions of Credit”: at any time, the aggregate amount of the Revolving Extensions of Credit of the Revolving Lenders outstanding at such time.

“Transferee”: any Assignee or Participant.

“TWTC”: as defined in the preamble hereto.

“Type”: as to any Loan, its nature as an ABR Loan or a Eurodollar Loan.

“United States”: the United States of America.

“Wholly Owned Subsidiary”: as to any Person, any other Person all of the Capital Stock of which (other than directors’ qualifying shares required by law) is owned by such Person directly and/or through other Wholly Owned Subsidiaries.

“Wholly Owned Subsidiary Guarantor”: any Subsidiary Guarantor that is a Wholly Owned Subsidiary of TWTC.

1.2. Other Definitional Provisions. (a) Unless otherwise specified therein, all terms defined in this Agreement shall have the defined meanings when used in the other Loan Documents or in any certificate or other document made or delivered pursuant hereto or thereto.

(b) As used herein and in the other Loan Documents, and in any certificate or other document made or delivered pursuant hereto or thereto, (i) accounting terms relating to TWTC, the Borrower and their respective Subsidiaries not defined in Section 1.1 and accounting terms partly defined in Section 1.1, to the extent not so defined, shall have the respective meanings given to them under GAAP, (ii) the words “include”, “includes” and “including” shall be deemed

to be followed by the phrase “without limitation”, (iii) the word “incur” shall be construed to mean incur, create, issue, assume, become liable in respect of or suffer to exist (and the words “incurred” and “incurrence” shall have correlative meanings), and (iv) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, Capital Stock, securities, revenues, accounts, leasehold interests and contract rights.

(c) The words “hereof”, “herein” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement, and Section, Schedule and Exhibit references are to this Agreement unless otherwise specified.

(d) The meanings given to terms defined herein shall be equally applicable to both the singular and plural forms of such terms.

SECTION 2. AMOUNT AND TERMS OF COMMITMENTS

2.1. Revolving Commitments; Additional Commitments; Incremental Facility. (a) Subject to the terms and conditions hereof, each Revolving Lender severally agrees to make revolving credit loans (“Revolving Loans”) to the Borrower from time to time during the Revolving Commitment Period in an aggregate principal amount at any one time outstanding which, when added to such Lender’s Revolving Percentage of the sum of (i) the L/C Obligations then outstanding (other than any such L/C Obligations to be concurrently repaid with the proceeds of a Revolving Loan) and (ii) the aggregate principal amount of the Swingline Loans then outstanding (other than any such Swingline Loan to be concurrently repaid with the proceeds of a Revolving Loan), does not exceed the amount of such Lender’s Revolving Commitment. During the Revolving Commitment Period the Borrower may use the Revolving Commitments by borrowing, prepaying the Revolving Loans in whole or in part, and reborrowing, all in accordance with the terms and conditions hereof. The Revolving Loans may from time to time be Eurodollar Loans or ABR Loans, as determined by the Borrower and notified to the Administrative Agent in accordance with Sections 2.2 and 2.9.

(b) The Borrower and any one or more Lenders (including New Lenders) may, with the consent of the Administrative Agent (such consent not to be unreasonably delayed, conditioned or withheld), at any time and from time to time after the Effective Date, agree that such Lenders shall obtain or increase the amount of their Revolving Commitments by executing and delivering to the Administrative Agent an Increased Facility Activation Notice specifying (i) the amount of such increase and (ii) the applicable Increased Facility Closing Date. Notwithstanding the foregoing, without the consent of the Required Lenders, (i) the Total Revolving Commitments may not be increased by more than $150,000,000 (minus the amount of any Incremental Loans provided under Section 2.1(c) below), (ii) no more than five Increased Facility Closing Dates may be selected by the Borrower during the term of this Agreement and (iii) after giving effect to any borrowings under the additional Revolving Commitments provided herein, the Gross Consolidated Senior First Lien Secured Leverage Ratio, calculated on a pro forma basis as of the last day of the most recently ended fiscal quarter of TWTC for which financial statements have been furnished under Section 6 of this Agreement, shall not exceed 1.50 to 1.0. No Lender shall have any obligation to participate in any increase described in this paragraph unless it agrees in writing to do so in its sole discretion. In addition, without the consent of all Lenders, the aggregate amount of all additional Revolving Commitments provided under this Section 2.1(b)

(together with all Incremental Facilities provided under Section 2.1(c) below) shall not exceed $300,000,000.

(c) As an alternative or in addition to Section 2.1(b) above, the Borrower and any one or more Lenders (including New Lenders) may, with the consent of the Administrative Agent (such consent not to be unreasonably delayed, conditioned or withheld), at any time and from time to time after the Effective Date, agree that such Lenders shall make one or more term loan facilities (each, an “Incremental Facility”; the loans thereunder, the “Incremental Loans”) available to the Borrower. Each Incremental Facility may be documented by a supplement to this Agreement signed by TWTC, the Borrower, the Administrative Agent and the Lenders party thereto. Notwithstanding the foregoing, without the consent of the Required Lenders, (i) the aggregate amount of all Incremental Facilities shall not exceed $150,000,000 (minus the amount of any additional Revolving Commitments provided under Section 2.1(b) above), (ii) the Incremental Loans shall not have a stated maturity prior to the Revolving Termination Date then in effect and (iii) after giving effect to any Incremental Facility and the borrowings contemplated thereunder, (x) no Default or Event of Default shall have occurred and be continuing, (y) TWTC shall be in pro forma compliance with the covenants contained in Section 7.1 to the extent such covenants are then in effect and (z) the Gross Consolidated Senior First Lien Secured Leverage Ratio, calculated on a pro forma basis as of the last day of the most recently ended fiscal quarter of TWTC for which financial statements have been furnished under Section 6 of this Agreement, shall not exceed 1.50 to 1.0. No Lender shall have any obligation to participate in an Incremental Facility unless it agrees in writing to do so in its sole discretion. In addition, without the consent of all Lenders, the aggregate amount of all Incremental Facilities (together with the amount of any additional Revolving Commitments provided under Section 2.1(b) above) shall not exceed $300,000,000.

(d) Any additional bank, financial institution or other entity which, with the consent of the Borrower and the Administrative Agent (such consent not to be unreasonably delayed, conditioned or withheld), elects to become a “Lender” under this Agreement in connection with any transaction described in Section 2.1(b) or 2.1(c) shall execute a New Lender Supplement (each, a “New Lender Supplement”), substantially in the form of Exhibit D-1, whereupon such bank, financial institution or other entity (a “New Lender”) shall become a Lender for all purposes and to the same extent as if originally a party hereto and shall be bound by and entitled to the benefits of this Agreement.

(e) Unless otherwise agreed by the Administrative Agent, if Revolving Loans are then outstanding and the Borrower wishes to borrow under the additional Revolving Commitments provided under Section 2.1(b), the Borrower shall repay all Revolving Loans then outstanding and reborrow under the Revolving Commitments then in effect (after giving effect to such additional Revolving Commitments) on a pro rata basis.

2.2. Procedure for Borrowing. In order to effect a borrowing hereunder, the Borrower shall give the Administrative Agent irrevocable notice (which notice must be received by the Administrative Agent prior to 2:00 P.M., New York City time, (a) three Business Days prior to the requested Borrowing Date, in the case of Eurodollar Loans, or (b) one Business Day prior to the requested Borrowing Date, in the case of ABR Loans) specifying (i) the amount and Type of Loans to be borrowed, (ii) the requested Borrowing Date and (iii) in the case of Eurodollar Loans, the respective amounts of each such Type of Loan and the respective lengths of the initial Interest Period therefor. Each borrowing shall be in an aggregate amount equal to (w) in the case of ABR Loans, $5,000,000 or a whole multiple of $1,000,000 in excess thereof (or, if the then aggregate Available Revolving Commitments are less than

$5,000,000, such lesser amount) and (x) in the case of Eurodollar Loans, $5,000,000 or a whole multiple of $1,000,000 in excess thereof; provided, that the Swingline Lender may request, on behalf of the Borrower, borrowings under the Revolving Commitments that are ABR Loans in other amounts pursuant to Section 2.5. Upon receipt of such notice the Administrative Agent shall promptly notify each Lender thereof. Not later than 12:00 Noon, New York City time, on the Borrowing Date requested by the Borrower, each Lender shall make available to the Administrative Agent at the Funding Office an amount in immediately available funds equal to the Loan to be made by such Lender. The Administrative Agent shall promptly credit the account of the Borrower on the books of such office of the Administrative Agent with the aggregate of the amounts made available to the Administrative Agent by the Lenders, in each case in immediately available funds.

2.3. Repayment of Loans. (a) The Borrower shall repay all outstanding Revolving Loans on the Revolving Termination Date.

(b) If on any date the Total Revolving Extensions of Credit exceed the Total Revolving Commitments then in effect, the Borrower shall, on such date, repay outstanding Revolving Loans and/or cash collateralize Letters of Credit so that the Total Revolving Extensions of Credit do not exceed the Total Revolving Commitments then in effect.

2.4. Swingline Commitment. (a) Subject to the terms and conditions hereof, the Swingline Lender agrees to make a portion of the credit otherwise available to the Borrower under the Revolving Commitments from time to time during the Revolving Commitment Period by making swing line loans (“Swingline Loans”) to the Borrower; provided that (i) the aggregate principal amount of Swingline Loans outstanding at any time shall not exceed the Swingline Commitment then in effect (notwithstanding that the Swingline Loans outstanding at any time, when aggregated with the Swingline Lender’s other outstanding Revolving Loans hereunder, may exceed the Swingline Commitment then in effect) and (ii) the Borrower shall not request, and the Swingline Lender shall not make, any Swingline Loan if (a) after giving effect to the making of such Swingline Loan, the aggregate amount of the Available Revolving Commitments would be less than zero. During the Revolving Commitment Period, the Borrower may use the Swingline Commitment by borrowing, repaying and reborrowing, all in accordance with the terms and conditions hereof, or (b) the conditions set forth in Section 5.3 are not satisfied. Swingline Loans shall be ABR Loans only.

(b) The Borrower shall repay all outstanding Swingline Loans on the Revolving Termination Date.

2.5. Procedure for Swingline Borrowing; Refunding of Swingline Loans. (a) Whenever the Borrower desires that the Swingline Lender make Swingline Loans it shall give the Swingline Lender irrevocable telephonic notice confirmed promptly in writing (which telephonic notice must be received by the Swingline Lender not later than 2:00 P.M., New York City time, on the proposed Borrowing Date), specifying (i) the amount to be borrowed and (ii) the requested Borrowing Date (which shall be a Business Day during the Revolving Commitment Period). Each borrowing under the Swingline Commitment shall be in an amount equal to $500,000 or a whole multiple of $100,000 in excess thereof. Not later than 3:00 P.M., New York City time, on the Borrowing Date specified in a notice in respect of Swingline Loans, the Swingline Lender shall make available to the Administrative Agent at the Funding Office an amount in immediately available funds equal to the amount of the Swingline Loan to be made by the Swingline Lender. The Administrative Agent shall promptly make the proceeds of such Swingline Loan available to the Borrower on such Borrowing Date by depositing such proceeds in the account of the Borrower with the Administrative Agent on such Borrowing Date in immediately available funds (unless in the notice of borrowing the Borrower gives instructions that the funds shall be wired to another

account, in which case the funds shall be so wired to the designated account prior to 3:00 P.M., New York City time).

(b) The Swingline Lender, at any time and from time to time in its sole and absolute discretion may, on behalf of the Borrower (which hereby irrevocably directs the Swingline Lender to act on its behalf), on one Business Day’s notice given by the Swingline Lender no later than 12:00 Noon, New York City time, request each Revolving Lender to make, and each Revolving Lender hereby agrees to make, a Revolving Loan, in an amount equal to such Revolving Lender’s Revolving Percentage of the aggregate amount of the Swingline Loans (the “Refunded Swingline Loans”) outstanding on the date of such notice, to repay the Swingline Lender. Each Revolving Lender shall make the amount of such Revolving Loan available to the Administrative Agent at the Funding Office in immediately available funds, not later than 10:00 A.M., New York City time, one Business Day after the date of such notice. The proceeds of such Revolving Loans shall be immediately made available by the Administrative Agent to the Swingline Lender for application by the Swingline Lender to the repayment of the Refunded Swingline Loans. The Borrower irrevocably authorizes the Swingline Lender to charge the Borrower’s accounts with the Administrative Agent (up to the amount available in each such account) in order to immediately pay the amount of such Refunded Swingline Loans to the extent amounts received from the Revolving Lenders are not sufficient to repay in full such Refunded Swingline Loans.

(c) If prior to the time a Revolving Loan would have otherwise been made pursuant to Section 2.5(b), one of the events described in Section 8(f) shall have occurred and be continuing with respect to the Borrower or if for any other reason, as determined by the Swingline Lender in its sole discretion, Revolving Loans may not be made as contemplated by Section 2.5(b), each Revolving Lender shall, on the date such Revolving Loan was to have been made pursuant to the notice referred to in Section 2.5(b) (the “Refunding Date”), purchase for cash an undivided participating interest in the then outstanding Swingline Loans by paying to the Swingline Lender an amount (the “Swingline Participation Amount”) equal to (i) such Revolving Lender’s Revolving Percentage times (ii) the sum of the aggregate principal amount of Swingline Loans then outstanding that were to have been repaid with such Revolving Loans.

(d) Whenever, at any time after the Swingline Lender has received from any Revolving Lender such Lender’s Swingline Participation Amount, the Swingline Lender receives any payment on account of the Swingline Loans, the Swingline Lender will distribute to such Lender its Swingline Participation Amount (appropriately adjusted, in the case of interest payments, to reflect the period of time during which such Lender’s participating interest was outstanding and funded and, in the case of principal and interest payments, to reflect such Lender’s pro rata portion of such payment if such payment is not sufficient to pay the principal of and interest on all Swingline Loans then due); provided, however, that in the event that such payment received by the Swingline Lender is required to be returned, such Revolving Lender will return to the Swingline Lender any portion thereof previously distributed to it by the Swingline Lender.

(e) Each Revolving Lender’s obligation to make the Loans referred to in Section 2.5(b) and to purchase participating interests pursuant to Section 2.5(c) shall be absolute and unconditional and shall not be affected by any circumstance, including (i) any setoff, counterclaim, recoupment, defense or other right that such Revolving Lender or the Borrower may have against the Swingline Lender, the Borrower or any other Person for any reason whatsoever; (ii) the occurrence or continuance of a Default or an Event of Default or the failure to satisfy any of the other conditions specified in Section 5; (iii) any adverse change in the condition

(financial or otherwise) of the Borrower; (iv) any breach of this Agreement or any other Loan Document by the Borrower, any other Loan Party or any other Revolving Lender; or (v) any other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing.

2.6. Commitment Fees, etc. (a) The Borrower agrees to pay to the Administrative Agent for the account of each Revolving Lender a commitment fee for the period from and including the Effective Date to the last day of the Revolving Commitment Period, computed at the Commitment Fee Rate on the average daily amount of the Available Revolving Commitment of such Lender during the period for which payment is made, payable quarterly in arrears on the last day of each March, June, September and December prior to, and on, the Revolving Termination Date, commencing on the first of such dates to occur after the date hereof.

(b) The Borrower agrees to pay to the Administrative Agent the fees in the amounts and on the dates previously agreed to in writing by the Borrower and the Administrative Agent.

2.7. Optional Termination or Reduction of Revolving Commitments. The Borrower shall have the right, upon notice (or, when accompanied by a prepayment of ABR Loans or Eurodollar Loans, not less than one or three Business Days’ notice, respectively) to the Administrative Agent, to terminate the Revolving Commitments or, from time to time, to reduce the amount of the Revolving Commitments; provided that no such termination or reduction of Revolving Commitments shall be permitted if, after giving effect thereto and to any prepayments of the Revolving Loans and Swingline Loans made on the effective date thereof, the Total Revolving Extensions of Credit would exceed the Total Revolving Commitments. Any such reduction shall be in an amount equal to $1,000,000, or a whole multiple thereof, and shall reduce ratably and permanently the Revolving Commitments then in effect.

2.8. Optional Prepayments. The Borrower may at any time and from time to time prepay the Loans, in whole or in part, without premium or penalty, upon irrevocable notice delivered to the Administrative Agent at least three Business Days prior thereto in the case of Eurodollar Loans and at least one Business Day prior thereto in the case of ABR Loans, which notice shall specify the date and amount of prepayment and whether the prepayment is of Eurodollar Loans or ABR Loans; provided, that if a Eurodollar Loan is prepaid on any day other than the last day of the Interest Period applicable thereto, the Borrower shall also pay any amounts owing pursuant to Section 2.17. Upon receipt of any such notice the Administrative Agent shall promptly notify each relevant Lender thereof. If any such notice is given, the amount specified in such notice shall be due and payable on the date specified therein, together with (except in the case of Revolving Loans that are ABR Loans and Swingline Loans) accrued interest to such date on the amount prepaid. Partial prepayments of Revolving Loans shall be in an aggregate principal amount of $1,000,000 or a whole multiple thereof. Partial prepayments of Swingline Loans shall be in an aggregate principal amount of $100,000 or a whole multiple thereof.

2.9. Conversion and Continuation Options. (a) The Borrower may elect from time to time to convert Eurodollar Loans to ABR Loans by giving the Administrative Agent at least two Business Days’ prior irrevocable notice of such election, provided that any such conversion of Eurodollar Loans may only be made on the last day of an Interest Period with respect thereto. The Borrower may elect from time to time to convert ABR Loans to Eurodollar Loans by giving the Administrative Agent at least three Business Days’ prior irrevocable notice of such election (which notice shall specify the length of the initial Interest Period therefor), provided that no ABR Loan may be converted into a Eurodollar Loan when any Event of Default has occurred and is continuing and the Administrative Agent has determined in its sole discretion not to permit such conversions. Upon receipt of any such notice the Administrative Agent shall promptly notify each relevant Lender thereof.

(b) Any Eurodollar Loan may be continued as such upon the expiration of the then current Interest Period with respect thereto by the Borrower giving irrevocable notice to the Administrative Agent, in accordance with the applicable provisions of the term “Interest Period” set forth in Section 1.1, of the length of the next Interest Period to be applicable to such Loans, provided that no Eurodollar Loan may be continued as such when any Event of Default has occurred and is continuing and the Administrative Agent has determined in its sole discretion not to permit such continuations, and provided, further, that if the Borrower shall fail to give any required notice as described above in this paragraph or if such continuation is not permitted pursuant to the preceding proviso, such Loans shall be automatically converted to ABR Loans on the last day of such then expiring Interest Period. Upon receipt of any such notice, the Administrative Agent shall promptly notify each relevant Lender thereof.

2.10. Limitations on Eurodollar Loans. Notwithstanding anything to the contrary in this Agreement, all borrowings, conversions and continuations of Eurodollar Loans hereunder and all selections of Interest Periods hereunder shall be in such amounts and be made pursuant to such elections so that, (a) after giving effect thereto, the aggregate principal amount of the Eurodollar Loans comprising each Eurodollar Tranche shall be equal to $5,000,000 or a whole multiple of $1,000,000 in excess thereof and (b) no more than 10 Eurodollar Tranches shall be outstanding at any one time.

2.11. Interest Rates and Payment Dates. (a) Each Eurodollar Loan shall bear interest for each day during each Interest Period with respect thereto at a rate per annum equal to the Eurodollar Rate determined for such day plus the Applicable Margin.

(b) Each ABR Loan shall bear interest at a rate per annum equal to the ABR plus the Applicable Margin.

(c) (i) If all or a portion of the principal amount of any Loan or Reimbursement Obligation shall not be paid when due (whether at the stated maturity, by acceleration or otherwise), such overdue amount shall bear interest at a rate per annum equal to (x) in the case of the Loans, the rate that would otherwise be applicable thereto pursuant to the foregoing provisions of this Section plus 2% or (y) in the case of Reimbursement Obligations, the rate then applicable to ABR Loans plus 2%, and (ii) if all or a portion of any interest payable on any Loan or Reimbursement Obligation or any commitment fee or other amount payable hereunder shall not be paid when due (whether at the stated maturity, by acceleration or otherwise), such overdue amount shall bear interest at a rate per annum equal to the rate then applicable to ABR Loans plus 2%, in each case, with respect to clauses (i) and (ii) above, from the date of such non-payment until such amount is paid in full (as well after as before judgment).

(d) Interest shall be payable in arrears on each Interest Payment Date, provided that interest accruing pursuant to paragraph (c) of this Section shall be payable from time to time on demand.

2.12. Computation of Interest and Fees. (a) Interest and fees payable pursuant hereto shall be calculated on the basis of a 360-day year for the actual days elapsed, except that, with respect to ABR Loans the rate of interest on which is calculated on the basis of the Prime Rate, the interest thereon shall be calculated on the basis of a 365- (or 366-, as the case may be) day year for the actual days elapsed. The Administrative Agent shall as soon as practicable notify the Borrower and the relevant Lenders of each determination of a Eurodollar Rate. Any change in the interest rate on a Loan resulting from a change in the ABR or the Eurocurrency Reserve Requirements shall become effective as of the opening of business on the day on which such change becomes effective. The Administrative Agent shall

as soon as practicable notify the Borrower and the relevant Lenders of the effective date and the amount of each such change in interest rate.

(b) Each determination of an interest rate by the Administrative Agent pursuant to any provision of this Agreement shall be conclusive and binding on the Borrower and the Lenders in the absence of manifest error. The Administrative Agent shall, at the request of the Borrower, deliver to the Borrower a statement showing the quotations used by the Administrative Agent in determining any interest rate pursuant to Section 2.11.

