{"id":40863,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/150-000-000-credit-agreement-anntaylor-inc-citicorp-usa.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"150-000-000-credit-agreement-anntaylor-inc-citicorp-usa","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/finance\/150-000-000-credit-agreement-anntaylor-inc-citicorp-usa.html","title":{"rendered":"$150,000,000 Credit Agreement &#8211; AnnTaylor Inc., Citicorp USA, First Union Capital Markets, Bank of America NT&#038;SA, Citibank NA, First Union National Bank and BancAmerica Robertson Stephens"},"content":{"rendered":"<pre>                         ANNTAYLOR, INC.\n                                \n                                \n        ________________________________________________\n                                \n                          $150,000,000\n                                \n                        CREDIT AGREEMENT\n                                \n                          June 30, 1998\n                                \n       __________________________________________________\n                                \n                                \n                                \n                          CITICORP USA,\n                  FIRST UNION CAPITAL MARKETS,\n                      as Syndication Agents\n                                \n     BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION,\n                         CITIBANK, N.A.,\n                   FIRST UNION NATIONAL BANK,\n                        as Issuing Banks\n                                \n                 BANCAMERICA ROBERTSON STEPHENS,\n                           as Arranger\n                                \n     BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION,\n                     as Administrative Agent\n                                \n                                \n                                \n                                \n=================================================================\n\n\n\n           CREDIT  AGREEMENT,  dated as  of  June  30,  1998  (as\namended,  supplemented  or  modified  from  time  to  time,  this\n\"Agreement\"), among ANNTAYLOR, INC., a Delaware corporation  (the\n ---------\n\"Borrower\"),   BANK  OF  AMERICA  NATIONAL  TRUST   AND   SAVINGS\n --------\nASSOCIATION (\"Bank of America\"), CITICORP USA (\"Citicorp\"), FIRST\n              ---------------                   --------\nUNION NATIONAL BANK and each other Person signatory hereto  as  a\nLender  or which from time to time becomes a Lender party  hereto\nin accordance with Section 12.01(a) (together with its respective\n                   ---------------\nsuccessors   and   assigns,   individually,   a   \"Lender\"   and,\n                                                   ------\ncollectively, the \"Lenders\"), BANCAMERICA ROBERTSON STEPHENS,  as\n                   -------\nArranger (in such capacity, the \"Arranger\"), BANK OF AMERICA,  in\n                                 --------\nits  separate  capacity as administrative agent for  the  Lenders\nhereunder   (in  such  capacity,  the  \"Administrative   Agent\"),\n                                        ----------------------\nCITICORP  and  FIRST  UNION CAPITAL MARKETS (\"First  Union\"),  in\n                                              ------------\ntheir  respective capacities as syndication agents (collectively,\nin  such  capacities,  the \"Syndication  Agents\"),  and  BANK  OF\n                            -------------------\nAMERICA, CITIBANK, N.A. and FIRST UNION NATIONAL BANK, as Issuing\nBanks.\n\n                      W I T N E S S E T H:\n                      - - - - - - - - - -\n\n           WHEREAS,  the Borrower has requested that the  Lenders\nmake  available  to  the Borrower a $150,000,000  senior  secured\nrevolving credit facility  (the \"Revolving Credit Facility\")  the\n                                 -------------------------\nproceeds  of which will be used by the Borrower for the  issuance\nof  commercial  and  standby letters of  credit  and  to  provide\nrevolving loans for other general corporate purposes; and\n\n\n           WHEREAS, the Lenders are willing to make available the\nRevolving  Credit  Facility pursuant to this Agreement  upon  the\nterms and conditions hereinafter set forth;\n\n\n           NOW,  THEREFORE, in consideration of the premises  and\nmutual  covenants  contained herein, the  parties  hereto  hereby\nagree as follows:\n\n\n                           ARTICLE I\n\n                          Definitions\n                          -----------\n\n          1.01.  Certain Defined Terms.\n                 ---------------------\n\n           The  following terms used in this Agreement shall have\nthe following meanings (such meanings to be applicable, except to\nthe  extent  otherwise indicated in a definition of a  particular\nterm,  both  to the singular and the plural forms  of  the  terms\ndefined):\n\n           \"Accommodation Obligation\", as applied to any  Person,\n            ------------------------\nshall  mean  any contractual obligation, contingent or otherwise,\nof  that  Person  with  respect  to  any  Indebtedness  or  other\nobligation   or   liability  of  another,  including   any   such\nIndebtedness,  obligation  or liability  directly  or  indirectly\nguaranteed, endorsed (otherwise than for collection or deposit in\nthe  ordinary course of business), co-made or discounted or  sold\nwith  recourse by that Person, or in respect of which that Person\nis otherwise directly or indirectly liable, including Contractual\nObligations   (contingent  or  otherwise)  arising  through   any\nagreement  to  purchase,  repurchase, or otherwise  acquire  such\nIndebtedness,  obligation or liability or any security  therefor,\nor to provide funds for the payment or discharge thereof (whether\nin   the  form  of  loans,  advances,  stock  purchases,  capital\n=================================================================\n                         -2-\n\ncontributions  or  otherwise), or to maintain  solvency,  assets,\nlevel of income, or other financial condition, or to make payment\nother than for value received.\n\n            \"Accounts\"   shall  mean,  as  to  any  Person,   any\n             --------\n\"account\", as such term is defined in Section 9-106 of  the  UCC,\nnow  or hereafter owned by such Person which is classified  as  a\nreceivable  on  a consolidated balance sheet of  such  Person  in\naccordance with GAAP.\n\n           \"Account Debtor\":  any Person that is liable  to  make\n            --------------\npayments with respect to a Credit Card Account.\n\n\n           \"Administrative Agent\" shall have the meaning ascribed\n            --------------------\nto  such  term  in the preamble and shall include  any  successor\nAdministrative Agent appointed pursuant to Section 11.09.\n                                           -------------\n\n           \"Administrative Agent's Payment Office\" shall mean the\n            -------------------------------------\naddress  for  payments  set forth on the  signature  page  hereto\nrelating to the Administrative Agent or such other address as the\nAdministrative Agent may from time to time specify in  accordance\nwith Section 12.10.\n    --------------\n\n           \"Advance  Rate\"  shall mean with respect  to  Eligible\n            -------------\nAccounts  Receivable,  75%, with respect to  Eligible  Inventory,\n65%,  and  with  respect  to Eligible  Fixed  Assets,  10%.   The\nAdministrative  Agent  may,  in its  reasonable  discretion,  but\nsubject  to  Section 12.08(a)(vi), adjust the Advance  Rate  with\nrespect to Eligible Accounts Receivable based upon an increase or\ndecrease in the dilution of the Credit Card Accounts reflected in\nthe  most  recent collateral audit performed pursuant to  Section\n7.06.\n\n           \"Affiliate\", as applied to any Person, shall mean  any\n           ----------\nother  Person directly or indirectly controlling, controlled  by,\nor  under common control with, that Person.  For purposes of this\ndefinition, \"control\" (including, with correlative meanings,  the\nterms  \"controlling\", \"controlled by\" and \"under  common  control\nwith\"),  as applied to any Person, means the possession, directly\nor indirectly, of the power to vote 10% or more of the Securities\nhaving  voting power for the election of directors of such Person\nor  otherwise to direct or cause the direction of the  management\nand  policies  of that Person, whether through the  ownership  of\nvoting  Securities or by contract or otherwise; provided that  no\n                                                --------\nfinancial  institution,  mutual fund or investment  banking  firm\nshall be an Affiliate of the Borrower unless it owns, directly or\nindirectly, at least 20% of such Securities of the Borrower.\n\n\n           \"Agent-Related Person\" shall mean Bank of America  and\n            --------------------\nany  successor  Administrative Agent pursuant to  Section  11.09,\n                                                  --------------\ntogether  with  their respective Affiliates,  and  the  officers,\ndirectors,  employees,  agents  and  attorneys-in-fact  of   such\nPersons and Affiliates.\n\n           \"Agreement\"  shall have the meaning ascribed  to  such\n            ---------\nterm in the preamble hereto.\n\n           \"AnnTaylor Finance Trust\" shall mean AnnTaylor Finance\n            -----------------------\nTrust, a Delaware statutory business trust.\n\n          \"Applicable Approved Issuance Amount\" shall mean, as to\n           -----------------------------------\neach  Issuing  Bank  (other than Bank  of  America),  the  amount\nnotified  from time to time by the Administrative Agent  to  such\nIssuing Banks.  The Applicable Approved Issuance Amount for  each\n=================================================================\n                            -3-\nsuch  Issuing Bank shall be equal unless otherwise agreed by  the\nAdministrative Agent and each such Issuing Bank.   The  aggregate\nApplicable Approved Issuance Amounts for such Issuing Banks shall\nnot at any time exceed the lesser of (i) the Commitments then  in\neffect  less  the  aggregate principal amount of all  outstanding\n        ----\nLoans and (ii) the Borrowing Base Amount then in effect less  the\n                                                        ----\naggregate principal amount of all outstanding Loans.\n\n\n          \"Applicable Lending Office\" shall mean, with respect to\n           -------------------------\neach  Lender, such Lender's Domestic Lending Office, in the  case\nof a Base Rate Loan, and such Lender's Eurodollar Lending Office,\nin the case of a Eurodollar Rate Loan.\n\n          \"Arranger\" shall have the meaning ascribed to such term\n           --------\nin the preamble.\n\n           \"Assignment  and Acceptance\" shall mean an  Assignment\n            --------------------------\nand Acceptance in the form of Exhibit 12.01 (with blanks appropri\n                              -------------\nately  filled in) delivered to the Administrative Agent  and  the\nBorrower  in connection with an assignment of a Lender's interest\nunder this Agreement pursuant to Section 12.01.\n                                 -------------\n\n           \"ATSC\"  shall  mean  AnnTaylor Stores  Corporation,  a\n            ----\nDelaware corporation.\n\n           \"ATSC  Guarantee  Agreements\" shall  mean  the  Common\n            ---------------------------\nSecurities  Guarantee  Agreement  and  the  Preferred  Securities\nGuarantee Agreement.\n\n          \"ATSC Guaranty\" shall mean the Guaranty dated as of the\n           -------------\nInitial  Funding Date substantially in the form of,  and  on  the\nterms  set  forth  in, Exhibit 4.01(a)(iv), as the  same  may  be\n                       -------------------\namended, modified or otherwise supplemented from time to time.\n\n           \"ATSC  Pledge Agreement\" shall mean the  Security  and\n            ----------------------\nPledge   Agreement   dated  as  of  the  Initial   Funding   Date\nsubstantially  in  the form of, and on the terms  set  forth  in,\nExhibit  4.01(a)(v), as the same may be amended, supplemented  or\n------------------\notherwise modified from time to time.\n\n          \"Available Cash\" shall mean, with respect to any Fiscal\n           --------------\nYear,  (a)  the sum of (i) Net Income for such Fiscal Year,  plus\n(ii)  to  the extent Net Income for such Fiscal Year  is  reduced\nthereby,   all  charges  for  amortization  of  intangibles   and\ndepreciation and other non-cash charges, plus (iii) any  decrease\n                                         ----\nin  Working Capital during such Fiscal Year minus (b) the sum  of\n(i)  Capital Expenditures during such Fiscal year plus  (ii)  any\n                                                  ----\nincrease in Working Capital during such Fiscal Year.\n\n           \"Available In-Transit Amount\" shall mean,  as  of  any\n            ---------------------------\nCalculation Date, an amount equal to (a) 65% of the  sum  of  (i)\nthe aggregate undrawn face amount of Commercial Letters of Credit\nissued to finance the purchase of Inventory (other than Inventory\nincluded  in the determination of Eligible Inventory),  and  (ii)\nthe   aggregate  Inventory  Value  of  Inventory  financed   with\nCommercial Letters of Credit which have been fully drawn and  the\nReimbursement  Obligations in respect of which  have  been  fully\npaid  so  long as, in the case of clause (i) and (ii),  (A)  such\nInventory  shall be in transit to properties owned or  leased  by\nthe  Borrower  or the Subsidiary Guarantors in the United  States\nand  (B)  such  Inventory is not included in the  calculation  of\nEligible  Inventory and, upon arrival in the United States,  will\nbe  included in the determination of the Eligible Inventory minus\n==================================================================\n                               -4-\n\n(b)  the  Stock-in-Transit  Reserve  with  respect  to  all  such\nInventory.\n\n           \"Bank  of America\" shall mean Bank of America National\n            ----------------\nTrust and Savings Association, a national banking association.\n\n           \"Bankruptcy  Code\" shall mean Title 11 of  the  United\n            ----------------\nStates  Code  (11 U.S.C Section 101 et seq.), as amended from  time  to\ntime, or any successor statute.\n\n           \"Base  Rate\"  shall mean, for any  day  a  fluctuating\n            ----------\ninterest  rate per annum equal to the higher of (a) the Reference\nRate  in effect on such day and (b) the sum of the Federal  Funds\nRate plus 0.50%.\n\n           \"Base  Rate  Loans\" shall mean all  Loans  outstanding\n            -----------------\nwhich bear interest at a rate determined by reference to the Base\nRate as provided in Section 2.02.\n                    ------------\n\n           \"Benefit  Plan\" shall mean a defined benefit  plan  as\n            -------------\ndefined  in  Section 3(35) of ERISA (other than  a  Multiemployer\nPlan)  which  the  Borrower  or  an  ERISA  Affiliate  maintains,\nadministers, contributes to or is required to contribute  to,  or\nunder  which  the Borrower or any ERISA Affiliate may  incur  any\nliability.\n\n          \"Borrower\" shall have the meaning ascribed to such term\n           --------\nin the preamble hereto.\n\n          \"Borrower Pledge Agreement\" shall mean the Security and\n           -------------------------\nPledge   Agreement   dated  as  of  the  Initial   Funding   Date\nsubstantially  in  the form of, and on the terms  set  forth  in,\nExhibit 4.01(a)(iii), as the same may be amended, supplemented or\n--------------------\notherwise modified from time to time.\n\n          \"Borrowing\" shall mean, except as otherwise provided in\n           ---------\nSection 2.07(c)(ii), a borrowing consisting of Loans of the  same\n-------------------\ntype, having the same Interest Period and made on the same day by\nthe Lenders.\n\n            \"Borrowing  Base  Amount\"  shall  mean,  as  of   any\n             -----------------------\nCalculation Date, the sum of (a) the product of (i) the  Eligible\nAccounts  Receivable Amount at such Calculation Date  times  (ii)\nthe  Advance  Rate  for  Eligible Accounts  Receivable,  (b)  the\nproduct  of (i) the Eligible Inventory Amount at such Calculation\nDate times (ii) the Advance Rate for Eligible Inventory, (c)  the\nAvailable in-Transit Amount at such Calculation Date and (d)  the\nEligible  Fixed  Asset  Amount at  such  Calculation  Date.   The\nBorrowing Base Amount as determined on any Calculation Date shall\nremain in effect until the next succeeding Calculation Date.\n\n\n           \"Borrowing Base Certificate\" shall mean a certificate,\n            --------------------------\nsubstantially  in  the form of Exhibit 6.01(o) delivered  to  the\n                               --------------\nAdministrative Agent by the Borrower pursuant to Section 6.01(o).\n                                                 ---------------\n\n           \"Business  Day\" shall mean (a) for all purposes  other\n            -------------\nthan  as covered by clause (b) below, any day excluding Saturday,\n                    ----------\nSunday and any day which is a legal holiday under the laws of the\nState  of  New York or the State of California, or is  a  day  on\n==================================================================\n                                      -5-\n\nwhich banking institutions located in either of those states  are\nrequired  or  authorized by law or other governmental  action  to\nclose  and  (b)  with  respect  to all  notices,  determinations,\nfundings and payments in connection with the Eurodollar Rate, any\nday which is a Business Day described in clause (a) and which  is\nalso  a  day  for  trading by and between  banks  in  the  London\ninterbank market.\n\n           \"Calculation Date\":  at any time, the last day of  any\n            ----------------\nperiod covered by the most recent Borrowing Base Certificate.\n\n\n          \"Capital Expenditures\" shall mean, for any period, on a\n           --------------------\nconsolidated   basis   for  the  Borrower  and   its   Restricted\nSubsidiaries, the aggregate of all expenditures (whether paid  in\ncash  or  accrued as liabilities during that period and including\nthat  portion of Capital Leases (except any capitalized interest)\nwhich  is  capitalized on the consolidated balance sheet  of  the\nBorrower and its Restricted Subsidiaries) made by the Borrower or\nany  Restricted Subsidiary during such period that, in conformity\nwith  GAAP,  are  required  to be included  in  or  reflected  by\nproperty,   plant   or  equipment  (including  expenditures   for\nequipment purchased simultaneously with the trade-in of  existing\nequipment owned by the Borrower or any such Restricted Subsidiary\nto the extent the gross amount of such purchase price exceeds the\nbook  value  of  the  equipment being traded  in,  but  excluding\nexpenditures   made  in  connection  with  the   replacement   or\nrestoration of assets, to the extent reimbursed or financed  from\ninsurance proceeds or condemnation awards).\n\n           \"Capital Lease\", as applied to any Person, shall  mean\n            -------------\nany  lease of any property (whether real, personal, or mixed)  by\nthat  Person  as  lessee  which,  in  conformity  with  GAAP,  is\naccounted  for  as a capital lease on the balance sheet  of  that\nPerson.\n\n           \"Cash  Collateral  Account\"  shall  have  the  meaning\n            -------------------------\nascribed to such term in Section 2.04.\n                         ------------\n\n           \"Cash  Equivalents\" shall mean (a)  marketable  direct\n            -----------------\nobligations  issued or unconditionally guaranteed by  the  United\nStates  Government or issued by an agency thereof and  backed  by\nthe  full  faith and credit of the United States  of  America  or\nhaving  a  rating  of  at least A-1 or P-1  from  either  S&amp;P  or\nMoody's, in each case maturing within 360 days after the date  of\nacquisition thereof; (b) marketable direct obligations issued  by\nany  state  of  the  United States of America  or  any  political\nsubdivision  of  any  such  state or any  public  instrumentality\nthereof maturing within 180 days (or, if no Loans are outstanding\nat  the  time  of  acquisition thereof and  after  giving  effect\nthereto, 360 days) after the date of acquisition thereof and,  at\nthe  time  of acquisition, having one of the two highest  ratings\nobtainable from either S&amp;P or Moody's (or, if at any time neither\nS&amp;P  nor Moody's shall be rating such obligations, then from such\nother  nationally  recognized rating services acceptable  to  the\nRequisite  Lenders) and not listed in Credit Watch  published  by\nS&amp;P; (c) commercial paper, other than commercial paper issued  by\nthe  Borrower or any Subsidiary of the Borrower or any  of  their\nAffiliates, maturing no more than 180 days (or, if no  Loans  are\noutstanding  at the time of acquisition thereof and after  giving\neffect thereto, 270 days) after the date of creation thereof and,\nat  the time of acquisition thereof, having a rating of at  least\nA-1 or P-1 from either S&amp;P or Moody's (or, if at any time neither\nS&amp;P  nor  Moody's  shall  be rating such  obligations,  then  the\nhighest  rating from other nationally recognized rating  services\nacceptable  to  the  Requisite Lenders);  and  (d)  domestic  and\nEurodollar  certificates of deposit or time deposits or  bankers'\nacceptances  maturing  within 180  days  (or,  if  no  Loans  are\noutstanding  at the time of acquisition thereof and after  giving\neffect  thereto, 360 days) after the date of acquisition  thereof\n=================================================================\n                                -6-\n\nissued  by  any commercial bank organized under the laws  of  the\nUnited States of America or any state thereof or the District  of\nColumbia  having combined capital and surplus of  not  less  than\n$500,000,000.\n\n           \"Change in Control\" shall have the meaning ascribed to\n            -----------------\nsuch term in the Subordinated Note Indenture (as in effect on the\ndate  hereof  and  as  from  time  to  time  in  effect)  or  any\nSubordinated Debt Indenture.\n\n\n           \"Claim\" shall mean any claim or demand, by any Person,\n            -----\nof   whatsoever  kind  or  nature  for  any  actual  or   alleged\nLiabilities  and Costs, whether based in contract, tort,  implied\nor express warranty, strict liability, criminal or civil statute,\nPermit, ordinance or regulation, common law or otherwise.\n\n\n\n           \"Cleandown\"  shall have the meaning ascribed  to  such\n            ---------\nterm in Section 2.01(a)(v).\n\n           \"Cleandown Period\" shall have the meaning ascribed  to\n            ----------------\nsuch term in Section 2.01(a)(v).\n             -----------------\n\n          \"Code\" shall mean the Internal Revenue Code of 1986, as\n           ----\namended from time to time, and any successor statute.\n\n\n           \"Collateral\" shall mean all property and interests  in\n            ----------\nproperty  now  owned or hereafter acquired in  or  upon  which  a\nsecurity  interest, pledge, lien or mortgage  is  granted  or  of\nwhich  a  collateral  assignment is  made  under  the  Collateral\nDocuments.\n\n\n           \"Collateral  Documents\" shall mean the ATSC  Guaranty,\n            ---------------------\nthe  ATSC  Pledge Agreement, the Borrower Pledge  Agreement,  the\nTrademark  Security  Agreement and the  Subsidiary  Guaranty  and\nCollateral Agreement, and any other document creating in favor of\nthe  Administrative  Agent, for the benefit  of  the  Lenders,  a\nsecurity   interest  in  any  property  as   security   for   the\nObligations, as any of the foregoing may be amended, supplemented\nor otherwise modified from time to time.\n\n\n           \"Commercial Letter of Credit\" shall mean any Letter of\n            ---------------------------\nCredit  which is drawable upon presentation of documents,  drafts\nat sight and time drafts evidencing the sale or shipment of goods\npurchased by the Borrower in the ordinary course of its business.\n\n\n           \"Commission\"  shall mean the Securities  and  Exchange\n            ----------\nCommission.\n\n          \"Commitment\" shall mean, with respect to each Lender as\n           ----------\nthe  context  may require, (a) the amount set out  opposite  such\nLender's name under the heading \"Commitment\" in Schedule  1.01(b)\n                                 ----------     -----------------\nor  assigned to it in accordance with Section 12.01(a),  as  such\n                                      ---------------\namount  may  be reduced or otherwise adjusted from time  to  time\npursuant to the terms of this Agreement or (b) the obligation  of\nsuch Lender to make Loans hereunder and participate in Letters of\nCredit  up  to the amount specified in the immediately  preceding\nclause (a), and \"Commitments\" shall mean the aggregate amount  of\n---------        -----------\nthe Commitments of all Lenders.\n================================================================\n                             -7-\n\n           \"Commitment  Letter\" shall mean the Commitment  Letter\n            ------------------\ndated  May  7, 1998 from Bank of America, the Arranger,  Citicorp\nand CoreStates Bank, N.A. to the Borrower.\n\n           \"Common Securities Guarantee Agreement\" shall mean the\n            -------------------------------------\nCommon  Securities Guarantee Agreement, dated  as  of  April  25,\n1996,  by  ATSC  for  the benefit of the holders  of  the  common\nsecurities of AnnTaylor Finance Trust.\n\n           \"Common Stock\" shall mean the common stock of ATSC the\n            ------------\npar  value  of  which  is set forth in the  ATSC  Certificate  of\nIncorporation,  as such certificate may be amended,  restated  or\notherwise modified from time to time.\n\n           \"Compliance  Certificate\"  shall  mean  a  certificate\n            -----------------------\nsubstantially in the form of Exhibit 6.01(d)(i) delivered to  the\n                             ------------------\nAdministrative  Agent  by  the  Borrower  pursuant   to   Section\n                                                          -------\n6.01(d)(i)  and  covering  the  Borrower's  compliance  with  the\n----------\ncovenants  contained in Article IX and certain of  the  covenants\n                        ----------\ncontained in Article VIII.\n             ------------\n\n           \"Contaminant\"  shall  mean  any  pollutant,  hazardous\n            -----------\nsubstance,  hazardous chemical, toxic substance, hazardous  waste\nor special waste, as those terms are defined in federal, state or\nlocal  laws  and  regulations, radioactive  material,  petroleum,\nincluding  crude  oil  or  any  petroleum-derived  substance,  or\nbreakdown or decomposition product thereof, or any constituent of\nany  such substance or waste, including polychlorinated biphenyls\nand asbestos.\n\n           \"Contractual  Obligation\", as applied to  any  Person,\n            -----------------------\nshall  mean any provision of any Securities issued by that Person\nor any indenture, mortgage, deed of trust, contract, undertaking,\ndocument,  instrument or other agreement or instrument  to  which\nthat Person is a party or by which it or any of its properties is\nbound,  or  to  which  it  or any of its  properties  is  subject\n(including any restrictive covenant affecting such Person or  any\nof its properties).\n\n           \"Convertible  Debentures\" shall mean  8-1\/2%  Convertible\n            -----------------------\nSubordinated   Debentures  Due  2016  issued  pursuant   to   the\nIndenture, dated as of April 15, 1996, between ATSC and the  Bank\nof New York, as Trustee.\n\n          \"Cost\/Market Reserve\" shall mean, as of any Calculation\n           -------------------\nDate,  the  lower of cost or market reserve for the  most  recent\nfiscal   month  calculated  in  accordance  with  the  accounting\npractices of the Borrower and the Subsidiary Guarantors.\n\n\n            \"Credit  Card  Accounts\":   all  accounts  receivable\n             ----------------------\narising  out  of  any  sale in the ordinary  course  of  business\npursuant to proprietary credit card transactions.\n\n\n           \"Credit  Facility\" shall mean the loan and  letter  of\n            ----------------\ncredit  facility  provided  to  the  Borrower  pursuant  to  this\nAgreement.\n\n           \"Current  Assets\"  shall  mean,  as  at  any  date  of\n            ---------------\ndetermination,  the consolidated assets of the Borrower  and  its\nRestricted  Subsidiaries  which may  properly  be  classified  as\ncurrent assets in conformity with GAAP.\n\n================================================================\n                             -8-\n\n           \"Current  Liabilities\" shall mean, as at any  date  of\n            --------------------\ndetermination, the consolidated liabilities of the  Borrower  and\nits  Restricted Subsidiaries which may properly be classified  as\ncurrent liabilities in conformity with GAAP.\n\n          \"Customary Permitted Liens\" shall mean\n           -------------------------\n\n           (a)    Liens (other than Environmental Liens  and  any\nLien  imposed  under  ERISA) for claims,  taxes,  assessments  or\ncharges  of any Governmental Authority not yet due or  which  are\nbeing contested in good faith by appropriate proceedings and with\nrespect   to   which  adequate  reserves  or  other   appropriate\nprovisions are being maintained in accordance with GAAP;\n\n\n           (b)   statutory Liens of landlords, bankers, carriers,\nwarehousemen, mechanics, materialmen and other Liens (other  than\nany  Lien imposed under ERISA or any Environmental Lien)  imposed\nby  law,  arising  in  the ordinary course of  business  and  for\namounts which (i) are not yet due, (ii) are not more than 30 days\npast  due as long as no notice of default has been given or other\naction taken to enforce such Liens, or (iii)(A) are not more than\n30  days past due and a notice of default has been given or other\naction taken to enforce such Liens, or (B) are more than 30  days\npast  due,  and,  in  the case of clause (A) or  (B),  are  being\n                                  ----------     ---\ncontested  in  good  faith by appropriate proceedings  which  are\nsufficient to prevent imminent foreclosure of such Liens and with\nrespect   to   which  adequate  reserves  or  other   appropriate\nprovisions are being maintained in accordance with GAAP;\n\n\n          (c)   Liens (other than any Lien imposed under ERISA or\nany Environmental Lien) incurred or deposits made in the ordinary\ncourse  of business (including surety bonds and appeal bonds)  in\nconnection with workers' compensation, unemployment insurance and\nother  types  of employment benefits or to secure the performance\nof  tenders,  bids, leases, contracts (other than in  respect  of\nIndebtedness),   statutory   obligations   and   other    similar\nobligations  or  arising as a result of progress  payments  under\ngovernment contracts;\n\n\n            (d)     easements   (including  reciprocal   easement\nagreements  and  utility  agreements), rights-of-way,  covenants,\nconsents,   rights  of  landlords,  reservations,  encroachments,\nvariations   and  other  restrictions,  charges  or  encumbrances\n(whether  or  not recorded) affecting the use of  real  property,\nwhich  do  not materially interfere with the ordinary conduct  of\nthe business of the Borrower; and\n\n\n           (e)    Liens on goods in favor of customs and  revenue\nauthorities  arising  as a matter of law  to  secure  payment  of\ncustoms duties in connection with the importation of such goods.\n\n\n           \"DOL\" shall mean the United States Department of Labor\n            ---\nand any successor department or agency.\n\n\n           \"Dollars\" and \"$\" shall mean the lawful money  of  the\n            -------       -\nUnited States of America.\n\n\n           \"Domestic Lending Office\" means, with respect  to  any\n            -----------------------\nLender,  the  office of such Lender specified  as  its  \"Domestic\n                                                         --------\nLending  Office\"  in  Schedule 1.01(a) or in the  Assignment  and\n---------------       ----------------\nAcceptance  by which it became a Lender or such other  office  of\nsuch  Lender as such Lender may from time to time specify to  the\nBorrower and the Administrative Agent.\n\n=================================================================\n                               -9-\n\n\n           \"EBITDA\"  shall mean, for any period, the sum  of  the\n            ------\namounts  for  such period, of (a) Net Income,  plus  (b)  to  the\n                                               ----\nextent  Net  Income  is  reduced  thereby  (i)  all  charges  for\namortization  of  intangibles  and  depreciation,  (ii)  Interest\nExpense, (iii) income tax expense and (iv) extraordinary  losses,\nminus (c) extraordinary gains (net of taxes).\n-----\n\n           \"EBITR\"  shall mean, for any period, the  sum  of  the\n            -----\namounts  for  such period, of (a) Net Income,  plus  (b)  to  the\n                                               ----\nextent  Net Income is reduced thereby (i) Interest Expense,  (ii)\nincome  tax  expense  and (iii) extraordinary  losses,  plus  (c)\n                                                        ----\nRental Expense, minus (d) extraordinary gains (net of taxes).