2.13. Inability to Determine Interest Rate. If prior to the first day of any Interest Period:

(a) the Administrative Agent shall have determined (which determination shall be conclusive and binding upon the Borrower) 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 Administrative Agent shall have received notice from the Required Lenders that the Eurodollar Rate determined or to be determined for such Interest Period will not adequately and fairly reflect the cost to such Lenders (as conclusively certified by such Lenders) of making or maintaining their affected Loans during such Interest Period,

the Administrative Agent shall give telecopy or telephonic notice thereof to the Borrower and the relevant Lenders as soon as practicable thereafter. If such notice is given (x) either the Borrower may withdraw any request for a borrowing of Eurodollar Loans or any Eurodollar Loans requested to be made on the first day of such Interest Period shall be made as ABR Loans, (y) any Loans that were to have been converted on the first day of such Interest Period to Eurodollar Loans shall be continued as ABR Loans and (z) any outstanding Eurodollar Loans shall be converted, on the last day of the then-current Interest Period, to ABR Loans. Until such notice has been withdrawn by the Administrative Agent, no further Eurodollar Loans shall be made or continued as such, nor shall the Borrower have the right to convert Loans to Eurodollar Loans.

2.14. Pro Rata Treatment and Payments. (a) Each borrowing by the Borrower from the Lenders hereunder, each payment by the Borrower on account of any commitment fee and any reduction of the Revolving Commitments of the Lenders shall be made pro rata according to the respective Revolving Percentages of the Revolving Lenders.

(b) Each payment (including each prepayment) by the Borrower on account of principal of and interest on the Revolving Loans shall be made pro rata according to the respective outstanding principal amounts of the Revolving Loans then held by the Revolving Lenders.

(c) All payments (including prepayments) to be made by the Borrower hereunder, whether on account of principal, interest, fees or otherwise, shall be made without setoff or counterclaim and shall be made prior to 12:00 Noon, New York City time, on the due date thereof to the Administrative Agent, for the account of the Lenders, at the Funding Office, in Dollars and in immediately available funds. The Administrative Agent shall distribute such payments to the Lenders promptly upon receipt in like funds as received. If any payment hereunder (other than payments on the Eurodollar Loans) becomes due and payable on a day other than a Business Day, such payment shall be extended to the next succeeding Business Day. If any payment on a Eurodollar Loan becomes due and payable on a day other than a Business Day, the maturity

thereof shall be extended to the next succeeding Business Day unless the result of such extension would be to extend such payment into another calendar month, in which event such payment shall be made on the immediately preceding Business Day. In the case of any extension of any payment of principal pursuant to the preceding two sentences, interest thereon shall be payable at the then applicable rate during such extension.

(d) Unless the Administrative Agent shall have been notified in writing by any Lender prior to a borrowing that such Lender will not make the amount that would constitute its share of such borrowing available to the Administrative Agent, the Administrative Agent may assume that such Lender is making such amount available to the Administrative Agent, and the Administrative Agent may, in reliance upon such assumption, make available to the Borrower a corresponding amount. If such amount is not made available to the Administrative Agent by the required time on the Borrowing Date therefor, such Lender shall pay to the Administrative Agent, on demand, such amount with interest thereon at a rate equal to the daily average Federal Funds Effective Rate for the period until such Lender makes such amount immediately available to the Administrative Agent. A certificate of the Administrative Agent submitted to any Lender with respect to any amounts owing under this paragraph shall be conclusive in the absence of manifest error. If such Lender’s share of such borrowing is not made available to the Administrative Agent by such Lender within three Business Days of such Borrowing Date, the Administrative Agent shall also be entitled to recover such amount with interest thereon at the rate per annum then applicable to ABR Loans, on demand, from the Borrower (it being understood and agreed that any payment by the Borrower pursuant to the foregoing shall be without prejudice to its rights against any defaulting Lender).

(e) Unless the Administrative Agent shall have been notified in writing by the Borrower prior to the date of any payment being made hereunder that the Borrower will not make such payment to the Administrative Agent, the Administrative Agent may assume that the Borrower is making such payment, and the Administrative Agent may, but shall not be required to, in reliance upon such assumption, make available to the Lenders their respective pro rata shares of a corresponding amount. If such payment is not made to the Administrative Agent by the Borrower within three Business Days of such required date, the Administrative Agent shall be entitled to recover, on demand, from each Lender to which any amount which was made available pursuant to the preceding sentence, such amount with interest thereon at the rate per annum equal to the daily average Federal Funds Effective Rate. Nothing herein shall be deemed to limit the rights of the Administrative Agent or any Lender against the Borrower.

2.15. Requirements of Law. (a) If the adoption of or any change in any Requirement of Law or in the interpretation or application thereof or compliance by any Lender with any request or directive (whether or not having the force of law) from any central bank or other Governmental Authority made subsequent to the date hereof:

(i) shall subject any Lender to any tax of any kind whatsoever with respect to this Agreement, any Letter of Credit, any Application or any Eurodollar Loan made by it, or change the basis of taxation of payments to such Lender in respect thereof (except for Non-Excluded Taxes covered by Section 2.16 and changes in the rate of tax on the overall net income of such Lender);

(ii) shall impose, modify or hold applicable any reserve, special deposit, compulsory loan or similar requirement against assets held by, deposits or other liabilities in or for the account of, advances, loans or other extensions of credit by, or any other acquisition of funds by,

any office of such Lender that is not otherwise included in the determination of the Eurodollar Rate hereunder; or

(iii) shall impose on such Lender any other condition;

and the result of any of the foregoing is to increase the cost to such Lender, by an amount that such Lender deems to be material, of making, converting into, continuing or maintaining Eurodollar Loans or issuing or participating in Letters of Credit, or to reduce any amount receivable hereunder in respect thereof, then, in any such case, the Borrower shall promptly pay such Lender, upon its demand, any additional amounts necessary to compensate such Lender for such increased cost actually incurred or reduced amount actually received; provided that the Borrower shall not be required to compensate a Lender pursuant to this paragraph for any amounts incurred more than 90 days prior to the date that such Lender notifies the Borrower of such Lender’s intention to claim compensation therefor; and provided further that, if the circumstances giving rise to such claim have a retroactive effect, then such 90-day period shall be extended to include the period of such retroactive effect. If any Lender becomes entitled to claim any additional amounts pursuant to this paragraph, it shall promptly (and, in any event, within three months) notify the Borrower (with a copy to the Administrative Agent) of the event by reason of which it has become so entitled.

(b) If any Lender shall have determined that the adoption of or any change in any Requirement of Law regarding capital adequacy or in the interpretation or application thereof or compliance by such Lender or any corporation controlling such Lender with any request or directive regarding capital adequacy (whether or not having the force of law) from any Governmental Authority made subsequent to the date hereof shall have the effect of reducing the rate of return on such Lender’s or such corporation’s capital as a consequence of its obligations hereunder or under or in respect of any Letter of Credit to a level below that which such Lender or such corporation could have achieved but for such adoption, change or compliance (taking into consideration such Lender’s or such corporation’s policies with respect to capital adequacy) by an amount deemed by such Lender to be material, then from time to time, after submission by such Lender to the Borrower (with a copy to the Administrative Agent) of a written request therefor, the Borrower shall pay to such Lender such additional amount or amounts as will compensate such Lender for such reduction; provided that the Borrower shall not be required to compensate a Lender pursuant to this paragraph for any amounts incurred more than 90 days prior to the date that such Lender notifies the Borrower of such Lender’s intention to claim compensation therefor; and provided further that, if the circumstances giving rise to such claim have a retroactive effect, then such 90-day period shall be extended to include the period of such retroactive effect.

(c) A certificate, setting forth a reasonably detailed explanation as to the reason for any additional amounts payable pursuant to this Section, as to any additional amounts payable pursuant to this Section submitted by any Lender to the Borrower (with a copy to the Administrative Agent) shall be conclusive in the absence of manifest error. The obligations of the Borrower pursuant to this Section shall survive the termination of this Agreement and the payment of the Loans and all other amounts payable hereunder.

2.16. Taxes. (a) All payments made by the Borrower under this Agreement shall be made free and clear of, and without deduction or withholding for or on account of, any present or future income, stamp or other taxes, levies, imposts, duties, charges, fees, deductions or withholdings, now or hereafter imposed, levied, collected, withheld or assessed by any Governmental Authority, excluding net income taxes and franchise taxes (imposed in lieu of net income taxes) imposed on the Administrative Agent, the Collateral Agent or any Lender as a result of a present or former connection between the

Administrative Agent, the Collateral Agent or such Lender and the jurisdiction of the Governmental Authority imposing such tax or any political subdivision or taxing authority thereof or therein (other than any such connection arising solely from the Administrative Agent, the Collateral Agent or such Lender having executed, delivered or performed its obligations or received a payment under, or enforced, this Agreement or any other Loan Document). If any such non-excluded taxes, levies, imposts, duties, charges, fees, deductions or withholdings (“Non-Excluded Taxes”) or Other Taxes are required to be withheld from any amounts payable to the Administrative Agent, the Collateral Agent or any Lender hereunder, the amounts so payable to the Administrative Agent, the Collateral Agent or such Lender shall be increased to the extent necessary to yield to the Administrative Agent, the Collateral Agent or such Lender (after payment of all Non-Excluded Taxes and Other Taxes) interest or any such other amounts payable hereunder at the rates or in the amounts specified in this Agreement, provided, however, that the Borrower shall not be required to increase any such amounts payable to any Lender with respect to any Non-Excluded Taxes (i) that are attributable to such Lender’s failure to comply with the requirements of paragraph (d) or (e) of this Section or (ii) that are United States withholding taxes imposed on amounts payable to such Lender at the time the Lender becomes a party to this Agreement, except as, and to the extent that, such Lender’s assignor (if any) was entitled, at the time of assignment, to receive additional amounts from the Borrower with respect to such Non-Excluded Taxes pursuant to this paragraph.

(b) In addition, the Borrower shall pay any Other Taxes to the relevant Governmental Authority in accordance with applicable law.

(c) Whenever any Non-Excluded Taxes or Other Taxes are payable by the Borrower, as promptly as possible thereafter the Borrower shall send to the Administrative Agent for its own account or for the account of the Collateral Agent or the relevant Lender, as the case may be, a certified copy of an original official receipt received by the Borrower showing payment thereof. If the Borrower fails to pay any Non-Excluded Taxes or Other Taxes when due to the appropriate taxing authority or fails to remit to the Administrative Agent the required receipts or other required documentary evidence, the Borrower shall indemnify the Administrative Agent, the Collateral Agent and the Lenders for any incremental taxes, interest or penalties that may become payable by the Administrative Agent or any Lender as a result of any such failure.

(d) Each Lender (or Transferee) that is not a “U.S. Person” as defined in Section 7701(a)(30) of the Code (a “Non-U.S. Lender”) shall deliver to the Borrower and the Administrative Agent (or, in the case of a Participant, to the Lender from which the related participation shall have been purchased) two copies of either U.S. Internal Revenue Service Form W-8BEN or Form W-8ECI, or, in the case of a Non-U.S. Lender claiming exemption from U.S. federal withholding tax under Section 871(h) or 881(c) of the Code with respect to payments of “portfolio interest”, a statement substantially in the form of Exhibit F and a Form W-8BEN, or any subsequent versions thereof or successors thereto, properly completed and duly executed by such Non-U.S. Lender claiming complete exemption from, or a reduced rate of, U.S. federal withholding tax on all payments by the Borrower under this Agreement and the other Loan Documents. Such forms shall be delivered by each Non-U.S. Lender on or before the date it becomes a party to this Agreement (or, in the case of any Participant, on or before the date such Participant purchases the related participation). In addition, each Non-U.S. Lender shall deliver such forms promptly upon the obsolescence or invalidity of any form previously delivered by such Non-U.S. Lender. Each Non-U.S. Lender shall promptly notify the Borrower at any time it determines that it is no longer in a position to provide any previously delivered certificate to the Borrower (or any other form of certification adopted by the U.S. taxing authorities for such purpose). Notwithstanding any other provision of this paragraph, a Non-U.S. Lender shall not be

required to deliver any form pursuant to this paragraph that such Non-U.S. Lender is not legally able to deliver.

(e) A Lender that is entitled to an exemption from or reduction of non-U.S. withholding tax under the law of the jurisdiction in which the Borrower is located, or any treaty to which such jurisdiction is a party, with respect to payments under this Agreement shall deliver to the Borrower (with a copy to the Administrative Agent), at the time or times prescribed by applicable law or reasonably requested by the Borrower, such properly completed and executed documentation prescribed by applicable law as will permit such payments to be made without withholding or at a reduced rate, provided that such Lender is legally entitled to complete, execute and deliver such documentation and in such Lender’s judgment such completion, execution or submission would not materially prejudice the legal position of such Lender.

(f) If any payee receives a refund of any Non-Excluded Taxes or Other Taxes paid by the Borrower under this Section 2.16, which refund in the sole judgment of such payee is allocable to such payment, such payee shall promptly pay over to the Borrower the amount of such refund, net of all out-of-pocket expenses of such payee; provided, however, that the Borrower, upon the request of such payee, agrees to repay the amount paid over to the Borrower to such payee in the event such Lender, the Collateral Agent or the Administrative Agent is required to repay such refund.

(g) The agreements in this Section shall survive the termination of this Agreement and the payment of the Loans and all other amounts payable hereunder.

2.17. Indemnity. The Borrower agrees to indemnify each Lender and to hold each Lender harmless from any loss or expense that such Lender may sustain or incur as a consequence of (a) default by the Borrower in making a borrowing of, conversion into or continuation of Eurodollar Loans after the Borrower has given a notice requesting the same in accordance with the provisions of this Agreement, (b) default by the Borrower in making any prepayment of or conversion from Eurodollar Loans after the Borrower has given a notice thereof in accordance with the provisions of this Agreement or (c) the making of a prepayment of Eurodollar Loans on a day that is not the last day of an Interest Period with respect thereto. Such indemnification may include an amount equal to the excess, if any, of (i) the amount of interest that would have accrued on the amount so prepaid, or not so borrowed, converted or continued, as the case may be, for the period from the date of such prepayment or of such failure to borrow, convert or continue to the last day of such Interest Period (or, in the case of a failure to borrow, convert or continue, the Interest Period that would have commenced on the date of such failure) in each case at the applicable rate of interest for such Loans provided for herein (excluding, however, the Applicable Margin included therein, if any) over (ii) the amount of interest (as reasonably determined by such Lender) that would have accrued to such Lender on such amount by placing such amount on deposit for a comparable period with leading banks in the interbank eurodollar market. A certificate as to any amounts payable pursuant to this Section submitted to the Borrower by any Lender shall be conclusive in the absence of manifest error. This covenant shall survive the termination of this Agreement and the payment of the Loans and all other amounts payable hereunder.

2.18. Change of Lending Office. Each Lender agrees that, upon the occurrence of any event giving rise to the operation of Section 2.15 or 2.16(a) with respect to such Lender, it will, if requested by the Borrower, use reasonable efforts (subject to overall policy considerations of such Lender) to designate another lending office for any Loans and other extensions of credit affected by such event with the object of avoiding the consequences of such event; provided, that such designation is made on terms that, in the sole judgment of such Lender, cause such Lender and its lending office(s) to suffer

no economic, legal or regulatory disadvantage, and provided, further, that nothing in this Section shall affect or postpone any of the obligations of any Borrower or the rights of any Lender pursuant to Section 2.15 or 2.16(a).

2.19. Replacement of Lenders. The Borrower shall be permitted to replace any Lender that (a) requests reimbursement for amounts owing pursuant to Section 2.15 or 2.16(a) or (b) defaults in its obligation to make Loans (or, in the case of the Swingline Lender, Swingline Loans or, in the case of the Issuing Lender, defaults in its obligation to issue Letters of Credit) hereunder, with a replacement financial institution; provided that (i) such replacement does not conflict with any Requirement of Law, (ii) no Event of Default shall have occurred and be continuing at the time of such replacement, (iii) prior to any such replacement, such Lender shall not have eliminated, after requested to do so by the Borrower, the continued need for payment of amounts owing pursuant to Section 2.15 or 2.16(a), (iv) the replacement financial institution shall purchase, at par, all Loans and other amounts owing to such replaced Lender on or prior to the date of replacement, (v) the Borrower shall be liable to such replaced Lender under Section 2.17 if any Eurodollar Loan owing to such replaced Lender shall be purchased other than on the last day of the Interest Period relating thereto, (vi) the replacement financial institution, if not already a Lender, shall be reasonably satisfactory to the Administrative Agent, (vii) the replaced Lender shall be obligated to make such replacement in accordance with the provisions of Section 10.6 (provided that the Borrower shall be obligated to pay the registration and processing fee referred to therein), (viii) until such time as such replacement shall be consummated, the Borrower shall pay all additional amounts (if any) required pursuant to Section 2.15 or 2.16(a), as the case may be, and (ix) any such replacement shall not be deemed to be a waiver of any rights that the Borrower, the Administrative Agent or any other Lender shall have against the replaced Lender.

2.20. Change of Control. Upon the occurrence of a Change of Control Triggering Event or a Specified Change of Control, (i) the Borrower shall not have any right to request an extension of credit hereunder and (ii) at the request of the Required Lenders (or of the Administrative Agent acting at the request or with the consent of the Required Lenders), (a) the Borrower shall immediately repay all Obligations then outstanding under this Agreement and the other Loan Documents and (b) all Revolving Commitments shall immediately terminate, without other or further action by any Person.

SECTION 3. LETTERS OF CREDIT

3.1. L/C Commitment. (a) Subject to the terms and conditions hereof, the Issuing Lender, in reliance on the agreements of the other Revolving Lenders set forth in Section 3.4(a), agrees to issue letters of credit (“Letters of Credit”) for the account of the Borrower on any Business Day during the Revolving Commitment Period in such form as may be approved from time to time by the Issuing Lender; provided that the Issuing Lender shall not issue any Letter of Credit if, after giving effect to such issuance, (i) the L/C Obligations would exceed the L/C Commitment or (ii) the aggregate amount of the Available Revolving Commitments would be less than zero. Each Letter of Credit shall (i) be denominated in Dollars, (ii) have a face amount of at least $500,000 (unless otherwise agreed by the Issuing Lender) and (iii) expire no later than the earlier of (x) the first anniversary of its date of issuance and (y) the date that is five Business Days prior to the Revolving Termination Date, provided that any Letter of Credit with a one-year term may provide for the renewal thereof for additional one-year periods (which shall in no event extend beyond the date referred to in clause (y) above).

(b) The Issuing Lender shall not issue any Letter of Credit hereunder if (i) such issuance would conflict with, or cause the Issuing Lender or any L/C Participant to exceed any limits

imposed by, any applicable Requirement of Law or (ii) the conditions set forth in Section 5.3 are not satisfied.

3.2. Procedure for Issuance of Letter of Credit. The Borrower may from time to time request that the Issuing Lender issue a Letter of Credit by delivering to the Issuing Lender at its address for notices specified herein an Application therefor, completed to the satisfaction of the Issuing Lender, and such other certificates, documents and other papers and information as the Issuing Lender may request. Upon receipt of any Application, the Issuing Lender will process such Application and the certificates, documents and other papers and information delivered to it in connection therewith in accordance with its customary procedures and shall promptly issue the Letter of Credit requested thereby (but in no event shall the Issuing Lender be required to issue any Letter of Credit earlier than three Business Days after its receipt of the Application therefor and all such other certificates, documents and other papers and information relating thereto) by issuing the original of such Letter of Credit to the beneficiary thereof or as otherwise may be agreed to by the Issuing Lender and the Borrower. The Issuing Lender shall furnish a copy of such Letter of Credit to the Borrower or at its direction promptly following the issuance thereof. The Issuing Lender shall promptly furnish to the Administrative Agent, which shall in turn promptly furnish to the Lenders, notice of the issuance of each Letter of Credit (including the amount thereof).

3.3. Fees and Other Charges. (a) The Borrower will pay a fee on the undrawn portion of all outstanding Letters of Credit at a per annum rate equal to the Applicable Margin then in effect with respect to Eurodollar Loans, shared ratably among the Revolving Lenders and payable quarterly in arrears on each L/C Fee Payment Date after the issuance date. In addition, the Borrower shall pay to the Issuing Lender for its own account a fronting fee of 0.25% per annum on the undrawn and unexpired amount of each Letter of Credit, payable quarterly in arrears on each L/C Fee Payment Date after the issuance date.

(b) In addition to the foregoing fees, the Borrower shall pay or reimburse the Issuing Lender for such normal and customary costs and expenses as are incurred or charged by the Issuing Lender in issuing, negotiating, effecting payment under, amending or otherwise administering any Letter of Credit.

3.4. L/C Participations. (a) The Issuing Lender irrevocably agrees to grant and hereby grants to each L/C Participant, and, to induce the Issuing Lender to issue Letters of Credit hereunder, each L/C Participant irrevocably agrees to accept and purchase and hereby accepts and purchases from the Issuing Lender, on the terms and conditions hereinafter stated, for such L/C Participant’s own account and risk, an undivided interest equal to such L/C Participant’s Revolving Percentage in the Issuing Lender’s obligations and rights under each Letter of Credit issued hereunder and the amount of each draft paid by the Issuing Lender thereunder. Each L/C Participant unconditionally and irrevocably agrees with the Issuing Lender that, if a draft is paid under any Letter of Credit for which the Issuing Lender is not reimbursed in full by the Borrower in accordance with the terms of this Agreement, such L/C Participant shall pay to the Administrative Agent, for the account of the Issuing Lender, upon demand at the Administrative Agent’s Funding Office (and thereafter the Administrative Agent shall promptly pay to the Issuing Lender) an amount equal to such L/C Participant’s Revolving Percentage of the amount of such draft, or any part thereof, that is not so reimbursed.

(b) If any amount required to be paid by any L/C Participant to the Administrative Agent, for the account of the Issuing Lender, pursuant to Section 3.4(a) in respect of any unreimbursed portion of any payment made by the Issuing Lender under any Letter of Credit is not paid to the Issuing Lender within three Business Days after the date such payment is due, the Issuing Lender shall so notify the Administrative Agent, who shall notify such L/C Participant

and such L/C Participant shall pay to the Administrative Agent, for the account of the Issuing Lender on demand (and thereafter the Administrative Agent shall promptly pay to the Issuing Lender) an amount equal to the product of (i) such amount, times (ii) the daily average Federal Funds Effective Rate during the period from and including the date such payment is required to the date on which such payment is immediately available to the Issuing Lender, times (iii) a fraction the numerator of which is the number of days that elapse during such period and the denominator of which is 360. If any such amount required to be paid by any L/C Participant pursuant to Section 3.4(a) is not made available to the Administrative Agent, for the account of the Issuing Lender, by such L/C Participant within three Business Days after the date such payment is due, the Administrative Agent on behalf of the Issuing Lender shall be entitled to recover from such L/C Participant, on demand, such amount with interest thereon calculated from such due date at the rate per annum applicable to ABR Loans. A certificate the Administrative Agent submitted on behalf of the Issuing Lender submitted to any L/C Participant with respect to any such amounts owing under this Section shall be conclusive in the absence of manifest error.

(c) Whenever, at any time after the Issuing Lender has made payment under any Letter of Credit and has received from the Administrative Agent any L/C Participant its pro rata share of such payment in accordance with Section 3.4(a), the Issuing Lender receives any payment related to such Letter of Credit (whether directly from the Borrower or otherwise, including proceeds of collateral applied thereto by the Issuing Lender), or any payment of interest on account thereof, the Issuing Lender will distribute to the Administrative Agent, for the account of such L/C Participant (and thereafter the Administrative Agent shall promptly pay such L/C Participant), its pro rata share thereof; provided, however, that in the event that any such payment received by the Issuing Lender shall be required to be returned by the Issuing Lender, such L/C Participant shall return to the Administrative Agent, for the account of the Issuing Lender (and thereafter the Administrative Agent shall promptly pay to the Issuing Lender), the portion thereof previously distributed by the Issuing Lender.

3.5. Reimbursement Obligation of the Borrower. Unless otherwise agreed by the Issuing Lender and the Required Lenders, the Borrower agrees to reimburse the Issuing Lender on each date on which the Issuing Lender notifies the Borrower of the date and amount of a draft presented under any Letter of Credit and paid by the Issuing Lender for the amount of (a) such draft so paid and (b) any taxes, fees, charges or other costs or expenses incurred by the Issuing Lender in connection with such payment. Each such payment shall be made to the Issuing Lender at its address for notices specified herein in lawful money of the United States and in immediately available funds. Interest shall be payable on any and all amounts remaining unpaid by the Borrower under this Section from the date such amounts become payable (whether at stated maturity, by acceleration or otherwise) until payment in full at the rate set forth in (i) until the second Business Day following the date of the applicable drawing, Section 2.11(b) and (ii) thereafter, Section 2.11(c).

3.6. Obligations Absolute. The Borrower’s obligations under this Section 3 shall be absolute and unconditional under any and all circumstances and irrespective of any setoff, counterclaim or defense to payment that the Borrower may have or have had against the Issuing Lender, any beneficiary of a Letter of Credit or any other Person. The Borrower also agrees with the Issuing Lender that the Issuing Lender shall not be responsible for, and the Borrower’s Reimbursement Obligations under Section 3.5 shall not be affected by, among other things, the validity or genuineness of documents or of any endorsements thereon, even though such documents shall in fact prove to be invalid, fraudulent or forged, or any dispute between or among the Borrower and any beneficiary of any Letter of Credit or any other party to which such Letter of Credit may be transferred or any claims whatsoever of the Borrower against any beneficiary of such Letter of Credit or any such transferee. The Issuing Lender shall not be

liable for any error, omission, interruption or delay in transmission, dispatch or delivery of any message or advice, however transmitted, in connection with any Letter of Credit, except for errors or omissions resulting from the gross negligence or willful misconduct of the Issuing Lender. The Borrower agrees that any action taken or omitted by the Issuing Lender under or in connection with any Letter of Credit or the related drafts or documents, if done in the absence of gross negligence or willful misconduct and in accordance with the standards of care specified in the Uniform Commercial Code of the State of New York, shall be binding on the Borrower and shall not result in any liability of the Issuing Lender to the Borrower.

3.7. Letter of Credit Payments. If any draft shall be presented for payment under any Letter of Credit, the Issuing Lender shall promptly notify the Borrower of the date and amount thereof. The responsibility of the Issuing Lender to the Borrower in connection with any draft presented for payment under any Letter of Credit shall, in addition to any payment obligation expressly provided for in such Letter of Credit, be limited to determining that the documents (including each draft) delivered under such Letter of Credit in connection with such presentment are substantially in conformity with such Letter of Credit.

3.8. Applications. To the extent that any provision of any Application related to any Letter of Credit is inconsistent with the provisions of this Section 3, the provisions of this Section 3 shall apply.

SECTION 4. REPRESENTATIONS AND WARRANTIES

To induce the Administrative Agent and the Lenders to enter into this Agreement and to make the Loans and issue or participate in the Letters of Credit, TWTC (as to itself and its Subsidiaries) and the Borrower (as to itself and its Subsidiaries) hereby severally represent and warrant to the Administrative Agent, the Collateral Agent and each Lender that:

4.1. Financial Condition. (a) The unaudited pro forma consolidated balance sheet of TWTC and its consolidated Subsidiaries as at December 31, 2003 (including the notes thereto) (the “Pro Forma Balance Sheet”), copies of which have heretofore been furnished to each Lender, has been prepared giving effect (as if such events had occurred on such date) to (i) the issuance of the High Yield Notes and the use of proceeds thereof, (ii) the termination of the Existing Credit Agreement and the payment of amounts then owing thereunder and (iii) the payment of fees and expenses in connection with the foregoing. The Pro Forma Balance Sheet has been prepared based on information and assumptions believed by TWTC to be reasonable as of the date of delivery thereof, and presents fairly, based on such information and assumptions, on a pro forma basis the estimated financial position of TWTC and its consolidated Subsidiaries as at December 31, 2003, assuming that the events specified in the preceding sentence had actually occurred at such date.

(b) The audited consolidated balance sheet of TWTC as at December 31, 2002, and the related consolidated statements of income and of cash flows for the fiscal year ended on such date, reported on by and accompanied by an unqualified report from Ernst & Young LLP, present fairly the consolidated financial condition of TWTC as at such date, and the consolidated results of its operations and its consolidated cash flows for the fiscal year then ended. The unaudited consolidated balance sheet of TWTC as at September 30, 2003, and the related unaudited consolidated statements of income and cash flows for the nine-month period ended on such date, present fairly the consolidated financial condition of TWTC as at such date, and the consolidated results of its operations and its consolidated cash flows for the nine-month period then ended (subject to normal year-end adjustments). All such financial

statements, including the related schedules and notes thereto, have been prepared in accordance with GAAP applied consistently throughout the periods involved (except as approved by the aforementioned firm of accountants and disclosed therein). TWTC and its Subsidiaries do not have any material Guarantee Obligations, contingent liabilities and liabilities for taxes, or any long-term leases or unusual forward or long-term commitments, including any interest rate or foreign currency swap or exchange transaction or other obligation in respect of derivatives, that are not reflected in the most recent financial statements referred to in this paragraph. During the period from December 31, 2002 to and including the date hereof there has been no Disposition by TWTC or any of its Subsidiaries of any material part of its business or property.

4.2. No Change. Since December 31, 2002, there has been no development or event that has had or could reasonably be expected to have a Material Adverse Effect.

4.3. Existence; Compliance with Law. Each of TWTC and its Subsidiaries (a) is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, (b) has the power and authority under its constitutive documents, 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, (c) is duly qualified as a foreign corporation, partnership or limited liability company, as the case may be, 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 and (d) is in compliance with all Requirements of Law except to the extent that the failure to be qualified or to comply therewith, as the case may be, could not, in the aggregate, reasonably be expected to have a Material Adverse Effect.

4.4. Power; Authorization; Enforceable Obligations. Each Loan Party will have the power and authority under its constitutive documents, and the legal right, to make, deliver and perform the Loan Documents to which it is a party prior to the execution of any such Loan Documents. The Borrower has the power and authority under its constitutive documents, and the legal right, to obtain extensions of credit hereunder. Each Loan Party will have taken all necessary organizational action under its constitutive documents to authorize the execution, delivery and performance of the Loan Documents to which it is a party prior to the execution of any such Loan Documents. The Borrower has taken all necessary organizational action under its constitutive documents to authorize the extensions of credit on the terms and conditions of this Agreement. No consent or authorization of, filing with, notice to or other act by or in respect of, any Governmental Authority or any other Person is required in connection with the extensions of credit hereunder or with the execution, delivery, performance, validity or enforceability of this Agreement or any of the Loan Documents by or on behalf of the Loan Parties, except (i) consents, authorizations, filings and notices described in Schedule 4.4, which consents, authorizations, filings and notices shall be obtained or made and shall be in full force and effect prior to the Initial Funding Date (except that no such filings will have been obtained or made with respect to certain real and personal property excluded from the Collateral under the Security Documents) and (ii) the filings referred to in Section 4.19. This Agreement has been, and each other Loan Document as of its date will be, duly executed and delivered on behalf of each Loan Party party thereto. This Agreement constitutes, and each other Loan Document upon execution will constitute, a legal, valid and binding obligation of each Loan Party party thereto, enforceable against each such Loan 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).

4.5. No Legal Bar. The execution, delivery and performance of this Agreement and the other Loan Documents, the issuance of Letters of Credit, the borrowings hereunder and the use of the proceeds thereof will not violate any Requirement of Law or any Contractual Obligation of TWTC or any

of its Subsidiaries and will not result in, or require, the creation or imposition of any Lien on any of their respective properties or revenues pursuant to any Requirement of Law or any such Contractual Obligation (other than the Liens permitted under Section 7.3 and other than the potential violation of any Contractual Obligation which could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect). No Requirement of Law or Contractual Obligation applicable to TWTC or any of its Subsidiaries could reasonably be expected to have a Material Adverse Effect.

4.6. Litigation. No litigation, investigation or proceeding of or before any arbitrator or Governmental Authority is pending or, to the knowledge of TWTC or the Borrower, threatened by or against TWTC or any of its Subsidiaries or against any of their respective properties or revenues (a) with respect to any of the Loan Documents or any of the transactions contemplated hereby or thereby, or (b) that could reasonably be expected to have a Material Adverse Effect.

4.7. No Default. Neither TWTC nor any of its Subsidiaries is in default under or with respect to any of its Contractual Obligations in any respect that could reasonably be expected to have a Material Adverse Effect. No Default or Event of Default has occurred and is continuing.

4.8. Ownership of Property; Liens. Each of TWTC and its Subsidiaries has title in fee simple to, or a valid leasehold interest (or a license or an indefeasible right of use) in, all its real property, and good title to, or a valid leasehold interest (or a license or an indefeasible right of use) in, all its other property, and none of such property is subject to any Lien except as permitted by Section 7.3. TWTC has no Lien on the assets of any of its limited partnership Subsidiaries pursuant to its limited partnership interests or otherwise and any claim or interest that TWTC has in such assets is subordinated and junior in right to that of the Lenders.

4.9. Intellectual Property. TWTC and each of its Subsidiaries owns, or is licensed to use, all Intellectual Property necessary for the conduct of its business as currently conducted except (a) certain licenses relating to certain trademarks, tradenames and similar Intellectual Property owned by Time Warner, Inc. may be withdrawn at the election of Time Warner, Inc. and (b) certain minor imperfections and other adverse interests which could not reasonably be expected to have a Material Adverse Effect may exist with respect to certain Intellectual Property. No claim has been asserted and is pending by any Person challenging or questioning the use of any Intellectual Property or the validity or effectiveness of any Intellectual Property that could reasonably be expected to have a Material Adverse Effect, nor does TWTC or any of its Subsidiaries know of any valid basis for any such claim. The use of Intellectual Property by TWTC and its Subsidiaries does not infringe on the rights of any Person in any material respect.

4.10. Taxes. Each of TWTC and its Subsidiaries has filed or caused to be filed all Federal, state and other material tax returns that are required to be filed and has paid all taxes shown to be due and payable on said returns or on any assessments made against it or any of its property and all other taxes, fees or other charges imposed on it or any of its property by any Governmental Authority (other than any the amount or validity of which are currently being contested in good faith by appropriate proceedings and with respect to which reserves in conformity with GAAP have been provided on the books of TWTC or its Subsidiaries, as the case may be); no tax Lien has been filed, and, to the knowledge of TWTC and the Borrower, no material claim is being asserted, with respect to any such tax, fee or other charge.

4.11. Federal Regulations. No part of the proceeds of any Loans, and no other extensions of credit hereunder, will be used for “buying” or “carrying” any “margin stock” within the respective meanings of each of the quoted terms under Regulation U as now and from time to time

hereafter in effect or for any purpose that violates the provisions of the Regulations of the Board. If requested by any Lender or the Administrative Agent, the Borrower will furnish to the Administrative Agent and each Lender a statement to the foregoing effect in conformity with the requirements of FR Form G-3 or FR Form U-1, as applicable, referred to in Regulation U.

4.12. Labor Matters. Except as, in the aggregate, could not reasonably be expected to have a Material Adverse Effect: (a) there are no strikes or other labor disputes against TWTC or any of its Subsidiaries pending or, to the knowledge of TWTC or the Borrower, threatened; (b) hours worked by and payment made to employees of TWTC and its Subsidiaries have not been in violation of the Fair Labor Standards Act or any other applicable Requirement of Law dealing with such matters; and (c) all payments due from TWTC or any of its Subsidiaries on account of employee health and welfare insurance have been paid or accrued as a liability on the books of TWTC or the relevant Subsidiary.

4.13. ERISA. Neither a Reportable Event with respect to a Plan which, if terminated, would result in material liability nor an “accumulated funding deficiency” (within the meaning of Section 412 of the Code or Section 302 of ERISA) has occurred during the five-year period prior to the date on which this representation is made or deemed made with respect to any Plan, and each Plan has complied in all material respects with the applicable provisions of ERISA and the Code. No termination of a Single Employer Plan, other than a standard termination pursuant to Section 4041(b) of ERISA, has occurred, and no Lien in favor of the PBGC or a Plan has arisen, during such five-year period, in either case with respect to which the Borrower has any outstanding liability. The present value of all accrued benefits under each Single Employer Plan (based on those assumptions used to fund such Plans) did not, as of the last annual valuation date prior to the date on which this representation is made or deemed made, exceed the value of the assets of such Plan allocable to such accrued benefits by a material amount. Neither the Borrower nor any Commonly Controlled Entity has had a complete or partial withdrawal from any Multiemployer Plan that has resulted or could reasonably be expected to result in a material liability under ERISA which has not been satisfied as of the date hereof, and neither the Borrower nor any Commonly Controlled Entity would to the knowledge of the Borrower become subject to any material liability under ERISA if the Borrower or any such Commonly Controlled Entity were to withdraw completely from all Multiemployer Plans as of the valuation date most closely preceding the date on which this representation is made or deemed made. No such Multiemployer Plan is in Reorganization or Insolvent.

4.14. Investment Company Act; Other Regulations. No Loan Party is an “investment company”, or a company “controlled” by an “investment company”, within the meaning of the Investment Company Act of 1940, as amended. No Loan Party is subject to regulation under any Requirement of Law (other than Regulation X of the Board and certain laws and regulations regulating utilities) that limits its ability to incur Indebtedness.

4.15. Subsidiaries. Schedule 4.15 sets forth, as of the Effective Date, the name and jurisdiction of incorporation of each Subsidiary and, as to each such Subsidiary, the percentage of each class of Capital Stock owned by any Loan Party, and there are no outstanding subscriptions, options, warrants, calls, rights or other agreements or commitments (other than stock options granted to employees or directors and directors’ qualifying shares) of any nature relating to any Capital Stock of the Borrower or any Subsidiary of TWTC, except as created by the Loan Documents or the security documents relating to the Second Lien Notes.

4.16. Use of Proceeds. The proceeds of the Revolving Loans, the Swingline Loans and the Letters of Credit shall be used for general corporate purposes of TWTC, the Borrower and their respective Subsidiaries.

4.17. Environmental Matters. Except as, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect:

(a) the facilities and properties owned, leased or operated by TWTC or any of its Subsidiaries (the “Properties”) do not contain any Materials of Environmental Concern in amounts or concentrations or under circumstances that constitute a violation of, or could reasonably be expected to give rise to liability under, any Environmental Law;

(b) neither TWTC nor any of its Subsidiaries has received any written notice of any violation, alleged violation, liability or potential liability regarding environmental matters or compliance with Environmental Laws with regard to any of the Properties or the business operated by TWTC or any of its Subsidiaries (the “Business”), nor does TWTC or the Borrower have knowledge that any such notice will be received or is being threatened;

(c) Materials of Environmental Concern have not been transported or disposed of from the Properties in violation of, or in a manner or to a location that could reasonably be expected to give rise to liability under, any Environmental Law, nor have any Materials of Environmental Concern been generated, treated, stored or disposed of at, on or under any of the Properties in violation of, or in a manner that could reasonably be expected to give rise to liability under, any applicable Environmental Law;

(d) no judicial proceeding or governmental or administrative action is pending or, to the knowledge of TWTC and the Borrower, threatened, under any Environmental Law to which TWTC or any Subsidiary is or will be named as a party with respect to the Properties or the Business, nor are there any consent decrees or other decrees, consent orders, administrative orders or other orders outstanding under any Environmental Law with respect to the Properties or the Business;

(e) there has been no release or threat of release of Materials of Environmental Concern at or from the Properties, or arising from or related to the operations of TWTC or any Subsidiary in connection with the Properties or otherwise in connection with the Business, in violation of or in amounts or in a manner that could give rise to liability under Environmental Laws; and

(f) the Properties and all operations at the Properties or otherwise in respect to the Business are in compliance, and have in the last five years been in compliance, with all applicable Environmental Laws.

4.18. Accuracy of Information, etc. No statement or information contained in this Agreement, any other Loan Document, the Confidential Information Memorandum or any other document, certificate or statement furnished by or on behalf of any Loan Party to the Administrative Agent or the Lenders, or any of them, for use in connection with the transactions contemplated by this Agreement or the other Loan Documents, contained as of the date such statement, information, document or certificate was so furnished (or, in the case of the Confidential Information Memorandum, as of the Effective Date), any untrue statement of a material fact or omitted to state a material fact necessary to make the statements contained herein or therein, when taken as a whole and in conjunction with TWTC’s public filings and disclosures, not misleading. The projections contained in the materials referenced above are based upon good faith estimates and assumptions believed by management of TWTC to be reasonable at the time made, it being recognized by the Lenders that such financial information as it relates to future events is not to be viewed as fact and that actual results during the period or periods covered by such financial information may differ from the projected results set forth therein by a material

amount. As of the Effective Date, there is no fact known to any Loan Party that could reasonably be expected to have a Material Adverse Effect that has not been expressly disclosed herein, in the other Loan Documents, in the Confidential Information Memorandum or in any other documents, certificates and statements furnished prior to the Effective Date by or on behalf of any Loan Party to the Administrative Agent and the Lenders for use in connection with the transactions contemplated hereby and by the other Loan Documents.

4.19. Security Documents. On and after the Collateral Base Date, the Guarantee and Collateral Agreement is effective to create in favor of the Collateral Agent a legal, valid and enforceable security interest in the Collateral described therein and proceeds thereof. In the case of the pledged stock described in the Guarantee and Collateral Agreement, when stock certificates representing such pledged stock (together with blank assignments) are delivered to the Collateral Agent (or the Collateral Agent otherwise obtains control thereof under the UCC), and in the case of the other Collateral (other than that which is required to be perfected by control) described in the Guarantee and Collateral Agreement, when Uniform Commercial Code financing statements and other filings specified on Schedule 3 to the Guarantee and Collateral Agreement in appropriate form are filed in the offices specified on Schedule 3 to the Guarantee and Collateral Agreement, the Guarantee and Collateral Agreement shall constitute a fully perfected Lien on, and security interest in, all right, title and interest of the Loan Parties in such Collateral and the proceeds thereof to the extent perfection may be accomplished by the filing of such Uniform Commercial Code financing statements and other filings, as security for the Secured Obligations, in each case prior and superior in right to any other Person (except Liens permitted by Section 7.3).

4.20. Solvency. Except for any Shell Subsidiaries, each Loan Party is, and after giving effect to the incurrence of all Indebtedness and obligations being incurred in connection herewith will be and will continue to be, Solvent.

4.21. Certain Documents. The Borrower has delivered to the Administrative Agent complete and correct copies of the Indentures (and any indenture governing any Refinancing of the Existing Senior Notes or the High Yield Notes and any indenture governing any Refinancing of any such refinancing Indebtedness).

4.22. Priority Lien Debt. The Obligations constitute (i) “Priority Lien Debt” (or any other term having a similar meaning) of the Borrower under and as defined in the High Yield Indentures (and any indenture governing any Refinancing of the Existing Senior Notes or the High Yield Notes, if applicable, and any indenture governing any Refinancing of any such refinancing Indebtedness, if applicable) and (ii) “First Priority Obligations” under and as defined in the Intercreditor Agreement. The obligations of each Subsidiary Guarantor under the Guarantee and Collateral Agreement constitute (i) “Priority Lien Debt” (or any other term having a similar meaning) of such Subsidiary Guarantor under and as defined in the High Yield Indentures (and any indenture governing any Refinancing of the Existing Senior Notes or the High Yield Notes, if applicable, and any indenture governing any Refinancing of any such refinancing Indebtedness, if applicable) and (ii) “First Priority Obligations” under and as defined in the Intercreditor Agreement.