\n\n\n           \"Eligible Accounts Receivable\" shall mean, as  of  any\n            ----------------------------\nCalculation  Date, all Credit Card Accounts of the  Borrower  and\nthe  Subsidiary  Guarantors that satisfy each  of  the  following\ncriteria:\n\n\n                (a) such Credit Card Account has been adjusted to\n          reflect the return or rejection of, or any loss  of  or\n          damage  to  any of the Inventory giving  rise  to  such\n          Credit  Card Account, and is not subject to  bona  fide\n          set-offs, counterclaims, defenses, or disputes asserted\n          with respect to such Credit Card Account;\n\n\n                (b) to the best knowledge of the Borrower and the\n          Subsidiary Guarantors, the Account Debtor with  respect\n          to  such  Credit Card Account is not insolvent  or  the\n          subject of any bankruptcy case or insolvency proceeding\n          of  any  kind, unless such Credit Card Account  is  due\n          from  such  Account  Debtor as an administrative  claim\n          under the Bankruptcy Code and the Administrative Agent,\n          in  the  exercise of its reasonable business  judgment,\n          deems the Account Debtor to be creditworthy;\n\n\n                 (c) the Account Debtor in respect of such Credit\n          Card  Account has a mailing address within  the  United\n          States of America (excluding the Virgin Islands and any\n          other territory of the United States) or Puerto Rico;\n\n\n                 (d) the Account Debtor in respect of such Credit\n          Card Account is not the United States of America or any\n          state,  territory, subdivision, department,  or  agency\n          thereof;\n\n\n                 (e) such Credit Card Account does not arise  out\n          of  transactions with a Subsidiary or Affiliate  (other\n          than directors, officers and employees) of the Borrower\n          or any Subsidiary Guarantor;\n\n\n                 (f)  no amount payable in respect of such Credit\n          Card Account has remained unpaid for a period exceeding\n          sixty  days  after the due date stated on the  customer\n          statement therefor;\n\n\n                 (g)  such  Credit Card Account  is  owed  by  an\n          Account Debtor which does not then have balances on its\n          Credit  Card Accounts which are more than 60 days  past\n          due  which exceed 50% of the total balance of all  such\n          Credit Card Accounts owed by such Account Debtor;\n\n=================================================================\n                             -10-\n\n\n                 (h) such Credit Card Account has not been and is\n          not  required  to  be charged off  or  written  off  as\n          uncollectible in accordance with the customary business\n          practice of the Borrower and the Subsidiary Guarantors;\n\n\n                 (i) such Credit Card Account does not arise  out\n          of  any  claim  in  tort, is not evidenced  by  chattel\n          paper,  a promissory note, a negotiable instrument,  or\n          any  other  instrument of any kind or, if  such  Credit\n          Card   Account  is  evidenced  by  chattel   paper,   a\n          promissory note, a negotiable instrument or  any  other\n          instrument,   such  chattel  paper,  promissory   note,\n          negotiable  instrument  or other  instrument  has  been\n          delivered to the Administrative Agent and is subject to\n          a  first  priority security interest in  favor  of  the\n          Administrative Agent;\n\n\n                 (j)  the amount of the face value of such Credit\n          Card  Account  listed on any schedule  of  Credit  Card\n          Accounts and shown on all customer statements delivered\n          to the Administrative Agent with respect to such Credit\n          Card  Account is not subject to any asserted bona  fide\n          retainages  or holdbacks of any type, is  actually  and\n          absolutely  owing,  and  is  not  contingent   on   any\n          condition,  in  each  case, other than  in  respect  of\n          repurchase or return agreements that (i) arise  in  the\n          ordinary course of the Borrower's business and (ii) are\n          consistent   with  the  Borrower  or  such   Subsidiary\n          Guarantor's historical business practice;\n\n\n                 (k) such Credit Card Account does not arise  out\n          of a cash on delivery sale;\n\n\n                 (l) such Credit Card Account does not arise  out\n          of the sale of samples;\n\n\n                 (m)  such Credit Card Account is owned solely by\n          the Borrower or a Subsidiary Guarantor and is evidenced\n          by a customer statement and has arisen from the sale of\n          goods  which  have  been shipped  or  delivered  to  an\n          Account Debtor on an absolute sale basis, have not been\n          shipped  or  delivered on a consignment,  approval,  or\n          sale-or-return  basis,  and  are  not  subject  to  any\n          repurchase  or  return agreement or arrangement,  other\n          than   those   repurchase  or  return   agreements   or\n          arrangements that (i) arise in the ordinary  course  of\n          the  Borrower's  business and (ii) are consistent  with\n          the  Borrower or such Subsidiary Guarantor's historical\n          business practices; and\n\n\n                (n) such Credit Card Account is subject to a Lien\n          in favor of the Administrative Agent and is not subject\n          to Liens other than Permitted Account Liens.\n\n\nThe  Administrative  Agent  may, in  its  reasonable  discretion,\nadjust  or  change  the  foregoing eligibility  criteria  or  add\nadditional  reserves with respect to Eligible Accounts Receivable\nbased  upon  the  results  of the most  recent  collateral  audit\nperformed pursuant to Section 7.06.\n\n\n          \"Eligible Accounts Receivable Amount\" shall mean, as of\n           -----------------------------------\nany  Calculation  Date, (a) Eligible Accounts Receivable  of  the\nBorrower  and the Subsidiary Guarantors at such Calculation  Date\nminus (b) the Sales Tax Reserve at such Calculation Date.\n-----\n=================================================================\n                              -11-\n\n\n\n            \"Eligible  Assignee\"  means  (a)  a  commercial  bank\n             ------------------\norganized  under  the  laws of the United States,  or  any  state\nthereof,  and having a combined capital and surplus of  at  least\n$100,000,000; (b) a commercial bank organized under the  laws  of\nany  other  country  which is a member of  the  Organization  for\nEconomic Cooperation and Development (the \"OECD\"), or a political\n                                           ----\nsubdivision  of  any such country, and having a combined  capital\nand surplus of at least $100,000,000, provided that such bank  is\nacting through a branch or agency located in the United States of\nAmerica;  (c) a Person that is primarily engaged in the  business\nof  commercial banking and that is (i) a Subsidiary of a  Lender,\n(ii)  a Subsidiary of a Person of which a Lender is a Subsidiary,\nor  (iii) a Person of which a Lender is a Subsidiary; and (d) any\nPerson that in the ordinary course of business extends credit  or\npurchases  loans  of  a character substantially  similar  to  the\nLoans.\n\n\n            \"Eligible  Fixed  Assets\"  shall  mean,  as  of   any\n             -----------------------\nCalculation  Date,  the  net  book value  of  all  furniture  and\nfixtures  (excluding leasehold improvements) of the Borrower  and\nthe Subsidiary Guarantors as set forth on the most recent balance\nsheet  of the Borrower and the Subsidiary Guarantors prepared  in\naccordance  with GAAP, which are subject to a perfected  security\ninterest in favor of the Administrative Agent and are subject  to\nno  other  Liens  other than Permitted Fixed  Asset  Liens.   The\nAdministrative  Agent  may,  in its  reasonable  discretion,  add\nadditional  eligibility  criteria or  reserves  with  respect  to\nEligible  Fixed Assets based upon the results of the most  recent\ncollateral audit performed pursuant to Section 7.06.\n\n\n           \"Eligible Fixed Asset Amount\" shall mean,  as  of  any\n            ---------------------------\nCalculation  Date, the Eligible Fixed Assets of the Borrower  and\nthe  Subsidiary  Guarantors at such Calculation  Date  times  the\nAdvance Rate for Eligible Fixed Assets.\n\n\n           \"Eligible  Inventory Amount\" shall  mean,  as  of  any\n            --------------------------\nCalculation  Date,  (a)  the  Inventory  Value  of  all  Eligible\nInventory of the Borrower and the Subsidiary Guarantors  at  such\nCalculation  Date  minus (b) the sum of (i) the Gift  Certificate\n                   -----\nLiability   Amount  as  of  such  Calculation  Date,   (ii)   the\nMerchandise Credit Amount as of such Calculation Date, (iii)  the\nCost\/Market Reserve as of such Calculation Date, (iv) the  Shrink\nReserve  as of such Calculation Date, and (v) the Positive  Price\nVariance Reserve as of such Calculation Date.\n\n\n           \"Eligible Inventory\" shall mean, as of the Calculation\n            ------------------\nDate, all Inventory of the Borrower and the Subsidiary Guarantors\nconsisting  of  finished goods available for sale that  satisfies\neach of the following criteria as of such day:\n\n\n                 (a)   such Inventory (i) is owned solely by  the\n          Borrower or any such Subsidiary Guarantor and  (ii)  is\n          not  leased by or on consignment to the Borrower or any\n          Subsidiary Guarantor;\n\n\n                 (b)   such Inventory is located at property that\n          is  owned  or leased by the Borrower or any  Subsidiary\n          Guarantor, including Inventory which is in transit from\n          one property that is owned or leased by the Borrower or\n          any Subsidiary Guarantor (or a flow through center or a\n          distribution center) to another property that is  owned\n          or  leased  by the Borrower or any Subsidiary Guarantor\n          (or a flow through center or a distribution center);\n\n==================================================================\n                              -12-\n\n                 (c)   such Inventory is not subject to a layaway\n          purchase by any customer;\n\n\n                 (g)  such Inventory is not located at any return\n          center   used   by  the  Borrower  or  any   Subsidiary\n          Guarantor;\n\n\n                 (h)   such  Inventory is located in  the  United\n          States   of   America   (excluding   territories    and\n          possessions thereof) and Puerto Rico; and\n\n\n                 (i)   such  Inventory is subject to a  perfected\n          security interest in favor of the Administrative  Agent\n          and  is  not  subject  to Liens  other  than  Permitted\n          Inventory Liens.\n\n\nThe  Administrative  Agent  may, in  its  reasonable  discretion,\nadjust  or  change  the  foregoing eligibility  criteria  or  add\nadditional reserves with respect to Eligible Inventory based upon\nthe  results  of  the  most  recent  collateral  audit  performed\npursuant to Section 7.06.\n\n\n           \"Environmental Lien\" shall mean a Lien in favor of any\n            ------------------\nGovernmental Authority for (a) any liability of the  Borrower  or\nany   Subsidiary   of  the  Borrower  under  federal   or   state\nenvironmental  laws or regulations, or (b) damages arising  from,\nor  costs incurred by such Governmental Authority in response to,\na  Release  or  threatened  Release of  a  Contaminant  into  the\nenvironment.\n\n\n           \"ERISA\"  shall  mean  the Employee  Retirement  Income\n            -----\nSecurity  Act  of  1974, as amended from time to  time,  and  any\nsuccessor statute.\n\n\n           \"ERISA Affiliate\" shall mean any (a) corporation which\n            ---------------\nis  a member of the same controlled group of corporations (within\nthe meaning of Section 414(b) of the Code) as the Borrower or any\nof  its  Subsidiaries, (b) partnership or other trade or business\n(whether  or  not incorporated) under common control (within  the\nmeaning of Section 414(c) of the Code) with the Borrower  or  any\nof  its  Subsidiaries,  and (c) member  of  the  same  affiliated\nservice group (within the meaning of Section 414(m) of the  Code)\nas  the  Borrower  or  any of its Subsidiaries,  any  corporation\ndescribed  in  clause (a) above or any partnership  or  trade  or\nbusiness described in clause (b) above.\n\n\n           \"Eurodollar Lending Office\" means, with respect to any\n            -------------------------\nLender,  the  office of such Lender specified as its  \"Eurodollar\n                                                       ----------\nLending  Office\"  in  Schedule 1.01(a) or in the  Assignment  and\n---------------       ----------------\nAcceptance by which it became a Lender (or, if no such office  is\nspecified, its Domestic Lending Office) or such other  office  of\nsuch  Lender  as  such Lender may from time to  time  specify  by\nwritten notice to the Borrower and the Administrative Agent.\n\n\n           \"Eurodollar  Rate\"  shall mean, with  respect  to  any\n            ----------------\nInterest  Period  applicable to a Borrowing  of  Eurodollar  Rate\nLoans,   an   interest   rate  per  annum   determined   by   the\nAdministrative Agent by dividing (a) the rate (rounded upward  to\nthe  next  1\/16th  of  1%) of interest per  annum  given  to  the\nAdministrative Agent by the Reference Bank as the rate  at  which\ndollar  deposits  for  such Interest  Period  and  in  an  amount\napproximately  equal  to  the  amount  of  the  Reference  Bank's\nEurodollar Rate Loan during such Interest Period would be offered\nby its applicable Eurodollar Lending Office to major banks in the\nLondon eurodollar market at or about 11:00 a.m. (London time) two\n=================================================================\n                            -13-\n\nBusiness  Days prior to the commencement of such Interest  Period\nby  (b)  a  percentage  equal to 1 minus the  Eurodollar  Reserve\n                                   -----\nPercentage.\n\n\n            \"Eurodollar  Rate  Loans\"  shall  mean  those   Loans\n             -----------------------\noutstanding which bear interest at a rate determined by reference\nto the Eurodollar Rate as provided in Section 2.02.\n                                      ------------\n\n\n          \"Eurodollar Reserve Percentage\" shall mean with respect\n           -----------------------------\nto any Interest Period for any Eurodollar Rate Loan, that percent\nage  (expressed  as  a  decimal rounded upwards  to  the  nearest\n1\/100%)  which is in effect on the date the Eurodollar  Rate  for\nsuch  Interest Period is determined as prescribed by the  Federal\nReserve  Board,  for determining the maximum reserve  requirement\n(including any emergency, supplemental or other marginal  reserve\nrequirement) for a member bank of the Federal Reserve System with\ndeposits  exceeding  $5,000,000,000 in respect  of  \"Eurocurrency\nliabilities\" having a term equal to such Interest Period  (or  in\nrespect  of  any  other  category of liabilities  which  includes\ndeposits  by  reference to which the interest rate on  Eurodollar\nRate  Loans is determined or any category of extensions of credit\nor  other  assets  which includes loans by  a  non-United  States\noffice of any bank to United States residents).\n\n\n           \"Event  of  Default\" shall mean any of the occurrences\n            ------------------\nset forth in Section 10.01 after the expiration of any applicable\n             -------------\ngrace period expressly provided therein.\n\n\n           \"Existing  Credit  Agreement\" means  the  Amended  and\n            ---------------------------\nRestated  Credit Agreement dated as of September 29,  1995  among\nAnnTaylor,  Inc.,  Bank  of  America  and  Fleet  Bank,  National\nAssociation,   as   Co-Agents,  BancAmerica  Robertson   Stephens\n(formerly  known  as BA Securities, Inc.), as Arranger,  Bank  of\nAmerica,  as  Agent,  and  the  financial  institutions   parties\nthereto, as amended.\n\n\n           \"Existing Letter of Credit\" shall mean each Letter  of\n            -------------------------\nCredit identified in Schedule 3.01.\n                     -------------\n\n\n           \"Extension Period\" shall have the meaning ascribed  to\n            ----------------\nsuch term in Section 2.01(f).\n             ---------------\n\n            \"FDIC\"  shall  mean  the  Federal  Deposit  Insurance\n             ----\nCorporation or any successor thereto.\n\n\n           \"Federal Funds Rate\" shall mean, for any day, the rate\n            ------------------\nset  forth  in  the  weekly  statistical  release  designated  as\nH.15(519), or any successor publication, published by the Federal\nReserve  Board  (including any such successor,  \"H.15(519)\")  for\n                                                 ---------\nsuch day opposite the caption \"Federal Funds (Effective)\".  If on\n                               ------------------------\nany relevant day such rate is not yet published in H.15(519), the\nrate  for  such  day  will be the rate set  forth  in  the  daily\nstatistical  release  designated  as  the  Composite  3:30   p.m.\nQuotations  for  U.S.  Government Securities,  or  any  successor\npublication, published by the Federal Reserve Bank  of  New  York\n(including   any  such  successor,  the  \"Composite   3:30   p.m.\n                                          ----------------------\nQuotation\")  for  such  day  under  the  caption  \"Federal  Funds\n---------                                          --------------\nEffective Rate\".  If on any relevant day the appropriate rate for\n--------------\nsuch previous day is not yet published in either H.15(519) or the\nComposite 3:30 p.m. Quotations, the rate for such day will be the\narithmetic mean as determined by the Administrative Agent of  the\nrates  for  the  last  transaction  in  overnight  Federal  funds\narranged prior to 9:00 a.m. (New York time) on that day  by  each\nof  three  leading brokers of Federal funds transactions  in  New\nYork City selected by the Administrative Agent.\n==================================================================\n                           -14-\n\n\n           \"Federal Reserve Board\" shall mean the Board of  Gover\n            ---------------------\nnors  of the Federal Reserve System or any Governmental Authority\nsucceeding to its functions.\n\n\n           \"Fee  Letter\" shall mean the Fee Letter dated  May  7,\n            -----------\n1998  between  the  Borrower,  Bank  of  America,  the  Arranger,\nCiticorp and CoreStates Bank, N.A.\n\n\n          \"Final Maturity Date\" shall mean June 30, 2000, as such\n           -------------------\ndate may be extended pursuant to Section 2.01(f).\n                                 ---------------\n\n\n           \"Fiscal  Year\"  shall  mean the  fiscal  year  of  the\n            ------------\nBorrower,  which shall be the twelve-month period ending  on  the\nSaturday closest to January 31 in each year or such other  period\nas  the  Borrower  may  designate and the Requisite  Lenders  may\napprove  (such  approval  not  to be  unreasonably  withheld)  in\nwriting.   A  Fiscal Year ending in January or February,  as  the\ncase  may  be,  of  any calendar year shall  have  the  numerical\ndesignation of the prior calendar year.\n\n\n           \"Fixed  Charge  Coverage Ratio\" shall  mean,  for  any\n            -----------------------------\nperiod,  the quotient obtained by dividing (a) EBITR by  (b)  the\nsum of (i) Interest Expense plus (ii) Rental Expense.\n                            ----\n\n\n           \"Foreign Currency Exchange Contracts\" shall  mean  any\n            -----------------------------------\nforeign  currency  exchange agreement or other currency  exchange\nrate  arrangement  providing currency exchange  rate  protection,\nentered  into  by  the Borrower, ATSC or any of their  respective\nRestricted Subsidiaries.\n\n\n           \"Foreign Subsidiary\" shall mean any Subsidiary of  the\n            ------------------\nBorrower organized under the laws of any jurisdiction outside the\nUnited States of America.\n\n\n           \"Funded  Debt\" shall mean, as at any date of determina\n            ------------\ntion, all Indebtedness then outstanding (a) for the principal  of\nLoans  under this Agreement and (b) for money borrowed  or  under\nany  debt  Securities issued by ATSC (other than the  Convertible\nDebentures),  the Borrower or any Restricted Subsidiary  (whether\nor  not subordinated, and specifically including the Subordinated\nNotes or any Subordinated Debt).\n\n\n           \"Funding  Date\" shall mean the date of  borrowing  any\n            -------------\nLoan.\n\n\n           \"GAAP\" shall mean generally accepted accounting princi\n            ----\nples  set  forth  in  the  opinions  and  pronouncements  of  the\nAccounting   Principles  Board  of  the  American  Institute   of\nCertified Public Accountants and statements and pronouncements of\nthe  Financial  Accounting Standards  Board,  or  in  such  other\nstatements  by  such other entity as may be  in  general  use  by\nsignificant  segments  of the accounting  profession,  which  are\napplicable to the circumstances as of the date of determination.\n\n\n           \"Gift Certificate Liability Amount\" shall mean, as  of\n            ---------------------------------\nany  Calculation Date, the aggregate amount of gift  certificates\nthen  outstanding entitling the holder thereof to use  all  or  a\nportion thereof to pay all or a portion of the purchase price for\nany  Inventory  as  of  such day which are  not  being  held  for\nescheatment or which have not been escheated as of such day.\n\n\n           \"Governmental Acts\" shall have the meaning ascribed to\n            -----------------\nssuch term in Section  3.09(a).\n              ----------------\n==================================================================\n                             -15-\n           \"Governmental Authority\" shall mean any nation, state,\n            ----------------------\nsovereign, or government, any federal, regional, state, local  or\npolitical   subdivision  and  any  entity  exercising  executive,\nlegislative, judicial, regulatory or administrative functions  of\nor pertaining to government.\n\n           \"Guarantors\"  shall  mean  ATSC  and  each  Restricted\n            ----------\nSubsidiary  (other  than  Foreign  Subsidiaries  and  Nonmaterial\nDomestic Subsidiaries) of the Borrower.\n\n           \"HKSB  Facility\" shall mean the Amended  and  Restated\n            --------------\nCredit  Agreement,  dated as of September 20, 1996,  as  amended,\nbetween  AnnTaylor  Global Sourcing, Inc. and  The  Hongkong  and\nShanghai Banking Corporation Limited.\n\n           \"Indebtedness\", as applied to any Person,  shall  mean\n            ------------\n(a)  all  indebtedness, obligations or other liabilities of  such\nPerson  for borrowed money or under any debt Securities,  whether\nor   not  subordinated,  (b)  all  obligations  with  respect  to\nredeemable  stock and redemption or repurchase obligations  under\nany  equity  securities  or profit payment  agreements,  (c)  all\nreimbursement  obligations and other liabilities of  such  Person\nwith  respect  to  letters  of credit issued  for  such  Person's\naccount,  (d) all obligations of such Person to pay the  purchase\nprice of property or services, except trade payables incurred  by\nsuch  Person  in  the  ordinary course of business  as  presently\nconducted,  (e) all obligations in respect of Capital  Leases  of\nsuch  Person,  (f) all Accommodation Obligations of such  Person,\n(g)  all  indebtedness, obligations or other liabilities of  such\nPerson  or others secured by a Lien on any asset of such  Person,\nwhether or not such indebtedness, obligations or liabilities  are\nassumed by or are a personal liability of such Person, all as  of\nsuch  time,  and  (h)  all  indebtedness,  obligations  or  other\nliabilities  in  respect of Interest Rate Contracts  and  Foreign\nCurrency   Exchange  Agreements.   For  purposes  of  determining\nIndebtedness,  the \"principal amount\" of the obligations  of  the\nBorrower  or  any  Subsidiary in respect  of  any  Interest  Rate\nContract or Foreign Currency Exchange Agreement at any time shall\nbe  the  maximum aggregate amount (giving effect to  any  netting\nagreements)  that  the  Borrower  or  such  Subsidiary  would  be\nrequired to pay if such Contract or Agreement were terminated  at\nsuch time.\n\n           \"Initial Funding\" shall mean the funding of  Loans  on\n            ---------------\nthe Initial Funding Date.\n\n           \"Initial  Funding Date\" shall mean  the  date  (on  or\n            ---------------------\nbefore July 29, 1998) on which all conditions precedent set forth\nin Section 4.01 have been satisfied or waived.\n   ------------\n\n          \"Initial Loans\" shall have the meaning ascribed to such\n           -------------\nterm in Section 4.01.\n        ------------\n\n          \"Interest Expense\" shall mean, for any period for ATSC,\n           ----------------\nthe  Borrower  and its Restricted Subsidiaries on a  consolidated\nbasis,  total  consolidated interest  expense,  whether  paid  or\naccrued  (including any amortization of discount and the interest\ncomponent of Capital Leases), for such period, including  to  the\nextent  included in interest expense, all commissions,  discounts\nand  other  fees and charges owed with respect to the letters  of\ncredit, the fees payable under this Agreement and net costs under\nInterest  Rate  Contracts, all as determined in  conformity  with\nGAAP,  plus (without duplication) all capitalized interest, minus\n       ----                                                 -----\npayments  received  under Interest Rate  Contracts  and  interest\nincome.\n\n=================================================================\n                           -16-\n\n           \"Interest Payment Date\" shall mean with respect to any\n            ---------------------\nEurodollar  Rate  Loan,  the last day  of  each  Interest  Period\napplicable to such Loan; provided that in the case of an Interest\n                         --------\nPeriod  of  six months or longer, \"Interest Payment  Date\"  shall\n                                   ----------------------\nalso  include each date that is a three-month anniversary of  the\nfirst day of such Interest Period.\n\n\n           \"Interest  Period\" shall have the meaning ascribed  to\n            ----------------\nsuch term in Section 2.06.\n             ------------\n\n           \"Interest  Rate  Contracts\" shall mean  interest  rate\n            -------------------------\nexchange,  collar,  cap or similar agreements providing  interest\nrate  protection, entered into by the Borrower, ATSC  or  any  of\ntheir respective Restricted Subsidiaries.\n\n            \"Inventory\"  shall  mean,  as  to  any  Person,   any\n             ---------\n\"inventory\"  as such term is defined in Section 9-109(4)  of  the\nUCC, now or hereafter owned by such Person.\n\n           \"Inventory  Value\"  shall mean, with  respect  to  any\n            ----------------\nInventory of the Borrower or any Subsidiary Guarantor, the  value\nof  such Inventory valued at cost on a basis consistent with  the\nBorrower's  or such Subsidiary Guarantor's current and historical\naccounting   practice  (without  giving  effect   to   markdowns,\nintercompany  profit,  rebates  and  discounts  and   capitalized\ninventory costs on the consolidated balance sheet of the Borrower\nand the Subsidiary Guarantors in respect of Inventory (other than\ncapitalized costs recorded in accordance with GAAP)).\n\n           \"Investment\" shall mean, as applied to any Person, any\n            ----------\ndirect  or indirect purchase or other acquisition by that  Person\nof  Securities, or of a beneficial interest in Securities, of any\nother  Person,  and any direct or indirect loan,  advance  (other\nthan   deposits   with  financial  institutions   available   for\nwithdrawal on demand, prepaid expenses, advances to employees and\nsimilar  items  made  or  incurred  in  the  ordinary  course  of\nbusiness),  or capital contribution by such Person to  any  other\nPerson,  including  all Indebtedness and accounts  owed  by  that\nother  Person which are not current assets or did not arise  from\nsales  of goods or services to that Person in the ordinary course\nof business.  The amount of any Investment shall be determined in\nconformity with GAAP.\n\n           \"Investor  Group\"  shall mean  Merrill  Lynch  Capital\n            ---------------\nPartners, Inc. and its Affiliates.\n\n           \"IRS\"  shall mean the Internal Revenue Service of  the\n            ---\nUnited  States  or any Governmental Authority succeeding  to  the\nfunctions thereof.\n\n           \"Issuing Banks\" shall mean First Union National  Bank,\n            -------------\nCitibank, N.A. and Bank of America (as to any Existing Letters of\nCredit issued by it).\n\n\n          \"Issuing Bank Agreement\" shall mean, as to each Issuing\n           ----------------------\nBank (other than Bank of America), any agreement entered into  by\nsuch Issuing Bank and the Borrower relating to Letters of Credit.\n\n           \"Lender\" shall have the meaning ascribed to such  term\n            ------\nin  the  preamble  and  shall include Bank  of  America,  in  its\nindividual capacity, each Issuing Bank and each Person  which  at\nany time becomes a Lender pursuant to Section 12.01(a).\n                                      ----------------\n==================================================================\n                             -17-\n\n           \"Letter of Credit\" shall mean any Commercial Letter of\n            ----------------\nCredit or any Standby Letter of Credit issued by any Issuing Bank\nfor  the  account  of the Borrower pursuant to  Article  III  and\nincludes each Existing Letter of Credit.\n\n           \"Letter of Credit Fee\" shall have the meaning ascribed\n            --------------------\nto such term in Section 2.03(d).\n                ---------------\n\n           \"Letter  of  Credit Obligations\" shall  mean,  at  any\n            ------------------------------\nparticular time, the sum of (a) Reimbursement Obligations and (b)\nthe aggregate maximum amount then available for drawing under the\nLetters of Credit.\n\n           \"Level  I  Status\" exists at any date if  the  Pricing\n            ----------------\nRatio on such date is greater than or equal to 3.25 to 1.00.\n\n\n           \"Level  II  Status\" exists at any date if the  Pricing\n            -----------------\nRatio on such date is less than 3.25 to 1.00 but greater than  or\nequal to 2.50 to 1.00.\n\n           \"Level  III Status\" exists at any date if the  Pricing\n            -----------------\nRatio on such date is less than 2.50 to 1.00 but greater than  or\nequal to 1.75 to 1.00.\n\n           \"Level  IV  Status\" exists at any date if the  Pricing\n            -----------------\nRatio on such date is less than 1.75 to 1.00.\n\n           \"Liabilities  and Costs\" shall mean  all  liabilities,\n            ----------------------\nclaims,  obligations, responsibilities, losses, damages, punitive\ndamages,  consequential damages, treble damages,  charges,  costs\nand  expenses (including attorney's, expert's and consulting fees\nand  costs  of  investigation  and feasibility  studies),  fines,\npenalties  and monetary sanctions, interest, direct or  indirect,\nknown  or  unknown,  absolute  or contingent,  past,  present  or\nfuture.\n\n           \"Lien\" shall mean any mortgage, deed of trust, pledge,\n            ----\nhypothecation,   assignment,   deposit   arrangement,    security\ninterest,  encumbrance (including, but not limited to, easements,\nrights   of  way  and  the  like),  lien  (statutory  or  other),\nEnvironmental  Lien, security agreement or transfer  intended  as\nsecurity, including any conditional sale or other title retention\nagreement,  the interest of a lessor under a Capital  Lease,  any\nfinancing lease having substantially the same economic effect  as\nany  of  the foregoing, and the filing of any financing statement\n(other than a financing statement filed pursuant to Section 9-408\nof the Uniform Commercial Code not intended as security).\n\n\n           \"Loan Account\" shall have the meaning ascribed to such\n            ------------\nterm in Section 2.01(d).\n        --------------\n\n            \"Loan  Documents\"  shall  mean  this  Agreement,  the\n             ---------------\nCollateral  Documents  and the Letters of Credit  and  all  other\nagreements  delivered to the Administrative  Agent,  the  Issuing\nBanks  or  any  Lender  by  or  on  behalf  of  the  Borrower  in\nsatisfaction of the requirements of this Agreement.\n\n           \"Loan  Party\"  shall mean ATSC, the Borrower  and  any\n            -----------\nRestricted Subsidiary which is a party to any Loan Document.\n=================================================================\n                           -18-\n\n\n          \"Loans\" shall have the meaning ascribed to such term in\n           -----\nSection 2.01(a).\n--------------\n\n           \"Margin Stock\" shall have the meaning ascribed to such\n            ------------\nterm in Regulation U.\n\n           \"Material Adverse Effect\" shall mean, with respect  to\n            -----------------------\nthe  Borrower, ATSC and its Restricted Subsidiaries,  a  material\nadverse  effect  upon the business, assets or  other  properties,\nliabilities  or  condition (financial or otherwise),  results  of\noperations  or  prospects  of  the Borrower  and  its  Restricted\nSubsidiaries taken as a whole or ATSC and its Subsidiaries  taken\nas  a whole, as the case may be, upon the ability of the Borrower\nto  repay  the  Loans,  or  upon the  benefits  provided  to  the\nAdministrative   Agent  or  the  Lenders  under  the   Collateral\nDocuments.\n\n           \"Maximum  Loan Amount\" shall mean, at  any  time,  the\n            --------------------\nlesser  of  (a)  (i)  the Commitments at such  time  (as  reduced\npursuant  to Section 2.01(e) and 2.04) less (ii) the sum  of  (A)\n             ----------------    ----  ----\nthe  then aggregate outstanding Letter of Credit Obligations  and\n(B)   if  applicable,  the  amount  of  any  Cleandown,  and  (b)\n$50,000,000.\n\n\n           \"Merchandise  Credit Amount\" shall  mean,  as  of  any\n            --------------------------\nCalculation  Date,  the aggregate amount of  merchandise  credits\nthen  outstanding entitling the holder thereof to use  all  or  a\nportion thereof to pay all or a portion of the purchase price for\nany  Inventory  as  of  such day which are  not  being  held  for\nescheatment or which have not been escheated as of such day.\n\n          \"Moody's\" shall mean Moody's Investors Service, Inc.\n           -------\n\n           \"Multiemployer Plan\" shall mean a \"multiemployer plan\"\n            ------------------\nas defined in Section 4001(a)(3) of ERISA which is, or within the\nimmediately preceding six years was, contributed to by either the\nBorrower  or  any ERISA Affiliate or under which the Borrower  or\nany ERISA Affiliate may incur any liability.\n\n            \"Net  Income\"  shall  mean,  for  any  period  on   a\n             -----------\nconsolidated  basis  for ATSC, the Borrower  and  its  Restricted\nSubsidiaries, the consolidated net income (or loss) of ATSC,  the\nBorrower and its Restricted Subsidiaries for such period taken as\na single accounting period, determined in conformity with GAAP.