SECTION 5. CONDITIONS PRECEDENT

5.1. Conditions to Effectiveness. This Agreement shall become effective on and as of the first date on which the following conditions precedent shall have been satisfied:

(a) Credit Agreement. The Administrative Agent shall have received this Agreement, executed and delivered by the Administrative Agent, the Collateral Agent, TWTC, the Borrower and each other Person listed on Schedule 1.1A.

(b) Fees. The Lenders, the Administrative Agent and the Collateral Agent shall have received all fees required to be paid, and all expenses for which invoices (with reasonable supporting documentation) have been presented (including, if so invoiced, the reasonable and documented fees and expenses of legal counsel), on or before the Effective Date.

(c) Termination of Existing Credit Agreement. The Administrative Agent shall have received evidence reasonably satisfactory to the Administrative Agent that the commitments of the lenders party to the Existing Credit Agreement shall then or theretofore have been terminated, all amounts then owing by TWTC or any Subsidiary thereunder or under any other “Loan Document” (as therein defined) shall have been paid in full, and arrangements reasonably satisfactory to the Administrative Agent shall have been made for the termination of Liens and security interests granted in connection therewith.

For purposes of determining compliance with the conditions specified in Section 5.1, each Lender shall be deemed to have consented to, approved or been satisfied with each document, condition or other matter required thereunder to be consented to, approved by or satisfactory to the Lenders unless the Administrative Agent shall have received notice from such Lender prior to the Effective Date specifying its objection thereto (unless such objection shall have been withdrawn or satisfied and the Administrative Agent shall have received notice from such Lender thereof). The Administrative Agent shall notify the Borrower upon satisfaction (or, as herein provided, waiver) of the conditions precedent to the Effective Date having occurred.

5.2. Conditions to Initial Extension of Credit. The agreement of each Lender to make the initial extension of credit requested to be made by it is subject to the satisfaction, prior to or concurrently with the making of such extension of credit on the Initial Funding Date, of the following conditions precedent:

(a) Guarantee and Collateral Agreement. The Administrative Agent shall have received (i) the Guarantee and Collateral Agreement, executed and delivered by TWTC, the Borrower and each then-existing Subsidiary Guarantor (which, prior to the earlier to occur of the Collateral Base Date and the Initial Funding Date, may exclude any Specified Subsidiary and, thereafter, must include (unless the Administrative Agent shall otherwise agree) each Specified Subsidiary existing on the Effective Date other than Time Warner Telecom of Arizona LLC and Time Warner Telecom of New Jersey, L.P.) and (ii) an Acknowledgment and Consent in the form attached to the Guarantee and Collateral Agreement, executed and delivered by each Issuer (as defined therein), if any, that is not a Loan Party (other than a Specified Subsidiary, a Shell Subsidiary or an Immaterial Subsidiary).

(b) Intercreditor Agreement. The Administrative Agent shall have received the Intercreditor Agreement, executed and delivered by the Collateral Agent, the Second Lien Trustee, TWTC, the Borrower and each then-existing Subsidiary Guarantor.

(c) High Yield Notes. The Borrower shall have received the Net Cash Proceeds (after giving effect to the payment of all related fees and expenses contemplated to be paid at the time of issuance) from the issuance of at least $440,000,000 of a combination of (i) the Second Lien Notes, in an aggregate amount not to exceed $240,000,000, and (ii) the New Senior Notes, each

on terms and conditions substantially as set forth in the final offering memorandum, dated February 10, 2004.

(d) Approvals. All material governmental and third party approvals necessary or, in the reasonable discretion of the Administrative Agent, advisable in connection with the transactions contemplated hereby shall have been obtained and be in full force and effect (except that no such approvals will have been obtained with respect to any Specified Subsidiary or with respect to certain real and personal property excluded from the Collateral under the Security Documents by the terms thereof).

(e) Closing Certificate. The Administrative Agent shall have received, with a counterpart for each Lender, a certificate of each then-existing Loan Party, dated the Initial Funding Date, substantially in the form of Exhibit C, with appropriate insertions and attachments.

(f) Legal Opinions. The Administrative Agent shall have received the following executed legal opinions:

(i) the legal opinion of Faegre & Xxxxxx LLP, counsel to TWTC and its Subsidiaries, in form and substance reasonably satisfactory to the Administrative Agent;

(ii) the legal opinion of Xxxx X. Xxxxx, Esq., general counsel of TWTC and its Subsidiaries, in form and substance reasonably satisfactory to the Administrative Agent; and

(iii) the legal opinion of local counsel and of such other special counsel as may be required by the Administrative Agent.

Each such legal opinion shall cover such other matters incident to the transactions contemplated by this Agreement as the Administrative Agent may reasonably require.

(g) Lien Searches. The Collateral Agent shall have received the results of a recent Uniform Commercial Code lien search in each relevant jurisdiction with respect to the assets to be owned by TWTC and its Subsidiaries as of the Initial Funding Date, and such search shall reveal no liens on any of the assets of TWTC or its Subsidiaries except for liens permitted by Section 7.3 or discharged on or prior to the Initial Funding Date pursuant to documentation reasonably satisfactory to the Collateral Agent.

(h) Pledged Stock; Stock Powers; Pledged Notes. The Collateral Agent shall have received (i) the certificates representing the shares of Capital Stock to be pledged pursuant to the Guarantee and Collateral Agreement on the Collateral Base Date, together with an undated indorsement for each such certificate executed in blank by an appropriate person and (ii) each promissory note (if any) to be pledged to the Collateral Agent pursuant to the Guarantee and Collateral Agreement on the Collateral Base Date, endorsed (without recourse) in blank (or accompanied by an executed transfer form in blank) by the pledgor thereof.

(i) Filings, Registrations and Recordings. Each document (including any Uniform Commercial Code financing statement) required by the Security Documents or under law or reasonably requested by the Collateral Agent to be filed, registered or recorded in order to create in favor of the Collateral Agent a perfected Lien on the Collateral described therein, prior and

superior in right to any other Person (other than with respect to Liens expressly permitted by Section 7.3), shall be in proper form for filing, registration or recordation.

(j) Insurance. The Collateral Agent shall have received insurance certificates satisfying the requirements of Section 5.2(b) of the Guarantee and Collateral Agreement.

(k) Fees. The Lenders, the Collateral Agent and the Administrative Agent shall have received all fees required to be paid, and all expenses for which invoices (with reasonable supporting documentation) have been presented (including, if so invoiced, the reasonable and documented fees and expenses of legal counsel), on or before the Initial Funding Date.

(l) Intercompany Debt. All Indebtedness of the Borrower or any Subsidiary to TWTC shall be evidenced by an Intercompany Subordinated Note.

(m) Pro Forma Balance Sheet; Financial Statements. The Lenders shall have received (i) the Pro Forma Balance Sheet and (ii) the financial statements referred to in Section 4.1(b).

(n) Other Documents. The Administrative Agent or the Collateral Agent shall have received such other documents or materials (including, without limitation, additional lien searches) as the Administrative Agent or the Collateral Agent shall reasonably request.

For purposes of determining compliance with the conditions specified in Section 5.2, each Lender shall be deemed to have consented to, approved or been satisfied with each document, condition or other matter required thereunder to be consented to, approved by or satisfactory to the Lenders unless the Administrative Agent shall have received notice from such Lender prior to the Initial Funding Date specifying its objection thereto (unless such objection shall have been withdrawn or satisfied and the Administrative Agent shall have received notice from such Lender thereof). The Administrative Agent shall notify the Borrower upon satisfaction (or, as provided herein, waiver) of the conditions precedent to the Initial Funding Date having occurred.

Whether or not the conditions precedent described in this Section 5.2 have been previously satisfied, TWTC will, or will cause its Subsidiaries to, complete and provide each item described in Sections 5.2(a), (b), (h) and (i) to the Administrative Agent and/or the Collateral Agent, as applicable, no later than 90 days after the Effective Date (the date on which all such items have actually been so provided or completed herein being the “Collateral Base Date”); provided, however, that the foregoing shall not obligate the Borrower to request any Loan or Letter of Credit on the Collateral Base Date or otherwise.

5.3. Conditions to Each Extension of Credit. The agreement of each Lender to make any extension of credit requested to be made by it on any date (including its initial extension of credit, but excluding any Revolving Loans made to refinance Swingline Loans or to refinance draws under Letters of Credit) is subject to the satisfaction of the following conditions precedent:

(a) Representations and Warranties. Each of the representations and warranties made by any Loan Party in or pursuant to the Loan Documents shall be true and correct on and as of such date as if made on and as of such date.

(b) No Default. No Default or Event of Default shall have occurred and be continuing on such date or after giving effect to the extensions of credit requested to be made on such date.

Each borrowing (but excluding any borrowing of Revolving Loans made to refinance Swingline Loans or to refinance draws under Letters of Credit) by and issuance of a Letter of Credit on behalf of the Borrower hereunder shall constitute a representation and warranty by the Borrower as of the date of such extension of credit that the conditions contained in this Section 5.3 have been satisfied.

SECTION 6. AFFIRMATIVE COVENANTS

TWTC (as to itself and its Subsidiaries) and the Borrower (as to itself and its Subsidiaries) hereby severally agree that, so long as the Revolving Commitments remain in effect, any Letter of Credit remains outstanding or any Loan or other amount is owing to any Lender, the Collateral Agent or the Administrative Agent hereunder, each of TWTC and the Borrower shall and shall cause each of its respective Subsidiaries to:

6.1. Financial Statements. Furnish to the Administrative Agent for duplication and distribution to the Lenders:

(a) as soon as available, but in any event within 95 days after the end of each fiscal year of TWTC, a copy of the audited consolidated balance sheet of TWTC and its consolidated Subsidiaries as at the end of such year and the related audited consolidated statements of income and of cash flows for such year, setting forth in each case in comparative form the figures for the previous year, reported on without a “going concern” or like qualification or exception, or qualification arising out of the scope of the audit, by Ernst & Young LLP or other independent certified public accountants of nationally recognized standing; and

(b) as soon as available, but in any event not later than 50 days after the end of each of the first three quarterly periods of each fiscal year of TWTC, the unaudited consolidated balance sheet of TWTC and its consolidated Subsidiaries as at the end of such quarter and the related unaudited consolidated statements of income and of cash flows for such quarter and the portion of the fiscal year through the end of such quarter, setting forth in each case in comparative form the figures for the previous year, certified by a Responsible Officer as being fairly stated in all material respects (subject to normal year-end adjustments).

All such financial statements, together with the notes thereto, shall be complete and correct in all material respects and shall be prepared in reasonable detail and in accordance with GAAP applied consistently throughout the periods reflected therein and with prior periods (except as approved by such accountants or officer, as the case may be, and disclosed therein).

Any financial statement required to be delivered pursuant to this Section 6.1 shall be deemed to have been delivered on the date on which TWTC posts such financial statement on its website on the Internet at xxx.xxxxxxxxx.xxx or when such financial statement is posted on the SEC’s website on the Internet at xxx.xxx.xxx; provided that TWTC shall give notice of any such posting to the Administrative Agent (who shall then give notice of any such posting to the Lenders); provided, further, that TWTC shall deliver paper copies of any financial statement referred to in this Section 6.1 to the Administrative Agent if the Administrative Agent or any Lender requests TWTC to deliver such paper copies until written notice to cease delivering such paper copies is given by the Administrative Agent.

6.2. Certificates; Other Information. Furnish to the Administrative Agent for duplication and distribution to the Lenders (or, in the case of clause (f), to the relevant Lender):

(a) concurrently with the delivery of the financial statements referred to in Section 6.1(a), a certificate of the independent certified public accountants reporting on such financial statements stating that in making the examination necessary therefor no knowledge was obtained of any Default or Event of Default, except as specified in such certificate;

(b) concurrently with the delivery of any financial statements pursuant to Section 6.1, (i) a certificate of a Responsible Officer stating that, to the best of each such Responsible Officer’s knowledge, each Loan Party during such period has observed or performed in all material respects all of its covenants and other agreements, and satisfied every condition, contained in this Agreement and the other Loan Documents to which it is a party to be observed, performed or satisfied by it, and that such Responsible Officer has obtained no knowledge of any Default or Event of Default except as specified in such certificate and (ii) in the case of quarterly or annual financial statements, (x) a Compliance Certificate containing all information and calculations necessary for determining compliance by TWTC and its Subsidiaries with the provisions of this Agreement referred to therein as of the last day of the fiscal quarter or fiscal year of TWTC, as the case may be, and (y) to the extent not previously disclosed to the Administrative Agent, a listing of any Intellectual Property acquired by any Loan Party since the date of the most recent list delivered pursuant to this clause (y) (or, in the case of the first such list so delivered, since the Effective Date);

(c) as soon as available, and in any event no later than 50 days after the end of each fiscal year of TWTC, a detailed consolidated budget for the following fiscal year (including a projected consolidated balance sheet of TWTC and its Subsidiaries as of the end of the following fiscal year, the related consolidated statements of projected cash flow and projected income and a description of the underlying assumptions applicable thereto), and, as soon as available, significant revisions, if any, of such budget and projections with respect to such fiscal year (collectively, the “Projections”), which Projections shall in each case be accompanied by a certificate of a Responsible Officer stating that such Projections are based on reasonable estimates, information and assumptions believed by TWTC to be reasonable at the time made and that such Responsible Officer has no reason to believe that such Projections are incorrect or misleading in any material respect (it being recognized by the Lenders that such opinions, projections and forecasts as to any future event or state of affairs are not to be viewed as factual information and that actual results during the period or periods covered by any such opinion, projection or forecast may differ from the opinions and projected or forecast results);

(d) no later than 5 Business Days prior to the effectiveness thereof, copies of substantially final drafts of any proposed amendment, supplement, waiver or other modification with respect to any Indenture (or any indenture governing any Refinancing of the Existing Senior Notes or the High Yield Notes or any indenture governing any Refinancing of any such refinancing Indebtedness);

(e) within five days after the same are sent, copies of all financial statements and reports that TWTC or the Borrower sends to the holders of any class of its debt securities or public equity securities and, within five days after the same are filed, copies of all financial statements and reports that TWTC or the Borrower may make to, or file with, the SEC; and

(f) promptly, such additional financial and other information as any Lender may from time to time reasonably request through the Administrative Agent.

Any delivery required to be made pursuant to Section 6.2(e) shall be deemed to have been made on the date on which TWTC posts such delivery on its website on the Internet at xxx.xxxxxxxxx.xxx or when such delivery is posted on the SEC’s website on the Internet at xxx.xxx.xxx; provided that TWTC shall give notice of any such posting to the Administrative Agent (who shall then give notice of any such posting to the Lenders); provided, further, that TWTC shall deliver paper copies of any delivery referred to in Section 6.2(e) to the Administrative Agent if the Administrative Agent or any Lender requests TWTC to deliver such paper copies until written notice to cease delivering such paper copies is given by the Administrative Agent.

6.3. Payment of Obligations. Pay, discharge or otherwise satisfy at or before maturity or before they become delinquent, as the case may be, all its material obligations of whatever nature, except where the amount or validity thereof is currently being contested in good faith by appropriate proceedings and reserves in conformity with GAAP with respect thereto have been provided on the books of TWTC or its Subsidiaries, as the case may be.

6.4. Maintenance of Existence; Compliance. (a)(i) Preserve, renew and keep in full force and effect its corporate existence and (ii) take all reasonable action to maintain all rights, privileges and franchises necessary or desirable in the normal conduct of its business, except, in each case, as otherwise permitted by Section 7.4 and except, in the case of clause (ii) above, to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect; and (b) comply with all Contractual Obligations and Requirements of Law except to the extent that failure to comply therewith could not, in the aggregate, reasonably be expected to have a Material Adverse Effect.

6.5. Maintenance of Property; Insurance. (a) Keep all material property useful and necessary in its business in good working order and condition, ordinary wear and tear excepted and (b) maintain with financially sound and reputable insurance companies insurance on all its material property in at least such amounts and against at least such risks (but including in any event public liability, product liability and business interruption) as are usually insured against in the same general area by companies engaged in the same or a similar business.

6.6. Inspection of Property; Books and Records; Discussions. (a) Keep proper books of records and account in which full, true and correct entries in conformity with GAAP and all Requirements of Law shall be made of all dealings and transactions in relation to its business and activities and (b) permit representatives of any Lender to visit and inspect any of its properties and examine and make abstracts from any of its books and records at any reasonable time, upon reasonable notice and as often as may reasonably be desired and to discuss the business, operations, properties and financial and other condition of TWTC and its Subsidiaries with officers and employees of TWTC and its Subsidiaries and, from and after the occurrence and during the continuance of an Event of Default, with its independent certified public accountants.

6.7. Notices. Promptly give notice to the Administrative Agent of:

(a) the occurrence of any Default or Event of Default;

(b) any (i) default or event of default under any Contractual Obligation of TWTC or any of its Subsidiaries or (ii) litigation, investigation or proceeding that may exist at any time between TWTC or any of its Subsidiaries and any Governmental Authority, that in either case could reasonably be expected to have a Material Adverse Effect;

(c) any litigation or proceeding affecting TWTC or any of its Subsidiaries (i) in which the amount involved is $5,000,000 or more and not covered by insurance, (ii) in which injunctive or similar relief is sought or (iii) which relates to any Loan Document;

(d) the following events, as soon as possible and in any event within 30 days after a Responsible Officer knows or has reason to know thereof: (i) the occurrence of any Reportable Event with respect to any Plan, a failure by the Borrower or any Commonly Controlled Entity to make any required contribution to a Plan, the creation of any Lien in favor of the PBGC or a Plan or any withdrawal from, or the termination, Reorganization or Insolvency of, any Multiemployer Plan or (ii) the institution of proceedings or the taking of any other action by the PBGC or the Borrower or any Commonly Controlled Entity or any Multiemployer Plan with respect to the withdrawal from, or the termination, Reorganization or Insolvency of, any Plan; provided that in the case of either clause (i) or (ii) above, such event or events could reasonably be expected to result in liability in excess of $5,000,000;

(e) the occurrence of any event which could reasonably be expected to have a material adverse effect on the aggregate value of the Collateral; and

(f) any development or event that has had or could reasonably be expected to have a Material Adverse Effect.

Each notice pursuant to this Section 6.7 shall be accompanied by a statement of a Responsible Officer setting forth details of the occurrence referred to therein and stating what action TWTC or the relevant Subsidiary proposes to take with respect thereto.

6.8. Environmental Laws. (a) Comply in all material respects with, and use its reasonable efforts to ensure compliance in all material respects by all tenants and subtenants, if any, with, all applicable Environmental Laws, and obtain and comply in all material respects with and maintain, and use its reasonable efforts to ensure that all tenants and subtenants obtain and comply in all material respects with and maintain, any and all licenses, approvals, notifications, registrations or permits required by applicable Environmental Laws, except to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect.

(b) Conduct and complete all investigations, studies, sampling and testing, and all remedial, removal and other actions required under Environmental Laws and promptly comply in all material respects with all lawful orders and directives of all Governmental Authorities regarding Environmental Laws, except to the extent that the same are being contested in good faith by appropriate proceedings and the pendency of such proceedings could not reasonably be expected to have a Material Adverse Effect.

6.9. Additional Collateral; Additional Subsidiary Guarantors, etc. (a) With respect to any property located or held in the United States acquired after the Collateral Base Date by any of TWTC’s Domestic Subsidiaries (other than (x) any property described in paragraph (b), (c), (d) or (e) below, (y) any property subject to a Lien expressly permitted by Section 7.3(g) and (z) any property acquired by any Shell Subsidiary, Immaterial Subsidiary or Specified Subsidiary) as to which the Collateral Agent does not have a perfected Lien, promptly (i) execute and deliver to the Collateral Agent such amendments to the Guarantee and Collateral Agreement or such other documents as the Collateral Agent reasonably deems necessary or advisable to grant to the Collateral Agent a security interest in such property, (ii) take all actions reasonably necessary or advisable to grant to the Collateral Agent a perfected first priority security interest in such property, including the filing of Uniform Commercial Code financing statements

in such jurisdictions in the United States as may be required by the Guarantee and Collateral Agreement or by law or as may be reasonably requested by the Collateral Agent and (iii) if reasonably requested by the Collateral Agent (and consistent with the opinion coverage provided on the Collateral Base Date), deliver to the Collateral Agent legal opinions relating to the matters described above, which opinions shall be in form and substance, and from counsel, reasonably satisfactory to the Collateral Agent.

(b) With respect to any interest in any real property (fee, leasehold or otherwise) located in the United States having a value (together with improvements thereof) of at least $7,500,000 (net of any amount of any third party mortgage on such property existing when acquired) acquired after the Collateral Base Date (and no real property not meeting such criteria shall be required to be pledged under this Section 6.9) by any of TWTC’s Domestic Subsidiaries (other than (x) any such real property subject to a Lien expressly permitted by Section 7.3(g) and (y) any real property acquired by any Shell Subsidiary, Immaterial Subsidiary or Specified Subsidiary), promptly (i) execute and deliver a first priority mortgage or deed of trust, as the case may be, in form and substance reasonably satisfactory to the Collateral Agent, in favor of the Collateral Agent covering such real property, (ii) if reasonably requested by the Collateral Agent, provide the Lenders with (x) title and extended coverage insurance covering such real property in an amount at least equal to the purchase price of such real property (or such other amount as shall be reasonably specified by the Collateral Agent) as well as a current ALTA or equivalent survey thereof, together with a surveyor’s certificate and (y) any consents or estoppels reasonably deemed necessary or advisable by the Collateral Agent in connection with such mortgage or deed of trust, each of the foregoing in form and substance reasonably satisfactory to the Collateral Agent and (iii) if reasonably requested by the Collateral Agent, deliver to the Collateral Agent legal opinions relating to the matters described above, which opinions shall be in form and substance, and from counsel, reasonably satisfactory to the Collateral Agent.

(c) With respect to any new Domestic Subsidiary (other than a Shell Subsidiary, an Immaterial Subsidiary or a Specified Subsidiary) created or acquired after the Collateral Base Date by TWTC or any of its Subsidiaries (which, for the purposes of this paragraph (c), shall include any then-existing Foreign Subsidiary that becomes a Domestic Subsidiary, and which is not a Shell Subsidiary, an Immaterial Subsidiary or a Specified Subsidiary, and any then-existing Domestic Subsidiary that ceases to be a Shell Subsidiary, an Immaterial Subsidiary or a Specified Subsidiary), promptly (i) cause such new Subsidiary (A) to become a party to the Guarantee and Collateral Agreement and the Intercreditor Agreement, (B) to take such actions reasonably necessary or advisable to grant to the Collateral Agent a perfected first priority security interest in the Collateral described in the Guarantee and Collateral Agreement (other than the property described in paragraph (d) below) with respect to such new Subsidiary, including the filing of Uniform Commercial Code financing statements in such jurisdictions in the United States as may be required by the Guarantee and Collateral Agreement or by law or as may be reasonably requested by the Collateral Agent and (C) to deliver to the Collateral Agent a certificate of such Subsidiary, substantially in the form of Exhibit C, with appropriate insertions and attachments, and (ii) if reasonably requested by the Collateral Agent (and consistent with the opinion coverage provided on the Collateral Base Date), deliver to the Collateral Agent legal opinions relating to the matters described above, which opinions shall be in form and substance, and from counsel, reasonably satisfactory to the Collateral Agent.

(d) With respect to any new Subsidiary (other than a Specified Subsidiary) created or acquired after the Collateral Base Date by TWTC or any of its Domestic Subsidiaries, promptly (i) execute and deliver to the Collateral Agent such amendments to the Guarantee and Collateral Agreement as the Collateral Agent reasonably deems necessary or advisable to grant to the

Collateral Agent a perfected first priority security interest in the Capital Stock of such new Subsidiary that is owned by TWTC or any of its Domestic Subsidiaries (provided that in no event shall more than 65% of the total outstanding Capital Stock of any Foreign Subsidiary be required to be so pledged), (ii) deliver to the Collateral Agent the certificates representing such Capital Stock, together with undated indorsements, in blank, executed and delivered by an appropriate person of TWTC or such Subsidiary, as the case may be, and take such other action as may be necessary or, in the opinion of the Collateral Agent, desirable to perfect the Collateral Agent’s security interest therein, and (iii) if reasonably requested by the Collateral Agent (and consistent with the opinion coverage provided on the Collateral Base Date), deliver to the Collateral Agent legal opinions relating to the matters described above, which opinions shall be in form and substance, and from counsel, reasonably satisfactory to the Collateral Agent.

(e) With respect to any Specified Subsidiary, (A) (i) use commercially reasonable efforts to obtain necessary regulatory approvals in order to permit TWTC or a Domestic Subsidiary thereof, as the case may be, to grant a security interest in the Capital Stock of such Specified Subsidiary and (ii) if, as and when such approvals are obtained, use commercially reasonable efforts to (x) execute and deliver to the Collateral Agent such amendments to the Guarantee and Collateral Agreement as the Collateral Agent reasonably deems necessary or advisable to grant to the Collateral Agent a perfected first priority security interest in the Capital Stock of such Specified Subsidiary that is owned by TWTC or any of its Domestic Subsidiaries (provided that in no event shall more than 65% of the total outstanding Capital Stock of any Foreign Subsidiary be required to be so pledged) and (y) deliver to the Collateral Agent the certificates representing such Capital Stock, together with undated indorsements, in blank, executed and delivered by TWTC or such Subsidiary, as the case may be, and take such other action as may be reasonably necessary or, in the opinion of the Collateral Agent, desirable to perfect the Collateral Agent’s security interest therein; (B) unless such Specified Subsidiary is a Foreign Subsidiary, Shell Subsidiary or Immaterial Subsidiary, (i) use commercially reasonable efforts to obtain necessary regulatory approvals in order to permit such Specified Subsidiary to become a party to the Guarantee and Collateral Agreement and the Intercreditor Agreement and (ii) if, as and when such approvals are obtained, use commercially reasonable efforts (x) to cause such Specified Subsidiary to become a party to the Guarantee and Collateral Agreement and the Intercreditor Agreement, (y) to take such actions reasonably necessary or advisable to grant to the Collateral Agent a perfected first priority security interest in the Collateral described in the Guarantee and Collateral Agreement with respect to such Specified Subsidiary, including the filing of Uniform Commercial Code financing statements in such jurisdictions in the United States as may be required by the Guarantee and Collateral Agreement or by law or as may be reasonably requested by the Collateral Agent and (z) to deliver to the Collateral Agent a certificate of such Specified Subsidiary, substantially in the form of Exhibit C, with appropriate insertions and attachments; and (C) if reasonably requested by the Collateral Agent (and consistent with the opinion coverage provided on the Collateral Base Date), deliver to the Collateral Agent legal opinions relating to the matters described above, which opinions shall be in form and substance, and from counsel, reasonably satisfactory to the Collateral Agent.

SECTION 7. NEGATIVE COVENANTS

Agent or the Administrative Agent hereunder, each of TWTC and the Borrower shall not, and shall not permit any of its respective Subsidiaries to, directly or indirectly:

7.1. Financial Condition Covenants.

(a) Consolidated Senior First Lien Secured Leverage Ratio. Permit the Consolidated Senior First Lien Secured Leverage Ratio as of the last day of any fiscal quarter of TWTC to exceed 1.00 to 1.0.

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


Fiscal Quarter		Consolidated Total Leverage Ratio
March 31, 2004		6.25 to 1.0
June 30, 2004 – September 30, 2004		6.00 to 1.0
December 31, 2004 – March 31, 2005		5.75 to 1.0
June 30, 2005 – September 30, 2005		5.50 to 1.0
December 31, 2005		5.25 to 1.0
March 31, 2006 – December 31, 2008		5.00 to 1.0

(c) Consolidated Interest Coverage Ratio. Permit the Consolidated Interest Coverage Ratio for any period of four consecutive fiscal quarters of TWTC ending with any fiscal quarter set forth below to be less than the ratio set forth below opposite such fiscal quarter:


Fiscal Quarter		Consolidated Interest Coverage Ratio
March 31, 2004 – June 30, 2004		1.25 to 1.0
September 30, 2004 – March 31, 2005		1.50 to 1.0
June 30, 2005 – December 31, 2005		1.75 to 1.0
March 31, 2006 – December 31, 2008		2.00 to 1.0

Notwithstanding anything to the contrary herein, the covenants contained in this Section 7.1 shall only apply when there are extensions of credit (including, without limitation, any Revolving Loans, Letters of Credit or Swingline Loans) outstanding hereunder; provided, that upon the making of any such extension of credit, TWTC and the Borrower shall be in compliance with the covenants contained in this Section 7.1 as of the end of the immediately preceding fiscal quarter for which financial statements have been furnished under Section 6 of this Agreement and immediately after giving effect to such extension of credit (and to the application of the proceeds thereof).

7.2. Indebtedness. Create, issue, incur, assume, become liable in respect of or suffer to exist any Indebtedness, except:

(a) Indebtedness of any Loan Party pursuant to any Loan Document;

(b) unsecured Indebtedness of the Borrower to any Subsidiary and of any Wholly Owned Subsidiary Guarantor to the Borrower or any other Subsidiary;

(c) unsecured Indebtedness of any Subsidiary to TWTC that arises from the making of payments by TWTC to a third party on behalf of the Borrower or its Subsidiaries related to ordinary course expenses of the Borrower and its Subsidiaries;

(d) Guarantee Obligations incurred in the ordinary course of business (i) by the Borrower or any other Subsidiary of TWTC of obligations of any Wholly Owned Subsidiary Guarantor and (ii) by TWTC of obligations of its Subsidiaries with respect to (x) such Subsidiaries’ real estate leases or (y) such Subsidiaries’ obligations under agreements with municipalities or building entry agreements, in each case entered into in the ordinary course of business;

(e) Indebtedness outstanding on the Effective Date and listed on Schedule 7.2(e), together with any Refinancings thereof (other than in respect of the Existing Senior Notes, which Refinancings shall be governed by Section 7.9), so long as there is no additional obligor with respect thereto and without shortening the maturity thereof or increasing the principal amount thereof, except to the extent of fees and expenses incurred in connection with any such Refinancing;

(f) Indebtedness (including, without limitation, Capital Lease Obligations) secured by Liens permitted by Section 7.3(g) in an aggregate principal amount not to exceed $30,000,000 at any one time outstanding;

(g) Hedge Agreements (i) with any Lender or any Affiliate of any Lender and (ii) with any Person other than a Lender or any Affiliate of any Lender so long as the aggregate obligations under all such Hedge Agreements with such other Persons (measured in terms of termination value) do not exceed $25,000,000 at any one time outstanding, and in each case so long as such Hedge Agreements are not entered into for speculative purposes;

(h) Cash Management Obligations incurred in the ordinary course of business;

(i) Indebtedness of any Subsidiary acquired in connection with any Investment permitted pursuant to Section 7.8(h), provided that (i) no Default or Event of Default has occurred and is continuing or would result therefrom, (ii) such Indebtedness existed at the time such Person became a Subsidiary and was not incurred in anticipation thereof, (iii) no Person other than such Subsidiary becomes an obligor in respect of such Indebtedness and (iv) the aggregate amount of such Indebtedness in excess of $20,000,000 shall constitute usage of the basket provided in Section 7.8(h) unless and until such Subsidiary becomes a Wholly Owned Subsidiary Guarantor, at which time such Indebtedness of such Subsidiary in excess of $20,000,000 shall no longer be permitted to remain outstanding and shall no longer constitute usage of such basket;

(j) unsecured Indebtedness consisting of guaranties of loans made to officers, directors or employees of TWTC or of any Subsidiary of TWTC in an aggregate amount which, when added to the outstanding principal amount of loans and advances made pursuant to Section 7.8(d), shall not exceed $5,000,000 at any one time outstanding;

(k) unsecured Indebtedness of TWTC to the Borrower or any other Subsidiary in connection with dividends, distributions or advancements made pursuant to clause (b), (c), (d), (e), (f) or (g) of Section 7.6;

(l) unsecured Indebtedness of the Borrower or of any Wholly Owned Subsidiary Guarantor to TWTC evidenced by an Intercompany Subordinated Note;

(m) unsecured trade accounts payable of TWTC, the Borrower or any of their respective Subsidiaries incurred in the ordinary course of business and not more than 120 days past due (but excluding any Indebtedness for borrowed money);

(n) reimbursement obligations of TWTC, the Borrower or any of their respective Subsidiaries incurred in the ordinary course of business related to performance bonds posted in connection with the installation of fiber facilities and similar activities in an aggregate amount not to exceed $30,000,000 at any one time outstanding;

(o) (i) Indebtedness of the Borrower in respect of the High Yield Notes in an aggregate principal amount not to exceed $440,000,000 and (ii) Guarantee Obligations of TWTC and any Subsidiary Guarantor in respect of such Indebtedness;

(p) letters of credit incurred in the ordinary course of business in an aggregate amount which, when added to the aggregate amount of L/C Obligations then outstanding, shall not exceed $25,000,000;

(q) (i) Indebtedness of the Borrower in an aggregate principal amount not to exceed $360,000,000 at any one time outstanding, so long as (a) no Default or Event of Default has occurred and is continuing or would result therefrom, (b) the Net Cash Proceeds thereof shall be (x) used to Refinance, in whole or in part, the Existing Senior Notes (or any refinancing Indebtedness thereof) in accordance with Section 7.9 or (y) retained by the Borrower in order to effectuate a substantially concurrent redemption or repurchase of any Existing Senior Notes (or any refinancing Indebtedness thereof) in accordance with the last sentence of Section 7.9 (provided that, in the case of this clause (y), such Indebtedness shall meet the criteria of refinancing Indebtedness described in Section 7.9(a)) and (c) after giving effect to the incurrence of such Indebtedness, TWTC shall be in pro forma compliance with the covenants contained in Section 7.1 to the extent such covenants are then in effect; and (ii) Guarantee Obligations of TWTC and any Subsidiary Guarantor in respect of such Indebtedness;

(r) unsecured Indebtedness of TWTC (but not any Subsidiary of TWTC) so long as (i) no Default or Event of Default has occurred and is continuing or would result therefrom, (ii) the Net Cash Proceeds thereof shall be (x) used to Refinance, in whole or in part, the Existing Senior Notes or the High Yield Notes (or any refinancing Indebtedness thereof) in accordance with Section 7.9 or (y) retained by TWTC in order to effectuate a substantially concurrent redemption or repurchase of any Existing Senior Notes or any High Yield Notes (or any refinancing Indebtedness thereof) in accordance with the last sentence of Section 7.9 (provided that, in the case of this clause (y), such Indebtedness shall meet the criteria of refinancing Indebtedness described in Section 7.9(a)) and (iii) after giving effect to the incurrence of such Indebtedness, TWTC shall be in pro forma compliance with the covenants contained in Section 7.1 to the extent such covenants are then in effect;

(s) (i) Indebtedness of the Borrower so long as (a) no Default or Event of Default has occurred and is continuing or would result therefrom, (b) the Net Cash Proceeds thereof shall be (x) used to Refinance, in whole or in part, the High Yield Notes (or any refinancing Indebtedness thereof) in accordance with Section 7.9 or (y) retained by the Borrower in order to effectuate a substantially concurrent redemption or repurchase of any High Yield Notes (or any refinancing Indebtedness thereof) in accordance with the last sentence of Section 7.9 (provided that, in the case of this clause (y), such Indebtedness shall meet the criteria of refinancing Indebtedness described in Section 7.9(a)) and (c) after giving effect to the incurrence of such Indebtedness,

TWTC shall be in pro forma compliance with the covenants contained in Section 7.1 to the extent such covenants are then in effect; and (ii) Guarantee Obligations of TWTC and any Subsidiary Guarantor in respect of such Indebtedness;

(t) unsecured Indebtedness of TWTC (but not any Subsidiary of TWTC) in an aggregate principal amount not to exceed $350,000,000 at any one time outstanding, so long as (i) no Default or Event of Default has occurred and is continuing or would result therefrom, (ii) such Indebtedness shall not mature prior to the date that is one year after the Initial Revolving Termination Date, (iii) the Net Cash Proceeds thereof shall be contributed to the Borrower as either equity or debt to the extent TWTC has cash and Cash Equivalents in excess of $25,000,000 in the aggregate (provided that to the extent contributed as debt, such debt shall be evidenced by an Intercompany Subordinated Note) and (iv) after giving effect to the incurrence of such Indebtedness, TWTC shall be in pro forma compliance with the covenants contained in Section 7.1 to the extent such covenants are then in effect; and

(u) additional Indebtedness of the Borrower or any of its Subsidiaries in an aggregate principal amount (for the Borrower and all Subsidiaries) not to exceed $30,000,000 at any one time outstanding.

7.3. Liens. Create, incur, assume or suffer to exist any Lien upon any of its property, whether now owned or hereafter acquired, except for:

(a) Liens for taxes not yet due or that are being contested in good faith by appropriate proceedings, provided that adequate reserves with respect thereto are maintained on the books of TWTC, the Borrower or their respective Subsidiaries, as the case may be, in conformity with GAAP;

(b) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or other like Liens arising in the ordinary course of business that are not overdue for a period of more than 30 days or that are being contested in good faith by appropriate proceedings;

(c) pledges or deposits in connection with workers’ compensation, unemployment insurance and other social security legislation and deposits securing liability to insurance carriers under insurance or self-insurance arrangements;

(d) deposits (i) to secure the performance of bids, trade contracts (other than for borrowed money), leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature incurred in the ordinary course of business and (ii) to cash collateralize letters of credit incurred in the ordinary course of business in an amount not to exceed $25,000,000 in the aggregate;

(e) easements, rights-of-way, restrictions and other similar encumbrances incurred in the ordinary course of business that, in the aggregate, are not substantial in amount and that do not in any case materially detract from the value of the property subject thereto or materially interfere with the ordinary conduct of the business of TWTC, the Borrower or any of their respective Subsidiaries;

(f) Liens in existence on the date hereof listed on Schedule 7.3(f), securing Indebtedness permitted by Section 7.2(e), provided that no such Lien is spread to cover any additional property after the Effective Date (other than after acquired title in or on such property and proceeds of the

existing collateral in accordance with the instrument creating such Lien) and that the amount of Indebtedness secured thereby is not increased, except to the extent of fees and expenses incurred in connection with any Refinancings of such Indebtedness;

(g) Liens securing Indebtedness of the Borrower or any other Subsidiary incurred pursuant to Section 7.2(f) to finance the acquisition of fixed or capital assets, provided that (i) such Liens shall be created substantially simultaneously with the acquisition of such fixed or capital assets, (ii) such Liens do not at any time encumber any property other than the property financed by such Indebtedness and (iii) the amount of Indebtedness secured thereby is not increased;

(h) Liens created pursuant to the Security Documents;

(i) any interest or title of a lessor under any lease entered into by TWTC, the Borrower or any other Subsidiary in the ordinary course of its business and covering only the assets so leased;

(j) Liens on the property or assets of a Person which becomes a Subsidiary after the date hereof securing Indebtedness permitted by Section 7.2(i), provided that (i) such Liens existed at the time such Person became a Subsidiary and were not created in anticipation thereof, (ii) any such Lien is not expanded to cover any property or assets of such Person after the time such Person becomes a Subsidiary (other than after acquired title in or on such property and proceeds of the existing collateral in accordance with the instrument creating such Lien), (iii) the amount of Indebtedness secured thereby is not increased, and (iv) neither (x) the aggregate outstanding principal amount of the obligations secured thereby nor (y) the aggregate fair market value (determined as of the date such Lien is incurred) of the assets subject thereto exceeds (as to all relevant Subsidiaries) $20,000,000 at any one time;

(k) Liens on assets of TWTC, the Borrower and any Subsidiary Guarantor securing the Second Lien Notes; provided that the Collateral Agent has a first priority Lien on such assets pursuant to the Security Documents (including, without limitation, the Intercreditor Agreement);

(l) Liens on assets of TWTC, the Borrower and any Subsidiary Guarantor securing Indebtedness permitted by Section 7.2(q); provided that the Collateral Agent has a first priority Lien on such assets pursuant to the Security Documents (including, without limitation, the Intercreditor Agreement);

(m) Liens on assets of TWTC, the Borrower and any Subsidiary Guarantor securing Indebtedness permitted by Section 7.2(s); provided that (i) the Collateral Agent has a first priority Lien on such assets pursuant to the Security Documents (including, without limitation, the Intercreditor Agreement) and (ii) the aggregate outstanding principal amount of the Indebtedness secured thereby does not exceed $240,000,000 at any one time; and

(n) Liens not otherwise permitted by this Section so long as neither (i) the aggregate outstanding principal amount of the obligations secured thereby nor (ii) the aggregate fair market value (determined as of the date such Lien is incurred) of the assets subject thereto exceeds (as to TWTC and all Subsidiaries) $5,000,000 at any one time.

7.4. Fundamental Changes. Enter into any merger, consolidation or amalgamation, or liquidate, wind up or dissolve itself (or suffer any liquidation or dissolution), or Dispose of, all or substantially all of its property or business, except that:

(a) any Subsidiary of TWTC may be merged or consolidated with or into the Borrower (provided that the Borrower shall be the continuing or surviving corporation) or with or into any Wholly Owned Subsidiary Guarantor (provided that the Wholly Owned Subsidiary Guarantor shall be the continuing or surviving corporation);

(b) any Subsidiary of TWTC may Dispose of any or all of its assets (upon voluntary liquidation or otherwise) to the Borrower or any Wholly Owned Subsidiary Guarantor; and

7.5. Disposition of Property. Dispose of any of its property, whether now owned or hereafter acquired, or issue or sell any shares of its Capital Stock to any Person, except:

(a) the Disposition of obsolete or worn out property in the ordinary course of business;

(b) the sale of inventory in the ordinary course of business; the Disposition of cash and Cash Equivalents for fair value; the license of intellectual property in the ordinary course of business; and leases and subleases with respect to excess capacity and not materially interfering with the ordinary conduct of business;

(d) Dispositions of assets of TWTC or any Subsidiary to any other Subsidiary having a fair market value not to exceed $5,000,000 in the aggregate for any fiscal year of TWTC;

(e) the sale or issuance of TWTC’s common stock or preferred stock (including in each case convertible stock subject to the specific restriction on convertible stock below) to any Person, provided that (i) the Net Cash Proceeds thereof shall be (x) used to redeem or repurchase Indebtedness to the extent permitted under Section 7.9 or (y) contributed to the Borrower as either equity or debt to the extent TWTC has cash and Cash Equivalents in excess of $25,000,000 in the aggregate (provided that to the extent contributed as debt, such debt shall be evidenced by an Intercompany Subordinated Note), (ii) if such issuance relates to convertible stock, the Net Cash Proceeds thereof shall be used only to redeem or repurchase Indebtedness of TWTC to the extent permitted under Section 7.9 and (iii) if such preferred stock constitutes Cash Pay Preferred Stock, it shall be issued in compliance with Section 7.2;

(f) the sale or issuance of any Subsidiary’s Capital Stock to TWTC, the Borrower or any Wholly Owned Subsidiary Guarantor;

(g) any Exchange by TWTC and its Subsidiaries, provided that (i) on the date of such Exchange, no Default or Event of Default shall have occurred and be continuing or would result therefrom, (ii) the assets received in connection with such Exchange shall be received by a Wholly Owned Subsidiary Guarantor and (iii) in the event that any cash consideration is paid or received by TWTC or any of its Subsidiaries in connection with such Exchange, then (a) the payment of any such cash is permitted by Section 7.7 or Section 7.8(h), as applicable and in

accordance with GAAP, and (b) the Disposition related to the receipt of any such cash is permitted by Section 7.5(h); and

(h) the Disposition of other property having a fair market value not to exceed (as to TWTC and all Subsidiaries) $50,000,000 in the aggregate for any fiscal year of TWTC.