\n\n\n           \"Net  Worth\"  shall mean, as at any  date  of  determi\n            ----------\nnation, the amount by which (a) the total consolidated assets  of\nATSC, the Borrower and its Restricted Subsidiaries exceed (b) the\ntotal  consolidated  liabilities of ATSC, the  Borrower  and  its\nRestricted  Subsidiaries, as determined in conformity  with  GAAP\nbut  excluding,  for  purposes  of  this  definition,  unrealized\nforeign exchange translation gains and losses from Investments in\nForeign Subsidiaries.\n\n           \"Nonmaterial  Domestic Subsidiaries\"  shall  mean  any\n            ----------------------------------\nRestricted Subsidiary (other than a Foreign Subsidiary) which has\ntotal  assets of $250,000 or less, provided that the total assets\n                                   --------\nof   all  Nonmaterial  Domestic  Subsidiaries  shall  not  exceed\n$1,000,000 in the aggregate and to the extent the aggregate total\nassets  of  all such Restricted Subsidiaries exceeds  $1,000,000,\none  or  more  such Restricted Subsidiaries (in descending  order\nbased upon their total assets) shall not be \"Nonmaterial Domestic\nSubsidiaries\" until such excess is eliminated.\n\n=================================================================\n                            -19-\n\n           \"Non-U.S.  Lender\" shall have the meaning ascribed  to\n            ----------------\nsuch term in Section 2.08(e).\n             ---------------\n\n           \"Note\" shall have the meaning ascribed to such term in\n            ----\nSection 2.01(d).\n---------------\n\n           \"Notice  of Borrowing\" shall mean, with respect  to  a\n            --------------------\nproposed   Borrowing  pursuant  to  Section  2.01(b),  a   notice\n                                    ----------------\nsubstantially in the form of Exhibit 2.01.\n                             ------------\n\n           \"Notice  of Conversion\/Continuation\" shall mean,  with\n            ----------------------------------\nrespect  to  a  proposed  conversion or continuation  of  a  Loan\npursuant  to Section 2.02(c), a notice substantially in the  form\n             --------------\nof Exhibit 2.02.\n   ------------\n\n           \"Obligations\"  shall  mean the principal  of  and  all\n            -----------\ninterest  on all Loans and Reimbursement Obligations,  all  fees,\nexpense   reimbursements,  taxes,  compensation  and  indemnities\npayable  by the Borrower to the Administrative Agent, the Issuing\nBanks,  or  any Lender pursuant to this Agreement and  all  other\npresent  and  future  Indebtedness and other liabilities  of  the\nBorrower  owing  to the Administrative Agent, the Issuing  Banks,\nany  Lender  (or,  in the case of any Interest Rate  Contract  or\nForeign Currency Exchange Contract, any Affiliate of any Lender),\nor  any  Person entitled to indemnification pursuant  to  Section\n                                                          -------\n12.04,  or  any  of their respective successors,  transferees  or\n-----\nassigns,  of every type and description, whether or not evidenced\nby  any note, guaranty or other instrument, arising under  or  in\nconnection with this Agreement, any other Loan Document,  or  any\nInterest  Rate  Contract or Foreign Currency  Exchange  Contract,\nwhether  or  not  for  the payment of money,  whether  direct  or\nindirect  (including those acquired by assignment),  absolute  or\ncontingent,  due  or  to  become due, now existing  or  hereafter\narising and however arising.\n\n\n          \"Operating Lease\" shall mean, as applied to any Person,\n           ---------------\nany lease of any Property by that Person as lessee which is not a\nCapital Lease.\n\n\n           \"Other Taxes\" shall have the meaning ascribed to  such\n            -----------\nterm in Section 2.08(b).\n        --------------\n\n           \"PBGC\" shall mean the Pension Benefit Guaranty Corpora\n            ----\ntion and any Person succeeding to the functions thereof.\n\n\n           \"Permits\"  shall  mean any permit, approval,  consent,\n            -------\nauthorization, license, variance, or permission required  from  a\nGovernmental Authority under an applicable Requirement of Law.\n\n\n           \"Permitted  Account Liens\" shall mean  the  collective\n            ------------------------\nreference  to Liens permitted by clause (a) of the definition  of\nCustomary Permitted Liens.\n\n\n            \"Permitted  Existing  Indebtedness\"  shall  mean  the\n             ---------------------------------\nIndebtedness  existing  on  the date  hereof  and  set  forth  in\nSchedule 8.01(k).\n----------------\n\n           \"Permitted Existing Liens\" shall mean the Liens on any\n            ------------------------\nProperty,  other  than  any  Environmental  Liens,  reflected  on\nSchedule 8.02(b).\n----------------\n=================================================================\n                             -20-\n\n\n          \"Permitted Fixed Asset Liens\" shall mean the collective\n           ---------------------------\nreference  to  Liens  permitted by clauses (a)  and  (b)  of  the\ndefinition of Customary Permitted Liens.\n\n\n           \"Permitted Inventory Liens\" shall mean the  collective\n            -------------------------\nreference to Liens permitted by clauses (a), (b) and (e)  of  the\ndefinition of Customary Permitted Liens.\n\n\n           \"Person\"  shall mean any natural person,  corporation,\n            ------\nlimited   partnership,  general  partnership,  limited  liability\ncompany,   joint  stock  company,  joint  venture,   association,\ncompany,  trust, bank, trust company, land trust, business  trust\nor  other  organization, whether or not a legal  entity,  or  any\nother nongovernmental entity, or any Governmental Authority.\n\n\n           \"Plan\" shall mean an employee benefit plan defined  in\n            ----\nSection  3(3) of ERISA which the Borrower or any ERISA  Affiliate\nmaintains,   administers,  contributes  to  or  is  required   to\ncontribute to, or under which the Borrower or any ERISA Affiliate\nmay incur any liability.\n\n\n           \"Pledged Securities\" shall mean the securities pledged\n            ------------------\npursuant to the Collateral Documents.\n\n\n          \"Positive Price Variance Reserve\" shall mean, as of any\n           -------------------------------\nCalculation Date, the reserve established by the Borrower and the\nSubsidiary  Guarantors  for  the most recently  completed  fiscal\nquarter in accordance with the historical accounting practices of\nthe  Borrower  and the Subsidiary Guarantors in  respect  of  the\nexcess,  if  any, of (a) the standard costs associated  with  the\nimportation  of  Inventory over (b) the actual  costs  associated\nwith the importation of Inventory.\n\n          \"Potential Event of Default\" shall mean an event which,\n           --------------------------\nwith  the  giving of notice or the lapse of time, or both,  would\nconstitute an Event of Default.\n\n\n           \"Preferred  Securities\" shall mean the 8-1\/2% Convertible\n            ---------------------\nTrust  Originated Preferred Securities issued April 25,  1996  by\nAnnTaylor Finance Trust pursuant to the Offering Memorandum dated\nApril 18, 1996.\n\n           \"Preferred Securities Guarantee Agreement\" shall  mean\n            ----------------------------------------\nthe  Preferred  Securities  Guarantee  Agreement,  dated  as   of\nApril 25, 1996, by ATSC and the Bank of New York, as Trustee  for\nthe benefit of the holders of the Preferred Securities.\n\n\n           \"Pricing Ratio\" shall mean, during any fiscal quarter,\n            -------------\nthe   Fixed  Charge  Coverage  Ratio  for  the  period  of   four\nconsecutive  fiscal  quarters  ended  on  the  last  day  of  the\nimmediately  preceding fiscal quarter.  Changes  in  the  Pricing\nRatio  indicated  by  a  Pricing Ratio Certificate  shall  become\neffective  on  the first day of the fiscal quarter following  the\nfiscal quarter in respect of which such Pricing Ratio Certificate\nis  delivered;  provided, however, that (a)  if  any  payment  of\n                --------  -------\ninterest,  commitment fee or Letter of Credit Fee is made  during\nthe  period  between the first day of a fiscal quarter (including\nthe  fiscal quarter ending August 2, 1998) and the date which  is\nfive  Business  Days after the date of delivery  of  the  Pricing\nRatio  Certificate for the immediately preceding fiscal  quarter,\nsuch payment shall be tentatively calculated on the basis of  the\nPricing Ratio in effect during such immediately preceding  fiscal\nquarter until the Pricing Ratio is adjusted upon delivery of such\nPricing  Ratio Certificate (it being agreed that Level IV  Status\n=================================================================\n                            -21-\n\nshall  be deemed to exist in respect of the fiscal quarter ending\nAugust  2,  1998)  and  (b) in the event that  no  Pricing  Ratio\nCertificate has been delivered for a fiscal quarter prior to  the\nlast  day of the next succeeding fiscal quarter, Level IV  Status\nshall  be presumed to exist until delivery of such Pricing  Ratio\nCertificate.   Changes in the rates of calculation  of  interest,\ncommitment  fee  or  Letter  of Credit  Fee  resulting  from  the\noperation  of either of clauses (a) or (b) above for  any  fiscal\nquarter  shall be given effect through adjustments  to  the  next\npayments  to  be made of interest, commitment fee  or  Letter  of\nCredit  Fee,  as  the case may be, so as to give effect  to  such\nchanges retroactively to the beginning of such fiscal quarter.\n\n\n           \"Pricing  Ratio  Certificate\" shall have  the  meaning\n            ---------------------------\ngiven to such term in Section 6.01(d)(ii).\n                      -------------------\n\n           \"Property\" shall mean with respect to any Person,  any\n           ---------\nreal  or personal property, plant, building, facility, structure,\nequipment or unit, or other asset (tangible or intangible) owned,\nleased or operated by such Person.\n\n          \"Pro Rata Share\" shall mean, at any particular time and\n           --------------\nwith   respect  to  any  Lender,  a  fraction  (expressed  as   a\npercentage), the numerator of which shall be the then  amount  of\nsuch  Lender's  Commitment  (or, if  the  Commitments  have  been\nterminated,  such  Lender's Commitment as in  effect  immediately\nprior to such termination, after giving effect to any assignments\npursuant to Section 12.01) and the denominator of which shall  be\n            -------------\nthe  then  aggregate  amount  of  all  Commitments  (or,  if  the\nCommitments  have been terminated, the aggregate  amount  of  all\nCommitments  as in effect immediately prior to such  termination,\nafter  giving  effect  to  any assignments  pursuant  to  Section\n                                                          -------\n12.01).\n-----\n\n           \"Qualified Capital Stock\" shall mean common  stock  of\n            -----------------------\nATSC  or  preferred  stock of ATSC which is not  subject  to  any\nmandatory  redemption  or repurchase, upon  the  happening  of  a\ncontingency  or  otherwise, and is not subject  to  any  required\nsinking fund or similar payments, at any time prior to March  31,\n2005.\n\n           \"Receivables  Transaction\" shall mean the  transaction\n            ------------------------\ncontemplated  by  that  certain Receivables Financing  Agreement,\ndated  as of January 27, 1994 among AnnTaylor Funding, Inc.,  the\nBorrower,  Clipper Receivables Corporation, State  Street  Boston\nCapital  Corporation and PNC Bank, National Association  and  the\nother documents relating thereto.\n\n\n          \"Reference Bank\" shall mean Bank of America.\n           --------------\n\n           \"Reference  Rate\"  shall mean  the  rate  of  interest\n            ---------------\npublicly  announced from time to time by Bank of America  in  San\nFrancisco, California, as its reference rate.  It is a  rate  set\nby  Bank of America based upon various factors including Bank  of\nAmerica's  costs and desired return, general economic  conditions\nand  other factors, and is used as a reference point for  pricing\nsome  loans,  which  may  be  priced at,  above,  or  below  such\nannounced  rate.   Any change in the Reference  Rate  shall  take\neffect  at the opening of business on the date specified  in  the\npublic announcement of such change.\n\n\n           \"Refinancing Date\" shall have the meaning ascribed  to\n            ----------------\nsuch term in Section 2.01(f).\n             ---------------\n===================================================================\n                              -22-\n\n          \"Register\" shall have the meaning ascribed to such term\n           --------\nin Section 12.01(c).\n   ----------------\n\n           \"Regulation  D\",  \"Regulation T\", \"Regulation  U\"  and\n            -------------     ------------    -------------\n\"Regulation X\" shall mean Regulation D, Regulation T,  Regulation\n ------------\nU and Regulation X, respectively, of the Federal Reserve Board as\nin effect from time to time.\n\n           \"Reimbursement Obligations\" shall mean  the  reimburse\n            -------------------------\nment  or  repayment obligations of the Borrower  to  the  Issuing\nBanks  with  respect to Letters of Credit, for amounts  paid  out\nthereunder.\n\n           \"Release\"  shall  mean any release,  spill,  emission,\n            -------\nleaking,   pumping,  injection,  deposit,  disposal,   discharge,\ndispersal,  leaching  or migration from  any  Property  into  the\nenvironment, including the movement of Contaminants through or in\nthe air, soil, surface water, groundwater or Property.\n\n\n          \"Remedial Action\" shall mean any action required to (i)\n           ---------------\nclean  up, remove, treat or in any other way address Contaminants\nin  the indoor or outdoor environment; (ii) prevent a Release  or\nthreat of Release or minimize the further Release of Contaminants\nso they do not migrate or endanger or threaten to endanger public\nhealth or welfare or the indoor or outdoor environment; or  (iii)\nperform  preremedial studies and investigations and post-remedial\nmonitoring and care.\n\n\n           \"Rental Expense\" shall mean, for any period for  ATSC,\n            --------------\nthe  Borrower  and its Restricted Subsidiaries, on a consolidated\nbasis,  the  aggregate base rental payments to lessors  or  their\nassignees  by  such Persons for such period under  agreements  to\nrent or lease any real property (excluding payments in respect of\nCapital Leases) as recorded in accordance with GAAP.\n\n\n           \"Reportable Event\" shall mean the events described  in\n            ----------------\nSection  4043  of ERISA with respect to which the  30-day  notice\nrequirement is not waived.\n\n          \"Requirements of Law\" shall mean, as to any Person, the\n           -------------------\ncharter   and  by-laws  or  other  organizational  or   governing\ndocuments  of  such  Person, and any  law,  rule  or  regulation,\nPermit,  or  determination of an arbitrator or a court  or  other\nGovernmental  Authority, in each case applicable  to  or  binding\nupon  such Person or any of its property or to which such  Person\nor  any of its property is subject, including the Securities Act,\nthe  Securities  Exchange Act, Regulation  T,  Regulation  U  and\nRegulation X, and any certificate of occupancy, zoning ordinance,\nbuilding,  environmental  or land use requirement  or  Permit  or\noccupational safety or health law, rule or regulation.\n\n\n           \"Requisite Lenders\" shall mean Lenders whose Pro  Rata\n            -----------------\nShares,  in  the  aggregate,  are at  least  51%,  or  after  the\ntermination  of the Commitments, at least 51% of the  outstanding\nLoans and Letter of Credit Obligations.\n\n\n           \"Responsible Officer\" shall mean, as to  ATSC  or  the\n            -------------------\nBorrower, its Senior Vice President-Chief Financial Officer,  its\nTreasurer or its Vice President-Controller.\n\n==================================================================\n                           -23-\n\n           \"Restricted  Payment\" shall mean (a) any  dividend  or\n            -------------------\nother  distribution, direct or indirect, on account of any shares\nof  any class of capital stock of ATSC or the Borrower or any  of\nits  Subsidiaries  now  or hereafter outstanding,  including  the\nCommon  Stock, except a distribution of stock as part of a  stock\nsplit  and  except a dividend payable solely in  shares  of  that\nclass of stock or in any junior class of stock to the holders  of\nthat  class,  (b)  any redemption, retirement,  sinking  fund  or\nsimilar payment, purchase or other acquisition for value,  direct\nor  indirect, of any shares of any class of capital stock of ATSC\nor  the  Borrower  or any of its Subsidiaries  now  or  hereafter\noutstanding,  (c)  any  payment or prepayment  of  principal  of,\npremium,  if  any, or interest on, and any redemption,  purchase,\nretirement  or defeasance of, or sinking fund or similar  payment\nwith  respect to, the Subordinated Notes, any Subordinated  Debt,\nthe  Convertible  Debentures or any  consideration  paid  to  any\nPerson  for  the  purpose of any of the foregoing,  and  (d)  any\npayment  made  to  retire, or to obtain  the  surrender  of,  any\noutstanding  warrants, options or other rights to acquire  shares\nof  any class of capital stock of ATSC or the Borrower or any  of\nthe Borrower's Subsidiaries now or hereafter outstanding.\n\n\n           \"Restricted  Subsidiary\" shall mean any Subsidiary  of\n            ----------------------\nthe Borrower which is not an Unrestricted Subsidiary.  Whether or\nnot   a  Restricted  Subsidiary  is  a  \"wholly-owned  Restricted\nSubsidiary\"  shall be determined without taking into account  any\ndirectors'  qualifying  shares  or similar  nominal  requirements\nunder foreign laws.\n\n           \"Sales  Tax Reserve\" shall mean, as of any Calculation\n            ------------------\nDate,  an  amount equal to 5% of Eligible Accounts Receivable  at\nsuch Calculation Date.\n\n\n          \"S&amp;P\" shall mean Standard and Poor's Ratings Services.\n           ---\n\n          \"Securities\" shall mean any stock, shares, voting trust\n           ----------\ncertificates,  bonds,  debentures, notes or  other  evidences  of\nindebtedness, secured or unsecured, convertible, subordinated  or\notherwise,  or  in  general  any instruments  commonly  known  as\n\"securities\",  or  any  certificates  of  interest,  shares,   or\nparticipations  in  temporary  or interim  certificates  for  the\npurchase  or  acquisition  of, or  any  right  to  subscribe  to,\npurchase  or acquire any of the foregoing, but shall not  include\nany evidence of the Obligations.\n\n          \"Securities Act\" shall mean the Securities Act of 1933,\n           --------------\nas  amended  to the date hereof and from time to time  hereafter,\nand any successor statute.\n\n\n           \"Securities  Exchange Act\" shall mean  the  Securities\n            ------------------------\nExchange Act of 1934, as amended to the date hereof and from time\nto time hereafter, and any successor statute.\n\n\n           \"Shareholders' Equity\" shall mean, as at any  date  of\n            --------------------\ndetermination,  the  amount  which  would  be  set  forth   under\nshareholders' equity on a consolidated balance sheet of ATSC  and\nits  Subsidiaries  in  accordance  with  GAAP  at  such  date  of\ndetermination.\n\n           \"Shrink  Reserve\"  shall mean, as of  any  Calculation\n            ---------------\nDate,  the  shrink  reserve  for the  most  recent  fiscal  month\ncalculated  in  accordance with the accounting practices  of  the\nBorrower and the Subsidiary Guarantors.\n==================================================================\n                            -24-\n\n           \"Standby  Letter of Credit\" shall mean any  Letter  of\n            -------------------------\nCredit which is not a Commercial Letter of Credit.\n\n\n           \"Stock-in-Transit  Reserve\"  shall  mean,  as  of  any\n            -------------------------\nCalculation  Date with respect to any Inventory, an amount  equal\nto the product of (a) the Inventory Value of such Inventory times\n(b)  a fraction the numerator of which is 100 and the denominator\nof which is 85 times (c) 0.15.\n\n            \"Subordinated   Debt\"  shall   mean   any   unsecured\n             -------------------\nIndebtedness of the Borrower or ATSC (other than the Subordinated\nNotes), no part of the principal of which is required to be  paid\n(whether  by way of mandatory sinking fund, mandatory  redemption\nor  mandatory  prepayment), prior to March  31,  2005  (it  being\nunderstood  that any required offer to purchase such Indebtedness\nas  a result of change of control or asset sale shall not violate\nthe  foregoing  restriction); the payment  of  principal  of  and\ninterest of which and other obligations of the Borrower  or  ATSC\nin  respect thereof are subordinated to the prior payment in full\nof   the  principal  of  and  interest  (including  post-petition\ninterest)  on  the Loans and all other Obligations on  terms  and\nconditions no less favorable to the Agents and the Lenders in any\nmaterial respect than those applicable to the Subordinated Notes;\nand the amount of and all other terms and conditions of which are\nreasonably satisfactory to the Requisite Lenders.\n\n\n           \"Subordinated Debt Indenture\" shall mean,  as  to  any\n            ---------------------------\nSubordinated Debt, the indenture or other agreements pursuant  to\nwhich such Subordinated Debt is issued or incurred.\n\n\n           \"Subordinated Note Indenture\" shall mean the indenture\n            ---------------------------\ndated  as  of June 15, 1993 between the Borrower and Fleet  Bank,\nN.A.,  as  trustee pursuant to which the Subordinated Notes  were\nissued.\n\n          \"Subordinated Notes\" shall mean the 8 3\/4% Subordinated\n           ------------------\nNotes   due  2000  issued  pursuant  to  the  Subordinated   Note\nIndenture.\n\n           \"Subsidiary\" shall mean, with respect to  any  Person,\n            ----------\nany  corporation, partnership, trust or other entity of  which  a\nmajority  of  the stock (or equivalent ownership  or  controlling\ninterest) having voting power to elect a majority of the Board of\nDirectors  (if  a  corporation)  or  to  select  the  trustee  or\nequivalent  controlling interest is directly or indirectly  owned\nor  controlled  by  such  Person or one  or  more  of  the  other\nSubsidiaries of such Person or any combination thereof; provided,\n                                                        --------\nhowever,  that for purposes of this Agreement, AnnTaylor  Finance\n-------\nTrust  and  the charitable foundation permitted to be established\npursuant  to  Section 8.02(a)(viii) shall not  be  deemed  to  be\n              --------------------\nSubsidiaries of the Borrower or ATSC.\n\n\n           \"Subsidiary  Guaranty and Collateral Agreement\"  shall\n            ---------------------------------------------\nmean the Subsidiary Guaranty and Collateral Agreement dated as of\nthe Initial Funding Date substantially in the form of, and on the\nterms  set  forth  in, Exhibit 4.01(a)(vi), as the  same  may  be\n                       ------------------\namended, supplemented or otherwise modified from time to time.\n\n\n           \"Subsidiary Guarantor\" shall mean any Guarantor (other\n            --------------------\nthan ATSC).\n\n\n          \"Taxes\" shall have the meaning ascribed to such term in\n           -----\nSection 2.08.\n------------\n==================================================================\n                           -25-\n\n           \"Termination Date\" shall mean the earlier to occur  of\n            ----------------\n(a)  the  Final Maturity Date and (b) the date of termination  of\nthe Commitments pursuant to Section 2.01(f) or 10.02(a).\n                            ---------------    --------\n\n           \"Termination Event\" shall mean (i) a Reportable  Event\n            -----------------\nwith respect to any Plan; (ii) the withdrawal of the Borrower  or\nany  ERISA  Affiliate from a Benefit Plan during a plan  year  in\nwhich  the  Borrower or such ERISA Affiliate was  a  \"substantial\nemployer\"  as  defined  in Section 4001(a)(2)  of  ERISA  or  the\ncessation  of  operations which results  in  the  termination  of\nemployment of 20% of Benefit Plan participants who are  employees\nof the Borrower and its ERISA Affiliates; (iii) the imposition of\nan  obligation  on  the  Borrower or any  ERISA  Affiliate  under\nSection 4041 of ERISA to provide affected parties written  notice\nof  intent  to terminate a Benefit Plan in a distress termination\ndescribed  in Section 4041(c) of ERISA; (iv) the termination  of,\nor  the  institution under ERISA of proceedings to  terminate,  a\nBenefit  Plan  (including the giving of written notice  thereof);\n(v)  any  event  or  condition which  constitutes  grounds  under\nSection  4042  of  ERISA (excluding Section 4042(a)(4))  for  the\ntermination  of, or the appointment of a trustee  to  administer,\nany   Benefit  Plan  (including  the  giving  of  written  notice\nthereof); (vi) the partial or complete withdrawal of the Borrower\nor  any ERISA Affiliate from a Multiemployer Plan or notification\nthat  a  Multiemployer  Plan  is  in  reorganization;  (vii)  any\n\"accumulated  funding deficiency\" (as defined in Section  302  of\nERISA),  whether or not waived, shall exist with respect  to  any\nPlan; (viii) the Borrower or any ERISA Affiliate has incurred  or\nis  likely  to incur a liability in connection with any nonexempt\n\"prohibited transaction\" (as defined in Section 406 of  ERISA  or\nSection 4975 of the Code) involving any Plan; (ix) the failure to\nmake a required contribution to a Benefit Plan if such failure is\nsufficient to give rise to a lien under Section 302 (f) of ERISA;\nor  (x)  the imposition of any liability under Title IV of ERISA,\nother  than  PBGC premiums due but not delinquent  under  Section\n4007 of ERISA, upon the Borrower or any ERISA Affiliate.\n\n\n           \"Total  Capitalization\"  means,  as  of  any  date  of\n            ---------------------\ndetermination,  the sum of (i) Funded Debt plus (ii)  obligations\n                                           ----\nin respect of Capital Leases plus (iii) Shareholders' Equity.\n                             ----\n\n\n            \"Total   Debt\"  shall  mean,  as  at  any   date   of\n             ------------\ndetermination, the aggregate principal amount of all Funded  Debt\nof  ATSC,  the Borrower and its Restricted Subsidiaries  at  such\ndate, determined on a consolidated basis in accordance with GAAP.\n\n\n           \"Trademark Security Agreement\" shall mean a  Trademark\n            ----------------------------\nSecurity Agreement substantially in the form of, and on the terms\nset  forth in, Exhibit 4.01(a)(iii), as the same may be  amended,\n               --------------------\nsupplemented or otherwise modified from time to time.\n\n\n           \"Transaction  Costs\" shall mean the  fees,  costs  and\n            ------------------\nexpenses  payable by the Borrower or any of its  Subsidiaries  or\nATSC  pursuant  hereto or in connection herewith  or  in  respect\nhereof.\n\n\n           \"UCC\"  shall mean the Uniform Commercial Code as  from\n            ---\ntime to time in effect in the State of New York.\n\n\n           \"Unrestricted Subsidiary\" shall mean a  Subsidiary  of\n            -----------------------\nthe Borrower which has been designated as such by resolution duly\nadopted by the board of directors of the Borrower, which  at  the\ntime  of such designation does not own or hold any Securities  of\nATSC, the Borrower or any Restricted Subsidiary, provided (a)  no\n                                                 --------\n=================================================================\n                         -26-\n\nSubsidiary   of  the  Borrower  shall  be  (or  if   already   an\nUnrestricted  Subsidiary  shall  immediately  cease  to  be)   an\nUnrestricted  Subsidiary if, at any time, ATSC, the  Borrower  or\nany  other  Restricted Subsidiary of the Borrower  shall  create,\nincur, issue, assume, guarantee or in any other manner whatsoever\nbe  or  become  liable with respect to any Claim against  or  any\nContractual Obligation or Indebtedness of, such Subsidiary  which\nis  not  permitted under Article VIII and (b) ATSC, the  Borrower\nand  its Restricted Subsidiaries shall be deemed to have made  an\nInvestment  in  an  Unrestricted  Subsidiary  at  the   time   of\ndesignation of such Subsidiary as an \"Unrestricted Subsidiary\" in\nan  amount equal to the sum of (i) any Indebtedness owed by  such\nSubsidiary  to ATSC, the Borrower and its Restricted Subsidiaries\nat such time, (ii) any outstanding Guarantees or Liens created by\nATSC, the Borrower and its Restricted Subsidiaries in favor of or\nfor the benefit of such Subsidiary and (iii) the total assets  of\nsuch  Subsidiary  at such time as determined  on  a  consolidated\nbasis in accordance with GAAP.\n\n           \"Working  Capital\"  shall mean,  as  at  any  date  of\n            ----------------\ndetermination, the difference between Current Assets at such date\nand Current Liabilities at such date.\n\n           \"Year 2000 Compliance\" shall have the meaning ascribed\n            --------------------\nto such term in Section 7.12(c).\n                --------------\n\n           \"Year 2000 Problem\" shall have the meaning ascribed to\n            -----------------\nsuch term in Section 5.01(q).\n             ---------------\n\n          1.02.  Computation of Time Periods.  In this Agreement,\n                 ---------------------------\nin the computation of periods of time from a specified date to  a\nlater  specified date, the word \"from\" means \"from and including\"\nand  the  words  \"to\" and \"until\" each mean \"to  but  excluding\".\nPeriods of days referred to in this Agreement shall be counted in\ncalendar days unless Business Days are expressly prescribed.\n\n            1.03.   Accounting  Terms.   For  purposes  of   this\n                    -----------------\nAgreement,  all  accounting terms not  otherwise  defined  herein\nshall have the meanings assigned to them in conformity with GAAP.\n\n\n           1.04.   Other Definitional Provisions.  References  to\n                   -----------------------------\n\"Articles\",  \"Sections\",  \"subsections\", \"Schedules\",  \"Exhibits\"\nand  \"the  preamble\" shall be to Articles, Sections, subsections,\nSchedules,  Exhibits  and  the preamble,  respectively,  of  this\nAgreement  unless  otherwise specifically  provided.   The  words\n\"include\" and \"including\" when used herein are not intended to be\nexclusive  and mean \"include, without limitation\" and \"including,\nwithout limitation.\"\n\n\n                           ARTICLE II\n\n                   Amounts and Terms of Loans\n                   --------------------------\n\n          2.01.  The Revolving Credit Facility.\n                 -----------------------------\n\n           (a)   Availability.   (i) Subject  to  the  terms  and\n                 ------------\nconditions  set  forth  in  this Agreement,  each  Lender  hereby\nseverally  and  not jointly agrees to make to the  Borrower  from\n==================================================================\n                             -27-\n\ntime  to time during the period from the Initial Funding Date  to\nthe  Termination  Date,  revolving loans  (each  individually,  a\n\"Loan\"  and,  collectively, the \"Loans\"),  in  an  amount  which,\n ----                            -----\ntogether  with  such Lender's Pro Rata Share of  the  outstanding\nLetters of Credit Obligations, shall not exceed, in the aggregate\nat  any  time  outstanding,  the  lesser  of  (A)  such  Lender's\nCommitment and (B) such Lender's Pro Rata Share of the  Borrowing\nBase Amount then in effect; provided that the aggregate principal\namount  of all Loans outstanding at any one time shall not exceed\nthe then Maximum Loan Amount.\n\n              (ii)  All Loans under this Agreement shall be  made\nby  the  Lenders  simultaneously  and  proportionately  to  their\nrespective  Pro Rata Shares, it being understood that  no  Lender\nshall  be  responsible for any failure by  any  other  Lender  to\nperform  its  obligation to make a Loan hereunder  and  that  the\nCommitment  of  any  Lender shall not be increased  or  decreased\nwithout  the prior written consent of such Lender as a result  of\nthe failure by any other Lender to perform its obligation to make\na  Loan.   The  failure of any Lender to make  available  to  the\nAdministrative Agent any Borrowing of the Commitments  shall  not\nrelieve  any  other  Lender of its obligation hereunder  to  make\navailable  to  the Administrative Agent such other  Lender's  Pro\nRata  Share of any Borrowing of the Commitments on the date  such\nfunds  are  to  be made available pursuant to the terms  of  this\nAgreement.\n\n              (iii)   Loans  may be prepaid pursuant  to  Section\n                                                          -------\n2.04,  and,  subject  to the provisions of  this  Agreement,  any\n----\namounts  so prepaid may be reborrowed, up to the amount available\nunder  this Section 2.01(a) at the time of such Borrowing,  until\n            --------------\nthe  Business Day immediately preceding the Final Maturity  Date.\nEach  Lender's  Commitment  shall  expire,  and  each  Loan  then\noutstanding  shall mature and be repaid by the Borrower,  without\nfurther  action on the part of the Lenders, on the Final Maturity\nDate.\n\n             (iv)  Loans made on any Funding Date shall be in the\naggregate  minimum amount of $1,000,000 and in integral multiples\nof $1,000,000 in excess thereof.\n\n\n              (v)   During  the  period of  30  consecutive  days\ncommencing  each year on January 1 and ending on  January  30  of\neach  year,  the  Borrower  shall  effect  a  prepayment  of  the\noutstanding Loans (such amount, a \"Cleandown\") so as to cause  no\n                                   ---------\nLoans  to be outstanding during such period (each such period,  a\n\"Cleandown  Period\").   Within 15  days  after  the  end  of  any\n -----------------\nCleandown  Period,  the Borrower shall notify the  Administrative\nAgent that a Cleandown Period has occurred and the Administrative\nAgent shall notify the Lenders.\n\n           (b)    Notice  of  Borrowing.  