7.6. Restricted Payments. Declare or pay any dividend (other than dividends payable solely in common stock or Non-Cash Pay Preferred Stock of the Person making such dividend) on, or make any payment on account of, or set apart assets for a sinking or other analogous fund for, the purchase, redemption, defeasance, retirement or other acquisition of, any Capital Stock of TWTC or any Subsidiary, whether now or hereafter outstanding, or make any other distribution in respect thereof, either directly or indirectly, or make any payment on account of any advance or loan made by TWTC or any Subsidiary, whether in cash or property or in obligations of TWTC or any Subsidiary (collectively, “Restricted Payments”), except that:

(a) any Subsidiary may make Restricted Payments to the Borrower or any Wholly Owned Subsidiary Guarantor;

(b) so long as no Event of Default shall have occurred and be continuing or would result therefrom, the Borrower or any other Subsidiary may pay dividends (or make distributions or advancements) to TWTC to permit TWTC to purchase TWTC’s common stock or common stock options from present or former officers or employees of TWTC, the Borrower or any other Subsidiary upon the death, disability or termination of employment of such officer or employee, provided, that the aggregate amount of payments under this Section 7.6(b) after the Effective Date (net of any proceeds received by TWTC and contributed to the Borrower after the Effective Date in connection with resales of any common stock or common stock options so purchased) shall not exceed $5,000,000;

(c) the Borrower or any other Subsidiary may pay dividends (or make distributions or advancements) to TWTC for the purpose of enabling TWTC to make scheduled interest payments (or, if applicable, dividends) in respect of any Indebtedness of TWTC incurred pursuant to Section 7.2(t), provided that (i) no Default or Event of Default shall have occurred and be continuing or would result therefrom and (ii) each such payment shall be made no earlier than three Business Days prior to the date the relevant interest payment or dividend payment, as the case may be, is due;

(d) the Borrower or any other Subsidiary may pay dividends (or make distributions or advancements) to TWTC for the purpose of enabling TWTC (i) to redeem or repurchase any of the Existing Senior Notes in accordance with the last sentence of Section 7.9 or (ii) to make scheduled interest payments (or, if applicable, dividends) in respect of the Existing Senior Notes (or any Indebtedness of TWTC incurred pursuant to Section 7.2(r) to Refinance the Existing Senior Notes or the High Yield Notes (or any refinancing Indebtedness thereof)) and other Indebtedness of TWTC that is senior and is incurred pursuant to Section 7.2(t), provided that (a) no Default under Section 8(a) or 8(e)(i) or (ii) or Event of Default shall have occurred and be continuing or would result therefrom and (b) each such payment shall be made no earlier than three Business Days prior to the date the relevant interest payment or dividend payment, as the case may be, is due;

(e) so long as no Default or Event of Default shall have occurred and be continuing or would result therefrom, the Borrower or any other Subsidiary may pay dividends (or make

distributions or advancements) to TWTC for the purpose of enabling TWTC to finance Investments permitted by Section 7.8(g) in an aggregate amount not to exceed the amount of Net Cash Proceeds previously contributed to the Borrower from any issuance or sale of TWTC’s common stock or Non-Cash Pay Preferred Stock;

(f) so long as no Default or Event of Default shall have occurred and be continuing or would result therefrom, the Borrower or any other Subsidiary may pay dividends (or make distributions or advancements) to TWTC to permit TWTC to make payments to a third party on behalf of the Borrower or its Subsidiaries related to ordinary course expenses of the Borrower and its Subsidiaries; and

(g) the Borrower or any other Subsidiary may pay dividends (or make distributions or advancements) to TWTC to permit TWTC to (i) pay customary corporate overhead expenses incurred in the ordinary course of business and (ii) pay any taxes that are due and payable by TWTC and the Borrower or any of their respective Subsidiaries as part of a consolidated group.

7.7. Capital Expenditures. Unless there are no extensions of credit outstanding hereunder, make or commit to make any Capital Expenditure, except Capital Expenditures of TWTC and its Subsidiaries in the ordinary course of business not exceeding for any fiscal year of TWTC set forth below the dollar amount set forth below opposite such fiscal year:


Fiscal Year	Amount
2004	$	250,000,000
2005	$	250,000,000
2006	$	375,000,000
2007	$	375,000,000
2008	$	375,000,000

provided, that (i) up to $150,000,000 of any such amount referred to above, if not so expended in the fiscal year for which it is permitted, may be carried over for expenditure in the next succeeding fiscal year, (ii) up to $25,000,000 of any such amount referred to above may be carried back for expenditure in the immediately preceding fiscal year and (iii) Capital Expenditures made pursuant to this Section 7.7 during any fiscal year shall be deemed made, first, in respect of amounts carried over from the prior fiscal year pursuant to subclause (i) above, second, in respect of amounts permitted for such fiscal year as provided above and, third, in respect of amounts carried back from the next succeeding fiscal year pursuant to subclause (ii) above.

7.8. Investments. Make any advance, loan, extension of credit (by way of guaranty or otherwise) or capital contribution to, or purchase any Capital Stock, bonds, notes, debentures or other debt securities of, or any assets constituting a business unit of, or make any other investment in, any Person (all of the foregoing, “Investments”), except:

(a) extensions of trade credit in the ordinary course of business;

(b) Investments in Cash Equivalents (provided that to the extent an existing investment in Cash Equivalents ceases to qualify as such, TWTC and its Subsidiaries shall have 10 days to reinvest such amount in Cash Equivalents);

(d) loans and advances to officers, directors or employees of TWTC or any Subsidiary of TWTC in the ordinary course of business (including for travel, entertainment and relocation expenses) in an aggregate amount for TWTC or any Subsidiary of TWTC which, when added to the outstanding principal amount of Indebtedness incurred pursuant to Section 7.2(j), shall not exceed $5,000,000 at any one time outstanding;

(e) intercompany Investments (i) by TWTC or any of its Subsidiaries in the Borrower or any Person that, prior to such investment, is a Wholly Owned Subsidiary Guarantor and (ii) by TWTC in any Subsidiary in connection, in the case of this clause (ii), with Indebtedness incurred under Section 7.2(c);

(f) Investments by the Borrower or any other Subsidiary in TWTC in connection with dividends, distributions or advancements made pursuant to clauses (b), (c), (d), (e), (f) or (g) of Section 7.6;

(g) Investments by TWTC in any Person that is or concurrently therewith becomes a Wholly Owned Subsidiary Guarantor (i) in an aggregate amount equal to the Net Cash Proceeds received from any issuance or sale of TWTC’s common stock or Non-Cash Pay Preferred Stock and (ii) to the extent the consideration therefor consists solely of Capital Stock of TWTC, provided, that (a) no Default or Event of Default shall have occurred and be continuing or would result therefrom and (b) TWTC shall be in pro forma compliance with the covenants contained in Section 7.1 to the extent such covenants are then in effect; and

(h) in addition to Investments otherwise expressly permitted by this Section, Investments by the Borrower or any of its Subsidiaries in an aggregate amount (valued at cost) not to exceed $75,000,000 during the term of this Agreement.

7.9. Optional Payments, Refinancings and Modifications of Certain Debt Instruments. (a) Make or offer to make any optional or voluntary payment, prepayment, repurchase or redemption of or otherwise optionally or voluntarily defease or segregate funds with respect to the High Yield Notes, the Existing Senior Notes or other Indebtedness of TWTC permitted by Section 7.2(t) (or with respect to any Indebtedness incurred to Refinance any of the foregoing or any Indebtedness incurred to Refinance any such refinancing Indebtedness), other than with the proceeds of (i) a substantially concurrent Refinancing that (x) is on terms not materially less favorable to the Lenders than the Indebtedness being refinanced, (y) matures no earlier than the date that is one year after the Initial Revolving Termination Date and (z) is in an aggregate principal amount not in excess of the aggregate principal amount of the Indebtedness being refinanced except to the extent of fees and expenses incurred in connection with any such Refinancing or (ii) any sale or issuance of TWTC’s common stock or preferred stock pursuant to Section 7.5(e); (b) amend, modify, waive or otherwise change, or consent or agree to any amendment, modification, waiver or other change to, any of the terms of the High Yield Notes, the Existing Senior Notes or other Indebtedness of TWTC permitted by Section 7.2(t) (or of any Indebtedness incurred to Refinance any of the foregoing or any Indebtedness incurred to Refinance any such refinancing Indebtedness) in any manner materially adverse to the Lenders; or (c) designate any Indebtedness (other than the Secured Obligations) as (i) “Priority Lien Debt” (or any other term having a similar meaning) for the purposes of either High Yield Indenture (or any indenture governing any Refinancing of the Existing Senior Notes or the High Yield Notes, if applicable, or any indenture governing any Refinancing of any such refinancing Indebtedness, if applicable) or (ii) “First Priority Obligations” for the purposes of the Intercreditor Agreement. Notwithstanding the foregoing, TWTC and the Borrower may redeem or repurchase any of the Existing Senior Notes (or any refinancing Indebtedness thereof) and the High Yield Notes (or any refinancing Indebtedness thereof), respectively; provided that (i) no Default or Event of

Default has occurred and is continuing or would result therefrom, (ii) no Revolving Loans shall be outstanding at the time of such repurchase or redemption or after giving effect thereto and (iii) immediately after giving effect thereto (and to the payment of any amounts required to be paid in connection therewith), (x) TWTC shall be in pro forma compliance with the covenants contained in Section 7.1 to the extent such covenants are then in effect and (y) Current Liquidity shall not be less than $300,000,000.

7.10. Transactions with Affiliates. Other than as set forth on Schedule 7.10, enter into any transaction, including any purchase, sale, lease or exchange of property, the rendering of any service or the payment of any management, advisory or similar fees, with any Affiliate (other than TWTC, the Borrower or any Wholly Owned Subsidiary Guarantor) unless such transaction is (a) otherwise permitted under this Agreement or the other Loan Documents, (b) in the ordinary course of business of TWTC, the Borrower or such Subsidiary, as the case may be, and (c) upon fair and reasonable terms no less favorable to TWTC, the Borrower or such Subsidiary, as the case may be, than it would obtain in a comparable arm’s length transaction with a Person that is not an Affiliate.

7.11. Sales and Leasebacks. Enter into any arrangement with any Person providing for the leasing by TWTC or any Subsidiary of real or personal property that has been or is to be sold or transferred by TWTC or such Subsidiary to such Person or to any other Person to whom funds have been or are to be advanced by such Person on the security of such property or rental obligations of TWTC or such Subsidiary, other than any sale and leaseback transaction involving properties acquired after the Effective Date and permitted by Section 7.3(g).

7.12. Changes in Fiscal Periods. Permit the fiscal year of TWTC or the Borrower to end on a day other than December 31 or change TWTC’s or the Borrower’s method of determining fiscal quarters.

7.13. Negative Pledge Clauses. Enter into or suffer to exist or become effective any agreement that prohibits or limits the ability of TWTC or any of its Subsidiaries to create, incur, assume or suffer to exist any Lien upon any of its property or revenues, whether now owned or hereafter acquired, other than (a) this Agreement and the other Loan Documents, (b) the Time Warner Arrangements, (c) any agreements governing any purchase money Liens or Capital Lease Obligations otherwise permitted hereby (in which case, any prohibition or limitation shall only be effective against the assets financed thereby), (d) any agreements governing any Investment in any joint venture or partnership that limit the ability to grant a security interest in the Capital Stock of such joint venture or partnership so long as such Capital Stock is pledged to the Collateral Agent in an indirect manner reasonably satisfactory to the Collateral Agent, (e) customary restrictions entered into in the ordinary course of business with respect to Intellectual Property that limit the ability to grant a security interest in such Intellectual Property, (f) any agreements governing any leasehold interest (including any rights of way, colocation agreements and other similar such interests in real estate, and agreements existing on the Effective Date granting or otherwise providing for an indefeasible right of use in fiber or conduits or providing for joint construction or marketing of fiber or conduits) or building entry agreements that limit the ability to grant a security interest in such leasehold interest or building entry agreements, (g) agreements with customers for the provision of services that limit the ability to grant a security interest in such agreements (but not amounts receivable or any money or other amounts due or to become due or other right of payment resulting from those agreements) and (h) the Indentures (or any indenture governing any Refinancing of the Existing Senior Notes or the High Yield Notes or any indenture governing any Refinancing of any such refinancing Indebtedness).

7.14. Clauses Restricting Subsidiary Distributions. Enter into or suffer to exist or become effective any consensual encumbrance or restriction on the ability of any Subsidiary of the Borrower or of TWTC to (a) make Restricted Payments in respect of any Capital Stock of such Subsidiary held by, or pay any Indebtedness owed to, TWTC, the Borrower or any other Subsidiary of TWTC, (b) make loans or advances to, or other Investments in, TWTC, the Borrower or any other Subsidiary of TWTC or (c) transfer any of its assets to TWTC, the Borrower or any other Subsidiary of TWTC, except for such encumbrances or restrictions existing under or by reason of (i) any restrictions existing under the Loan Documents, (ii) any restrictions existing under the High Yield Indentures on and as of the Effective Date (or any indenture governing any Refinancing of the Existing Senior Notes or the High Yield Notes or any indenture governing any Refinancing of any such refinancing Indebtedness) and (iii) any restrictions with respect to a Subsidiary imposed pursuant to an agreement that has been entered into in connection with the Disposition of all or substantially all of the Capital Stock or assets of such Subsidiary.

7.15. Lines of Business; Holding Company Status. (a) Enter into any business, either directly or through any Subsidiary, except for the design, development, construction, installation, integration, management or provision of any telecommunications business, including voice, video, Internet and data transmission products, services and systems, fiber network construction and sales and any business reasonably related to the foregoing (each, a “Permitted Line of Business”).

(b) In the case of TWTC, (i) conduct, transact or otherwise engage in, or commit to conduct, transact or otherwise engage in, any business or operations other than those incidental to its ownership of cash and Cash Equivalents and Indebtedness and the Capital Stock of other Persons or (ii) own, lease, manage or otherwise operate any properties or assets (including cash and Cash Equivalents) for any period greater than two consecutive days other than (1) cash and Cash Equivalents in an amount not to exceed $25,000,000 in the aggregate and (2) the ownership of shares of Capital Stock of other Persons; provided that, TWTC may continue to conduct administrative and management oversight and headquarters functions (including, without limitation, maintaining its leases of office space existing on the Effective Date).

7.16. Modifications to Time Warner Arrangements and Material Rights and Privileges. Amend, supplement, or otherwise modify the terms and conditions of any of the Time Warner Arrangements or any material rights and privileges (including, without limitation, FCC and local regulatory licenses) in any manner materially adverse to the Lenders.

SECTION 8. EVENTS OF DEFAULT

If any of the following events shall occur and be continuing:

(a) the Borrower shall fail to pay any principal of any Loan or Reimbursement Obligation when due in accordance with the terms hereof; or the Borrower shall fail to pay any interest on any Loan or Reimbursement Obligation, or any other amount payable hereunder or under any other Loan Document, within five days after any such interest or other amount becomes due in accordance with the terms hereof; or

(b) any representation or warranty made or deemed made by any Loan Party herein or in any other Loan Document or that is contained in any certificate, document or financial or other statement furnished by it at any time under or in connection with this Agreement or any such

other Loan Document shall prove to have been inaccurate in any material respect on or as of the date made or deemed made; or

(c) any Loan Party shall default in the observance or performance of any agreement contained in clause (i) or (ii) of Section 6.4(a) (with respect to TWTC and the Borrower only), Section 6.7(a) or Section 7 of this Agreement or Sections 5.5 and 5.7(b) of the Guarantee and Collateral Agreement, and, if no Obligations are then outstanding hereunder, such default shall continue unremedied for a period of 10 days; or

(d) any Loan Party shall default in the observance or performance of any other agreement contained in this Agreement or any other Loan Document (other than as provided in paragraphs (a) through (c) of this Section), and such default shall continue unremedied for a period of 30 (or, if no Obligations are then outstanding hereunder, 60) days after notice to the Borrower from the Administrative Agent or the Required Lenders; or

(e) TWTC or any of its Subsidiaries (other than a Shell Subsidiary or an Immaterial Subsidiary) shall (i) default in making any payment of any principal of any Indebtedness (including any Guarantee Obligation, but excluding the Loans) on the scheduled or original due date, whichever is later, with respect thereto (giving effect to any applicable grace periods); or (ii) default in making any payment of any interest on any such Indebtedness beyond the period of grace, if any, provided in the instrument or agreement under which such Indebtedness was created; or (iii) default in the observance or performance of any other agreement or condition relating to any such Indebtedness or contained in any instrument or agreement evidencing, securing or relating thereto, or any other default shall occur or exist, the effect of which default is to cause, or, if any Obligations are then outstanding hereunder, to permit the holder or beneficiary of such Indebtedness (or a trustee or agent on behalf of such holder or beneficiary) to cause, with the giving of notice if required, such Indebtedness to become due prior to its stated maturity or (in the case of any such Indebtedness constituting a Guarantee Obligation) to become payable; provided, that a default described in clause (i), (ii) or (iii) of this paragraph (e) shall not at any time constitute an Event of Default unless, at such time, one or more defaults of the type described in clauses (i), (ii) and (iii) of this paragraph (e) shall have occurred and be continuing with respect to Indebtedness the outstanding principal amount of which exceeds in the aggregate $10,000,000; or

(f) (i) TWTC, the Borrower or any of their respective Subsidiaries (other than a Shell Subsidiary or an Immaterial Subsidiary) shall commence any case, proceeding or other action (A) under any existing or future law of any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency, reorganization or relief of debtors, seeking to have an order for relief entered with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or seeking reorganization, arrangement, adjustment, winding-up, liquidation, dissolution, composition or other relief with respect to it or its debts, or (B) seeking appointment of a receiver, trustee, custodian, conservator or other similar official for it or for all or any substantial part of its assets, or TWTC, the Borrower or any of their respective Subsidiaries (other than a Shell Subsidiary or an Immaterial Subsidiary) shall make a general assignment for the benefit of its creditors; or (ii) there shall be commenced against TWTC, the Borrower or any of their respective Subsidiaries (other than a Shell Subsidiary or an Immaterial Subsidiary) any case, proceeding or other action of a nature referred to in clause (i) above that (A) results in the entry of an order for relief or any such adjudication or appointment or (B) remains undismissed, undischarged or unbonded for a period of 60 days; or (iii) there shall be commenced against TWTC, the Borrower or any of their respective Subsidiaries (other than a Shell Subsidiary or an Immaterial Subsidiary) any case,

proceeding or other action seeking issuance of a warrant of attachment, execution, distraint or similar process against all or any substantial part of its assets that results in the entry of an order for any such relief that shall not have been vacated, discharged, or stayed or bonded pending appeal within 60 days from the entry thereof; or (iv) TWTC, the Borrower or any of their respective Subsidiaries (other than a Shell Subsidiary or an Immaterial Subsidiary) shall take any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the acts set forth in clause (i), (ii), or (iii) above; or (v) TWTC, the Borrower or any of their respective Subsidiaries (other than a Shell Subsidiary or an Immaterial Subsidiary) shall generally not, or shall be unable to, or shall admit in writing its inability to, pay its debts as they become due; or

(g) (i) any Person shall engage in any “prohibited transaction” (as defined in Section 406 of ERISA or Section 4975 of the Code) involving any Plan, (ii) any “accumulated funding deficiency” (as defined in Section 302 of ERISA), whether or not waived, shall exist with respect to any Plan or any Lien in favor of the PBGC or a Plan shall arise on the assets of the Borrower or any Commonly Controlled Entity, (iii) a Reportable Event shall occur with respect to, or proceedings shall commence to have a trustee appointed, or a trustee shall be appointed, to administer or to terminate, any Single Employer Plan, which Reportable Event or commencement of proceedings or appointment of a trustee is, in the reasonable opinion of the Required Lenders, likely to result in the termination of such Plan for purposes of Title IV of ERISA, (iv) any Single Employer Plan shall terminate for purposes of Title IV of ERISA, (v) the Borrower or any Commonly Controlled Entity shall, or in the reasonable opinion of the Required Lenders is likely to, incur any liability in connection with a withdrawal from, or the Insolvency or Reorganization of, a Multiemployer Plan or (vi) any other event or condition other than in the ordinary course shall occur or exist with respect to a Plan; and in each case in clauses (i) through (vi) above, such event or condition, together with all other such events or conditions, if any, could, in the sole judgment of the Required Lenders, reasonably be expected to have a Material Adverse Effect; or

(h) one or more judgments or decrees shall be entered against TWTC, the Borrower or any of their respective Subsidiaries (other than a Shell Subsidiary or an Immaterial Subsidiary) involving in the aggregate a liability (to the extent (i) not paid by insurance or (ii) as to which no reasonable expectation of insurance coverage exists) of $20,000,000 or more, and all such judgments or decrees shall not have been vacated, discharged, stayed or bonded pending appeal within 30 days from the entry thereof; or

(i) any of the Security Documents shall cease, for any reason, to be in full force and effect, or any Loan Party or any Affiliate of any Loan Party shall so assert, or any Lien created by any of the Security Documents shall cease to be enforceable and of the same effect and priority purported to be created thereby (other than as a result of an act or omission of the Collateral Agent); or

(j) the guarantee contained in Section 2 of the Guarantee and Collateral Agreement shall cease, for any reason, to be in full force and effect or any Loan Party or any Affiliate of any Loan Party shall so assert; or

(k) any of the Time Warner Arrangements (other than the trade name license agreement between TWTC and Time Warner Inc. and its affiliates) shall cease, for any reason, to be in full force and effect or any Loan Party or any Affiliate of any Loan Party shall so assert (other than any expiration of any of the Time Warner Arrangements in accordance with its terms that could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect);

then, and in any such event, (A) if such event is an Event of Default specified in clause (i) or (ii) of paragraph (f) above with respect to the Borrower, automatically the Revolving Commitments shall immediately terminate and the Loans hereunder (with accrued interest thereon) and all other amounts owing under this Agreement and the other Loan Documents (including all amounts of L/C Obligations, whether or not the beneficiaries of the then outstanding Letters of Credit shall have presented the documents required thereunder) shall immediately become due and payable, and (B) if such event is any other Event of Default, either or both of the following actions may be taken: (i) with the consent of the Required Lenders, the Administrative Agent may, or upon the request of the Required Lenders, the Administrative Agent shall, by notice to the Borrower declare the Revolving Commitments to be terminated forthwith, whereupon the Revolving Commitments shall immediately terminate; and (ii) with the consent of the Required Lenders, the Administrative Agent may, or upon the request of the Required Lenders, the Administrative Agent shall, by notice to the Borrower, declare the Loans hereunder (with accrued interest thereon) and all other amounts owing under this Agreement and the other Loan Documents (including all amounts of L/C Obligations, whether or not the beneficiaries of the then outstanding Letters of Credit shall have presented the documents required thereunder) to be due and payable forthwith, whereupon the same shall immediately become due and payable. With respect to all Letters of Credit with respect to which presentment for honor shall not have occurred at the time of an acceleration pursuant to this paragraph, the Borrower shall at such time deposit in a cash collateral account opened by the Administrative Agent an amount equal to the aggregate then undrawn and unexpired amount of such Letters of Credit. Amounts held in such cash collateral account shall be applied by the Administrative Agent to the payment of drafts drawn under such Letters of Credit, and the unused portion thereof after all such Letters of Credit shall have expired or been fully drawn upon, if any, shall be applied to repay other obligations of the Borrower hereunder and under the other Loan Documents. After all such Letters of Credit shall have expired or been fully drawn upon, all Reimbursement Obligations shall have been satisfied and all other obligations of the Borrower hereunder and under the other Loan Documents shall have been paid in full, the balance, if any, in such cash collateral account shall be returned to the Borrower (or such other Person as may be lawfully entitled thereto). Except as expressly provided above in this Section, presentment, demand, protest and all other notices of any kind are hereby expressly waived by the Borrower.