Whenever  the  Borrower\n                  ---------------------\ndesires  to  borrow under this Section 2.01, the  Borrower  shall\n                               ------------\ndeliver to the Administrative Agent a Notice of Borrowing (i)  no\nlater  than  11:00  a.m. (New York time) on the proposed  Funding\nDate, in the case of a Borrowing of Base Rate Loans, and (ii) not\nlater  than  11:00 a.m. (New York time) at least  three  Business\nDays  in advance of the proposed Funding Date, in the case  of  a\nBorrowing  of  Eurodollar Rate Loans.  The  Notice  of  Borrowing\nshall  specify  (A) the Funding Date (which shall be  a  Business\nDay),  (B) the amount of the proposed Borrowing, (C) whether  the\nproposed Borrowing will be of Base Rate Loans or Eurodollar  Rate\nLoans,  and  (D)  in  the  case  of Eurodollar  Rate  Loans,  the\nrequested   Interest   Period.   In  lieu   of   delivering   the\nabove-described Notice of Borrowing and only with the consent  of\nthe Administrative Agent in its sole discretion at such time, the\nBorrower  may give the Administrative Agent telephonic notice  of\n================================================================\n                            -28-\n\nany  proposed  Borrowing by the time required under this  Section\n                                                          -------\n2.01(b); provided that, in the event the Administrative Agent  so\n-------\nconsents, such notice shall be confirmed immediately by  delivery\nto   the  Administrative  Agent  of  a  Notice  of  Borrowing  by\nfacsimile.  Any Notice of Borrowing (or telephonic notice in lieu\nthereof) pursuant to this Section 2.01(b) shall be irrevocable.\n                          ---------------\n\n           (c)    Making of Loans.  Promptly after receipt  of  a\n                  ---------------\nNotice  of Borrowing under Section 2.01(b) (or telephonic  notice\n                           --------------\nin  lieu  thereof  if the Administrative Agent consents  to  such\ntelephonic  notice,  immediately  confirmed  by  facsimile),  the\nAdministrative  Agent shall notify each Lender  by  facsimile  or\nother   similar  form  of  teletransmission,  of   the   proposed\nBorrowing.   Each  Lender  shall make  the  amount  of  its  Loan\navailable  to  the  Administrative Agent  at  the  Administrative\nAgent's  Payment  Office in Dollars and in immediately  available\nfunds,  not  later  than (i) 1:00 p.m. (New  York  time)  on  the\nFunding  Date, in the case of a Borrowing of Base Rate Loans  and\n(ii)  11:00 a.m. (New York time) on the Funding Date, in the case\nof   a   Borrowing   of  Eurodollar  Rate   Loans.    After   the\nAdministrative Agent's receipt of the proceeds of such Loans, the\nAdministrative  Agent  shall  make the  proceeds  of  such  Loans\navailable to the Borrower on such Funding Date in Dollars and  in\nimmediately  available  funds  to an  account  of  the  Borrower,\ndesignated in writing by the Borrower.\n\n           (d)    Loan Accounts; Notes.  The Loans made  by  each\n                  --------------------\nLender shall be evidenced by one or more loan accounts maintained\nby  the  Administrative  Agent and such Lender  in  the  ordinary\ncourse of business (each a \"Loan Account\").  The Loan Accounts or\n                            ------------\nrecords  maintained by the Administrative Agent and  each  Lender\nshall  be conclusive absent manifest error of the amount  of  the\nLoans  made  by the Lenders to the Borrower and the interest  and\npayments thereon.  Any failure so to record or any error in doing\nso  shall  not, however, limit or otherwise affect the obligation\nof the Borrower hereunder to pay any amount owing with respect to\nthe  Loans.  In case of a discrepancy between the entries in  the\nAdministrative  Agent's  books  and  any  Lender's  books,   such\nLender's  books  shall  constitute prima facie  evidence  of  the\n                                   -----------\naccuracy  of  the  information so recorded.  Notwithstanding  the\nforegoing,  the  Borrower  agrees  that,  upon  request  to   the\nAdministrative  Agent by any Lender, in order  to  evidence  such\nLender's  Loans,  the Borrower will execute and deliver  to  such\nLender  a  promissory note substantially in the form  of  Exhibit\n                                                          -------\n2.01(d)  (each, as amended, supplemented, replaced  or  otherwise\n-------\nmodified   from  time  to  time,  a  \"Note\"),  with   appropriate\n                                      ----\ninsertions therein as to payee, date and principal amount.   Each\nNote shall (i) be dated the Initial Funding Date, (ii) be payable\nas  provided in Section 2.01(g) and (iii) provide for the payment\n                --------------\nof interest in accordance with Section 2.02.\n                               ------------\n\n           (e)    Termination  or Reduction of Commitments.   The\n                  ----------------------------------------\nBorrower shall have the right, at any time and from time to time,\n(a)  to  terminate the Commitments in whole, without  premium  or\npenalty, if no Loans or Letter of Credit Obligations are then out\nstanding,  or (b) permanently to reduce in part, without  premium\nor  penalty, the Commitments by an amount of up to (i)  the  then\nmaximum  amount  of  the  Commitments, less  (ii)  the  aggregate\nprincipal  amount of Loans and Letter of Credit Obligations  then\noutstanding,  provided that the Borrower shall  pay  any  funding\n              --------\nlosses, breakfunding fees and related expenses in connection with\nany  prepayment made in respect thereof.  The Borrower shall give\nnot  less  than  three  Business Days' prior  irrevocable  notice\nthereof  (not later than 11:00 a.m. (New York time) on such  day)\nto  the Administrative Agent designating the date (which shall be\na  Business Day) of such termination or reduction and the  amount\nof  any partial reduction.  Promptly after receipt of a notice of\nsuch  termination  or reduction, the Administrative  Agent  shall\nnotify  each  Lender  of the proposed termination  or  reduction.\n================================================================\n                         -29-\n\nSuch termination or partial reduction of the Commitments shall be\neffective  on  the  date specified in the Borrower's  notice  and\nshall  reduce  the  Commitment of each Lender proportionately  in\naccordance  with its Pro Rata Share.  Any such partial  reduction\nof  the  Commitments shall be in an aggregate minimum  amount  of\n$2,000,000 and integral multiples of $1,000,000 in excess of that\namount.\n\n          (f)   Special Termination or Extension of Commitments.\n                -----------------------------------------------\n\n           (i)   If  the Subordinated Notes shall not  have  been\nrepaid in full with the net cash proceeds of Subordinated Debt or\nthe  issuance of Qualified Capital Stock by ATSC on or  prior  to\nFebruary   16,  2000  (the  \"Refinancing  Date\")  on  terms   and\n                             -----------------\nconditions  reasonably  satisfactory to  the  Requisite  Lenders,\nthen,  unless  all the Lenders otherwise agree,  the  Commitments\nshall  automatically  terminate on  the  Refinancing  Date.   The\nBorrower  shall provide the Lenders with a period of at least  15\ndays  to  review  and  approve the terms and  conditions  of  any\nissuance of Subordinated Debt or Qualified Capital Stock.\n\n           (ii)  If the Subordinated Notes shall have been repaid\nin  full with the net cash proceeds of Subordinated Debt  or  the\nissuance  of Qualified Capital Stock by ATSC on or prior  to  the\nRefinancing  Date on terms and conditions reasonably satisfactory\nto  the  Requisite  Lenders, the Final  Maturity  Date  shall  be\nextended  for  an  additional one-year (the  \"Extension  Period\")\n                                              -----------------\nperiod  commencing  on  the  then current  Final  Maturity  Date,\nprovided that (a) no Default or Event of Default shall have  then\n--------\noccurred and be continuing and (b) the Borrower shall demonstrate\ncompliance on a pro forma basis through the end of the  Extension\nPeriod  with the financial covenants contained in Article IX  and\n                                                  ----------\nshall   have   delivered   an  officer's   certificate   to   the\nAdministrative Agent and the Lenders setting forth in  reasonable\ndetail the calculations required to make such determination.\n\n\n          (g)   Repayment of Loans.  The Borrower hereby promises\n                ------------------\nto  pay on the Final Maturity Date the then outstanding principal\namount of Loans.\n\n\n          2.02.  Interest on the Loans.\n                 ---------------------\n\n           (a)   Rate of Interest.  The Borrower promises to  pay\n                 ----------------\ninterest  on  the unpaid principal amount of all Loans  from  the\ndate  made  until  paid in full at a fluctuating rate  determined\nfrom time to time by reference to the Base Rate or the Eurodollar\nRate.   The applicable basis for determining the rate of interest\nshall  be  selected  by  the Borrower at the  time  a  Notice  of\nBorrowing is given by the Borrower pursuant to Section 2.01(b) or\n                                               ---------------\nat  the time a Notice of Conversion\/Continuation is delivered  by\nthe  Borrower  pursuant  to Section 2.02(c);  provided  that  the\n                            ---------------\nBorrower  may  not select the Eurodollar Rate as  the  applicable\nbasis  for determining the rate of interest on a Loan if  at  the\ntime  of such selection an Event of Default has occurred  and  is\ncontinuing.  If on any day a Loan is outstanding with respect  to\nwhich  notice has not been delivered to the Administrative  Agent\nin  accordance  with the terms of this Agreement  specifying  the\nbasis  for  determining the rate of interest, then for each  such\nday  such  Loan shall be a Base Rate Loan.  The Loans shall  bear\ninterest, subject to Section 2.02(d), as follows:\n                     ---------------\n\n          Loans shall bear interest from the Initial Funding Date\nuntil  August 2, 1998 at a rate per annum for each day which  is,\n(A)  in the case of Base Rate Loans, equal to the Base Rate  plus\n==================================================================\n                              -30-\n\n1.00% and (B) in the case of Eurodollar Rate Loans, equal to  the\nEurodollar  Rate  determined for the applicable  Interest  Period\nplus 2.00%; thereafter, Loans shall bear interest as follows:\n\n                 1)   in the case of Base Rate Loans, then  at  a\n     rate per annum for each day equal to the sum of (x) the Base\n     Rate as in effect from time to time as interest accrues  and\n     (y)  the  applicable  margin set forth  below  opposite  the\n     Pricing Ratio in effect on such day:\n\n          Pricing Ratio                 Applicable Margin\n          --------------                -----------------\n          Level I Status                      0.25%\n          Level II Status                     0.50%\n          Level III Status                    0.75%\n          Level IV Status                     1.00%\n\n\n                2)  in the case of Eurodollar Rate Loans, then at\n     a  rate  per annum for each day equal to the sum of (x)  the\n     Eurodollar  Rate  determined  for  the  applicable  Interest\n     Period  and  (y)  the  applicable  margin  set  forth  below\n     opposite the Pricing Ratio in effect on such day:\n\n\n          Pricing Ratio                 Applicable Margin\n          -------------                 -----------------\n          Level I Status                      1.25%\n          Level II Status                     1.50%\n          Level III Status                    1.75%\n          Level IV Status                     2.00%\n\n\n           (b)    Interest Payments.  Subject to Section 2.02(d),\n                  -----------------              ---------------\n(i)  interest accrued on each Base Rate Loan shall be payable  in\narrears (A) on the fifteenth day of each January, April, July and\nOctober,  for  the  three-month  period  ending  on  such   date,\ncommencing  on  the first such day following the making  of  such\nBase Rate Loan, and (B) at the Termination Date and (ii) interest\naccrued  on each Eurodollar Rate Loan shall be payable in arrears\non  the  earlier of (A) each Interest Payment Date applicable  to\nsuch Eurodollar Rate Loan, (B) upon the prepayment thereof on the\namount prepaid and (C) at the Termination Date.\n\n\n           (c)   Conversion or Continuation.  (i) Subject to  the\n                 --------------------------\nprovisions of Sections 2.06 and 2.07, the Borrower shall have the\n              -------------     ----\noption  (A) to convert at any time all or any part of outstanding\nLoans which comprise part of the same Borrowing and which, in the\naggregate, equal $1,000,000 or an integral multiple of $1,000,000\nin  excess of such amount from Base Rate Loans to Eurodollar Rate\nLoans;  or  (B)  to convert all or any part of outstanding  Loans\nwhich, in the aggregate, equal $1,000,000 or an integral multiple\nof $1,000,000 in excess of that amount from Eurodollar Rate Loans\nto  Base Rate Loans on the expiration date of any Interest Period\napplicable  thereto, provided the remaining amount of  Eurodollar\n                     --------\nRate  Loans with the same Interest Period shall not be less  than\n$1,000,000;  or  (C) upon the expiration of any  Interest  Period\napplicable  to a Borrowing of Eurodollar Rate Loans, to  continue\nall  or  any  portion  of such Loans equal to  $1,000,000  or  an\nintegral  multiple  of $1,000,000 in excess  of  such  amount  as\n=================================================================\n                             -31-\n\nEurodollar Rate Loans, and the succeeding Interest Period of such\ncontinued  Loans  shall commence on the expiration  date  of  the\nInterest  Period applicable thereto; provided that no outstanding\n                                     --------\nLoan may be continued as, or be converted into, a Eurodollar Rate\nLoan when any Event of Default has occurred and is continuing.\n\n\n              (ii)   In  the  event the Borrower shall  elect  to\nconvert  or  continue  a  Loan under this  Section  2.02(c),  the\n                                           ----------------\nBorrower    shall    deliver    an    irrevocable    Notice    of\nConversion\/Continuation to the Administrative Agent no later than\n11:00  a.m.  (New  York  time) at least three  Business  Days  in\nadvance  of  the proposed conversion date or date of continuation\nin  the  case  of Eurodollar Rate Loans and on the conversion  or\ncontinuation date in the case of Base Rate Loans.   A  Notice  of\nConversion\/Continuation   shall   specify   (w)   the    proposed\nconversion\/continuation date (which shall be a Business Day), (x)\nthe  amount of the Loan to be converted\/continued, (y) the nature\nof the proposed conversion\/continuation, and (z) in the case of a\nconversion to, or a continuation of, a Eurodollar Rate Loan,  the\nrequested   Interest   Period.   In  lieu   of   delivering   the\nabove-described Notice of Conversion\/Continuation,  the  Borrower\nmay  give  the  Administrative Agent  telephonic  notice  of  any\nproposed conversion\/continuation by the time required under  this\nSection  2.02(c);  provided that such notice shall  be  confirmed\n----------------   --------\nimmediately by delivery to the Administrative Agent by  facsimile\nof  a  Notice  of  Conversion\/Continuation.  No  failure  of  the\nBorrower  to  confirm any telephonic notice  by  facsimile  shall\nimpair  or  in  any  way  limit the Borrower's  obligations  with\nrespect  to  such Loans.  Promptly after receipt of a  Notice  of\nConversion\/Continuation under this Section 2.02(c) (or telephonic\n                                   ---------------\nnotice  in lieu thereof immediately confirmed by facsimile),  the\nAdministrative  Agent shall notify each Lender  of  the  proposed\nconversion\/continuation.\n\n              (iii)   Any  Notice of Conversion\/Continuation  for\nconversion  to, or continuation of, a Loan (or telephonic  notice\nin  lieu thereof) shall be irrevocable and the Borrower shall  be\nbound to convert or continue in accordance therewith.\n\n\n           (d)   Default Interest.  Notwithstanding the rates  of\n                 ----------------\ninterest  specified  in  Section 2.02(a) and  the  payment  dates\n                         ---------------\nspecified  in  Section  2.02(b), effective immediately  upon  the\n               ----------------\noccurrence  of  any  Event of Default of the  type  specified  in\nSection  10.01(a)  or upon acceleration of maturity  pursuant  to\n-----------------\nSection 10.02(a) and for so long thereafter as any such Event  of\n----------------\nDefault  or  acceleration  shall  be  continuing,  the  principal\nbalance  of all Loans and Reimbursement Obligations then due  and\npayable  (including  all  amounts due  and  payable  pursuant  to\nSection 10.02(a)) and any interest payments on the Loans not paid\n-----------------\nwhen due, shall bear interest payable upon demand at a rate which\nis  2  per  cent  per  annum in excess of the  rate  of  interest\notherwise payable under this Agreement.\n\n           (e)    Computation of Interest.  Interest on Base Rate\n                  -----------------------\nLoans  and  Reimbursement Obligations shall be  computed  on  the\nbasis  of the actual number of days elapsed in the period  during\nwhich interest accrues and a year of 365 or 366 days (except that\na year of 360 days shall be used if the Base Rate is derived from\nthe  Federal Funds Rate), as applicable.  Interest on  Eurodollar\nRate Loans shall be computed on the basis of the actual number of\ndays  elapsed in the period during which interest accrues  and  a\nyear of 360 days.  In computing interest on any Loan, the date of\nthe making of the Loan or the first day of an Interest Period, as\nthe case may be, shall be included and the date of payment or the\nexpiration date of an Interest Period, as the case may be,  shall\n==================================================================\n                             -32-\n\nbe excluded; provided that if a Loan is repaid on the same day on\n             --------\nwhich it is made, one day's interest shall be paid on that Loan.\n\n\n           (f)    Changes; Legal Restrictions.  In the event that\n                  ---------------------------\nafter  the date hereof (a) the adoption of or any change  in  any\nlaw,  treaty, rule, regulation, guideline or determination  of  a\nGovernmental  Authority or any change in  the  interpretation  or\napplication   thereof  by  a  Governmental  Authority,   or   (b)\ncompliance  by any Lender with any request or directive  (whether\nor  not having the force of law and whether or not the failure to\ncomply  therewith  would be unlawful) from any  central  bank  or\nother  Governmental  Authority  or  quasi-governmental  authority\nexercising jurisdiction, power or control over banks or financial\ninstitutions generally, does impose, modify, or hold  applicable,\nin  the  determination of a Lender, any reserve, special deposit,\ncompulsory  loan, FDIC insurance, capital allocation  or  similar\nrequirement  against  assets  held  by,  or  deposits  or   other\nliabilities (including those pertaining to Letters of Credit)  in\nor for the account of, advances or loans by, Commitments made, or\nother credit extended by, or any other acquisition of funds by, a\nLender  or  any Applicable Lending Office of such Lender  (except\n(a) with respect to Base Rate Loans, so long as the Base Rate  in\neffect  at  the  time  is  determined under  clause  (a)  in  the\n                                             -----------\ndefinition  of \"Base Rate\", (b) with respect to Base Rate  Loans,\nto  the  extent that the reserve and FDIC insurance  requirements\nare  reflected  in  the definition of \"Base Rate\"  and  (c)  with\nrespect  to Eurodollar Rate Loans, to the extent that the reserve\nrequirements  are  reflected  in the  definition  of  \"Eurodollar\nRate\"), and the result of any of the foregoing is to increase the\ncost  to such Lender of making, renewing or maintaining the Loans\nor  its Commitment to the Borrower or issuing to the Borrower any\nLetter of Credit or to reduce any amount receivable hereunder  or\nthereunder;  then,  in  any such case, the  Borrower  shall  upon\n             ----\nwritten notice from and demand by that Lender pay to such Lender,\nwithin 15 Business Days of the date specified in such notice  and\ndemand,   such  amount  or  amounts  (based  upon  a   reasonable\nallocation  thereof by such Lender to the financing  transactions\ncontemplated  by  this  Agreement and affected  by  this  Section\n                                                          -------\n2.02(f))  as may be necessary to compensate that Lender  for  any\n--------\nsuch  additional cost incurred or reduced amount received.   Such\nLender  shall deliver to the Borrower a written statement of  the\ncosts  or  reductions  claimed and the basis  therefor,  and  the\nallocation  made  by  such Lender of such costs  and  reductions,\nwhich  statement  shall, in the absence  of  manifest  error,  be\nconclusive.   If  a  Lender subsequently  recovers  from  another\nPerson  any  amount previously paid by the Borrower  pursuant  to\nthis  Section  2.02(f), such Lender shall, within 30  days  after\n      ----------------\nreceipt  of such refund and to the extent permitted by applicable\nlaw,  pay  to the Borrower, without interest, the amount  of  any\nsuch recovery.\n\n\n          2.03.  Fees.\n                 ----\n\n           (a)   Fees to Bank of America.  The Borrower shall pay\n                 -----------------------\nto Bank of America, for its own account and\/or for the account of\nthe  Arranger, fees in the amounts set forth in the  Fee  Letter,\npayable  on the Initial Funding Date.  Except as contemplated  by\nthe  Fee  Letter,  no Person other than Bank of America  and  the\nArranger shall have any interest in such fees.\n\n          (b)   Commitment Fee.\n                --------------\n\n              (i)   The  Borrower shall pay to the Administrative\nAgent,  for the account of each Lender, in accordance with  their\nPro  Rata  Shares, a commitment fee accruing from and  after  the\nInitial Funding Date to the Termination Date, calculated  on  the\nbasis of a year of 360 days, upon the difference between (A)  the\n=================================================================\n                               -33-\n\nCommitments  in effect from time to time and (B)  the  Loans  and\nLetter of Credit Obligations outstanding from time to time.   All\nsuch  commitment  fees  payable under  this  paragraph  shall  be\npayable  in arrears on the fifteenth day of each January,  April,\nJuly  and October for the three-month period ending on such date,\nbeginning after the Initial Funding Date and in addition  on  the\nTermination Date.\n\n              (ii)  Commitment fees shall accrue from the Initial\nFunding Date until August 2, 1998 at the rate of 0.50% per annum;\nthereafter, commitment fees shall accrue for each day at  a  rate\nper  annum  equal  to the percentage per annum  set  forth  below\nopposite the Pricing Ratio in effect on such day:\n\n\n          Pricing Ratio            Commitment Fee\n          -------------            --------------\n          Level I Status               0.375%\n          Level II Status              0.50%\n          Level III Status             0.50%\n          Level IV Status              0.50%\n\n           (c)    Agency  Fee.   The Borrower shall  pay  to  the\n                  -----------\nAdministrative Agent, solely for its own account, the agency  fee\nset  forth  in  the  Fee Letter in the amount  per  annum  agreed\nbetween  the  Administrative Agent and the  Borrower  payable  in\nadvance on the Initial Funding Date and each one-year anniversary\nof   the  Initial  Funding  Date.   No  Person  other  than   the\nAdministrative Agent shall have any interest in such fee.\n\n\n          (d)   Letter of Credit Fees.  The Borrower shall pay to\n                ---------------------\nthe  Administrative Agent, for the account of the Lenders, or  to\nthe  relevant Issuing Bank, as applicable, a fee for each  Letter\nof Credit issued on behalf of the Borrower (the \"Letter of Credit\n                                                 ----------------\nFee\"), determined as set forth in Section 3.08(a) and (b).\n---                               ---------------     ---\n\n           (e)    Payment  of Fees.  The fees described  in  this\n                  ----------------\nSection 2.03 represent compensation for services rendered and  to\n------------\nbe  rendered separate and apart from the lending of money or  the\nprovision  of credit and do not constitute compensation  for  the\nuse, detention or forbearance of money, and the obligation of the\nBorrower  to  pay each fee described herein shall be in  addition\nto,  and  not in lieu of, the obligation of the Borrower  to  pay\ninterest,  other  fees and expenses otherwise described  in  this\nAgreement.   Fees  and  expenses shall be  payable  when  due  in\nimmediately  available  funds.  All fees and  expenses  shall  be\nnonrefundable  when  paid.  All fees and  expenses  specified  or\nreferred  to  in this Agreement due to the Administrative  Agent,\nthe  Issuing  Banks or a Lender, including those referred  to  in\nthis   Section  2.03  and  in  Section  12.03,  shall  constitute\n       -------------           --------------\nObligations and shall be secured by all the Collateral.  All fees\ndescribed in this Section 2.03 which are expressed as a per annum\n                  ------------\ncharge  shall be calculated on the basis of the actual number  of\ndays elapsed in a 360-day year.\n\n==================================================================\n                              -34-\n\n           2.04.   Voluntary and Mandatory Prepayments.  (a)  The\n                   -----------------------------------\nBorrower  may, (i) upon written or telephonic irrevocable  notice\nfor  any Base Rate Loan on the proposed prepayment date, or  upon\nnot  less  than three Business Day's prior written or  telephonic\nnotice for any Eurodollar Rate Loan (in each case not later  than\n11:00 a.m. (New York time) on the date such notice is given), and\nif  made by telephone, confirmed immediately by facsimile to  the\nAdministrative Agent (which notice the Administrative Agent shall\npromptly  transmit by facsimile or telephone to each Lender),  at\nany  time and from time to time, prepay any Loan in whole  or  in\npart,  without premium or penalty, in an aggregate minimum amount\nof  $1,000,000, and integral multiples of $1,000,000 in excess of\nsuch amounts; provided that the Borrower may prepay such Loans in\n              --------\nfull  without  regard  to  such  minimum  amount;  and  provided,\n                                                        --------\nfurther, that if the Borrower prepays any Eurodollar Rate Loan on\n-------\na  date  other  than the expiration date of the  Interest  Period\napplicable  thereto, the Borrower shall pay to the Administrative\nAgent  the  amounts described in Section 2.07(d).  Any notice  of\n                                 ---------------\nprepayment  given to the Administrative Agent under this  Section\n                                                          -------\n2.04(a)  shall  specify the date of prepayment and the  aggregate\n-------\nprincipal  amount of the prepayment.  If a notice  of  prepayment\nhas  been  delivered  as provided herein, such  notice  shall  be\nirrevocable  and the principal amount of the Loans  specified  in\nsuch  notice shall become due and payable on the prepayment  date\nspecified in such notice.\n\n           (b)    If  at  any time the sum of (i)  the  aggregate\nprincipal amount of Loans outstanding at such time plus (ii)  the\nLetter  of  Credit Obligations at such time exceed the  Borrowing\nBase  Amount at such time, the Borrower shall, without notice  or\ndemand, immediately repay Loans in an aggregate principal  amount\nequal to the lesser of (x) the amount of such excess and (y)  the\naggregate principal amount of Loans then outstanding, in the case\nof  Eurodollar Rate Loans, together with interest accrued to  the\ndate  of  such payment or prepayment on the principal so  prepaid\nand  any  amounts  payable under Section  2.07(d)  in  connection\n                                 ----------------\ntherewith.   In  the case of Base Rate Loans, interest  shall  be\npayable  at  the next Interest Payment Date.  To the extent  that\nafter  giving effect to any prepayment of Loans required  by  the\npreceding sentence, the sum of (i) the aggregate principal amount\nof  Loans outstanding at such time plus (ii) the Letter of Credit\nObligations at such time exceed the Borrowing Base Amount at such\ntime,  the  Borrower shall, without notice or demand, immediately\ndeposit  in  a  Cash  Collateral Account  upon  terms  reasonably\nsatisfactory to the Administrative Agent an amount equal  to  the\nlesser  of (i) the Letter of Credit Obligations at such time  and\n(ii)  the  amount  of such remaining excess.  The  Administrative\nAgent  shall  apply  any cash deposited in  the  Cash  Collateral\nAccount   (to  the  extent  thereof)  to  pay  any  Reimbursement\nObligations  which  become  due  thereafter,  provided  that  the\n                                              --------\nAdministrative Agent shall release to the Borrower from  time  to\ntime such portion of the amount on deposit in the Cash Collateral\nAccount  which  is equal to the amount by which the  sum  of  (A)\nBorrowing Base Amount at such time plus (B) the amount on deposit\nin  the  Cash Collateral Account at such time exceeds the sum  of\n(i)  the aggregate principal amount of Loans outstanding at  such\ntime  plus  (ii) the Letter of Credit Obligations at  such  time.\n\"Cash  Collateral  Account\" means an account established  by  the\n -------------------------\nBorrower  with  the  Administrative  Agent  and  over  which  the\nAdministrative Agent shall have exclusive dominion  and  control,\nincluding  the right of withdrawal for application in  accordance\nwith  this  Section 2.04(b).  The Borrower shall also prepay  the\n            ---------------\nLoans to the extent required to comply with Section 2.01(a)(v).\n                                            ------------------\n\n\n          2.05.  Payments.\n                 --------\n===================================================================\n                              -35-\n\n           (a)   Manner and Time of Payment. (i) All payments  of\n                 --------------------------\nprincipal, interest, Reimbursement Obligations and fees hereunder\nor  any  Letter  of Credit payable to the Lenders shall  be  made\nwithout  condition  or reservation of right, in  Dollars  and  in\nimmediately  available  funds, delivered  to  the  Administrative\nAgent at the Administrative Agent's Payment Office not later than\n1:00 p.m. (New York time) on the date due; and funds received  by\nthe Administrative Agent after that time and date shall be deemed\nto have been paid and received by the Administrative Agent on the\nnext succeeding Business Day.  Payments actually received by  the\nAdministrative Agent for the account of the Lenders shall be paid\nto  them  promptly  in like funds after receipt  thereof  by  the\nAdministrative Agent.\n\n\n              (ii)   Unless the Administrative Agent  shall  have\nreceived notice from the Borrower prior to the date on which  any\npayment  is  due to the Lenders hereunder that the Borrower  will\nnot  make  such  payment  in full, the Administrative  Agent  may\nassume  that  the Borrower has made such payment in full  to  the\nAdministrative  Agent on such date, and the Administrative  Agent\nmay, in reliance upon such assumption, cause to be distributed to\neach  Lender on such due date an amount equal to the amount  then\ndue  such  Lender.  If and to the extent the Borrower  shall  not\nhave  so  made such payment in full to the Administrative  Agent,\neach Lender shall repay to the Administrative Agent forthwith  on\ndemand  the excess of the amount distributed to such Lender  over\nthe  amount, if any, paid by the Borrower for the account of such\nLender, together with interest thereon at the Federal Funds Rate,\nfor  each  day from the date such amount is distributed  to  such\nLender  until  the  date such Lender repays such  amount  to  the\nAdministrative Agent; provided, however, that if any Lender shall\n                      --------  -------\nfail to repay such amount within three Business Days after demand\ntherefor,  such Lender shall, from and after such third  Business\nDay  until  payment  is  made  to the Administrative  Agent,  pay\ninterest thereon at a rate per annum equal to the Base Rate.\n\n\n          (b)   Apportionment of Payments.  So long as there does\n                -------------------------\nnot  exist  an  Event of Default, all payments of  principal  and\ninterest  in respect of outstanding Loans, all payments  of  fees\nconstituting  Obligations, and all payments  in  respect  of  any\nother Obligations shall be allocated among such of the Lenders as\nare  entitled thereto, in proportion to their respective Pro Rata\nShares or otherwise as provided herein.  After the occurrence and\nduring  the continuance of an Event of Default, and after  notice\nby  the  Administrative Agent to the Borrower that  payments  and\nproceeds  shall  be  so  applied, all payments  remitted  to  the\nAdministrative Agent and all amounts and proceeds  of  Collateral\nreceived by the Administrative Agent shall be applied, subject to\nthe  provisions of this Agreement, (i) first, to pay  Obligations\nin   respect  of  any  fees  or  indemnities  then  due  to   the\nAdministrative  Agent, the Issuing Banks and  the  Lenders;  (ii)\nsecond,  to  pay Obligations in respect of expense reimbursements\nthen  due  under  Section 12.03; (iii) third, to  pay  or  prepay\n                  -------------\nprincipal  of  and  interest  on  any  outstanding  Reimbursement\nObligations  and  Loans,  and  to pay  (or  to  the  extent  such\nObligations are contingent, prepay or provide cash collateral  in\nrespect  of)  Letter  of  Credit Obligations;  provided  that  if\n                                               --------\nsufficient  funds are not available to fund all  payments  to  be\nmade  to the holders of the Obligations described in this  clause\n(iii),  the available funds shall be allocated to the payment  of\nsuch  Obligations ratably, based on the proportion of  each  such\nholder's   interest   in   the   aggregate   outstanding   Loans,\nReimbursement Obligations and other Letter of Credit  Obligations\n(in  each  instance  whether or not due); and provided,  further,\n                                              --------   -------\nthat  matured  and,  to the extent permitted  by  law,  unmatured\ninterest-bearing Obligations shall, in any event, be  paid  prior\nto  prepayment  or  provision of cash collateral  for  contingent\nLetter of Credit Obligations; (iv) fourth, to the ratable payment\n=================================================================\n                              -36-\n            \nof  all  other  Obligations  then due  and  payable  for  expense\nreimbursements;  (v)  fifth,  to pay  Obligations  then  due  and\npayable  in respect of the Interest Rate Contracts, if  any;  and\n(vi)  sixth, to the ratable payment of all other Obligations  due\nto any and all holders of Obligations.\n\n           The Administrative Agent shall promptly distribute  to\neach Lender at its primary address set forth in Schedule 1.01(a),\n                                                ----------------\nor at such other address as a Lender may request in writing, such\nfunds as it may be entitled to receive or as may be shown due  to\nit  in the Administrative Agent's Loan Account, provided that the\nAdministrative Agent shall in any event not be bound  to  inquire\ninto or determine the validity, scope or priority of any interest\nor  entitlement of any Lender or any other holder of  Obligations\nand   may  suspend  all  payments  or  seek  appropriate   relief\n(including instructions from the Requisite Lenders or  an  action\nin  the  nature  of interpleader) in the event of  any  doubt  or\ndispute  as  to  any  apportionment or distribution  contemplated\nhereby.   The  order of priority herein is set  forth  solely  to\ndetermine the rights and priorities of the holders of Obligations\nas  among themselves and may at any time or from time to time  be\nchanged  by  the  Lenders  as  they  may  elect,  in  writing  in\naccordance  with  Section 12.08 (except that no  amendment  shall\n                  -------------\nrequire prepayment or provision of cash collateral for contingent\nLetter of Credit Obligations unless (as provided in clause  (iii)\n                                                    -------------\nof   Section   2.05(b))  matured  and  certain   interest-bearing\n     ------------------\nunmatured Obligations shall have been paid), without necessity of\nnotice to or consent of or approval by the Borrower or any  other\nPerson.\n\n           (c)    Payments  on Non-Business Days.   Whenever  any\n                  ------------------------------\npayment  to be made by the Borrower hereunder shall be stated  to\nbe  due  on a day which is not a Business Day, payments shall  be\nmade  on  the next succeeding Business Day and such extension  of\ntime  shall  be  included in the computation of  the  payment  of\ninterest  hereunder and of any of the fees specified  in  Section\n                                                          -------\n2.03, as the case may be.\n----\n\n           (d)   Payments by Lenders to the Administrative Agent.\n                 -----------------------------------------------\nUnless  the Administrative Agent shall have been notified by  any\nLender prior to any Funding Date that such Lender does not intend\nto  make available to the Administrative Agent such Lender's Loan\non such Funding Date (except that in the case of Base Rate Loans,\nthe  Administrative Agent shall have been so  notified  no  later\nthan  1:00  p.m.  (New  York  time) on  the  Funding  Date),  the\nAdministrative Agent may assume that such Lender  has  made  such\namount available to the Administrative Agent on such Funding Date\nand  the  Administrative Agent in its sole  discretion  may,  but\nshall  not  be  obligated to, make available to  the  Borrower  a\ncorresponding amount on such Funding Date.  If such corresponding\namount is not in fact made available to the Administrative  Agent\nby  such Lender on or prior to a Funding Date, such Lender agrees\nto  pay  and  the  Borrower  agrees to  repay  severally  to  the\nAdministrative  Agent  forthwith  on  demand  such  corresponding\namount together with interest thereon, for each day from the date\nsuch amount is made available to the Borrower until the date such\namount  is paid or repaid to the Administrative Agent, at (A)  in\nthe  case  of such Lender, the Federal Funds Rate for  the  first\nthree  Business Days and thereafter at the Base Rate, and (B)  in\nthe  case  of the Borrower, the interest rate applicable  at  the\ntime to a Borrowing of Base Rate Loans made on such Funding Date.\nIf  such  Lender  shall  pay  to the  Administrative  Agent  such\ncorresponding  amount, such amount so paid shall constitute  such\nLender's  Loan,  and if both such Lender and the  Borrower  shall\nhave  paid  and repaid, respectively, such corresponding  amount,\nthe  Administrative Agent shall promptly pay over to the Borrower\nsuch  corresponding amount in same day funds,  but  the  Borrower\nshall remain obligated for all interest thereon.  Nothing in this\nSection  2.05(d)  shall be deemed to relieve any  Lender  of  its\n---------------\n==================================================================\n                              -37-\nobligation  hereunder  to  make its Loan  on  any  Funding  Date.\nNotwithstanding any provision of this Agreement to the  contrary,\nthe  Administrative  Agent may apply all funds  and  proceeds  of\nCollateral available for the payment of any Obligations first  to\nrepay  any amount owing by any Lender to the Administrative Agent\nas a result of such Lender's failure to fund its Loan as required\nhereunder.\n\n\n          2.06.  Interest Periods.  By giving notice as set forth\n                 ----------------\nin  Section  2.01(b) or 2.02(c)(ii) with respect to a  Eurodollar\n    ----------------    -----------\nBorrowing of, conversion into or continuation of Eurodollar  Rate\nLoans,  the Borrower shall have the option, subject to the  other\nprovisions  of this Section 2.06 and Section 2.07, to specify  an\n                    ------------     ------------\ninterest  period  (each an \"Interest Period\")  to  apply  to  the\n                            ---------------\nBorrowing  described in such notice, which Interest Period  shall\nbe  either a 1-, 2-, 3-, or 6-month period.  The determination of\nInterest Periods shall be subject to the following provisions:\n\n\n           (a)    In  the case of immediately successive Interest\nPeriods,  each successive Interest Period shall commence  on  the\nday on which the next preceding Interest Period expires;\n\n\n           (b)   If any Interest Period would otherwise expire on\na  day which is not a Business Day, the Interest Period shall  be\nextended  to expire on the next succeeding Business Day; provided\nthat if any such Interest Period would otherwise expire on a  day\nwhich is not a Business Day and no further Business Day occurs in\nthat  month, that Interest Period shall expire on the immediately\npreceding Business Day;\n\n          (c)   The Borrower may not select an Interest Period in\nrespect  of Loans which terminates later than the Final  Maturity\nDate; and\n\n\n            (d)    Without  the  prior  written  consent  of  the\nAdministrative Agent and the Requisite Lenders, there shall be no\nmore than five Interest Periods under this Agreement at any time.\n\n\n           2.07.   Special  Provisions Governing Eurodollar  Rate\n                   ----------------------------------------------\nLoans.   Notwithstanding other provisions of this Agreement,  the\n-----\nfollowing provisions shall govern with respect to Eurodollar Rate\nLoans as to the matters covered:\n\n           (a)    Determination of Interest  Rate.   As  soon  as\n                  -------------------------------\npracticable two Business Days prior to the Funding Date  or  date\nof  conversion  or continuation, the Administrative  Agent  shall\ndetermine  (which determination shall, absent manifest error,  be\npresumptively correct) the interest rate which shall apply to the\nEurodollar  Rate Loans for which an interest rate is  then  being\ndetermined for the applicable Interest Period and shall  promptly\ngive  notice  thereof  (in writing or by telephone  confirmed  in\nwriting) to the Borrower and to each Lender.\n\n           (b)    Interest  Rate Unascertainable,  Inadequate  or\n                  -----------------------------------------------\nUnfair.   With  respect  to  any  Interest  Period,  if  (i)  the\n------\nReference  Bank  is  not offering deposits  in  Dollars  (in  the\napplicable amounts) in the London interbank Eurodollar market for\nsuch Interest Period, or (ii) the Administrative Agent reasonably\ndetermines  that  adequate  and  fair  means  do  not  exist  for\nascertaining  the applicable interest rate on the basis  provided\nfor  in  the definition of Eurodollar Rate, for any reason  other\nthan  the  failure  of the Reference Bank to  offer  deposits  in\n=================================================================\n                           -38-\n\nDollars  in  the  relevant market, then the Administrative  Agent\nshall  forthwith  give notice thereof to the Borrower,  whereupon\nuntil   the   Administrative  Agent  has  determined   that   the\ncircumstances giving rise to such suspension no longer exist, (a)\nthe  right  of the Borrower to elect to have Loans bear  interest\nbased upon the Eurodollar Rate, shall be suspended, and (b)  each\noutstanding Eurodollar Rate Loan, shall be converted into a  Base\nRate  Loan  or a Eurodollar Rate Loan not covered by  the  notice\ndescribed  above  (as may be designated by the Borrower)  on  the\nlast   day   of  the  then  current  Interest  Period   therefor,\nnotwithstanding  any  prior  election  by  the  Borrower  to  the\ncontrary.\n\n           (c)    Illegality.  (i) In the event that on any  date\n                  ----------\nany  Lender shall have determined (which determination shall,  in\nthe  absence  of  manifest  error, be final  and  conclusive  and\nbinding upon all parties) that the making or continuation of  any\nEurodollar  Rate Loan has become unlawful by compliance  by  that\nLender  in good faith with any law, governmental rule, regulation\nor order of any Governmental Authority (whether or not having the\nforce of law and whether or not failure to comply therewith would\nbe  unlawful),  then, and in any such event,  such  Lender  shall\npromptly  give  notice  (by facsimile or  by  telephone  promptly\nconfirmed  in  writing)  to the Borrower and  the  Administrative\nAgent of that determination and the reasons therefor.\n\n\n              (ii)  Upon the giving of the notice referred to  in\nSection  2.07(c)(i), (A) the Borrower's right to request of  such\n-------------------\nLender and such Lender's obligation to make Eurodollar Rate Loans\nshall  be  immediately suspended, and such Lender  shall  make  a\nLoan,  as  part  of  any requested Borrowing of  Eurodollar  Rate\nLoans,  as  a  Base Rate Loan or as a Eurodollar  Rate  Loan  not\ncovered  by  the  notice  described  in  Section  2.07(c)(i)  (as\n                                         -------------------\ndesignated  by the Borrower), which Base Rate Loan or  Eurodollar\nRate  Loan shall, for all purposes, be considered a part of  such\nBorrowing, and (B) if the affected Eurodollar Rate Loan or  Loans\nare  then  outstanding, the Borrower shall  immediately  (or,  if\npermitted  by  applicable law, no later than the  date  permitted\nthereby, upon at least one Business Day's written notice  to  the\nAdministrative Agent and the affected Lender) convert  each  such\nLoan  into a Base Rate Loan or a Eurodollar Rate Loan not covered\nby  such  notice.  If at any time notice is given  under  Section\n                                                          -------\n2.07(c)(i)  by one or more Lenders, but not by all of  them,  the\n----------\nprovisions of this Section 2.07(c)(ii) shall apply only in  favor\n                   -------------------\nof the Lenders which gave such notice.\n\n              (iii)  In the event that a Lender determines at any\ntime  following  its giving of a notice referred  to  in  Section\n                                                          -------\n2.07(c)(i)  that  such Lender may lawfully make  Eurodollar  Rate\n----------\nLoans  of  the  type(s) referred to in such notice,  such  Lender\nshall promptly give notice (by facsimile or by telephone promptly\nconfirmed  in  writing)  to the Borrower and  the  Administrative\nAgent  of  that determination, whereupon the Borrower's right  to\nrequest  of  such  Lender and such Lender's  obligation  to  make\nEurodollar Rate Loans of such type(s) shall be restored.\n\n\n          (d)   Compensation.  In addition to such amounts as are\n                ------------\nrequired to be paid by the Borrower pursuant to Sections 2.02(a),\n                                                ----------------\n(d)  and  (f),  the Borrower shall compensate each  Lender,  upon\n---       ---\ndemand,  for all losses, expenses and liabilities (including  any\nloss or expense incurred by reason of the liquidation or reemploy\nment  of deposits or other funds acquired by such Lender to  fund\nor  maintain such Lender's Eurodollar Rate Loans to the Borrower)\nwhich such Lender may sustain (i) if for any reason (other than a\ndefault  by  such  Lender), a Borrowing of,  conversion  into  or\ncontinuation of Eurodollar Rate Loans does not occur  on  a  date\nspecified  therefor  in  a Notice of Borrowing  or  a  Notice  of\nConversion\/Continuation or in a telephonic request for  borrowing\n\n=================================================================\n                            -39-\n\nor  conversion\/continuation or a successive Interest Period  does\nnot  commence after notice therefor is given pursuant to  Section\n                                                          -------\n2.02(c), (ii) if any prepayment or payment of any Eurodollar Rate\n-------\nLoan  (including any prepayment pursuant to Section 2.04)  occurs\n                                            ------------\nfor  any  reason  on  a date which is not the  last  day  of  the\napplicable  Interest  Period,  (iii)  as  a  consequence  of  any\nrequired conversion of a Eurodollar Rate Loan to a Base Rate Loan\nas a result of any of the events indicated in Section 2.07(c), or\n                                              ---------------\n(iv)  as  a  consequence of any other failure by the Borrower  to\nprepay or repay Eurodollar Rate Loans when required by the  terms\nof  this  Agreement.  Such Lender shall deliver to  the  Borrower\nwith  a  copy to the Administrative Agent, as a condition of  the\nBorrower's  obligation  to  compensate  such  Lender,  a  written\nstatement  as  to  such  losses, expenses and  liabilities  which\nstatement,  in the absence of manifest error, shall be conclusive\nas to such amounts.\n\n           (e)    Quotation of Eurodollar Rate.  If the Reference\n                  ----------------------------\nBank  shall  have  failed to provide offered  quotations  to  the\nAdministrative  Agent  in  accordance  with  the  definition   of\n\"Eurodollar  Rate\",  the  Administrative  Agent  shall  give  the\nBorrower  and  each Lender prompt notice thereof  and  the  Loans\nrequested shall be made or continued as, or converted into,  Base\nRate Loans.\n\n          (f)   Booking of Eurodollar Rate Loans.  Any Lender may\n                --------------------------------\nmake, carry or transfer Eurodollar Rate Loans at, to, or for  the\naccount of, any of its branch offices, agencies or the office  of\nan  Affiliate of that Lender; provided that no such Lender  shall\n                              --------\nbe  entitled to receive any greater amount under Section  2.02(f)\n                                                 ----------------\nor Section 2.08 as a result of the transfer of any such Loan than\n   ------------\nsuch Lender would be entitled to immediately prior thereto unless\n(i)  such  transfer occurred at a time when circumstances  giving\nrise  to the claim for such greater amount did not exist and were\nnot  reasonably  foreseeable by such Lender, or (ii)  such  claim\nwould have arisen even if such transfer had not occurred.\n\n          2.08.  Taxes.\n                 -----\n           (a)    Any  and all payments by the Borrower hereunder\nshall be made, in accordance with Section 2.05, free and clear of\n                                  ------------\nand  without  deduction for any and all present or future  taxes,\nlevies,  imposts, deductions, charges, or withholdings,  and  all\nliabilities  with respect thereto but excluding, in the  case  of\neach  Lender and the Administrative Agent, taxes imposed  on  its\nnet  income, branch profits taxes and franchise taxes imposed  on\nit  by the United States of America or any Governmental Authority\n(including  Puerto Rico) and, in the case of each  Lender,  taxes\nimposed  on  its income and franchise taxes imposed on  it  as  a\nresult  of making any Loan, by the Governmental Authority of  the\njurisdiction of such Lender's Applicable Lending Office (all such\nnon-excluded   taxes,   levies,  imposts,  deductions,   charges,\nwithholdings,  and liabilities which a Lender  determines  to  be\napplicable to this Agreement, the Commitments, the Loans  or  the\nLetters of Credit being hereinafter referred to as \"Taxes\").   If\n                                                    -----\nthe Borrower shall be required by law to deduct any Taxes from or\nin  respect  of  any sum payable hereunder to any Lender  or  the\nAdministrative  Agent,  (i)  so  long  as  such  Lender  or   the\nAdministrative Agent is in compliance with Section  2.08(e),  the\n                                           ---------------\nsum  payable shall be increased as may be necessary so that after\nmaking  all  required deductions (including deductions applicable\nto  additional sums payable under this Section 2.08) such  Lender\n                                       ------------\nor  the  Administrative Agent (as the case may  be)  receives  an\namount  equal  to  the  sum it would have received  had  no  such\ndeductions  been  made,  (ii)  the  Borrower  shall   make   such\ndeductions,  and  (iii) the Borrower shall pay  the  full  amount\n\n=================================================================\n                             -40-\n\ndeducted to the relevant taxation authority or other authority in\naccordance  with  applicable law.  If a withholding  tax  of  the\nUnited  States  of  America or any other  Governmental  Authority\nshall  be  or  become  applicable (y)  after  the  date  of  this\nAgreement,  to  such  payments  by  the  Borrower  made  to   the\nApplicable  Lending  Office or any other  office  that  a  Lender\nspecified on Schedule 1.01(a) to this Agreement may claim as  its\n             ----------------\nApplicable  Lending  Office or (z) after such Lender's  selection\nand  designation of any other Applicable Lending Office, to  such\npayments  made  to  such other Applicable  Lending  Office,  such\nLender  shall, in good faith, use its reasonable best efforts  to\nmake, fund and maintain its Loans, and to make, fund and maintain\nits  obligations  under  the Letters of Credit,  through  another\nApplicable  Lending Office of such Lender in another jurisdiction\nso  as  to  reduce  the Borrower's liability  hereunder,  if  the\nmaking, funding or maintenance of such Loans or obligations under\nthe  Letters  of  Credit  through such other  Applicable  Lending\nOffice  of such Lender does not, in the judgment of such  Lender,\notherwise  materially  adversely affect such  Loans,  obligations\nunder the Letters of Credit or such Lender.\n\n           (b)    In  addition, the Borrower agrees  to  pay  any\npresent or future stamp or documentary taxes or any other  excise\nor  property taxes, charges, or similar levies which  arise  from\nany  payment  made  hereunder, from the issuance  of  Letters  of\nCredit hereunder, or from the execution, delivery or registration\nof,   or   otherwise  with  respect  to,  this   Agreement,   the\nCommitments,  the  Loans  or the Letters of  Credit  (hereinafter\nreferred to as \"Other Taxes\").\n                -----------\n\n           (c)   The Borrower will indemnify each Lender and  the\nAdministrative Agent for the full amount of Taxes and Other Taxes\n(including  any Taxes or Other Taxes imposed by any  Governmental\nAuthority  on  amounts payable under this Section 2.08)  paid  by\n                                          ------------\nsuch Lender or the Administrative Agent (as the case may be)  and\nany  liability  (including  penalties,  interest,  and  expenses)\narising  therefrom or with respect thereto, whether or  not  such\nTaxes  or Other Taxes were correctly or legally asserted by  such\nGovernmental  Authority.   This  indemnification  shall  be  made\nwithin  30  days after the date such Lender or the Administrative\nAgent  (as  the  case may be) makes written demand  therefor.   A\ncertificate  as to any additional amount payable  to  any  Lender\nunder  this  Section  2.08 submitted to  such  Borrower  and  the\n             -------------\nAdministrative  Agent  (if a Lender is  so  submitting)  by  such\nLender  or  the  Administrative Agent shall  show  in  reasonable\ndetail  the amount payable and the calculations used to determine\nsuch   amount  and  shall,  absent  manifest  error,  be   final,\nconclusive  and  binding upon all parties  hereto.   Each  Lender\nagrees that, to the extent that such Lender is entitled to  claim\nan  exemption in respect of all or a portion of any  Taxes  which\nare  otherwise  required  to  be paid  or  deducted  or  withheld\npursuant  to  this Section 2.08 in respect of any payments  under\n                   ------------\nthis  Agreement such Lender shall within a reasonable time  after\nreceiving  written request by the Borrower provide  the  Borrower\nwith  such  certificates as such Lender in good  faith  may  deem\nappropriate to obtain the benefits of such exemption.\n\n\n           (d)   Within 30 days after the date of any payment  of\nTaxes  or Other Taxes by the Borrower, the Borrower will  furnish\nto  the  Administrative  Agent, at its  address  referred  to  in\nSection  12.10,  the original or a certified copy  of  a  receipt\n--------------\nevidencing payment thereof.\n\n          (e)   Each Lender (or transferee of any Lender) that is\nnot a United States person (as defined in Section 7701(a)(30)  of\nthe Code) (a \"Non-U.S. Lender\") shall deliver to the Borrower and\n              ---------------\nthe Administrative Agent (or in the case of a participant, to the\nLender  from  which  the related participation  shall  have  been\npurchased) two copies of U.S. Internal Revenue Service Form 1001,\n=================================================================\n                             -41-\n\nForm  4224  or  any  subsequent versions  thereof  or  successors\nthereto,  or, in the case of a Non-U.S. Lender claiming exemption\nfrom  U.S. federal withholding tax under Section 871(h) or 881(c)\nof  the Code with respect to payments of \"portfolio interest\",  a\nForm  W-8,  or  any  subsequent versions  thereof  or  successors\nthereto (and, if such Non-U.S. Lender delivers a Form W-8, or any\nsubsequent  versions  thereof or successors  thereto,  an  annual\ncertificate representing that such Non-U.S. Lender (i) is  not  a\n\"bank\"  for  purposes of Section 881(c) of the Code (and  is  not\nsubject  to regulatory or other legal requirements as a  bank  in\nany  jurisdiction, and has not been treated  as  a  bank  in  any\nfiling  with or submission made to any Governmental Authority  or\nrating agency), (ii) is not a 10-percent shareholder (within  the\nmeaning of Section 871(h)(3)(B) of the Code) of the Borrower  and\n(iii)  is  not  a controlled foreign corporation related  to  the\nBorrower (within the meaning of Section 864(d)(4) of the  Code)),\nproperly  completed  and duly executed by  such  Non-U.S.  Lender\nclaiming complete exemption from U.S. federal withholding tax  on\nall  payments by the Borrower under this Agreement and the  other\nLoan  Documents, along with such other additional  forms  as  the\nBorrower  or the Administrative Agent may reasonably  request  to\nestablish  the availability of such exemption.  Such forms  shall\nbe  delivered by each Non-U.S. Lender on or before  the  date  it\nbecomes  a  party  to  this Agreement (or, in  the  case  of  any\nparticipant, on or before the date such participant purchases the\nrelated  participation) and on or before the date, if  any,  such\nNon-U.S.   Lender  changes  its  Applicable  Lending  Office   by\ndesignating a different lending office (a \"New Lending  Office\").\n                                           -------------------\nIn addition, each Non-U.S. Lender shall timely deliver such forms\n(or  any  other  form  of certification adopted  by  U.S.  taxing\nauthorities  for such purpose) promptly upon the obsolescence  or\ninvalidity  of  any form previously delivered  by  such  Non-U.S.\nLender.   Each Non-U.S. Lender shall promptly notify the Borrower\nat  any time it determines that it is no longer in a position  to\nprovide any previously delivered certificate to the Borrower  (or\nany  other  form  of  certification adopted by  the  U.S.  taxing\nauthorities  for  such  purpose).   Notwithstanding   any   other\nprovision  of  Section  2.08,  a Non-U.S.  Lender  shall  not  be\n               -------------\nrequired  to  deliver any form pursuant to this  Section  2.08(e)\n                                                 ---------------\nthat such Non-U.S. Lender is not legally able to deliver.\n\n\n           (f)    The Borrower shall not be required to indemnify\nany Non-U.S. Lender, or to pay any additional amounts to any Non-\nU.S. Lender, in respect of United States federal withholding  tax\npursuant  to  paragraph (a) or (c) above to the extent  that  the\nobligation  to  withhold amounts with respect  to  United  States\nfederal withholding tax existed on the date such Non-U.S.  Lender\nbecame  a  party  to  this  Agreement  (or,  in  the  case  of  a\nparticipant, on the date such participant became a transferee  of\na  participation interest hereunder) or, with respect to payments\nto a New Lending Office, the date such Non-U.S. Lender designated\nsuch New Lending Office with respect to a Loan.\n\n\n          (g)   If the IRS or any other Governmental Authority of\nthe  United States or of any other jurisdiction asserts  a  claim\nthat  the  Administrative Agent or the Borrower did not  properly\nwithhold  tax  from  amounts paid to or for the  account  of  any\nLender  (because the appropriate form was not delivered, was  not\nproperly  executed, or because such Lender failed to  notify  the\nAdministrative Agent of a change in circumstances which  rendered\nthe  exemption from withholding tax ineffective or for any  other\nreason),  such  Lender  shall indemnify the Administrative  Agent\nand\/or  the Borrower, as applicable, fully for all amounts  paid,\ndirectly  or indirectly, by the Administrative Agent  and\/or  the\nBorrower, as applicable, as tax or otherwise, including penalties\nand interest, and including any taxes imposed by any jurisdiction\non  the  amounts  payable  to  the Administrative  Agent  or  the\n=================================================================\n                            -42-\n\nBorrower,  as applicable, under this Section 2.08, together  with\n                                     ------------\nall  costs and expenses, including, legal fees, incurred  by  the\nAdministrative Agent or the Borrower.\n\n           (h)    If  the  Administrative  Agent  or  any  Lender\nreceives  a  refund,  which in the good faith  judgment  of  such\nLender is allocable to Taxes or Other Taxes paid by the Borrower,\nit shall promptly pay such refund to the Borrower, net of all out-\nof-pocket expenses of such Lender incurred in obtaining such  Tax\nRefund,  provided, however, that the Borrower agrees to  promptly\n         --------  -------\nreturn  such refund to the Administrative Agent or the applicable\nLender,  as  the  case  may be, if it receives  notice  from  the\nAdministrative   Agent   or   applicable   Lender    that    such\nAdministrative Agent or Lender is required to repay such  refund.\nIn  addition,  the Lender shall take such steps as  the  Borrower\nshall  reasonably request to recover or assist  the  Borrower  in\nrecovering any Taxes or Other taxes paid by the Borrower pursuant\nto paragraph (a) or (c) above.\n\n           (i)    Without prejudice to the survival of any  other\nagreement   of   the  Borrower  hereunder,  the  agreements   and\nobligations of the Borrower contained in this Section 2.08  shall\n                                              ------------\nsurvive  the payment in full of principal and interest hereunder,\nthe  termination of the Letters of Credit and the termination  of\nthis Agreement.\n\n            2.09.   Increased Capital.  If any Lender  or  Issuing\n                   -----------------\nBank determines that either (a) the introduction of or any change\nin  any  law,  order  or regulation or in the  interpretation  or\nadministration   of   any  law,  order  or  regulation   by   any\nGovernmental   Authority  charged  with  the  interpretation   or\nadministration  thereof after the date hereof or  (b)  compliance\nwith  any  guideline  or request issued or made  after  the  date\nhereof  from  any  central bank or other  Governmental  Authority\n(whether  or not having the force of law) has or would  have  the\neffect  of  reducing the rate of return on the  capital  of  such\nLender or Issuing Bank or any corporation controlling such Lender\nor  Issuing Bank, as a consequence of or with reference  to  such\nLender's  Commitment or its making or maintaining Loans  or  such\nIssuing  Bank's  issuance or maintenance  of,  or  such  Lender's\nparticipation in any Letter of Credit, below the rate which  such\nLender or such Issuing Bank or such other corporation could  have\nachieved  but  for  such  compliance  (taking  into  account  the\npolicies of such Lender or such Issuing Bank or corporation  with\nregard  to capital), then the Borrower shall from time  to  time,\nupon  demand by such Lender or Issuing Bank (with a copy of  such\ndemand  to  the  Administrative Agent), pay  to  such  Lender  or\nIssuing  Bank  additional amounts sufficient to  compensate  such\nLender  or  Issuing Bank or other corporation for such reduction,\nupon  receipt  by the Borrower (with a copy to the Administrative\nAgent)  of  a certificate as to such amounts, by such  Lender  or\nIssuing  Bank, setting forth in reasonable detail the basis  for,\nand  the  calculations used by such Lender  or  Issuing  Bank  in\ndetermining, any such amounts.  Such certificate, in the  absence\nof  manifest  error  shall  be conclusive  and  binding  for  all\npurposes.  Each Lender and Issuing Bank agrees promptly to notify\nthe  Borrower  and the Administrative Agent of any  circumstances\nthat  would cause the Borrower to pay additional amounts pursuant\nto  this  Section 2.09, provided that the failure  to  give  such\n          ------------  --------\nnotice  shall not affect the Borrower's obligation  to  pay  such\nadditional amounts hereunder, provided further that the  Borrower\n                              -------- -------\nshall not be required to compensate a Lender or the Issuing Banks\npursuant  to  this Section for any increased costs or  reductions\nincurred more than 180 days prior to the date that such Lender or\nIssuing  Bank, as the case may be, notifies the Borrower  of  the\ncircumstances  giving rise to such increased costs or  reductions\nand  of  such  Lender's  or  Issuing Bank's  intention  to  claim\ncompensation   therefor;   provided   further   that,   if    the\n                           --------  --------\ncircumstances  giving rise to such increased costs or  reductions\n=================================================================\n                           -43-\n\nis  retroactive, then the 180-day period referred to above  shall\nbe extended to include the period of retroactive effect thereof.\n\n\n           2.10.  Use of Proceeds of the Loans.  The proceeds  of\n                  ----------------------------\nthe Loans may be used for general corporate purposes.\n\n\n           2.11.   Replacement  of Lender  in  Event  of  Adverse\n                   ----------------------------------------------\nCondition.   If the Borrower becomes obligated to pay  additional\n---------\namounts to any Lender pursuant to Sections 2.02(f), 2.07(d), 2.08\n                                  ----------------  -------  ----\nor  2.09  as a result of any condition described in such Sections\n    ----\nwhich  is  not generally applicable to all Lenders, then,  unless\nsuch  Lender has theretofore taken steps to remove or  cure,  and\nhas  removed or cured, the conditions creating the cause for such\nobligation  to  pay such additional amounts,  or  if  any  Lender\ndefaults  in its obligation to fund Loans hereunder, the Borrower\nmay  designate another bank which is reasonably acceptable to the\nAdministrative  Agent  and the Issuing  Banks  (such  bank  being\nherein called a \"Replacement Lender\") to purchase for cash all of\n                 ------------------\nthe  Obligations  of such Lender and all of such Lender's  rights\nhereunder,  without recourse to or warranty by,  or  expense  to,\nsuch  Lender  for  a  purchase price  equal  to  the  outstanding\nprincipal  amount  payable to such Lender plus  any  accrued  but\nunpaid interest and accrued but unpaid commitment and other fees,\nexpense  reimbursements  and  indemnities  in  respect  of   that\nLender's Commitment.  Such Lender shall consummate such  sale  in\naccordance  with such terms (and, if such Lender  is  an  Issuing\nBank,  such  other terms as may be necessary to compensate  fully\nsuch  Lender) within a reasonable time not exceeding 60 days from\nthe  date the Borrower designated a Replacement Lender, and  upon\ncompliance with the provisions of Section 12.01 such Lender shall\n                                  -------------\nno  longer  be a party hereto or have any obligations  or  rights\nhereunder  (except  rights which, pursuant to the  provisions  of\nthis Agreement, survive the termination of this Agreement and the\nrepayment of the Loans), and the Replacement Lender shall succeed\nto such obligations and rights.\n\n           2.12.   Authorized  Officers  of  the  Borrower.   The\n                   ---------------------------------------\nAdministrative  Agent shall be entitled to rely  conclusively  on\nthe  authority of any officer or employee designated pursuant  to\nSection  4.01(c) to request any Loan or Letter of Credit  or  any\nconversion\/continuation  of  any Loan  until  the  Administrative\nAgent   receives   written   notice   to   the   contrary.    