SECTION 9. THE AGENTS

9.1. Appointment. Each Lender hereby irrevocably designates and appoints the Administrative Agent and the Collateral Agent as the agents of such Lender under this Agreement and the other Loan Documents, and each such Lender irrevocably authorizes the Administrative Agent and the Collateral Agent, in such capacities, to take such action on its behalf under the provisions of this Agreement and the other Loan Documents and to exercise such powers and perform such duties as are expressly delegated to the Administrative Agent and the Collateral Agent by the terms of this Agreement and the other Loan Documents, together with such other powers as are reasonably incidental thereto. Notwithstanding any provision to the contrary elsewhere in this Agreement, neither the Administrative Agent nor the Collateral Agent shall have any duties or responsibilities, except those expressly set forth herein, or any fiduciary relationship with any Lender, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or any other Loan Document or otherwise exist against the Administrative Agent or the Collateral Agent.

9.2. Delegation of Duties. The Administrative Agent and the Collateral Agent may execute any of their respective duties under this Agreement and the other Loan Documents by or through agents or attorneys-in-fact and shall be entitled to advice of counsel concerning all matters pertaining to

such duties. Neither the Administrative Agent nor the Collateral Agent shall be responsible for the negligence or misconduct of any agents or attorneys in-fact selected by it with reasonable care.

9.3. Exculpatory Provisions. None of the Agents nor any of their respective officers, directors, employees, agents, attorneys-in-fact or affiliates shall be (i) liable for any action lawfully taken or omitted to be taken by it or such Person under or in connection with this Agreement or any other Loan Document (except to the extent that any of the foregoing have resulted from its or such Person’s own gross negligence or willful misconduct) or (ii) responsible in any manner to any of the Lenders for any recitals, statements, representations or warranties made by any Loan Party or any officer thereof contained in this Agreement or any other Loan Document or in any certificate, report, statement or other document referred to or provided for in, or received by the Agents under or in connection with, this Agreement or any other Loan Document or for the value, validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement or any other Loan Document or for any failure of any Loan Party a party thereto to perform its obligations hereunder or thereunder. The Agents shall not be under any obligation to any Lender to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of, this Agreement or any other Loan Document, or to inspect the properties, books or records of any Loan Party.

9.4. Reliance by Administrative Agent and Collateral Agent. Each of the Administrative Agent and the Collateral Agent shall be entitled to rely, and shall be fully protected in relying, upon any instrument, writing, resolution, notice, consent, certificate, affidavit, letter, telecopy, telex or teletype message, statement, order or other document or conversation reasonably 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 TWTC or the Borrower), independent accountants and other experts selected by it. The Administrative Agent may deem and treat the payee of any Note as the owner thereof for all purposes unless a written notice of assignment, negotiation or transfer thereof shall have been filed with the Administrative Agent. Each of the Administrative Agent and the Collateral Agent shall be fully justified in failing or refusing to take any action under this Agreement or any other Loan Document unless it shall first receive such advice or concurrence of the Required Lenders (or, if so specified by this Agreement, all Lenders) as it deems appropriate or it shall first be indemnified to its satisfaction by the Lenders against any and all liability and expense that may be incurred by it by reason of taking or continuing to take any such action. The Administrative Agent and the Collateral Agent shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement and the other Loan Documents in accordance with a request of the Required Lenders (or, if so specified by this Agreement, all Lenders), and such request and any action taken or failure to act pursuant thereto shall be binding upon all the Lenders and all future holders of the Loans.

9.5. Notice of Default. Neither the Administrative Agent nor the Collateral Agent shall be deemed to have knowledge or notice of the occurrence of any Default or Event of Default hereunder unless the Administrative Agent has received notice from a Lender, TWTC or the Borrower referring to this Agreement, describing such Default or Event of Default and stating that such notice is a “notice of default”. In the event that the Administrative Agent receives such a notice, the Administrative Agent shall give notice thereof to the Lenders. The Administrative Agent or the Collateral Agent, as the case may be, shall take such action with respect to such Default or Event of Default as shall be reasonably directed by the Required Lenders (or, if so specified by this Agreement, all Lenders); provided that unless and until the Administrative Agent and the Collateral Agent shall have received such directions, the Administrative Agent and the Collateral 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 in the best interests of the Lenders.

9.6. Non-Reliance on Agents and Other Lenders. Each Lender expressly acknowledges that none of the Agents nor any of their respective officers, directors, employees, agents, attorneys-in-fact or affiliates have made any representations or warranties to it and that no act by any Agent hereafter taken, including any review of the affairs of a Loan Party or any affiliate of a Loan Party, shall be deemed to constitute any representation or warranty by any Agent to any Lender. Each Lender represents to the Agents that it has, independently and without reliance upon any Agent or any other Lender, and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, operations, property, financial and other condition and creditworthiness of the Loan Parties and their affiliates and made its own decision to make its Loans hereunder and enter into this Agreement. Each Lender also represents that it will, independently and without reliance upon any Agent or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis, appraisals and decisions in taking or not taking action under this Agreement and the other Loan Documents, and to make such investigation as it deems necessary to inform itself as to the business, operations, property, financial and other condition and creditworthiness of the Loan Parties and their affiliates. Except for notices, reports and other documents expressly required to be furnished to the Lenders by the Administrative Agent hereunder, neither the Administrative Agent nor the Collateral Agent shall have any duty or responsibility to provide any Lender with any credit or other information concerning the business, operations, property, condition (financial or otherwise), prospects or creditworthiness of any Loan Party or any affiliate of a Loan Party that may come into the possession of the Administrative Agent or the Collateral Agent or any of their respective officers, directors, employees, agents, attorneys-in-fact or affiliates.

9.7. Indemnification. The Lenders agree to indemnify each Agent in its capacity as such (to the extent not reimbursed by the Loan Parties and without limiting the obligation of the Loan Parties to do so), ratably according to their respective Aggregate Exposure Percentages in effect on the date on which indemnification is sought under this Section (or, if indemnification is sought after the date upon which the Revolving Commitments shall have terminated and the Loans shall have been paid in full, ratably in accordance with such Aggregate Exposure Percentages immediately prior to such date), from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind whatsoever that may at any time (whether before or after the payment of the Loans) be imposed on, incurred by or asserted against such Agent in any way relating to or arising out of, the Revolving Commitments, this Agreement, any of the other Loan Documents or any documents contemplated by or referred to herein or therein or the transactions contemplated hereby or thereby or any action taken or omitted by such Agent under or in connection with any of the foregoing; provided that no Lender shall be liable for the payment of any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements that have resulted from such Agent’s gross negligence or willful misconduct. The agreements in this Section shall survive the payment of the Loans and all other amounts payable hereunder.

9.8. Agent in Its Individual Capacity. Each Agent and its affiliates may make loans to, accept deposits from and generally engage in any kind of business with any Loan Party as though such Agent were not an Agent. With respect to its Loans made or renewed by it and with respect to any Letter of Credit issued or participated in by it, each Agent shall have the same rights and powers under this Agreement and the other Loan Documents as any Lender and may exercise the same as though it were not an Agent, and the terms “Lender” and “Lenders” shall include each Agent in its individual capacity.

9.9. Successor Administrative Agent. The Administrative Agent may resign as Administrative Agent upon 30 days’ notice to the Lenders and the Borrower. If the Administrative Agent shall resign as Administrative Agent under this Agreement and the other Loan Documents, then the

Required Lenders shall appoint from among the Lenders a successor agent for the Lenders, which successor agent shall (unless an Event of Default under Section 8(a) or Section 8(f) with respect to the Borrower shall have occurred and be continuing) be subject to approval by the Borrower (which approval shall not be unreasonably withheld or delayed), whereupon such successor agent shall succeed to the rights, powers and duties of the Administrative Agent, and the term “Administrative Agent” shall mean such successor agent effective upon such appointment and approval, and the former Administrative Agent’s rights, powers and duties as Administrative Agent shall be terminated, without any other or further act or deed on the part of such former Administrative Agent or any of the parties to this Agreement or any holders of the Loans. If no successor agent has accepted appointment as Administrative Agent by the date that is 30 days following a retiring Administrative Agent’s notice of resignation, the retiring Administrative Agent’s resignation shall nevertheless thereupon become effective and the Lenders shall assume and perform all of the duties of the Administrative Agent hereunder until such time, if any, as the Required Lenders appoint a successor agent as provided for above. After any retiring Administrative Agent’s resignation as Administrative Agent, the provisions of this Section 9 shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Administrative Agent under this Agreement and the other Loan Documents.

9.10. Successor Collateral Agent. Subject to the provisions of the Intercreditor Agreement and the Guarantee and Collateral Agreement, the Collateral Agent may resign as Collateral Agent upon 30 days’ notice to the Lenders and the Borrower. If the Collateral Agent shall resign as Collateral Agent under this Agreement and the other Loan Documents, then the Required Lenders shall appoint from among the Lenders a successor agent for the Lenders, which successor agent shall (unless an Event of Default under Section 8(a) or Section 8(f) with respect to the Borrower shall have occurred and be continuing) be subject to approval by the Borrower (which approval shall not be unreasonably withheld or delayed), whereupon such successor agent shall succeed to the rights, powers and duties of the Collateral Agent, and the term “Collateral Agent” shall mean such successor agent effective upon such appointment and approval, and the former Collateral Agent’s rights, powers and duties as Collateral Agent shall be terminated, without any other or further act or deed on the part of such former Collateral Agent or any of the parties to this Agreement or any holders of the Loans. If no successor agent has accepted appointment as Collateral Agent by the date that is 30 days following a retiring Collateral Agent’s notice of resignation, the retiring Collateral Agent’s resignation shall nevertheless thereupon become effective and the Administrative Agent shall assume and perform all of the duties of the Collateral Agent hereunder until such time, if any, as the Required Lenders appoint a successor agent as provided for above. After any retiring Collateral Agent’s resignation as Collateral Agent, the provisions of this Section 9 shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Collateral Agent under this Agreement and the other Loan Documents.

9.11. Syndication Agent and Co-Documentation Agents. Neither the Syndication Agent nor the Co-Documentation Agents shall have any duties or responsibilities hereunder in its capacity as such.

SECTION 10. MISCELLANEOUS

10.1. Amendments and Waivers. Neither this Agreement, any other Loan Document, nor any terms hereof or thereof may be amended, supplemented or modified except in accordance with the provisions of this Section 10.1 and, in the case of the Intercreditor Agreement or the Guarantee and Collateral Agreement, the provisions of Section 9.3 of the Intercreditor Agreement and Section 8.2 of the Guarantee and Collateral Agreement. Subject to the foregoing, the Required Lenders and each Loan Party party to the relevant Loan Document may, or, with the written consent of the Required Lenders, the

Administrative Agent (or the Collateral Agent, as the case may be) and each Loan Party party to the relevant Loan Document may, from time to time, (a) enter into written amendments, supplements or modifications hereto and to the other Loan Documents for the purpose of adding any provisions to this Agreement or the other Loan Documents or changing in any manner the rights of the Lenders or of the Loan Parties hereunder or thereunder or (b) waive, on such terms and conditions as the Required Lenders or the Administrative Agent (or the Collateral Agent, as the case may be), with the written consent of the Required Lenders, as the case may be, may specify in such instrument, any of the requirements of this Agreement or the other Loan Documents or any Default or Event of Default and its consequences, including, without limitation, the termination of the Revolving Commitments and the Loans being due and payable; provided, however, that no such waiver and no such amendment, supplement or modification shall (i) forgive the principal amount or extend the final scheduled date of maturity of any Loan, reduce the stated rate of any interest or fee payable hereunder (except that any amendment or modification of defined terms used in the financial covenants in this Agreement shall not constitute a reduction in the rate of interest or fees for purposes of this clause (i)) or extend the scheduled date of any payment thereof, or increase the amount or extend the expiration date of any Lender’s Revolving Commitment, in each case without the written consent of each Lender directly affected thereby; (ii) eliminate or reduce the voting rights of any Lender under Section 2.1(b), 2.1(c) or this Section 10.1 without the written consent of such Lender; (iii) reduce any percentage specified in the definition of Required Lenders, consent to the assignment or transfer by the Borrower of any of its rights and obligations under this Agreement and the other Loan Documents, release, or subordinate to any other Person the Liens of the Collateral Agent upon, or permit Liens in favor of any other Person that are pari passu to the Liens of the Collateral Agent upon, all or substantially all of the Collateral or release all or substantially all of the Subsidiary Guarantors from their obligations under the Guarantee and Collateral Agreement, in each case without the written consent of all Lenders; (iv) amend, modify or waive any provision of Section 2.14(a) or (b) without the written consent of each Lender adversely affected thereby; (v) amend, modify or waive any provision of Section 9 without the written consent of the Administrative Agent and the Collateral Agent; (vi) amend, modify or waive any provision of Section 2.4 or 2.5 without the written consent of the Swingline Lender; (vii) amend, modify or waive any provision of Section 3 without the written consent of the Issuing Lender; or (viii) amend or modify any provision of Section 10.6 to add any additional consent requirements necessary to effect any assignment under such Section without the written consent of the Supermajority Lenders. Any such waiver and any such amendment, supplement or modification shall apply equally to each of the Lenders and shall be binding upon the Loan Parties, the Lenders, the Collateral Agent, the Administrative Agent and all future holders of the Loans. In the case of any waiver, the Loan Parties, the Lenders, the Collateral Agent and the Administrative Agent shall be restored to their former position and rights hereunder and under the other Loan Documents, and any Default or Event of Default waived shall be deemed to be cured and not continuing; but no such waiver shall extend to any subsequent or other Default or Event of Default, or impair any right consequent thereon.

Notwithstanding anything to the contrary above, each Lender hereby authorizes the Administrative Agent on its behalf, and without its further consent, to enter into amendments to this Agreement (including, without limitation, amendments to this Section 10.1) and the other Loan Documents as the Administrative Agent may reasonably deem appropriate in order to effectuate an Incremental Facility, including, without limitation, amendments to permit the Incremental Loans to share ratably in the benefits of this Agreement and the other Loan Documents and to include appropriately the Lenders under an Incremental Facility in any determination of the Required Lenders; provided that no such amendment shall modify any provision described in clause (i) or (ii) of the foregoing paragraph or otherwise adversely affect in any material respect the rights of any Lender, in each case without the written consent of such Lender.

In addition, this Agreement may be amended (or amended and restated) with the written consent of the Required Lenders, the Collateral Agent and the Administrative Agent to add one or more additional credit facilities to this Agreement and to permit the extensions of credit from time to time outstanding thereunder to share ratably in the benefits of this Agreement and the other Loan Documents and to include appropriately the Lenders holding such credit facilities in any determination of the Required Lenders.

10.2. Notices. All notices, requests and demands to or upon the respective parties hereto to be effective shall be in writing (including by telecopy), and, unless otherwise expressly provided herein, shall be deemed to have been duly given or made when delivered, or three Business Days after being deposited in the mail, postage prepaid, or, in the case of telecopy notice, when received, addressed as follows in the case of TWTC, the Borrower, the Collateral Agent, the Administrative Agent, and as set forth in an administrative questionnaire delivered to the Administrative Agent in the case of the Lenders, or to such other address as may be hereafter notified by the respective parties hereto:


TWTC:		Time Warner Telecom Inc.
		00000 Xxxx Xxxxxxx Xxxxx
		Xxxxxxxxx, XX 00000
		Attention: Xxxx X. Xxxxxx, Vice President, Treasurer
		Telecopy: (000) 000-0000
		Telephone: (000) 000-0000

The Borrower:		Time Warner Telecom Holdings Inc.
		00000 Xxxx Xxxxxxx Xxxxx
		Xxxxxxxxx, XX 00000
		Attention: Xxxx X. Xxxxx, Esq., General Counsel
		Telecopy: (000) 000-0000
		Telephone: (000) 000-0000

with a copy to:		Faegre & Xxxxxx LLP
		2200 Xxxxx Fargo Center
		00 Xxxxx 0^xx Xxxxxx
		Xxxxxxxxxxx, XX 00000
		Attention: Xxxxxxx X. Xxxxxxxxxx, Esq.
		Xxxxx X. Xxxxxx, Esq.
		Telecopy: (000) 000-0000
		Telephone: (000) 000-0000

The Administrative Agent:		Xxxxxx Commercial Paper Inc.
		000 Xxxxxxx Xxxxxx, 00xx Xxxxx
		Xxx Xxxx, XX 00000
		Attention: Xxxxxxx Xxxxxx
		Telecopy: (000) 000-0000
		Telephone: (000) 000-0000


The Collateral Agent:		Xxxxxx Commercial Paper Inc.
		000 Xxxxxxx Xxxxxx
		Xxx Xxxx, XX 00000
		Attention: Xxxxxx Xxxxxxx
		Telecopy: (000) 000-0000
		Telephone: (000) 000-0000

provided that any notice, request or demand to or upon the Administrative Agent, the Collateral Agent or the Lenders shall not be effective until received.

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

10.4. Survival of Representations and Warranties. All representations and warranties made hereunder, in the other Loan Documents and in any document, certificate or statement delivered pursuant hereto or in connection herewith shall survive the execution and delivery of this Agreement and the making of the Loans and other extensions of credit hereunder.