The\nAdministrative   Agent  shall  have  no  duty   to   verify   the\nauthenticity of the signature appearing on any written Notice  of\nBorrowing or Notice of Conversion\/Continuation and, with  respect\nto  an  oral request for such a Loan or Letter of Credit or  such\nconversion\/continuation, the Administrative Agent shall  have  no\nduty to verify the identity of any person representing himself as\none  of the officers or employees authorized to make such request\non  behalf of the Borrower.  Neither the Administrative Agent nor\nany  Lender shall incur any liability to the Borrower  in  acting\nupon   any   telephonic  notice  referred  to  above  which   the\nAdministrative Agent believes in good faith to have been given by\na duly authorized officer or other person authorized to borrow on\nbehalf of the Borrower.\n\n==================================================================\n                             -44-\n\n                          ARTICLE III\n\n                       Letters of Credit\n                       -----------------\n\n           3.01.  Obligation to Issue.  (a) Subject to the  terms\n                  -------------------\nand  conditions  set forth in this Agreement, each  Issuing  Bank\n(other  than  Bank of America) hereby agrees to issue,  and  each\nLender  agrees to participate in, one or more Letters  of  Credit\nfor  the account of the Borrower, up to an aggregate face  amount\nat   any  one  time  outstanding,  together  with  the  aggregate\nprincipal amount of outstanding Loans, equal to the lesser of the\nCommitments or the Borrowing Base Amount from time to time during\nthe  period commencing on the Initial Funding Date and ending  on\nthe  Business Day which is five Business Days prior to the  Final\nMaturity Date.\n\n          (b)   The Lenders acknowledge that the Existing Letters\nof  Credit have been issued for the account of the Borrower prior\nto  the  Initial  Funding Date and agree to participate  in  such\nLetters  of  Credit to the same extent and on the same conditions\nas  if  such  Letters  of  Credit had  been  issued  pursuant  to\nparagraph  (a) above.  Bank of America shall be the Issuing  Bank\n--------------\nwith respect to each Existing Letter of Credit but shall not have\nany obligation to issue any Letters of Credit pursuant to Section\n                                                          -------\n3.01(a) after the Closing Date.\n-------\n\n          3.02.  Types and Amounts.  Each Issuing Bank agrees not\n                 -----------------\nto issue any Letter of Credit at any time:\n\n           (a)    if  the aggregate maximum amount then available\nfor  drawing under Letters of Credit issued by such Issuing Bank,\nafter  giving  effect to the issuance of such Letter  of  Credit,\nwould  exceed  any limit imposed by law or regulation  upon  such\nIssuing Bank;\n\n\n          (b)   if, immediately after the issuance of such Letter\nof  Credit,  the aggregate amount of Letter of Credit Obligations\nthen  existing  (which amount shall be calculated without  giving\neffect  to  the participation of the Lenders pursuant to  Section\n                                                          -------\n3.06)  would  exceed  the lesser of (i) the Commitments  then  in\n----\neffect  less  the  aggregate principal amount of all  outstanding\n        ----\nLoans and (ii) the Borrowing Base Amount then in effect less  the\n                                                        ----\naggregate principal amount of all outstanding Loans;\n\n\n           (c)    which has an expiration date (i) more than  one\nyear  after the date of issuance, for Standby Letters  of  Credit\n(provided  that  a Standby Letter of Credit may  provide  for  an\n --------\nannual renewal on the terms set forth in Section 3.04(c)) or more\n                                         ---------------\nthan  180  days after the date of issuance (subject to  extension\nfor  a  maximum  period  of 60 days), for Commercial  Letters  of\nCredit,  or  (ii) after four Business Days immediately  preceding\nthe Final Maturity Date; or\n\n           (d)   if such Issuing Bank has received written notice\nfrom (i) the Requisite Lenders, (ii) the Administrative Agent  or\n(iii) the Borrower, on or prior to the Business Day prior to  the\nrequested date of issuance of such Letter of Credit, that one  or\nmore of the applicable conditions contained in Article IV has not\n                                               -----------\nbeen then satisfied or waived.\n\n          3.03.  Conditions.  In addition to being subject to the\n                 ----------\nsatisfaction  of  the conditions precedent contained  in  Section\n                                                          -------\n4.02,  the  obligation of an Issuing Bank to issue any Letter  of\n----\nCredit  is  subject  to the condition that  as  of  the  date  of\nissuance,  no order, judgment or decree of any court,  arbitrator\n\n=================================================================             \n                             -45-\n\nor  other  Governmental Authority shall purport by its  terms  to\nenjoin or restrain such Issuing Bank from issuing such Letter  of\nCredit  and no law, rule or regulation applicable to such Issuing\nBank and no request or directive (whether or not having the force\nof  law and whether or not the failure to comply therewith  would\nbe  unlawful)  from any Governmental Authority with  jurisdiction\nover  such  Issuing Bank shall prohibit or request  such  Issuing\nBank  to refrain from the issuance of Letters of Credit generally\nor  the issuance of such Letter of Credit.  No Issuing Bank shall\nhave  any obligation to issue any Letter of Credit if (a) in  the\ncase of a Commercial Letter of Credit, such Commercial Letter  of\nCredit  does  not provide for drafts or (b) in the  case  of  any\nLetter of Credit, such Letter of Credit is not otherwise in  form\nand  substance reasonably acceptable to such Issuing Bank or  the\nissuance  of  such Letter of Credit would violate any  applicable\npolicies  of  such Issuing Bank.  No Issuing Bank  shall  violate\nSection 3.02(b) in connection with the issuance of any Letter  of\n---------------\nCredit by such Issuing Bank if, immediately after the issuance of\nsuch  Letter of Credit, the aggregate amount of Letter of  Credit\nObligations  then  existing  (which amount  shall  be  calculated\nwithout  giving  effect  to  the  participation  of  the  Lenders\npursuant to Section 3.06) in respect of Letters of Credit  issued\n            ------------\nby  such  Issuing Bank are equal to or less than  the  Applicable\nApproved  Issuance Amount for such Issuing Bank.   In  the  event\nthat  the issuance of a Letter of Credit by an Issuing Bank would\ncause  the aggregate amount of Letter of Credit Obligations  then\nexisting (which amount shall be calculated without giving  effect\nto  the participation of the Lenders pursuant to Section 3.06) in\n                                                 ------------\nrespect  of  Letters  of Credit issued by such  Issuing  Bank  to\nexceed  the Applicable Approved Issuance Amount for such  Issuing\nBank  (or  would increase such excess), such Issuing  Bank  shall\nnotify the Administrative Agent thereof prior to the issuance  of\nsuch  Letter  of  Credit and shall verify with the Administrative\nAgent whether the issuance of such Letter of Credit would violate\nSection 3.02(b).\n---------------\n\n          3.04.  Issuance of Letters of Credit.\n                 -----------------------------\n\n          (a)   The Borrower shall give the relevant Issuing Bank\nnotice in accordance with the relevant Issuing Bank Agreement  of\nthe requested issuance by such Issuing Bank of a Letter of Credit\nunder this Agreement.  Such notice shall be irrevocable and shall\nspecify  (A) the stated amount of the Letter of Credit  requested\nto  be  issued,  (B) the effective date (which  day  shall  be  a\nBusiness Day) of issuance of such Letter of Credit, (C) the  date\non  which such Letter of Credit is to expire (which date shall be\na  Business Day and shall be subject to paragraph (c) of  Section\n                                        -------------     -------\n3.02),  (D) the Person for whose benefit the requested Letter  of\n-----\nCredit  is  to be issued, (E) in the case of Standby  Letters  of\nCredit, the full text of any certificate to be presented  by  the\nbeneficiary in case of any drawing thereunder and (F) such  other\nmatters  as are set forth in the relevant Issuing Bank  Agreement\nor as the relevant Issuing Bank may require.\n\n\n           (b)   No Issuing Bank shall extend or amend any Letter\nof  Credit  if the issuance of a new Letter of Credit having  the\nsame  terms  as such Letter of Credit as so extended  or  amended\nwould  be  prohibited by Section 3.02.  Any request for amendment\n                         ------------\nto  any  previously  issued Letter of Credit shall  be  given  in\naccordance  with  the  relevant  Issuing  Bank  Agreement.   Each\nrequest for an amendment to a previously issued Letter of  Credit\nshall  not  request  an  extension  beyond  four  Business   Days\nimmediately  preceding the Final Maturity Date.   Notwithstanding\nany provision of any letter of credit application or Issuing Bank\nAgreement  to the contrary, in the event of any conflict  between\nthe  terms  of any such letter of credit application  or  Issuing\nBank Agreement and the terms of this Agreement, the terms of this\n=================================================================\n                               -46-\n\nAgreement  shall  control  with respect  to  events  of  default,\nrepresentations and warranties, and covenants, except  that  such\nletter  of  credit  application or  Issuing  Bank  Agreement  may\nprovide  for  further  warranties relating  specifically  to  the\ntransaction or affairs underlying such Letter of Credit.\n\n\n           (c)    The  Issuing Banks and the Lenders agree  that,\nwhile a Standby Letter of Credit is outstanding and prior to  the\nFinal  Maturity Date, at the option of the Borrower and upon  the\nwritten  request of the Borrower received by the relevant Issuing\nBank  at  least five days (or such shorter time as  such  Issuing\nBank  may  agree in a particular instance in its sole discretion)\nprior  to  the  proposed date of notification  of  renewal,  such\nIssuing Bank shall be entitled to authorize the automatic renewal\nof  any  Letter  of Credit issued by it so long  as,  immediately\nafter  the  renewal thereof, the aggregate amount  of  Letter  of\nCredit   Obligations  then  existing  (which  amount   shall   be\ncalculated  without  giving effect to the  participation  of  the\nLenders pursuant to Section 3.06) in respect of Letters of Credit\n                    ------------\nissued  by  such  Issuing Bank are equal  to  or  less  than  the\nApplicable Approved Issuance Amount for such Issuing Bank.   Each\nsuch  request for renewal of a Letter of Credit shall be made  in\naccordance  with the relevant Issuing Bank Agreement,  and  shall\nspecify  in form and detail satisfactory to the relevant  Issuing\nBank:  (i) the Letter of Credit to be renewed; (ii) the  proposed\ndate  of  notification of renewal of the Letter of Credit  (which\nshall  be a Business Day); (iii) the revised expiry date  of  the\nLetter of Credit; and (iv) such other matters as are set forth in\nthe  relevant Issuing Bank Agreement or as such Issuing Bank  may\nrequire.  No Issuing Bank shall so renew any Letter of Credit if:\n(A)  such Issuing Bank would have no obligation at such  time  to\nissue  or  amend such Letter of Credit in its renewed form  under\nthe  terms of Section 3.02 or 3.03; or (B) the beneficiary of any\n              ------------    ----\nsuch Letter of Credit does not accept the proposed renewal of the\nLetter  of Credit.  If any outstanding Existing Letter of  Credit\nshall  provide that it shall be automatically renewed unless  the\nbeneficiary  thereof  receives notice from the  relevant  Issuing\nBank  that such Letter of Credit shall not be renewed, and if  at\nthe  time  of  renewal  such Issuing Bank would  be  entitled  to\nauthorize  the  automatic renewal of such  Letter  of  Credit  in\naccordance  with  this  paragraph (c) upon  the  request  of  the\n                        ------------\nBorrower,  but  such  Issuing Bank shall not  have  received  any\namendment  application from the Borrower  with  respect  to  such\nrenewal  or other written direction by the Borrower with  respect\nthereto,  such  Issuing Bank shall nonetheless  be  permitted  to\nallow  such Letter of Credit to renew, and the Borrower  and  the\nLenders  hereby  authorize such renewal, and,  accordingly,  such\nIssuing  Bank  shall  be  deemed to have  received  an  amendment\napplication from the Borrower requesting such renewal.\n\n            (d)      Each   Issuing   Bank   shall   notify   the\nAdministrative  Agent and the Administrative Agent  shall  notify\nthe  Lenders on the first Business Day of each week and  calendar\nquarter of the total face amount of all of the Letters of  Credit\nissued  by  it  on  each Business Day of the  preceding  week  or\ncalendar quarter, as the case may be.\n\n\n          3.05.  Reimbursement Obligations; Duties of the Issuing\n                 -------------------------  ---------------------\nBanks.\n-----\n\n           (a)    (i)  The Borrower shall reimburse each  Issuing\nBank  for drawings under a Letter of Credit issued by it no later\nthan  1:00  p.m. (New York time) on each date that any amount  is\npaid by such Issuing Bank under any Letter of Credit in an amount\nequal to the amount so paid by such Issuing Bank.\n\n==================================================================\n                            -47-\n\n\n              (ii)  Any Reimbursement Obligation with respect  to\nany  Letter  of Credit shall bear interest from the date  of  the\nrelevant  drawing at the interest rate applicable  to  Base  Rate\nLoans  until the first Business Day after the date on  which  the\nrelevant  Issuing  Bank  gives notice  of  such  drawing  to  the\nBorrower  and thereafter at the interest rate for past  due  Base\nRate Loans in accordance with Section 2.02(d).\n                              --------------\n\n           (b)    No  action taken or omitted to be taken  by  an\nIssuing  Bank  under or in connection with any Letter  of  Credit\nissued  by  it  shall put such Issuing Bank under  any  resulting\nliability to any Lender or relieve such Lender of its obligations\nhereunder  to  such  Issuing Bank except in  the  event  of  such\nIssuing  Bank's  gross negligence or wilful misconduct.   Without\nlimiting  the foregoing, in determining whether to pay under  any\nLetter of Credit, an Issuing Bank shall have no obligation to the\nLenders other than to confirm that any documents required  to  be\ndelivered  under  such Letter of Credit have been  delivered  and\nthat they appear on their face to comply with the requirements of\nsuch Letter of Credit.\n\n           (c)    The  obligations  of the  Borrower  under  this\nAgreement  and any Letter of Credit to reimburse an Issuing  Bank\nfor a drawing under a Letter of Credit issued by it, and to repay\nany  drawing  under a Letter of Credit issued  by  it,  shall  be\nunconditional  and  irrevocable, and shall be  paid  strictly  in\naccordance  with the terms of this Agreement and such  Letter  of\nCredit under all circumstances, including the following:\n\n\n              (i)  any lack of validity or enforceability of this\n     Agreement or any Letter of Credit;\n\n              (ii)   any change in the time, manner or  place  of\n     payment  of,  or in any other term of, all  or  any  of  the\n     obligations  of  the Borrower in respect of  any  Letter  of\n     Credit or any other amendment or waiver of or any consent to\n     departure from all or any Letter of Credit;\n\n              (iii)  the existence of any claim, set-off, defense\n     or  other  right  that the Borrower may  have  at  any  time\n     against  any beneficiary or any transferee of any Letter  of\n     Credit  (or any Person for whom any such beneficiary or  any\n     such  transferee  may be acting), any Issuing  Bank  or  any\n     other Person, whether in connection with this Agreement, the\n     transactions contemplated hereby or by the Letter of  Credit\n     or any unrelated transaction;\n\n              (iv)   any  draft,  demand,  certificate  or  other\n     document presented under any Letter of Credit proving to  be\n     forged,  fraudulent, invalid or insufficient in any  respect\n     or  any statement therein being untrue or inaccurate in  any\n     respect;  or  any  loss  or delay  in  the  transmission  or\n     otherwise  of  any  document required in  order  to  make  a\n     drawing under any Letter of Credit;\n\n              (v)   any  payment by any Issuing  Bank  under  any\n     Letter  of Credit against presentation of a draft or certifi\n     cate  that  does not strictly comply with the terms  of  any\n     Letter  of  Credit; or any payment made by any Issuing  Bank\n     under any Letter of Credit to any Person purporting to be  a\n     trustee  in  bankruptcy, debtor-in-possession, assignee  for\n     the  benefit  of  creditors, liquidator, receiver  or  other\n     representative  of  or successor to any beneficiary  or  any\n ==================================================================\n                             -48-\n\n     transferee of any Letter of Credit, including any arising in\n     connection with any insolvency proceeding;\n\n\n             (vi)  any exchange, release or non-perfection of any\n     collateral,  or  any release or amendment or  waiver  of  or\n     consent  to departure from any other guarantee, for  all  or\n     any  of  the obligations of the Borrower in respect  of  any\n     Letter of Credit; or\n\n               (vii)   any   other  circumstance   or   happening\n     whatsoever, whether or not similar to any of the  foregoing,\n     including   any  other  circumstance  that  might  otherwise\n     constitute  a defense available to, or a discharge  of,  the\n     Borrower or a guarantor.\n\n          3.06.  Participations.\n                 --------------\n\n           (a)   Immediately upon issuance by an Issuing Bank  of\nany  Letter  of  Credit  for  the  account  of  the  Borrower  in\naccordance  with  the procedures set forth in this  Article  III,\n                                                    ------------\neach   Lender   shall   be   deemed  to  have   irrevocably   and\nunconditionally  purchased and received from such  Issuing  Bank,\nwithout recourse or warranty, an undivided interest in the amount\nof  such  Lender's  Pro  Rata Share  in  such  Letter  of  Credit\n(including  all obligations of the Borrower with respect  thereto\nother  than  amounts  owing to such Issuing  Bank  under  Section\n                                                          -------\n3.08(b))   and  any  security  therefor  or  guaranty  pertaining\n--------\nthereto.\n\n           (b)    If an Issuing Bank makes any payment under  any\nLetter  of Credit and the Borrower does not repay such amount  to\nsuch  Issuing  Bank  pursuant to Section 3.05(a)  or  3.07,  such\n                                 ---------------      ----\nIssuing  Bank shall promptly notify the Administrative Agent  and\nthe  Administrative Agent shall promptly notify  each  Lender  of\nsuch  failure, and each Lender shall promptly and unconditionally\npay  to  the Administrative Agent for the account of such Issuing\nBank  the amount of such Lender's Pro Rata Share of such payment,\nin   Dollars  and  in  immediately  available  funds,   and   the\nAdministrative  Agent  shall promptly pay such  amount,  and  any\nother  amounts  received  by the Administrative  Agent  for  such\nIssuing Bank's account pursuant to this Section 3.06(b), to  such\n                                        ---------------\nIssuing  Bank.   If  the Administrative Agent  so  notifies  such\nLender  prior to 11:00 a.m. (New York time) on any Business  Day,\nsuch Lender shall make available to the Administrative Agent  for\nthe  account of the relevant Issuing Bank its Pro Rata  Share  of\nthe amount of such payment on such Business Day in Dollars and in\nimmediately available funds at the Administrative Agent's Payment\nOffice.  If and to the extent such Lender shall not have so  made\nits Pro Rata Share of the amount of such payment available to the\nAdministrative Agent for the account of such Issuing  Bank,  such\nLender  agrees to pay to the Administrative Agent for the account\nof  such  Issuing  Bank forthwith on demand such amount  together\nwith  interest thereon, for each day from the date  such  payment\nwas  first  due  until  the  date such  amount  is  paid  to  the\nAdministrative Agent for the account of such Issuing Bank, at the\nFederal  Funds Rate for three Business Days and then at the  Base\nRate.   The  failure  of  any Lender to  make  available  to  the\nAdministrative Agent for the account of an Issuing Bank  its  Pro\nRata Share of any such payment shall not relieve any other Lender\nof   its   obligation  hereunder  to  make   available   to   the\nAdministrative Agent for the account of such Issuing Bank its Pro\nRata Share of any payment on the date such payment is to be made.\n\n\n           (c)   Whenever an Issuing Bank receives a payment from\nthe  Borrower on account of a Reimbursement Obligation, including\nany  interest thereon, as to which the Administrative  Agent  has\n=================================================================\n                              -49-\n\npreviously received payments from the Lenders for the account  of\nsuch  Issuing  Bank  pursuant  to this  Section  3.06,  it  shall\n                                        -------------\npromptly  pay  to the Administrative Agent at the  Administrative\nAgent's  Payment  Office  and  the  Administrative  Agent   shall\npromptly  pay  to each Lender which has funded its  participating\ninterest therein in Dollars and in the kind of funds so received,\nan  amount  equal to such Lender's Pro Rata Share thereof.   Each\nsuch  payment shall be made by the relevant Issuing Bank  or  the\nAdministrative Agent, as the case may be, on the Business Day  on\nwhich such Person receives the funds paid to such Person pursuant\nto  the preceding sentence, if received prior to 11:00 a.m.  (New\nYork  time)  on  such  Business Day, and otherwise  on  the  next\nsucceeding Business Day.\n\n           (d)    Upon  the request of the Administrative  Agent,\neach  Issuing  Bank  shall  furnish to the  Administrative  Agent\ncopies  of  any Letter of Credit or Letter of Credit  application\nform  to  which  such  Issuing  Bank  is  party  and  such  other\ndocumentation   as   may   reasonably   be   requested   by   the\nAdministrative Agent.\n\n           (e)   The obligations of a Lender to make payments  to\nthe  Administrative Agent for the account of an Issuing Bank with\nrespect  to  a  Letter of Credit issued by it on  behalf  of  the\nBorrower   in   accordance  with  the  terms  hereof   shall   be\nirrevocable,  shall  not  be  subject  to  any  qualification  or\nexception whatsoever (except in the event of such Issuing  Bank's\ngross  negligence or wilful misconduct), and shall be honored  in\naccordance with the terms and conditions of this Agreement  under\nall circumstances (subject to Section 3.02), including any of the\n                              ------------\nfollowing circumstances:\n\n              (i)  any lack of validity or enforceability of this\nAgreement or any of the other Loan Documents;\n\n\n             (ii) the existence of any claim, set-off, defense or\nother  right  which the Borrower may have at any time  against  a\nbeneficiary named in a Letter of Credit or any transferee of  any\nLetter of Credit (or any Person for whom any such transferee  may\nbe  acting),  the  Administrative Agent, any  Issuing  Bank,  any\nLender,  or  any  other Person, whether in connection  with  this\nAgreement,  any  Letter of Credit, the transactions  contemplated\nherein  or  any unrelated transactions (including any  underlying\ntransactions  between the Borrower and the beneficiary  named  in\nany Letter of Credit);\n\n              (iii)  any draft, certificate of any other document\npresented  under  the  Letter of Credit  proving  to  be  forged,\nfraudulent,  invalid  or  insufficient  in  any  respect  or  any\nstatement therein being untrue or inaccurate in any respect;\n\n\n             (iv) the surrender or impairment of any security for\nthe  performance or observance of any of the terms of any of  the\nLoan Documents;\n\n\n              (v)  any failure by the Administrative Agent or any\nIssuing  Bank  to make any reports required pursuant  to  Section\n                                                          -------\n3.04; or\n----\n\n              (vi)  the  occurrence of any Event  of  Default  or\nPotential Event of Default.\n\n\n          3.07.  Payment of Reimbursement Obligations.\n                 ------------------------------------\n==================================================================\n                            -50-\n\n           (a)    The  Borrower  agrees to pay  to  the  relevant\nIssuing   Bank  the  amount  of  all  Reimbursement  Obligations,\ninterest and other amounts payable to such Issuing Banks under or\nin  connection with any Letter of Credit issued on behalf of  the\nBorrower immediately when due, irrespective of any claim, setoff,\ndefense  or other right which the Borrower may have at  any  time\nagainst any Issuing Bank or any other Person.\n\n          (b)   In the event any payment by the Borrower received\nby an Issuing Bank with respect to any Letter of Credit issued by\nit  and distributed by the Administrative Agent to the Lenders on\naccount  of their participations is thereafter set aside, avoided\nor  recovered  from  such  Issuing Bank in  connection  with  any\nreceivership, liquidation or bankruptcy proceeding or  otherwise,\neach  Lender which received such distribution shall, upon  demand\nby  such Issuing Bank, contribute such Lender's Pro Rata Share of\nthe amount set aside, avoided or recovered together with interest\nat  the  rate required to be paid by such Issuing Bank  upon  the\namount required to be repaid by it.\n\n\n          3.08.  Compensation for Letters of Credit.\n                 ----------------------------------\n\n           (a)    Letter of Credit Fees.  (i) The Borrower  shall\n                  ---------------------\npay  with  respect to each Letter of Credit issued as  a  Standby\nLetter  of Credit quarterly in arrears, on the fifteenth  day  of\neach  January, April, July and October for the three-month period\nending on such date, beginning after the Initial Funding Date and\nalso on the Termination Date, a Letter of Credit Fee equal to the\npercentage  per annum set forth below based on the Pricing  Ratio\nin effect from time to time, applied (on the basis of actual days\nelapsed in a 360-day year) to the maximum amount available to  be\ndrawn  under such Standby Letter of Credit from day to day during\nsuch  quarter.   This  fee shall be paid  to  the  Administrative\nAgent,  for  the  account of the Lenders in proportion  to  their\nrespective Pro Rata Shares.\n\n          Pricing Ratio            Standby Letter of Credit Fee\n          -------------            ----------------------------\n          Level I Status                    1.25%\n          Level II Status                        1.50%\n          Level III Status                  1.75%\n          Level IV Status                   2.00%\n\nOn  the Business Day preceding the fifteenth day of each January,\nApril,  July  or October, each Issuing Bank will  report  to  the\nAdministrative  Agent  the  aggregate daily  outstanding  Standby\nLetter of Credit amounts for the three-month period ending on the\nfifteenth of such January, April, July or October.\n\n\n              (ii)   The Borrower shall pay with respect to  each\nLetter  of  Credit  issued  as  a  Commercial  Letter  of  Credit\nquarterly  in  arrears, on the fifteenth  day  of  each  January,\nApril, July and October for the three-month period ending on such\ndate,  beginning after the Initial Funding Date and also  on  the\nTermination Date, a Letter of Credit Fee equal to the  percentage\nper  annum  set forth below based on the Pricing Ratio in  effect\nfrom  time to time, applied (on the basis of actual days  elapsed\nin  a  360-day year) to the maximum amount available to be  drawn\nunder  such  Commercial Letter of Credit from day to  day  during\nsuch  quarter.   This  fee shall be paid  to  the  Administrative\n=================================================================\n                              -51-\n\nAgent,  for  the  account of the Lenders in proportion  to  their\nrespective Pro Rata Shares.\n\n\n          Pricing Ratio            Commercial Letter of Credit\n          --------------           ---------------------------\n          Level I Status                    0.625%\n          Level II Status                   0.750%\n          Level III Status                  0.875%\n          Level IV Status                   1.000%\n\nOn  the Business Day preceding the fifteenth day of each January,\nApril,  July  or October, each Issuing Bank will  report  to  the\nAdministrative  Agent the aggregate daily outstanding  Commercial\nLetter of Credit amounts for the three-month period ending on the\nfifteenth of such January, April, July or October.\n\n\n           (iii)   Any  Letter of Credit Fees accrued  under  the\nExisting  Credit Agreement for the period prior  to  the  Initial\nFunding Date shall be payable as provided in the Existing  Credit\nAgreement.\n\n\n           (b)         Issuing Bank Charges.  The Borrower  shall\n                       --------------------\ndirectly  pay  to each Issuing Bank, solely for its own  account,\n(i)  quarterly  in arrears on the fifteenth day of each  January,\nApril, July and October beginning after the Initial Funding  Date\nand  also on the Termination Date, a fronting fee equal to  0.25%\nper  annum  applied  (on the basis of actual days  elapsed  in  a\n360-day  year) to the maximum amount available to be  drawn  from\nday  to day during the immediately preceding fiscal quarter under\neach  Letter  of  Credit issued by it, and  (ii)  on  demand  the\nstandard charges assessed by such Issuing Bank including  charges\nassessed  in  connection  with  the  negotiation,  amendment   or\ncancellation of Letters of Credit.\n\n          3.09.  Indemnification; Exoneration.\n                 ----------------------------\n\n           (a)        In addition to amounts payable as elsewhere\nprovided  in  this  Article III, the Borrower  hereby  agrees  to\n                    -----------\nprotect,  indemnify, pay and save the Administrative Agent,  each\nIssuing  Bank and each Lender harmless from and against  any  and\nall  Liabilities and Costs which the Administrative Agent or such\nIssuing  Bank  or  Lender  may  incur  or  be  subject  to  as  a\nconsequence,  direct  or indirect, of (i)  the  issuance  of  the\nLetter of Credit other than, in the case of such Issuing Bank, as\na  result  of  its  gross  negligence or willful  misconduct,  as\ndetermined  by  the  final  judgment  of  a  court  of  competent\njurisdiction or (ii) the failure of such Issuing Bank to honor  a\ndrawing  under such Letter of Credit as a result of  any  act  or\nomission, whether rightful or wrongful, of any present or  future\nde  jure  or  de facto Governmental Authority (all such  acts  or\nomissions herein called \"Governmental Acts\").\n                         -----------------\n\n           (b)        As between the Borrower, the Administrative\nAgent,  the  Lenders and the Issuing Banks, the Borrower  assumes\nall  risks of the acts and omissions of, or misuse of such Letter\nof  Credit  by,  the beneficiary of such Letter  of  Credit.   In\nfurtherance  and not in limitation of the foregoing, the  Issuing\nBanks,  the  Administrative Agent and the Lenders  shall  not  be\nresponsible  (except, in the case of an Issuing  Bank,  for  such\nIssuing   Bank's  gross  negligence  or  willful  misconduct   in\n=================================================================\n                            -52-\n\nconnection therewith):  (i)  for the form, validity, sufficiency,\naccuracy,  genuineness or legal effect of any document  submitted\nby  any party in connection with the application for and issuance\nof  the Letters of Credit, even if it should in fact prove to  be\nin   any  or  all  respects  invalid,  insufficient,  inaccurate,\nfraudulent  or  forged; (ii)  for the validity or sufficiency  of\nany  instrument  transferring  or  assigning  or  purporting   to\ntransfer  or assign a Letter of Credit or the rights or  benefits\nthereunder  or proceeds thereof, in whole or in part,  which  may\nprove  to  be invalid or ineffective for any reason;  (iii)   for\nerrors,  omissions,  interruptions or delays in  transmission  or\ndelivery  of  any  messages, by mail,  cable,  telegraph,  telex,\nfacsimile,   or   other  similar  form  of  teletransmission   or\notherwise, whether or not they be in cipher; (iv) for  errors  in\ninterpretation of technical terms; (v) for any loss or  delay  in\nthe  transmission or otherwise of any document required in  order\nto  make  a drawing under any Letter of Credit or of the proceeds\nthereof;  (vi)  for the misapplication by the  beneficiary  of  a\nLetter of Credit of the proceeds of any drawing under such Letter\nof  Credit;  and (vii) for any consequences arising  from  causes\nbeyond the control of the Administrative Agent, the Issuing Banks\nand  the  Lenders including any Governmental Acts.  None  of  the\nabove shall affect, impair, or prevent the vesting of any Issuing\nBank's rights or powers under this Section 3.09.\n                                   ------------\n\n           (c)         In  furtherance and extension and  not  in\nlimitation of the specific provisions hereinabove set forth,  any\naction taken or omitted by an Issuing Bank under or in connection\nwith  Letters of Credit issued on behalf of the Borrower  or  any\nrelated  certificates, if taken or omitted in good  faith,  shall\nnot,  in  the  absence of gross negligence or willful misconduct,\nput  such  Issuing Bank, the Administrative Agent or  any  Lender\nunder  any  resulting liability to the Borrower  or  relieve  the\nBorrower of any of its obligations hereunder to any such Person.\n\n\n                           ARTICLE IV\n\n           Conditions To Loans and Letters of Credit\n           -----------------------------------------\n\n           4.01.   Conditions Precedent to the  Initial  Funding.\n                   ---------------------------------------------\nThe  obligation of each Lender to make any Loan requested  to  be\nmade by it on the Initial Funding Date (individually, an \"Initial\nLoan\"  and collectively, the \"Initial Loans\") and of the  Issuing\n                              -------------\nBanks  to  issue  any  Letter of Credit pursuant  hereto  on  the\nInitial Funding Date, and the effectiveness of this Agreement  on\nthe Initial Funding Date, shall be subject to satisfaction of all\nof  the following conditions precedent (unless waived by all  the\nLenders):\n\n           (a)         Certain  Documents and Other  Items.   The\n                       ------------------------------------\nAdministrative Agent shall have received on or before the Initial\nFunding  Date  all  of  the following, all of  which,  except  as\nprovided  below,  shall be in form and substance satisfactory  to\nthe Administrative Agent and the Lenders and in sufficient copies\nfor each Lender:\n\n              (i)   This Agreement, executed by the Borrower  and\neach of the Lenders, together with all Exhibits and Schedules;\n\n\n               (ii)    Evidence  that  (A)  the  Existing  Credit\nAgreement  shall  have been terminated and all  amounts  due  and\npayable  thereunder (other than the Existing  Letters  of  Credit\nissued thereunder) shall have been paid and all Liens granted  in\n=================================================================\n                                -53-\n\nconnection therewith shall have been released, and (B)  the  HKSB\nFacility  shall  have  been terminated and all  amounts  due  and\npayable  thereunder shall have been paid, all letters  of  credit\nissued  thereunder  shall have been terminated or  collateralized\nand  all  Liens granted in connection therewith shall  have  been\nreleased,  and  (C) the Receivables Transaction shall  have  been\nterminated;\n\n              (iii)   (A)  The Borrower Pledge Agreement and  (B)\nthe  Trademark Security Agreement, in each case, executed by  the\nBorrower, together with stock certificates and appropriate  stock\npowers  (endorsed in blank) in respect of any securities  pledged\npursuant to the Borrower Pledge Agreement;\n\n\n             (iv)  The ATSC Guaranty executed by ATSC;\n\n              (v)   The  ATSC Pledge Agreement executed by  ATSC,\ntogether  with  stock certificates and appropriate  stock  powers\n(endorsed in blank) in respect of any securities pledged pursuant\nto the ATSC Pledge Agreement;\n\n               (vi)    The  Subsidiary  Guaranty  and  Collateral\nAgreement  executed  by  each Restricted Subsidiary  (other  than\nForeign  Subsidiaries),  together  with  stock  certificates  and\nappropriate  stock powers (endorsed in blank) in respect  of  any\nsecurities  pledged  pursuant  to  the  Subsidiary  Guaranty  and\nCollateral Agreement;\n\n              (vii)  The Borrower's Certificate of Incorporation,\nas amended, modified or supplemented to the Initial Funding Date,\ncertified  to  be true, correct and complete by the Secretary  of\nState  of  Delaware as of a date not more than ten Business  Days\nprior  to the Initial Funding Date, together with a good standing\ncertificate from the Secretary of State of Delaware dated a  date\nnot  more  than  ten Business Days prior to the  Initial  Funding\nDate;\n\n              (viii)   ATSC's  Certificate of  Incorporation,  as\namended,  modified or supplemented, to the Initial Funding  Date,\ncertified  to  be true, correct and complete by the Secretary  of\nState  of  Delaware as of a date not more than ten Business  Days\nprior  to the Initial Funding Date, together with a good standing\ncertificate from the Secretary of State of Delaware dated as of a\ndate not more than ten Business Days prior to the Initial Funding\nDate;\n\n              (ix)   A  certificate of the Secretary or Assistant\nSecretary  of  the  Borrower  dated  the  Initial  Funding   Date\ncertifying  (A)  the names and true signatures of  the  incumbent\nofficers  of the Borrower authorized to sign this Agreement,  the\nother  Loan  Documents  and  any  notice  or  certificate  to  be\ndelivered hereunder, (B) the By-Laws of the Borrower as in effect\non  the  date of such certification, (C) the resolutions  of  the\nBorrower's Board of Directors approving and authorizing  (x)  the\nexecution,  delivery and performance of this Agreement,  and  all\nother Loan Documents executed by the Borrower, (y) the extensions\nof  credit  contemplated hereunder and (z) the  granting  by  the\nBorrower  of the Liens created by the security documents  related\nhereto and (D) that there have been no changes in the Certificate\nof  Incorporation  of the Borrower since the  date  of  the  most\nrecent  certification  thereof  by  the  Secretary  of  State  of\nDelaware;\n\n              (x)   A  certificate of the Secretary or  Assistant\nSecretary  of ATSC dated the Initial Funding Date certifying  (A)\nthe  names and true signatures of the incumbent officers of  ATSC\n\n==================================================================\n                             -54-\n\nauthorized  to  sign  the  ATSC  Guaranty  and  the  ATSC  Pledge\nAgreement,  (B) the By-Laws of ATSC as in effect on the  date  of\nsuch  certification,  (C)  the resolutions  of  ATSC's  Board  of\nDirectors  approving and authorizing the execution, delivery  and\nperformance  of  the ATSC Guaranty and the ATSC Pledge  Agreement\nand all other Loan Documents executed by ATSC, and (D) that there\nhave  been no changes in the Certificate of Incorporation of ATSC\nsince  the date of the most recent certification thereof  by  the\nSecretary of the State of Delaware;\n\n              (xi)   A favorable legal opinion, dated the Initial\nFunding  Date, addressed to the Administrative Agent, the Issuing\nBanks  and the Lenders from Skadden, Arps, Slate, Meagher &amp; Flom\nLLP,  special  counsel to the Borrower and ATSC, in substantially\nthe form of Exhibit 4.01(a)(xi), with such changes thereto as may\n            -------------------\nbe approved by the Administrative Agent;\n\n              (xii)   UCC-1  financing statements signed  by  the\nBorrower  or  ATSC,  as  the case may be, as  debtor  naming  the\nAdministrative  Agent  as  secured  party  to  be  filed  in  the\njurisdictions listed on Schedule 4.01; provided, that no  fixture\n                        -------------  --------\nfilings shall be required to be made;\n\n\n             (xiii)  A certificate dated the Initial Funding Date\nexecuted  by  a Responsible Officer of each of the  Borrower  and\nATSC to the effect that there has been no material adverse change\nin  the condition (financial or otherwise), business, operations,\nproperties or prospects of the Borrower or ATSC, from the date of\nthe last available financial statements;\n\n\n              (xiv)  A collateral appraisal of certain assets  of\nthe Borrower and its Subsidiaries issued by M.R. Weiser;\n\n\n              (xv)  A Borrowing Base Certificate for the Borrower\nand  the  Subsidiary Guarantors, dated the Initial Funding  Date,\nwith  appropriate  insertions  and  attachments  executed  by   a\nResponsible  Officer  of  the  Borrower  and  setting  forth  the\nBorrowing Base Amount as of May 30, 1998.\n\n\n              (xvi)  The results of a recent lien search in  each\nof  the  jurisdictions  where assets  of  the  Borrower  and  its\nSubsidiaries are located revealing that no liens on any assets of\nthe  Borrower  or its Subsidiaries except for liens permitted  by\nSection 8.02(b); and\n---------------\n\n              (xvii)  Such additional items as the Administrative\nAgent or the Requisite Lenders may reasonably require.\n\n\n          (b)        Fees and Expenses Paid.  All costs, fees and\n                     ----------------------\nexpenses (including the costs and expenses of one outside counsel\nand, without duplication, the allocated cost of in-house counsel)\nfor  which  invoices have been delivered at least three  Business\nDays  prior  to  the Initial Funding Date and other  compensation\npayable   to   the   Arranger,  the   Syndication   Agents,   the\nAdministrative  Agent, the Issuing Banks and  the  Lenders  shall\nhave been paid.\n\n          (c)  Authorized Officers of the Borrower.  The Borrower\n               -----------------------------------\nshall  have notified the Administrative Agent in writing  of  the\nnames  of the officers and employees authorized to request  Loans\nand Letters of Credit and to request a conversion\/continuation of\nany  Loan  and  shall  provide the Administrative  Agent  with  a\nspecimen signature of each such officer or employee.\n=================================================================\n                           -55-\n\n           The acceptance by the Borrower of the proceeds of  the\nInitial  Loans  made hereunder shall constitute a  representation\nand  warranty by the Borrower as of the Initial Funding  Date  in\nrespect  of such Loans that all the conditions contained in  this\nSection 4.01 have been satisfied or waived in writing pursuant to\nSection 12.08.\n-------------\n\n          4.02.  Conditions Precedent to all Loans and Letters of\n                 ------------------------------------------------\nCredit.  The obligation of the Lenders to make any Loan requested\n------\nto  be made by it, and of any Issuing Bank to issue any Letter of\nCredit,  on  any  date,  is subject to the  following  conditions\nprecedent as of such date:\n\n           (a)         Notice  of  Borrowing.  The Administrative\n                       ---------------------\nAgent  shall  have received in accordance with the provisions  of\nSection  2.01(b), on or before any Funding Date for any  Loan,  a\n----------------\nNotice of Borrowing.\n\n           (b)        Additional Matters.  As of the Funding Date\n                      -------------------\nfor any Loan or the date of issuance of any Letter of Credit:\n\n\n                 (i)      Representations and Warranties.  All of\n                          ------------------------------\nthe  representations and warranties of the Borrower contained  in\nor  repeated  pursuant  to Section 5.02 and  in  any  other  Loan\n                           ------------\nDocument   (other  than  representations  and  warranties   which\nexpressly  speak only as of a different date) shall be  true  and\ncomplete in all material respects on and as of such Funding  Date\nor issuance date, as though made on and as of such date;\n\n                (ii)       No  Default.  No Event of  Default  or\n                           -----------\nPotential  Event of Default shall have occurred and be continuing\nor  would  result from the making of the requested  Loan  or  the\nissuance of the Letter of Credit; and\n\n               (iii)       No Material Adverse Change.  No  event\n                           --------------------------\nshall  have  occurred  after  January  31,  1998  which,  in  the\nreasonable  judgment  of the Requisite Lenders,  has  had  or  is\nlikely to have a Material Adverse Effect.\n\n            (c)Supplemental   Documentation.    Such   additional\n               ----------------------------\ndocumentation   (including   opinions   of   counsel)   as    the\nAdministrative  Agent  or any Lender through  the  Administrative\nAgent may reasonably require.\n\n           (d)  Compliance  with Borrowing  Base.   After  giving\n                --------------------------------\neffect  to  the  making  of such Loans or the  issuance  of  such\nLetters of Credit, the sum of (i) the aggregate principal  amount\nof  Loans  then  outstanding  plus  (ii)  the  Letter  of  Credit\nobligations  at  such  time does not exceed  the  Borrowing  Base\nAmount at such time.\n\n           The acceptance by the Borrower of the proceeds of each\nLoan made on any Funding Date other than the Initial Funding Date\nor  the issuance of any Letter of Credit in accordance with  this\nAgreement shall constitute a representation and warranty  by  the\nBorrower  as of such Funding Date or issuance date that  all  the\nconditions contained in this Section 4.02 have been satisfied  or\n                             ------------\nwaived in writing pursuant to Section 12.08.\n                              -------------\n=================================================================\n                             -56-\n\n                           ARTICLE V\n\n                 Representations and Warranties\n                 ------------------------------\n\n           5.01.   Representations and Warranties on the  Initial\n                   ----------------------------------------------\nFunding Date.  In order to induce the Lenders to enter into  this\n------------\nAgreement  and  to  make the Initial Loans, the  Borrower  hereby\nrepresents  and warrants to each Lender, each Issuing  Bank,  the\nSyndication  Agents  and  the  Administrative  Agent   that   the\nfollowing statements are true and correct:\n\n\n           (a)         Organization; Corporate Powers.   Each  of\n                       ------------------------------\nATSC, the Borrower and each Subsidiary of the Borrower (i)  is  a\ncorporation duly organized, validly existing and in good standing\nunder  the laws of the jurisdiction of its organization, (ii)  is\nduly qualified to do business as a foreign corporation and is  in\ngood  standing under the laws of each jurisdiction  in  which  it\nowns  or  leases  real property or in which  the  nature  of  its\nbusiness   requires   it  to  be  so  qualified,   except   those\njurisdictions where the failure to be in good standing or  to  so\nqualify  has not had or will not have a Material Adverse  Effect,\nand (iii) has all requisite corporate power and authority to own,\noperate  and encumber its property and assets and to conduct  its\nbusiness  as presently conducted and as proposed to be  conducted\nin   connection  with  and  following  the  consummation  of  the\ntransactions contemplated by the Loan Documents.\n\n           (b)         Authority.  (i) Each Loan  Party  has  the\n                       ---------\nrequisite  corporate power and authority to execute, deliver  and\nperform its obligations under each of the Loan Documents executed\nby it, or to be executed by it.\n\n              (ii)   The execution, delivery and performance  (or\nfiling  or  recording, as the case may be) of each  of  the  Loan\nDocuments  to  which  it  is party and the  consummation  of  the\ntransactions  contemplated thereby, have been duly authorized  by\nall necessary corporate action on the part of each Loan Party and\nno other corporate proceedings on the part of such Loan Party are\nnecessary to consummate such transactions.\n\n              (iii)  Each of the Loan Documents (other than those\nnot  in  effect on the date of the making of this representation)\nto  which  it is a party has been duly executed and delivered  by\neach  Loan  Party  and constitutes its legal, valid  and  binding\nobligation, enforceable against it in accordance with its  terms,\nis  in full force and effect and no term or condition thereof has\nbeen  amended,  modified or waived from the terms and  conditions\ncontained therein delivered to the Administrative Agent  pursuant\nto   Article  IV  without  the  prior  written  consent  of   the\n     -----------\nAdministrative  Agent and the Requisite Lenders,  and  each  Loan\nParty  and,  to the best of the Borrower's knowledge,  the  other\nparties  thereto  have  performed and complied  in  all  material\nrespects with all the material terms, provisions, agreements  and\nconditions  set  forth therein and required to  be  performed  or\ncomplied  with  by such parties on or before the  effective  date\nthereof, and no default by any such party exists thereunder.\n\n\n           (c)         No Conflict.  The execution, delivery  and\n                       -----------\nperformance of each Loan Document to which it is a party by  each\nLoan  Party and each of the transactions contemplated thereby  do\nnot  and will not (i) constitute a tortious interference with any\nContractual  Obligation  of any Person, any  liability  resulting\nfrom  which  would  have  or be reasonably  expected  to  have  a\nMaterial  Adverse Effect, or (ii) conflict with or  violate  such\nPerson's  Certificate  of  Incorporation  or  By-Laws  or   (iii)\n=================================================================\n                        -57-\nconflict  with,  result  in a breach of or  constitute  (with  or\nwithout  notice  or  lapse of time or both) a default  under  any\nRequirement of Law or material Contractual Obligation of ATSC  or\nof  the Borrower or any Subsidiary of the Borrower or (iv) result\nin  or  require the creation or imposition of any Lien whatsoever\nupon any of the properties or assets of ATSC, the Borrower or any\nSubsidiary  of  the Borrower (other than Liens in  favor  of  the\nAdministrative Agent or the Issuing Banks arising pursuant to the\nLoan  Documents or Liens permitted pursuant to Section  8.02(b)),\n                                               -----------------\nor (v) require any approval of stockholders, unless such approval\nhas been obtained.\n\n            (d)         Governmental  Consents.   The  execution,\n                        ----------------------\ndelivery and performance of each Loan Document to which it  is  a\nparty,  by  each  Loan  Party  and the transactions  contemplated\nthereby  do  not  and  will not require  any  registration  with,\nconsent or approval of, or notice to, or other action, with or by\nany  Governmental Authority, except filings, consents or  notices\nwhich  have  been,  or will in due course be, made,  obtained  or\ngiven.\n\n           (e)        Governmental Regulation.  None of ATSC, the\n                      -----------------------\nBorrower  or  any  of its Subsidiaries is subject  to  regulation\nunder  the  Public  Utility Holdings Company  Act  of  1935,  the\nFederal  Power  Act, the Interstate Commerce Act, the  Investment\nCompany  Act  of 1940 or any other statute or regulation  of  any\nGovernmental   Authority  such  that   its   ability   to   incur\nindebtedness  is  limited  or  its  ability  to  consummate   the\ntransactions contemplated hereby is materially impaired.\n\n           (f)         Financial  Position.   All  quarterly  and\n                       -------------------\nannual  financial  statements of ATSC, the  Borrower  or  of  the\nBorrower and any of its Restricted Subsidiaries delivered to  the\nAdministrative  Agent  were prepared  in  conformity  with  GAAP,\nexcept  as  otherwise  noted  therein,  and  fairly  present  the\nfinancial  position  of ATSC, the Borrower  or  the  consolidated\nfinancial  position of ATSC, the Borrower and such  Subsidiaries,\nas  the  case may be, as at the respective dates thereof and  the\nresults of operations and changes in cash flows for each  of  the\nperiods  covered thereby, subject, in the case of  any  unaudited\ninterim financial statements, to changes resulting from audit and\nnormal year-end adjustments.  Except as contemplated in the  Loan\nDocuments,  none of ATSC, the Borrower or any of  its  Restricted\nSubsidiaries has any material obligations, contingent liabilities\nor liabilities for taxes, long term leases or material or unusual\nforward or long term commitments which are not reflected in  such\nfinancial statements and the notes thereto.\n\n\n           (g)         Permitted  Indebtedness.  All  Obligations\n                       -----------------------\nhereunder    constitute    \"Permitted   Indebtedness\",    \"Senior\nIndebtedness\" and \"Designated Senior Indebtedness\" as such  terms\nare   defined  in  the  Subordinated  Note  Indenture   and   any\nSubordinated Debt Indenture.  As of the Initial Funding Date,  no\nIndebtedness  (other  than  the  Obligations)  is  designated  as\n\"Designated  Senior Indebtedness\" under and  as  defined  in  the\nSubordinated Note Indenture.  No Event of Default (as defined  in\nthe  Subordinated Note Indenture) has occurred and is  continuing\nunder the Subordinated Note Indenture and, after issuance of  any\nSubordinated  Debt,  no  event of default  has  occurred  and  is\ncontinuing with respect to such Subordinated Debt.\n\n           (h)        Litigation; Adverse Effects.  (i) There  is\n                      ---------------------------\nno  action,  suit, proceeding, investigation of any  Governmental\nAuthority  or arbitration, at law or in equity, or before  or  by\nany Governmental Authority, pending, or, to the best knowledge of\nthe  Borrower,  threatened  against ATSC,  the  Borrower  or  any\n================================================================\n                         -58-\n\nSubsidiary of the Borrower or any property of any of them,  which\nwould  be  reasonably  expected to (A)  result  in  any  Material\nAdverse  Effect, (B) materially and adversely affect the  ability\nof  any  party  to  any  of  the Loan Documents  to  perform  its\nobligations  thereunder, or (C) materially and  adversely  affect\nthe  ability  of the Borrower to perform its Obligations  or  the\nLenders' ability to enforce such Obligations.\n\n              (ii)   None of ATSC, the Borrower or any Subsidiary\nof  the Borrower is (A) in violation of any applicable law  which\nviolation has or might reasonably be expected to have a  Material\nAdverse  Effect, or (B) subject to or in default with respect  to\nany  final  judgment, writ, injunction, decree,  order,  rule  or\nregulation  of any court or Governmental Authority which  has  or\nmight  have a Material Adverse Effect.  There is no action, suit,\nproceeding or investigation pending or, to the knowledge  of  the\nBorrower,  threatened against or affecting ATSC, the Borrower  or\nany  Subsidiary of the Borrower challenging the validity  or  the\nenforceability of any of the Loan Documents.\n\n           (i)         No  Material  Adverse Change.   There  has\n                       ----------------------------\noccurred  no event since January 31, 1998 which has or  would  be\nreasonably expected to have a Material Adverse Effect.\n\n\n           (j)         Payment  of  Taxes.  All tax  returns  and\n                       ------------------\nreports  of  each  of  ATSC, the Borrower  and  its  Subsidiaries\nrequired  to  be filed (including extensions), have  been  timely\nfiled,  and  all  taxes, assessments, fees and other  charges  of\nGovernmental  Authorities  thereupon and  upon  their  respective\nproperties, assets, income and franchises which are shown on such\nreturns  as  being due and payable, have been paid when  due  and\npayable, except such taxes, if any, that are reserved against  in\naccordance  with  GAAP, such taxes which are not yet  delinquent,\nsuch  taxes  which are payable in installments so  long  as  paid\nbefore any penalty accrues with respect thereto and such taxes as\nare being contested in good faith by appropriate proceedings.\n\n\n           (k)        Material Adverse Agreements.  None of ATSC,\n                      ---------------------------\nthe  Borrower or any of its Subsidiaries is a party to or subject\nto  any Contractual Obligation or other restriction contained  in\nits  charter or By-laws which has or would reasonably be expected\nto  have  a  Material Adverse Effect after giving effect  to  the\nconsummation  of  the  transactions  contemplated  in  the   Loan\nDocuments or otherwise.\n\n           (l)         Securities Activities.  None of ATSC,  the\n                       ---------------------\nBorrower or any of its Subsidiaries is engaged in the business of\nextending  credit for the purpose of purchasing or  carrying  any\nMargin  Stock and the Borrower shall not use the proceeds of  any\nLoan  in violation of Regulation T, U or X of the Federal Reserve\nBoard.\n\n           (m)        Disclosure.  Subject to changes in facts or\n                      ----------\nconditions  which are required or permitted under this Agreement,\nthe  representations  and warranties of  ATSC  and  the  Borrower\ncontained  in the Loan Documents, and all certificates and  other\ndocuments  delivered  to the Administrative Agent  in  connection\ntherewith,  taken as a whole do not contain any untrue  statement\nof  a material fact or omit to state a material fact necessary in\norder  to  make  the statements contained herein or  therein,  in\nlight  of  the  circumstances under which  they  were  made,  not\nmisleading.\n==================================================================\n                          -59-\n\n           (n)         Patents,  Trademarks, Permits,  Etc.   The\n                       -----------------------------------\nBorrower  and  each  of  its  Restricted  Subsidiaries  owns,  is\nlicensed  or otherwise has the lawful right to use,  or  has  all\npermits and other approvals of Governmental Authorities, patents,\ntrademarks,  service marks, trade names, copyrights,  technology,\nknow-how  and processes used in or necessary for the  conduct  of\nits  business  as currently conducted which are material  to  its\nfinancial  condition, business, operations, assets and prospects,\nindividually  or taken as a whole.  The use of such  permits  and\nother approvals of Governmental Authorities, patents, trademarks,\nservice  marks trade names, copyrights, technology, know-how  and\nprocesses  by  the  Borrower  or any  such  Subsidiary  does  not\ninfringe on the rights of any Person, subject to such claims  and\ninfringements  the  existence of which do not  have  or  are  not\nreasonably  expected  to  have a Material  Adverse  Effect.   The\ntransactions contemplated by the Loan Documents will  not  impair\nthe  ownership of or rights under (or the license or other  right\nto  use,  as  the  case  may  be) any  permits  and  governmental\napprovals,  patents,  trademarks,  service  marks,  trade  names,\ncopyrights, technology, know-how or processes by the Borrower  or\nany  such  Subsidiary in any manner which has  or  might  have  a\nMaterial Adverse Effect.\n\n           (o)        Environmental Matters.  To the best of  the\n                      ---------------------\nBorrower's  knowledge, the operations of  the  Borrower  and  its\nRestricted Subsidiaries comply in all material respects with  all\napplicable environmental, health and safety Requirements  of  Law\nexcept  where any failure to comply is not reasonably  likely  to\nhave a Material Adverse Effect.\n\n\n           (p)         ERISA.  Each Plan is in compliance in  all\n                       -----\nmaterial respects with its terms and with ERISA, the Code and any\napplicable  law.   Each Plan which is intended  to  be  qualified\nunder Section 401(a) of the Code is so qualified and has received\na  determination  letter  to that effect,  or  will  promptly  be\nsubmitted  to the IRS for a determination that it is so qualified\nand  that  the  trust  related to any such Plan  is  exempt  from\nFederal  income tax under Section 501(a) of the Code as currently\nin  effect.   Neither  the Borrower nor any ERISA  Affiliate  has\nbreached  any  of  the  responsibilities, obligations  or  duties\nimposed on it by ERISA or regulations promulgated thereunder with\nrespect  to  any  Plan  which  breach  would  have  or  would  be\nreasonably  expected  to  have  a Material  Adverse  Effect.   No\nBenefit Plan has incurred any accumulated funding deficiency  (as\ndefined in Sections 302(a)(2) of ERISA and 412(a) of the Code) or\nis  reasonably  likely to have such a deficiency whether  or  not\nwaived which would have or would be reasonably expected to have a\nMaterial  Adverse Effect, and no application for a funding  waver\nor  extension of any amortization period pursuant to Section  412\nof  the Code has been made with respect to any Plan.  None of the\nBorrower, any ERISA Affiliate or any fiduciary of any Plan  which\nis  not  a  Multiemployer Plan has taken or failed  to  take  any\naction  which  would constitute or result in a Termination  Event\nthat  would  have  or  would be reasonably  expected  to  have  a\nMaterial  Adverse  Effect.  There are no premium  payments  which\nhave  become  due  to  the PBGC which are  unpaid.   Neither  the\nBorrower  nor  any  ERISA Affiliate has  (i)  failed  to  make  a\nrequired  contribution or payment to a Multiemployer  Plan  which\nwould  have  or would be reasonably expected to have  a  Material\nAdverse  Effect  or  (ii) made a complete or  partial  withdrawal\nunder  Section  4203  or 4205 of ERISA from a Multiemployer  Plan\nwhich  would  have  or would be reasonably  expected  to  have  a\nMaterial  Adverse  Effect.  Neither the Borrower  nor  any  ERISA\nAffiliate has failed to make a required installment or any  other\nrequired  payment under Section 412 of the Code on or before  the\ndue  date for such installment or other payment which would  have\nor  would  be  reasonably  expected to have  a  Material  Adverse\nEffect.  Neither the Borrower nor any ERISA Affiliate is required\n=================================================================\n                           -60-\n\nto provide security to a Benefit Plan under Section 401(a)(29) of\nthe  Code due to a Plan amendment that results in an increase  in\ncurrent liability for,the plan year.\n\n          (q)        Year 2000.  The Borrower has been conducting\n                     ---------\na  comprehensive review of its computer systems to identify those\nthat could be adversely affected by the \"Year 2000 problem\" (that\nis, the inability of computers, as well as embedded microchips in\nnon-computing   devices,   to  perform  properly   date-sensitive\nfunctions  with  respect  to certain dates  prior  to  and  after\nDecember  31, 1999) and is developing an implementation  plan  to\nresolve  any  problem  identified in such review.   The  Borrower\nreasonably  believes that any reprogramming and  testing  of  its\ncomputer  systems required in respect of the \"Year 2000  problem\"\nwill  be  completed  by March 31, 1999, and that  the  Year  2000\nproblem  as  it  relates  to  the  Borrower's  computer  systems,\nincluding  costs of remediation, will not result  in  a  material\nadverse change in the operations, business, properties, condition\n(financial  or  otherwise) or prospects of the Borrower  and  its\nRestricted Subsidiaries.\n\n\n            5.02.    Subsequent   Funding   Representations   and\n                     --------------------------------------------\nWarranties.   In  order to induce the Lenders to make  any  Loans\n----------\nafter  the Initial Funding Date, and the Issuing Banks  to  issue\nLetters of Credit, the Borrower hereby represents and warrants to\neach Lender, each Issuing Bank, and the Administrative Agent that\nthe  statements set forth in Section 5.01 (except to  the  extent\n                             ------------\nthat  such  statements expressly are made only as of the  Initial\nFunding  Date),  are true, correct and complete in  all  material\nrespects as though made on and as of the Funding Date in  respect\nof  each Borrowing after the Initial Funding Date and the date of\nissuance   of   each   Letter   of  Credit,   except   that   the\nrepresentations and warranties need not be true  and  correct  to\nthe extent that changes in the facts and conditions on which such\nrepresentations  and  warranties  are  based  are   required   or\npermitted under this Agreement.\n\n\n                           ARTICLE VI\n\n                      Reporting Covenants\n                      -------------------\n\n           6.01.   Financial Statements.  So long as the Borrower\n                   --------------------\nshall have any Obligation or any Lender shall have any Commitment\nhereunder  or  any  Letter of Credit shall  be  outstanding,  the\nBorrower  shall maintain or cause to be maintained  a  system  of\naccounting established and administered in accordance with  sound\nbusiness  practices and consistent with past practice  to  permit\npreparation of financial statements in conformity with GAAP,  and\neach  of  the  financial  statements  described  below  shall  be\nprepared  from  such  system  and records.   The  Borrower  shall\ndeliver  or  cause  to  be delivered to the Administrative  Agent\n(with a sufficient number of copies for each Lender):\n\n\n          (a)        (i) As soon as practicable, and in any event\nwithin 45 days after the end of each of ATSC's first three fiscal\nquarters on a consolidated basis for ATSC, the Borrower  and  its\nRestricted  Subsidiaries, a balance sheet, income  statement  and\ncash  flow  statement for such fiscal quarter and a  year-to-date\nbalance sheet, income statement and cash flow statement of  ATSC,\nthe Borrower and its Restricted Subsidiaries, and (ii) as soon as\npracticable,  and in any event within 30 days after  the  end  of\neach fiscal month of ATSC (other than a fiscal month which is the\nlast  fiscal month of a fiscal quarter), on a consolidated  basis\n\n=================================================================\n                               -61-\n\nfor ATSC, the Borrower and its Restricted Subsidiaries, a balance\nsheet,  income statement and cash flow statement for such  fiscal\nmonth and a year-to-date balance sheet, income statement and cash\nflow   statement  for  ATSC,  the  Borrower  and  its  Restricted\nSubsidiaries, all certified by a Responsible Officer;\n\n\n           (b)         As  soon as practicable, and in any  event\nwithin  90  days  after  the  end of  each  Fiscal  Year,  annual\nfinancial  statements  on  a consolidated  basis  for  ATSC,  the\nBorrower  and  its Subsidiaries, consisting of a  balance  sheet,\nincome  statement  and  cash  flow statement,  certified  without\nqualification  by  the  firm  of  independent  certified   public\naccountants of recognized national standing regularly retained by\nATSC  and acceptable to the Administrative Agent, and accompanied\nby  such  firm's certification that, in the course of  its  audit\n(conducted   in  accordance  with  generally  accepted   auditing\nstandards), it obtained no knowledge that an Event of Default  or\nPotential  Event  of  Default has  occurred  as  a  result  of  a\nviolation of any of the covenants set forth in Article IX;\n                                               -----------\n\n           (c)         As  soon as practicable, and in any  event\nwithin  45  days  after  the  end  of  each  Fiscal  Year,  on  a\nconsolidated  basis for ATSC, the Borrower and its  Subsidiaries,\ndetailed   financial  projections  for  the  Fiscal   Year   next\nsucceeding  such Fiscal Year, including a written explanation  of\nthe principal assumptions made with respect thereto;\n\n\n           (d)   (i) Together with each delivery of the financial\nstatements  pursuant  to  paragraphs  (a)(i)  and  (b)  above,  a\n                          ------------------       ---\nCompliance Certificate of the Borrower substantially in the  form\nof  Exhibit  6.01(d)(i),  stating  that  the  executive  officers\n    -------------------\nsignatory  thereto have reviewed the terms of this Agreement  and\nthe  Collateral Documents, and have made, or caused  to  be  made\nunder  their  supervision, a review in reasonable detail  of  the\ntransactions  and condition of the Borrower and its Subsidiaries,\nduring   the   accounting  period  covered  by   such   financial\nstatements, and that such review has not disclosed the  existence\nduring  or  at  the end of such accounting period, and  that  the\nsigners do not have knowledge of the existence as at the date  of\nsuch certificate, of any condition or event which constitutes  an\nEvent  of Default or Potential Event of Default, or, if any  such\ncondition  or event existed or exists, specifying the nature  and\nperiod  of  existence thereof and what action  the  Borrower  has\ntaken,  is  taking  and  proposes to take with  respect  thereto;\nprovided, however, that Attachment 2 to Exhibit 6.01(d)(i),  need\n--------  -------       ------------    ------------------\nnot  be  included in the Compliance Certificate provided together\nwith the financial statements delivered pursuant to paragraph (a)\n                                                    -------------\nabove  and  (ii)  not later than 45 days after the  end  of  each\nfiscal  quarter (including the fourth fiscal quarter), a  Pricing\nRatio    Certificate,    substantially    in    the    form    of\nExhibit  6.01(d)(ii) (a \"Pricing Ratio Certificate\"), calculating\n------------------       -------------------------\nthe Pricing Ratio for the four consecutive fiscal quarters ending\nwith such fiscal quarter.