10.5. Payment of Expenses and Taxes. Each of TWTC and the Borrower agrees (a) to pay or reimburse the Administrative Agent, the Collateral Agent and the Joint Lead Arrangers for all their reasonable and documented out-of-pocket costs and expenses incurred in connection with the syndication of this Agreement and the preparation, execution and delivery of, and any amendment, supplement or modification to, this Agreement and the other Loan Documents and any other documents prepared in connection herewith or therewith, and the consummation and administration of the transactions contemplated hereby and thereby, including the reasonable and documented fees, disbursements and other charges of one firm of primary counsel to the Administrative Agent and the Collateral Agent and filing and recording fees and expenses, with statements with respect to the foregoing to be submitted to the Borrower prior to the Effective Date (in the case of amounts to be paid on the Effective Date) and from time to time thereafter on a quarterly basis or such other periodic basis as the Administrative Agent or the Collateral Agent shall deem appropriate, (b) to pay or reimburse each Lender (other than in respect of intercreditor disputes arising from the Intercreditor Agreement), the Administrative Agent and the Collateral Agent for all its costs and expenses incurred in connection with the enforcement or preservation of any rights under this Agreement, the other Loan Documents and any such other documents, including the fees, disbursements and other charges of counsel to each Lender and of counsel to the Administrative Agent, the Collateral Agent and the Joint Lead Arrangers, (c) to pay, indemnify, and hold each Lender, the Administrative Agent and the Collateral Agent harmless from, any and all recording and filing fees and any and all liabilities with respect to, or resulting from any delay in paying, stamp, excise and other taxes, if any, that may be payable or determined to be payable in connection with the execution and delivery of, or consummation or administration of any of the transactions contemplated by, or any amendment, supplement or modification of, or any waiver or consent under or in respect of, this Agreement, the other Loan Documents and any such other documents, and (d) to pay, indemnify, and hold each Lender, the Administrative Agent, the Collateral Agent and the Joint Lead Arrangers and their respective officers, directors, employees, affiliates, agents and controlling persons (each, an “Indemnitee”) harmless from and against any and all other liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever

with respect to the execution, delivery, enforcement, performance and administration of this Agreement, the other Loan Documents and any such other documents, including any of the foregoing relating to the use of proceeds of the Loans or the violation of, noncompliance with or liability under, any Environmental Law applicable to the operations of TWTC or any of its Subsidiaries or any of the Properties and the reasonable fees and expenses of legal counsel in connection with claims, actions or proceedings by any Indemnitee against any Loan Party under any Loan Document (all the foregoing in this clause (d), collectively, the “Indemnified Liabilities”), provided, that neither TWTC nor the Borrower shall have any obligation hereunder to any Indemnitee with respect to Indemnified Liabilities to the extent such Indemnified Liabilities have resulted from the gross negligence or willful misconduct of such Indemnitee. It is understood and agreed that, to the extent not precluded by a conflict of interest, each Indemnitee shall endeavor to work cooperatively with a view to minimizing the legal and other expenses associated with any defense and any potential settlement or judgment. Without limiting the foregoing, and to the extent permitted by applicable law, TWTC agrees not to assert and to cause its Subsidiaries not to assert, and hereby waives and agrees to cause its Subsidiaries to waive, all rights for contribution or any other rights of recovery with respect to all claims, demands, penalties, fines, liabilities, settlements, damages, costs and expenses of whatever kind or nature, under or related to Environmental Laws, that any of them might have by statute or otherwise against any Indemnitee. All amounts due under this Section 10.5 shall be payable not later than 10 days after written demand therefor. Statements payable by TWTC or the Borrower pursuant to this Section 10.5 shall be submitted to the address of the Borrower set forth in Section 10.2, or to such other Person or address as may be hereafter designated by the Borrower in a written notice to the Administrative Agent. The agreements in this Section 10.5 shall survive repayment of the Loans and all other amounts payable hereunder.

10.6. Successors and Assigns; Participations and Assignments. (a) This Agreement shall be binding upon and inure to the benefit of TWTC, the Borrower, the Lenders, the Agents, all future holders of the Loans and their respective successors and assigns, except that the Borrower may not assign or transfer any of its rights or obligations under this Agreement without the prior written consent of each Lender.

(b) Any Lender other than any Conduit Lender may, without the consent of the Borrower or any Agent, in accordance with applicable law, at any time sell to one or more banks, financial institutions or other entities (each, a “Participant”) participating interests in any Loan owing to such Lender, any Revolving Commitment of such Lender or any other interest of such Lender hereunder and under the other Loan Documents. In the event of any such sale by a Lender of a participating interest to a Participant, such Lender’s obligations under this Agreement to the other parties to this Agreement shall remain unchanged, such Lender shall remain solely responsible for the performance thereof, such Lender shall remain the holder of any such Loan for all purposes under this Agreement and the other Loan Documents, and the Borrower and the Administrative Agent shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement and the other Loan Documents. In no event shall any Participant under any such participation have any right to approve any amendment or waiver of any provision of any Loan Document, or any consent to any departure by any Loan Party therefrom, except to the extent that such amendment, waiver or consent would reduce the principal of, or interest on, the Loans or any fees payable hereunder, or postpone the date of the final maturity of the Loans, in each case to the extent subject to such participation. The Borrower agrees that if amounts outstanding under this Agreement and the Loans are due or unpaid, or shall have been declared or shall have become due and payable upon the occurrence of an Event of Default, each Participant shall, to the maximum extent permitted by applicable law, be deemed to have the right of setoff in respect of its participating interest in amounts owing under this Agreement to the same extent as if the amount of its participating interest were owing

directly to it as a Lender under this Agreement; provided that, in purchasing such participating interest, such Participant shall be deemed to have agreed to share with the Lenders the proceeds thereof as provided in Section 10.7(a) as fully as if it were a Lender hereunder. The Borrower also agrees that each Participant shall be entitled to the benefits of Sections 2.15, 2.16 and 2.17 with respect to its participation in the Revolving Commitments and the Loans outstanding from time to time as if it was a Lender; provided that, in the case of Section 2.16, such Participant shall have complied with the requirements of said Section; and provided, further, that no Participant shall be entitled to receive any greater amount pursuant to any such Section than the transferor Lender would have been entitled to receive in respect of the amount of the participation transferred by such transferor Lender to such Participant had no such transfer occurred. In the event that any Lender sells participations in a Loan, such Lender shall maintain a register on which it enters the name of all participants in the Loans held by it (the “Participant Register”). A Loan (and the Note, if any, evidencing the same) may be participated in whole or in part only by registration of such participation on the Participant Register.

(c) Any Lender other than any Conduit Lender (an “Assignor”) may, in accordance with applicable law, at any time and from time to time assign to any Lender, any Affiliate of any Lender or any Approved Fund or, with the consent of the Borrower, the Administrative Agent and the Issuing Lender (which, in each case, shall not be unreasonably withheld or delayed), to an additional bank, financial institution or other entity (an “Assignee”) all or any part of its rights and obligations under this Agreement and the other Loan Documents pursuant to an Assignment and Acceptance, executed by such Assignee, such Assignor and any other Person whose consent is required pursuant to this paragraph, and delivered to the Administrative Agent for its acceptance and recording in the Register; provided that, unless otherwise agreed by the Borrower and the Administrative Agent, no such assignment to an Assignee (other than any Lender or any Affiliate of any Lender or any Approved Fund) shall be in an aggregate principal amount of less than $5,000,000, except in the case of an assignment of all of a Lender’s interests under this Agreement. For purposes of the proviso contained in the preceding sentence, the amount described therein shall be aggregated in respect of each Lender and its related Approved Funds, if any. Upon such execution, delivery, acceptance and recording, from and after the effective date determined pursuant to such Assignment and Acceptance, (x) the Assignee thereunder shall be a party hereto and, to the extent provided in such Assignment and Acceptance, have the rights and obligations of a Lender hereunder with a Revolving Commitment and/or Loans as set forth therein, and (y) the Assignor thereunder shall, to the extent provided in such Assignment and Acceptance, be released from its obligations under this Agreement (and, in the case of an Assignment and Acceptance covering all of an Assignor’s rights and obligations under this Agreement, such Assignor shall cease to be a party hereto) except with respect to its obligations under Section 10.15. Notwithstanding any provision of this Section 10.6, the consent of the Borrower shall not be required for any assignment that occurs when an Event of Default shall have occurred and be continuing. Notwithstanding the foregoing, any Conduit Lender may assign at any time to its designating Lender hereunder without the consent of the Borrower or the Administrative Agent any or all of the Loans it may have funded hereunder and pursuant to its designation agreement and without regard to the limitations set forth in the first sentence of this Section 10.6(c). In addition, a Lender shall permitted to transfer internally any of its Loans or any portion of its Revolving Commitments to an Approved Fund of such Lender without delivering an Assignment and Acceptance to the Administrative Agent, provided that (i) the transferring Lender shall maintain a register with respect to any such transfer and (ii) notwithstanding the effectiveness of any such transfer, the transferring Lender shall continue to be the Lender of record, and be obligated, hereunder for all purposes of this Agreement and the other Loan Documents until such Approved Fund that is a transferee of such Lender delivers an

Assignment and Acceptance to the Administrative Agent for recording in accordance with this Section 10.6.

(d) The Administrative Agent shall, on behalf of the Borrower, maintain at its address referred to in Section 10.2 a copy of each Assignment and Acceptance delivered to it and a register (the “Register”) for the recordation of the names and addresses of the Lenders and the Revolving Commitment of, and the principal amount of the Loans owing to, each Lender from time to time. The Register shall be available for inspection by the Borrower or any Lender at any reasonable time and from time to time upon reasonable prior notice. The entries in the Register shall be conclusive, in the absence of manifest error, and the Borrower, each other Loan Party, the Administrative Agent, the Collateral Agent and the Lenders shall treat each Person whose name is recorded in the Register as the owner of the Loans and any Notes evidencing the Loans recorded therein for all purposes of this Agreement. Any assignment of any Loan, whether or not evidenced by a Note, shall be effective only upon appropriate entries with respect thereto being made in the Register. Any assignment or transfer of all or part of a Loan evidenced by a Note shall be registered on the Register only upon surrender for registration of assignment or transfer of the Note evidencing such Loan, accompanied by a duly executed Assignment and Acceptance, and thereupon one or more new Notes shall be issued to the designated Assignee.

(e) Upon its receipt of an Assignment and Acceptance executed by an Assignor, an Assignee and any other Person whose consent is required by Section 10.6(c), together with payment to the Administrative Agent of a registration and processing fee of $3,500, the Administrative Agent shall (i) promptly accept such Assignment and Acceptance and (ii) record the information contained therein in the Register on the effective date determined pursuant thereto.

(f) For avoidance of doubt, the parties to this Agreement acknowledge that the provisions of this Section 10.6 concerning assignments of Loans and Notes relate only to absolute assignments and that such provisions do not prohibit assignments creating security interests, including any pledge or assignment by a Lender of any Loan or Note to any Federal Reserve Bank in accordance with applicable law.

(g) The Borrower, upon receipt of written notice from the relevant Lender, agrees to issue Notes to any Lender requiring Notes to facilitate transactions of the type described in paragraph (f) above.

(h) Each of TWTC, the Borrower, each Lender and each Agent hereby confirms that it will not institute against a Conduit Lender or join any other Person in instituting against a Conduit Lender any bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding under any state bankruptcy or similar law, for one year and one day after the payment in full of the latest maturing commercial paper note issued by such Conduit Lender; provided, however, that each Lender designating any Conduit Lender hereby agrees to indemnify, save and hold harmless each other party hereto for any loss, cost, damage or expense arising out of its inability to institute such a proceeding against such Conduit Lender during such period of forbearance.

10.7. Adjustments; Set-off. (a) Except to the extent that this Agreement expressly provides for payments to be allocated to a particular Lender, if any Lender (a “Benefitted Lender”) shall receive any payment of all or part of the Obligations owing to it, or receive any collateral in respect thereof (whether voluntarily or involuntarily, by set-off, pursuant to events or proceedings of the nature

referred to in Section 8(f), or otherwise), in a greater proportion than any such payment to or collateral received by any other Lender, if any, in respect of the Obligations owing to such other Lender, such Benefitted Lender shall purchase for cash from the other Lenders a participating interest in such portion of the Obligations owing to each such other Lender, or shall provide such other Lenders with the benefits of any such collateral, as shall be necessary to cause such Benefitted Lender to share the excess payment or benefits of such collateral ratably with each of the Lenders; provided, however, that if all or any portion of such excess payment or benefits is thereafter recovered from such Benefitted Lender, such purchase shall be rescinded, and the purchase price and benefits returned, to the extent of such recovery, but without interest.

(b) In addition to any rights and remedies of the Lenders provided by law, each Lender shall have the right, without prior notice to TWTC or the Borrower, any such notice being expressly waived by TWTC and the Borrower to the extent permitted by applicable law, upon any amount becoming due and payable by TWTC or the Borrower hereunder, subject to applicable grace periods (whether at the stated maturity, by acceleration or otherwise), to set off and appropriate and apply against such amount any and all deposits (general or special, time or demand, provisional or final), in any currency, and any other credits, indebtedness or claims, in any currency, in each case whether direct or indirect, absolute or contingent, matured or unmatured, at any time held or owing by such Lender or any branch or agency thereof to or for the credit or the account of TWTC or the Borrower, as the case may be. Each Lender agrees promptly to notify the Borrower and the Administrative Agent after any such setoff and application made by such Lender, provided that the failure to give such notice shall not affect the validity of such setoff and application.

10.8. Counterparts. This Agreement may be executed by one or more of the parties to this Agreement on any number of separate counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument. Delivery of an executed signature page of this Agreement by facsimile transmission shall be effective as delivery of a manually executed counterpart hereof. A set of the copies of this Agreement signed by all the parties shall be lodged with the Borrower and the Administrative Agent.

10.9. Severability. Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

10.10. Integration. This Agreement and the other Loan Documents represent the entire agreement of TWTC, the Borrower, the Administrative Agent, the Collateral Agent and the Lenders with respect to the subject matter hereof and thereof, and there are no promises, undertakings, representations or warranties by the Administrative Agent, the Collateral Agent or any Lender relative to subject matter hereof not expressly set forth or referred to herein or in the other Loan Documents.

10.11. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

10.12. Submission To Jurisdiction; Waivers. Each of TWTC and the Borrower hereby irrevocably and unconditionally:

(a) submits for itself and its property in any legal action or proceeding relating to this Agreement and the other Loan Documents to which it is a party, or for recognition and enforcement of any judgment in respect thereof, to the non-exclusive general jurisdiction of the courts of the State of New York, the courts of the United States for the Southern District of New York, and appellate courts from any thereof;

(b) consents that any such action or proceeding may be brought in such courts and waives any objection that it may now or hereafter have to the venue of any such action or proceeding in any such court or that such action or proceeding was brought in an inconvenient court and agrees not to plead or claim the same;

(c) agrees that service of process in any such action or proceeding may be effected by mailing a copy thereof by registered or certified mail (or any substantially similar form of mail), postage prepaid, to TWTC or the Borrower, as the case may be at its address set forth in Section 10.2 or at such other address of which the Administrative Agent shall have been notified pursuant thereto;

(d) agrees that nothing herein shall affect the right to effect service of process in any other manner permitted by law or shall limit the right to xxx in any other jurisdiction; and

(e) waives, to the maximum extent not prohibited by law, any right it may have to claim or recover in any legal action or proceeding referred to in this Section any special, exemplary, punitive or consequential damages.

10.13. Acknowledgments. Each of TWTC and the Borrower hereby acknowledges that:

(a) it has been advised by counsel in the negotiation, execution and delivery of this Agreement and the other Loan Documents;

(b) neither any Agent nor any Lender has any fiduciary relationship with or duty to TWTC or the Borrower arising out of or in connection with this Agreement or any of the other Loan Documents, and the relationship between Agents and Lenders, on one hand, and TWTC and the Borrower, on the other hand, in connection herewith or therewith is solely that of debtor and creditor; and

(c) no joint venture is created hereby or by the other Loan Documents or otherwise exists by virtue of the transactions contemplated hereby among the Lenders or among TWTC, the Borrower, the Agents and the Lenders.

10.14. Releases of Guarantees and Liens. (a) Notwithstanding anything to the contrary contained herein or in any other Loan Document, the Collateral Agent is hereby irrevocably authorized by each Lender (without requirement of notice to or consent of any Lender except as expressly required by Section 10.1) to take any action requested by the Borrower having the effect of releasing any Collateral or guarantee obligations of any Subsidiary Guarantor or other Person (i) to the extent necessary to permit consummation of any transaction not prohibited by any Loan Document or that has been consented to in accordance with Section 10.1 or (ii) under the circumstances described in paragraph (b) below.

(b) At such time as the Loans, the Reimbursement Obligations and the other obligations under the Loan Documents (other than obligations under or in respect of Hedge Agreements and other than obligations in respect of indemnities and expense reimbursement that are, at the time,

contingent and in respect of which no assertion of liability or demand for payment has been made) shall have been paid in full, the Revolving Commitments have been terminated and no Letters of Credit shall be outstanding, (x) the Collateral shall be released from the Liens created by the Security Documents, (y) the Subsidiary Guarantors shall be released from all obligations under the Guarantee and Collateral Agreement (other than those expressly stated to survive termination) and (z) the Security Documents and all obligations (other than those expressly stated to survive termination) of the Administrative Agent, the Collateral Agent and each Loan Party under the Security Documents shall terminate, all without delivery of any instrument or performance of any act by any Person.

10.15. Confidentiality. Each Agent and each Lender agrees to keep confidential all non-public information and all other information specifically designated as “confidential” by the Borrower, TWTC or one of their respective authorized representatives (including oral information for which such designation has been specifically made) provided to it by any Loan Party pursuant to this Agreement; provided that nothing herein shall prevent any Agent or any Lender from disclosing any such information (a) to an Agent, a Lender, any Affiliate of a Lender or any Approved Fund (provided that such Approved Fund expressly agrees to comply with the provisions of this Section), (b) to any actual or prospective Transferee or Hedge Agreement counterparty that expressly agrees to comply with the provisions of this Section, (c) to its employees, directors, agents, attorneys, accountants and other professional advisors or those of any of its Affiliates (provided that such Lender or Agent shall be required to inform such Persons of the confidential nature of such information), (d) upon the request or demand of any Governmental Authority, (e) in response to any order of any court or other Governmental Authority or as may otherwise be required pursuant to any Requirement of Law, (f) if requested or required to do so in connection with any litigation or similar proceeding, (g) that has been publicly disclosed or otherwise disclosed to such Person on a non-confidential basis, (h) to the National Association of Insurance Commissioners or any similar organization or any nationally recognized rating agency that requires access to information about a Lender’s investment portfolio in connection with ratings issued with respect to such Lender, (i) in connection with the exercise of any remedy hereunder or under any other Loan Document or (j) to any direct or indirect contractual counterparty in Hedge Agreements or such contractual counterparty’s professional advisor (so long as such contractual counterparty or professional advisor to such contractual counterparty expressly agrees to be bound by the provisions of this Section 10.15); provided, further, that with respect to disclosures pursuant to clauses (d), (e) and (f) of this Section, unless prohibited by applicable law or court order, each Lender and each Agent shall attempt to notify TWTC of any request by any governmental agency or representative thereof or other Person (other than any such request in connection with an examination of the financial condition of such Lender by such governmental agency) for disclosure of any material confidential information after receipt of such request, and if reasonably practicable and permissible, before disclosure of such information.

10.16. WAIVERS OF JURY TRIAL. TWTC, THE BORROWER, THE AGENTS AND THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered by their proper and duly authorized officers as of the day and year first above written.


TIME WARNER TELECOM INC.

By:		/s/ Xxxx Xxxxx

		Name: Xxxx Xxxxx
		Title: Vice President and Deputy General Counsel


TIME WARNER TELECOM HOLDINGS INC.

By:		/s/ Xxxx Xxxxx

		Name: Xxxx Xxxxx
		Title: Vice President and Deputy General Counsel


XXXXXX COMMERCIAL PAPER INC., as Administrative Agent, Collateral Agent and as a Lender

By:		/s/ G. Xxxxxx Xxxxxxx

		Name: G. Xxxxxx Xxxxxxx
		Title: Vice President


XXXXXX XXXXXXX SENIOR FUNDING, INC., as Syndication Agent and as a Lender

By:		/s/ Xxxx Xxxxxxxx

		Name: Xxxx Xxxxxxxx
		Title: Executive Director


WACHOVIA BANK, NATIONAL ASSOCIATION, as Co-Documentation Agent and as a Lender

By:		/s/ Xxxx X. Xxxxx

		Name: Xxxx X. Xxxxx
		Title: Director


BEAR XXXXXXX CORPORATE LENDING INC., as Co-Documentation Agent and as a Lender

By:		/s/ Xxxxx X. Xxxxxxx

		Name: Xxxxx X. Xxxxxxx
		Title: Executive Vice President


Signature page to the Credit Agreement, dated as of February 20, 2004, among Time Warner Telecom Inc., a Delaware corporation, Time Warner Telecom Holdings Inc., a Delaware corporation, the several banks and other financial institutions or entities from time to time parties thereto, Xxxxxx Xxxxxxx Senior Funding, Inc., as syndication agent, Wachovia Bank, National Association and Bear Xxxxxxx Corporate Lending Inc., as co-documentation agents, and Xxxxxx Commercial Paper Inc., as administrative agent and as collateral agent.


XXXXXXXXX L.L.C.

By:		/s/ Xxxxx Xxxxx

		Name: Xxxxx Xxxxx
		Title: Vice President

Annex A

PRICING GRID FOR REVOLVING LOANS


Consolidated Total Leverage Ratio	Applicable Margin for Eurodollar Loans		Applicable Margin for ABR Loans
Greater than or equal to 5.50 to 1.0	3.00	%	1.75	%
Greater than or equal to 4.50 to 1.0 but less than 5.50 to 1.0	2.75	%	1.50	%
Greater than or equal to 3.50 to 1.0 but less than 4.50 to 1.0	2.50	%	1.25	%
Less than or equal to 3.50 to 1.00	2.25	%	1.00	%

For the purposes of the Pricing Grid, changes in the Applicable Margin resulting from changes in the Consolidated Total Leverage Ratio shall become effective on the date (the “Adjustment Date”) that is three Business Days after the date on which financial statements are delivered to the Lenders pursuant to Section 6.1 and shall remain in effect until the next change to be effected pursuant to this paragraph. If any financial statements referred to above are not delivered within the time periods specified in Section 6.1, then, until the date that is three Business Days after the date on which such financial statements are delivered, the highest rate set forth in each column of the Pricing Grid shall apply. In addition, at all times while an Event of Default shall have occurred and be continuing, the highest rate set forth in each column of the Pricing Grid shall apply. Each determination of the Consolidated Total Leverage Ratio pursuant to the Pricing Grid shall be made in a manner consistent with the determination thereof pursuant to Section 7.1.

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CREDIT AGREEMENT among TIME WARNER TELECOM INC., TIME WARNER TELECOM HOLDINGS INC., as Borrower, The Several Lenders from Time to Time Parties Hereto, LEHMAN COMMERCIAL PAPER INC., as Administrative Agent and Collateral Agent, MORGAN STANLEY SENIOR...

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