\n\n            (e)          Promptly  upon  the  Borrower  obtaining\nknowledge  (A)  of  any condition or event which  constitutes  an\nEvent  of  Default  or  Potential Event of Default,  (B)  of  any\ncondition  or  event  which constitutes an event  of  default  or\nwhich, with the giving of notice or lapse of time or both,  would\nconstitute  an  event  of  default under  the  Subordinated  Note\nIndenture  or  any  Subordinated Debt Indenture  or  (C)  of  any\ncondition  or  event which has or in the Borrower's  judgment  is\nlikely  to  have  a Material Adverse Effect, a certificate  of  a\nResponsible Officer specifying the nature and period of existence\nof any such condition or event, or specifying the notice given or\naction taken by any lender or holder of the Subordinated Notes or\nany  Subordinated  Debt and the nature of such  claimed  default,\n================================================================\n                          -62-\n\nEvent of Default, Potential Event of Default, event or condition,\nand what action the Borrower has taken, is taking and proposes to\ntake with respect thereto;\n\n\n           (f)   (A)  Promptly after learning thereof, notice  of\nthe  institution of, or threat of, any action, suit,  proceeding,\ngovernmental  investigation or arbitration against  or  affecting\nATSC,  the Borrower or any Restricted Subsidiary of the  Borrower\ninvolving  claims  in excess of $5,000,000, or  any  Property  of\nATSC,  the Borrower or any Restricted Subsidiary of the  Borrower\nvalued  in  excess of $5,000,000 except, in each case, where  the\nsame  is  fully  covered by insurance (other than any  applicable\ndeductible)  or has been previously disclosed in writing  by  the\nBorrower  and  of  any material adverse change  in  any  existing\naction,   suit,   proceeding,   governmental   investigation   or\narbitration;  and (B) promptly upon learning thereof,  notice  of\nany  investigation  or proceeding before or by  any  Governmental\nAuthority, the effect of which might limit, prohibit or  restrict\nmaterially the manner in which it currently conducts its business\nor   to   declare  any  substance  contained  in   the   products\nmanufactured  or  distributed by it  to  be  dangerous,  if  such\ndeclaration  is  reasonably likely to  have  a  Material  Adverse\nEffect;\n\n          (g)        As soon as possible, and in any event within\nten  Business  Days  after  either  the  Borrower  or  any  ERISA\nAffiliate  knows  or has reason to know that a Termination  Event\nhas occurred, a written statement of a Responsible Officer of the\nBorrower  describing such Termination Event and  the  action,  if\nany,  which  the Borrower or such ERISA Affiliate has  taken,  is\ntaking  or proposes to take with respect thereto, and when known,\nany  action  taken  or threatened by the IRS, DOL  or  PBGC  with\nrespect thereto;\n\n           (h)        Promptly upon, and in any event within  ten\nBusiness  Days  after,  receipt  by  the  Borrower  or  an  ERISA\nAffiliate of the PBGC's intention to terminate a Benefit Plan  or\nto  have a trustee appointed to administer a Benefit Plan, copies\nof each such notice;\n\n\n           (i)        Promptly upon, and in any event within  ten\nBusiness  Days  after,  receipt by  the  Borrower  or  any  ERISA\nAffiliate  of any unfavorable determination letter from  the  IRS\nregarding the qualification of a Plan under Section 401(a) of the\nCode, copies of such letter;\n\n\n           (j)        Promptly upon, and in any event within  ten\nBusiness  Days  after,  receipt  by  the  Borrower  or  an  ERISA\nAffiliate  of  a notice from a Multiemployer Plan  regarding  the\nimposition of withdrawal liability, copies of each such notice;\n\n\n           (k)        Promptly upon, and in any event within  ten\nBusiness  Days,  after the Borrower or any ERISA Affiliate  knows\n(A)   a   Multiemployer  Plan  has  been  terminated,   (B)   the\nadministrator or plan sponsor of a Multiemployer Plan intends  to\nterminate a Multiemployer Plan, or (C) the PBGC has instituted or\nwill  institute  proceedings  under  Section  4042  of  ERISA  to\nterminate   a   Multiemployer  Plan  a   notification   of   such\ninformation;\n\n            (l)         Such  other  information  respecting  the\nfinancial  condition  of  ATSC, the Borrower  or  any  Restricted\nSubsidiary   of  the  Borrower,  business,  operations,   assets,\nperformance  or  prospects  as the Administrative  Agent  or  the\nRequisite  Lenders  may,  from time to time,  reasonably  request\nincluding  financial  projections and including  monthly  balance\nsheets, income statements and cash flow statements;\n=================================================================\n                             -63-\n\n\n           (m)         On  a  timely  basis consistent  with  the\nBorrower's legal obligations to release such materials, copies of\nall  financial statements, reports and notices, if any,  sent  or\nmade  available generally by the Borrower to the holders  of  its\npublicly held Securities or sent or made available generally to a\nholder of the Subordinated Notes or any Subordinated Debt or  the\ntrustee under the Subordinated Note Indenture or any Subordinated\nDebt  Indenture  or filed with the Commission and  of  all  press\nreleases  made available generally by the Borrower to the  public\nconcerning material developments in the business of the Borrower;\n\n\n          (n)        Upon the request of the Administrative Agent\nor  any Lender, copies of any management reports prepared by  the\nBorrower's independent certified public accountants in connection\nwith the annual audit;\n\n\n           (o)         As soon as available, but in any event  no\nlater  than  15 days after the end of each fiscal  month  of  the\nBorrower, a Borrowing Base Certificate of the Borrower  dated  as\nof  the last day of such fiscal month with appropriate insertions\nand attachments certified by a Responsible Officer;\n\n\n           (p) (i) Promptly upon sending or receiving copies, any\nand  all  management  letters  and  correspondence  relating   to\nmanagement letters, sent or received by the Borrower to  or  from\nthe Borrower's independent certified public accountants, and (ii)\nupon  request,  (A) a copy of the Borrower's plan, timetable  and\nbudget  to address the Year 2000 problem, together with  periodic\nupdates  thereof  and expenses incurred to date,  (B)  any  third\nparty assessment of the Borrower's Year 2000 remediation efforts,\nand (C) any Year 2000 contingency plans; and\n\n          (q)  Promptly to the Administrative Agent notice of the\nRefinancing Date if such Refinancing Date occurs.\n\n\n                          ARTICLE VII\n                     Affirmative Covenants\n                     ---------------------\n           The  Borrower covenants and agrees that, on and  after\nthe  date  hereof  and  so  long as any  Lender  shall  have  any\nCommitment hereunder or any Letter of Credit shall be outstanding\nhereunder and until payment in full of all of the Obligations:\n\n\n           7.01.   Corporate Existence, Etc.  The Borrower shall,\n                   -----------------------\nand  shall cause ATSC and each of its Restricted Subsidiaries to,\nat  all  times maintain its corporate existence and preserve  and\nkeep in full force and effect its rights and franchises except as\npermitted under Section 8.08.\n                ------------\n\n           7.02.  Corporate Powers, Etc.  The Borrower shall, and\n                  ---------------------\nshall  cause ATSC and each Restricted Subsidiary of the  Borrower\nto,   qualify  and  remain  qualified  to  do  business  in  each\njurisdiction in which the nature of its business requires  it  to\nbe  so qualified, except in those jurisdictions where the failure\nto  so  qualify does not have or would not reasonably be expected\nto have a Material Adverse Effect.\n\n================================================================\n                        -64-\n\n           7.03.  Compliance with Laws.  The Borrower shall,  and\n                  --------------------\nshall  cause ATSC and each Restricted Subsidiary of the  Borrower\nto,  comply  with  all Requirements of Law, and  all  restrictive\ncovenants  affecting  it or its business, properties,  assets  or\noperations,  where the failure so to comply would  reasonably  be\nexpected to have Material Adverse Effect.\n\n\n           7.04.   Payment  of  Taxes and Claims.   The  Borrower\n                   -----------------------------\nshall, and shall cause ATSC and each Restricted Subsidiary of the\nBorrower,  to pay (a) all material taxes, assessments  and  other\ngovernmental charges imposed upon it or on any of its  properties\nor  assets  or  in  respect of any of its  franchises,  business,\nincome or property before any material penalty or interest  in  a\nmaterial  amount  accrues thereon, and (b) all claims  (including\nclaims  for  labor, services, materials and supplies)  for  sums,\nmaterial in the aggregate, which have become due and payable  and\nwhich  by  law have or may become a Lien (other than a  Customary\nPermitted  Lien) upon any of its properties or assets,  prior  to\nthe time when any material penalty or fine shall be incurred with\nrespect  thereto;  provided that no such taxes,  assessments  and\n                   --------\ngovernmental  charges referred to in clause (a) above  or  claims\n                                     ----------\nreferred  to in clause (b) above need be paid if being  contested\n                ---------\nin   good   faith  by  appropriate  proceedings  instituted   and\ndiligently  conducted  and if such reserve or  other  appropriate\nprovision, if any, as shall be required in conformity  with  GAAP\nshall have been made therefor.\n\n           7.05.   Maintenance  of  Properties;  Insurance.   The\n                   ---------------------------------------\nBorrower   shall  and  shall  cause  ATSC  and  each   Restricted\nSubsidiary of the Borrower to, maintain or cause to be maintained\nin  good  repair, working order and condition, excepting ordinary\nwear  and  tear  and damage due to casualty or condemnation,  all\nProperty material to its operations and will make or cause to  be\nmade  all appropriate repairs, renewals and replacements thereof,\nconsistent  with  past practice.  The Borrower shall,  and  shall\ncause  each  of  its  Restricted Subsidiaries to,  maintain  such\ninsurance as it may be required to maintain under its leases  and\nother  contracts  and, to the extent not inconsistent  with  such\nrequirements,   shall  also  maintain  with   financially   sound\ninsurance companies, insurance policies and programs against loss\nor  damage  by  fire,  theft, burglary,  pilferage  and  loss  in\ntransit,  together  with  such other  hazards  as  is  reasonably\nconsistent  with prudent industry practice, and maintain  product\nand  other  liability insurance consistent with prudent  industry\npractice with financially sound insurance companies.\n\n\n           7.06.   Inspection  of Property;  Books  and  Records;\n                   ---------------------------------------------\nDiscussions.  The Borrower shall, and shall cause ATSC  and  each\n-----------\nRestricted  Subsidiary  of  the  Borrower  to,  permit  (a)   any\nauthorized  representative(s) designated  by  the  Administrative\nAgent  to  visit  and  inspect any of its  properties,  including\nfinancial  and  accounting records, and to make copies  and  take\nextracts  therefrom,  and to discuss its  affairs,  finances  and\naccounts with its officers, employees, representatives, agents or\nindependent  certified public accountants,  all  upon  reasonable\nnotice  and  at  such  reasonable time and as  often  as  may  be\nreasonably  requested and (b) the Administrative  Agent  and  its\nrepresentatives to perform collateral audits with respect to  the\nCredit Card Accounts, Inventory and Eligible Fixed Assets of  the\nBorrower and the Subsidiary Guarantors, provided that, unless  an\n                                        -------------\nEvent  of  Default  shall have occurred and  be  continuing,  the\nAdministrative Agent shall have the right to perform or cause  to\nbe performed only one such collateral audit per year, except that\nat  any  time  while  the  sum of (i) the  aggregate  outstanding\nprincipal  amount  of  Loans  and  (ii)  the  Letter  of   Credit\nObligations exceeds $100,000,000, the Administrative Agent  shall\nhave the right to perform or cause to be performed up to one such\ncollateral  audit per quarter.  Each such visitation,  inspection\n\n=================================================================\n                           -65-\n\nor  collateral  audit made by or on behalf of the  Administrative\nAgent shall be at the Borrower's expense.  The Borrower will keep\nproper books of record and account in which entries in conformity\nwith  GAAP  shall  be  made to prepare the  financial  statements\ndescribed in Section 6.01 and to satisfy all Requirements of Law.\n\n\n           7.07.   Labor Matters.  The Borrower shall notify  the\n                   -------------\nAdministrative Agent in writing, promptly, of any material  labor\ndispute  to which it may become a party, any strikes or  walkouts\nrelating to any of its facilities and the expiration of any labor\ncontract to which it is a party or by which it is bound.\n\n\n           7.08.   Maintenance  of Permits.  The  Borrower  shall\n                   -----------------------\nobtain  and  maintain,  and shall cause each  of  its  Restricted\nSubsidiaries to obtain and maintain, in full force and effect all\nPermits  or  other  rights necessary for  the  operation  of  its\nbusiness,  except  where the failure to obtain or  maintain  such\nPermits  or  rights  would not have or would  not  reasonably  be\nexpected to have a Material Adverse Effect.\n\n           7.09.   ERISA.  The Borrower shall establish, maintain\n                   -----\nand  operate and cause each of its ERISA Affiliates to establish,\nmaintain  and  operate,  all Plans in all  material  respects  in\ncompliance with their terms and with the applicable provisions of\nERISA, the Code, and all other Requirements of Law.\n\n           7.10.   Pledge of After-Acquired Property;  Additional\n                   ----------------------------------------------\nGuarantors.  (a)  With respect to any property acquired after the\n----------\nInitial  Funding  Date  by  ATSC, the  Borrower  or  any  of  the\nSubsidiary  Guarantors (other than (x) any property described  in\nparagraph  (b), (c) or (d) below, (y) any property subject  to  a\nLien  expressly permitted by Section 8.02(b)(iv) and (z) property\n                             -------------------     \nacquired   by   any   Foreign  Subsidiary)  as   to   which   the\nAdministrative  Agent, for the benefit of the Lenders,  does  not\nhave a perfected Lien, the Borrower shall, or shall cause ATSC or\nthe  relevant Subsidiary Guarantors to, promptly (i) execute  and\ndeliver  to  the  Administrative Agent  such  amendments  to  the\nCollateral   Documents   or   such   other   documents   as   the\nAdministrative Agent deems necessary or advisable to grant to the\nAdministrative Agent, for the benefit of the Lenders, a  security\ninterest in such property and (ii) take all actions necessary  or\nadvisable  to grant to the Administrative Agent, for the  benefit\nof  the Lenders, a perfected first priority security interest  in\nsuch  property,  including the filing of Uniform Commercial  Code\nfinancing statements in such jurisdictions as may be required  by\nthe  Collateral Documents or by law or as may be requested by the\nAdministrative Agent.\n\n           (b)   With  respect to any fee interest  in  any  real\nproperty  having a value (together with improvements thereof)  of\nat  least $1,000,000 acquired after the Initial Funding  Date  by\nATSC,  the  Borrower or any of the Subsidiary  Guarantors  (other\nthan  (x)  any  such real property subject to  a  Lien  expressly\npermitted  by Section 8.02(b)(iv) and (z) real property  acquired\nby  any  Foreign Subsidiary), the Borrower shall, or shall  cause\nATSC  or  the  relevant Subsidiary Guarantors  to,  promptly  (i)\nexecute  and deliver a first priority mortgage, in favor  of  the\nAdministrative  Agent, for the benefit of the  Lenders,  covering\nsuch  real  property,  (ii) if requested  by  the  Administrative\nAgent,  provide the Lenders with (x) title and extended  coverage\ninsurance covering such real property in an amount at least equal\nto the purchase price of such real property (or such other amount\nas  shall be reasonably specified by the Administrative Agent) as\nwell as a current ALTA survey thereof, together with a surveyor's\ncertificate  and (y) any consents or estoppels reasonably  deemed\nnecessary  or advisable by the Administrative Agent in connection\n=================================================================\n                              -66-\n\nwith  such  mortgage or deed of trust, each of the  foregoing  in\nform  and substance reasonably satisfactory to the Administrative\nAgent and (iii) if requested by the Administrative Agent, deliver\nto  the  Administrative  Agent legal  opinions  relating  to  the\nmatters  described above, which opinions shall  be  in  form  and\nsubstance,  and  from  counsel, reasonably  satisfactory  to  the\nAdministrative Agent.\n\n           (c)   With  respect  to any new Restricted  Subsidiary\n(other  than  a  Foreign  Subsidiary or  a  Nonmaterial  Domestic\nSubsidiary)  created or acquired (or any Subsidiary which  ceases\nto  be  a Nonmaterial Domestic Subsidiary in accordance with  the\ndefinition thereof) after the Initial Funding Date by  ATSC,  the\nBorrower  or  any  of its Restricted Subsidiaries,  the  Borrower\nshall,   or   shall   cause  ATSC  or  the  relevant   Restricted\nSubsidiaries  to,  promptly  (i)  execute  and  deliver  to   the\nAdministrative Agent such amendments to the Collateral  Documents\nas the Administrative Agent deems necessary or advisable to grant\nto  the  Administrative Agent, for the benefit of the Lenders,  a\nperfected  first priority security interest in the Securities  of\nsuch  new Subsidiary that are owned by ATSC, the Borrower or  any\nSubsidiary  Guarantor, (ii) deliver to the  Administrative  Agent\nthe  certificates, if any, representing such Securities, together\nwith undated stock powers, in blank, executed and delivered by  a\nduly  authorized officer of ATSC, the Borrower or such Subsidiary\nGuarantor,  as  the case may be, (iii) cause such new  Subsidiary\n(A)  to  become a party to the Subsidiary Guaranty and Collateral\nAgreement,  (B)  to take such actions necessary or  advisable  to\ngrant  to the Administrative Agent for the benefit of the Lenders\na  perfected  first priority security interest in the  Collateral\ndescribed  in  the  Subsidiary Guaranty and Collateral  Agreement\nwith  respect  to such new Subsidiary, including  the  filing  of\nUniform   Commercial   Code   financing   statements   in    such\njurisdictions as may be required by the Subsidiary  Guaranty  and\nCollateral  Agreement or by law or as may  be  requested  by  the\nAdministrative  Agent  and (C) to deliver to  the  Administrative\nAgent  a certificate of such Subsidiary of the type described  in\nSection  4.01(a)(ix)  in form and substance satisfactory  to  the\n-------------------\nAdministrative Agent, and (iv) if requested by the Administrative\nAgent,   deliver  to  the  Administrative  Agent  legal  opinions\nrelating to the matters described above, which opinions shall  be\nin  form and substance, and from counsel, reasonably satisfactory\nto the Administrative Agent.\n\n           (d)         With respect to any new Foreign Subsidiary\ncreated  or acquired after the Initial Funding Date by ATSC,  the\nBorrower or any of the Subsidiary Guarantors, the Borrower shall,\nor  shall  cause  ATSC or the relevant Subsidiary Guarantors  to,\npromptly (i) execute and deliver to the Administrative Agent such\namendments  to  the  Collateral Documents as  the  Administrative\nAgent deems necessary or advisable to grant to the Administrative\nAgent, for the benefit of the Lenders, a perfected first priority\nsecurity  interest in the Securities of such new Subsidiary  that\nis  owned  by  ATSC,  the  Borrower or any  Subsidiary  Guarantor\n(provided  that  in no event shall more than  65%  of  the  total\noutstanding  voting equity Securities of any such new  Subsidiary\nbe required to be so pledged), (ii) deliver to the Administrative\nAgent  the  certificates, if any, representing  such  Securities,\ntogether  with  undated  stock powers,  in  blank,  executed  and\ndelivered  by a duly authorized officer of ATSC, the Borrower  or\nsuch  Subsidiary  Guarantor, as the case may be,  and  take  such\nother  action  as  may be necessary or, in  the  opinion  of  the\nAdministrative  Agent,  desirable to perfect  the  Administrative\nAgent's security interest therein, and (iii) if requested by  the\nAdministrative Agent, deliver to the Administrative  Agent  legal\nopinions  relating to the matters described above, which opinions\nshall  be  in  form  and substance, and from counsel,  reasonably\nsatisfactory to the Administrative Agent.\n==================================================================\n                                 -67-\n\n           7.11.  Further Assurances.  At any time and from  time\n                  ------------------\nto  time,  upon  the Administrative Agent's request  and  at  the\nexpense of the Borrower, promptly and duly execute and deliver or\ncause   to  be  executed  and  delivered  any  and  all   further\ninstruments  and documents and take such further  action  as  the\nAdministrative Agent may reasonably request to effect the purpose\nof  the Collateral Documents, including, without limitation,  the\nfiling  of  any  financing or continuation statements  under  the\nUniform  Commercial  Code  in effect  in  any  jurisdiction.   In\naddition, the Borrower shall use reasonable commercial efforts to\nobtain a waiver, in form and substance reasonably satisfactory to\nthe  Administrative Agent, from each landlord in respect  of  any\nlease  of  real  property entered into by  the  Borrower  or  any\nSubsidiary Guarantor after the date hereof.\n\n          7.12.  Year 2000.  The Borrower shall:\n                 ---------\n\n           (a)   By  March 31, 1999, make inquiries  of  material\nsuppliers,  vendors and customers of the Borrower,  to  ascertain\nwhether  such persons are aware of the need to address  the  Year\n2000 problem and whether they are taking appropriate steps to  do\nso;\n\n           (b)   By  March 31, 1999, prepare a project  plan  and\nbudget  for  ensuring that the Year 2000 problem is  successfully\naddressed  in  all  material  respects  as  it  pertains  to  the\nBorrower's own business, properties or operations, and containing\ncontingency  plans  to  mitigate to the  extent  practicable  the\neffects  of  any third party's unexpected failure to address  the\nYear 2000 problem;\n\n           (c)   By  September  30, 1999, renovate  all  material\nsystems  and equipment of the Borrower affected by the Year  2000\nproblem   to  cause  them  to  perform  correctly  date-sensitive\nfunctions  for relevant data from before and after  December  31,\n1999 (\"Year 2000 Compliance\") or replace them with technology not\n       --------------------\nso affected; and\n\n           (d)   By  September  30, 1999,  complete  testing  and\ninstallation  of  all  material  systems  and  equipment  of  the\nBorrower to ensure timely Year 2000 Compliance.\n\n\n                          ARTICLE VIII\n\n                       Negative Covenants\n                       ------------------\n\n           The  Borrower covenants and agrees that, on and  after\nthe  date  hereof  and  so  long as any  Lender  shall  have  any\nCommitment hereunder or any Letter of Credit shall be outstanding\nhereunder and until payment in full of all of the Obligations:\n\n\n          8.01.  Indebtedness.  The Borrower shall not, and shall\n                 ------------\nnot  permit ATSC or any Restricted Subsidiary to, create,  incur,\nassume  or  otherwise  become or remain  directly  or  indirectly\nliable with respect to any Indebtedness, except:\n\n          (a)        the Obligations;\n=================================================================\n                         -68-\n           (b)        Indebtedness in the form of bank overdrafts\nin the ordinary course of business;\n\n            (c)         the  Subordinated  Notes  and  any  other\nSubordinated Debt;\n\n           (d)  (i)  Indebtedness incurred by the Borrower or any\nRestricted  Subsidiary to finance Capital Expenditures  and  (ii)\nCapital  Lease  obligations  of the Borrower  or  any  Restricted\nSubsidiary;\n\n           (e)         Indebtedness in respect  of  Accommodation\nObligations permitted under Section 8.04;\n                            ------------\n\n          (f)        Indebtedness of ATSC to the Borrower and any\nRestricted  Subsidiary  in  connection  with  any  advances  made\npursuant to Section 8.03(b);\n            ---------------\n\n           (g)         Indebtedness in respect of  Interest  Rate\nContracts  and Foreign Currency Exchange Agreements entered  into\nin  the  ordinary  course  of business and  not  for  speculative\npurposes;\n\n           (h)         subject  to Section 8.03(d),  intercompany\n                                   ---------------\nIndebtedness among the Borrower and its Restricted Subsidiaries;\n\n\n           (i)        Indebtedness arising out of Liens permitted\nunder clauses (iii), (vi) and (ix) of Section 8.02(b);\n                                      ---------------\n\n            (j)   Indebtedness  of  ATSC  under  the  Convertible\nDebentures and the ATSC Guarantee Agreements;\n\n\n           (k)  Permitted Existing Indebtedness and refinancings,\nrenewals or extensions thereof so long as the principal amount of\nany  such Permitted Existing Indebtedness is not increased  as  a\nresult of any such refinancing, renewal or extension (other  than\nby  an amount equal to the amount of fees and expenses payable in\nconnection with such refinancing, renewal or extension);\n\n            (l)  other  Indebtedness  of  the  Borrower  and  its\nRestricted Subsidiaries not exceeding in the aggregate  principal\namount of $10,000,000 at any one time outstanding; and\n\n\n           (m)   Indebtedness of the Borrower in respect  of  the\nintercompany note described in Section 8.05(i).\n                               ---------------\n\n          8.02.  Sales of Assets; Liens.\n                 ----------------------\n\n           (a)         Sales.  The Borrower shall not, and  shall\n                       -----\nnot  permit  ATSC or any Restricted Subsidiary to, sell,  assign,\ntransfer,  lease, convey or otherwise dispose of, any  properties\nor assets, whether now owned or hereafter acquired, or any income\nor  profits  therefrom, except among ATSC, the Borrower  and  any\nRestricted Subsidiary and except:\n\n=================================================================\n                                -69-\n\n                (i)      sales of inventory and subleases of real\nproperty in the ordinary course of business (and with respect  to\nsuch subleases consistent with its past practices);\n\n\n                (ii)       subleases of real property not in  the\nordinary course of business, but only to the extent the aggregate\nannual  rental payments accrued under all such subleases  do  not\nexceed $1,000,000;\n\n               (iii)       other  sales of assets, including  the\nsale  of  Securities  of  Subsidiaries, whether  or  not  in  the\nordinary  course of business, and excluding the sale of obsolete,\nunused  or unnecessary equipment, having an aggregate fair market\nvalue  of  not  more than $1,000,000 pursuant to any  one  single\ndisposition  or $2,000,000 in the aggregate pursuant  to  several\ndispositions in any one Fiscal Year;\n\n                (iv)       licenses of trademarks to  the  extent\nnecessary to maintain or protect such trademarks in jurisdictions\noutside the United States of America;\n\n                  (v)        sales   or  dispositions   of   Cash\nEquivalents;\n\n                (vi)      licenses of trademarks to third parties\nin exchange for royalty or other similar payments made on an arms-\nlength  basis  for use in connection with products  not  marketed\nunder such trademarks as of the date hereof;\n\n               (vii)       Investments  permitted  under  Section\n                                                          -------\n8.03; and\n----\n\n              (viii)       so  long as no Event of Default  shall\nhave  then  occurred and be continuing or would result therefrom,\ntransfer  of  cash or property in an amount not to exceed  1%  of\nEBITDA   for   each  Fiscal  Year  to  a  charitable   foundation\nestablished by the Borrower or ATSC;\n\nprovided, that no disposition (other than transfers permitted  by\n--------  ----\nclause  (vii)  or  (viii))  in  excess  of  $1,000,000  shall  be\n-------------      -------\npermitted unless the price to be received therefor represents the\nthen  fair market value of the asset or property sold at the time\nof  such disposition and at least 80% of the price is to be  paid\nin cash at the closing of the disposition.\n\n           (b)    Liens.  The Borrower shall not, and  shall  not\npermit  ATSC  or  any  Restricted Subsidiary to,  create,  incur,\nassume or permit to exist, directly or indirectly, any Lien on or\nwith respect to any of its Property except:\n\n\n             (i) Liens securing the Obligations;\n\n             (ii) Liens upon the interest or title of a lessor or\nsecured  by a lessor's interest under any lease under  which  the\nBorrower  or  any  Restricted Subsidiary is the  lessee  and  the\ninterest  of the lessee under any lease under which the  Borrower\nor any Restricted Subsidiary is the lessor;\n\n             (iii) Customary Permitted Liens;\n===================================================================\n                          -70-\n\n             (iv) Liens granted by the Borrower or any Restricted\nSubsidiary  (including the interest of a lessor under  a  Capital\nLease)  and Liens on Property existing at the time of acquisition\nthereof  by  the  Borrower or any Restricted Subsidiary  securing\nIndebtedness permitted by Section 8.01(d)(i), provided that  such\n                          ------------------  -------- \nLiens are limited to the assets financed with such Indebtedness;\n\n\n              (v) Liens on Property of any Person existing at the\ntime   such  Person  becomes  a  Restricted  Subsidiary  securing\nIndebtedness permitted by Section 8.01;\n                          ------------\n\n              (vi) Liens with respect to judgments or attachments\nwhich do not result in an Event of Default or Potential Event  of\nDefault hereunder;\n\n              (vii)  Permitted Existing Liens and any extensions,\nrenewals  and replacements thereof so long as (i) the  amount  of\nthe  obligations secured thereby is not increased  in  connection\nwith  any  such extension, renewal or replacement and  (ii)  such\nLien  is  limited to the property subject thereto prior  to  such\nextension, renewal or replacement;\n\n              (viii)   Liens in respect of Indebtedness permitted\npursuant to Section 8.01(l); and\n            ---------------\n\n              (ix)  to the extent Indebtedness secured thereby is\npermitted  to  be  extended, renewed, replaced or  refinanced,  a\nfuture  Lien  upon  any  Property which  is  subject  to  a  Lien\ndescribed  in  clause (vii) above, if such future  Lien  attaches\n               ------------\nonly   to   the  same  Property,  secures  only  such   permitted\nextensions, renewals, replacements or refinancings and is of like\nquality, character and extent.\n\n           8.03.  Investments.  The Borrower shall not, and shall\n                  -----------\nnot  permit  ATSC or any Restricted Subsidiary to, make  or  own,\ndirectly or indirectly, any Investment in any Person except:\n\n           (a)Investments  by  the  Borrower  or  any  Restricted\nSubsidiary in Cash Equivalents;\n\n           (b)Investments  by  the  Borrower  or  any  Restricted\nSubsidiary  resulting from advances to ATSC to fund  any  of  the\nitems set forth in Section 8.05(a), (b), (g) or (i);\n                   --------------   ---  ---    ---\n\n          (c)Investments by ATSC in the Borrower;\n\n           (d)Investments  by ATSC, the Borrower  and  Restricted\nSubsidiaries   in   the   Borrower  or   any   other   Restricted\nSubsidiaries,  provided  that,  after  giving  effect   to   such\n               --------\nInvestment,  the aggregate then outstanding amount  of  all  such\nInvestments  by  the  Borrower  and  the  Subsidiary   Guarantors\n(including  Investments in the nature of sales and  transfers  of\nassets   for  less  than  fair  market  value  and  Accommodation\nObligations)  made  subsequent to the  Initial  Funding  Date  in\nForeign  Subsidiaries  shall  not  exceed  $5,000,000,  provided,\nfurther,  that  the conversion of any Indebtedness  owed  to  the\nBorrower  or any Restricted Subsidiary by any Foreign  Subsidiary\ninto  equity  of such Foreign Subsidiary shall not constitute  an\nadditional Investment in such Foreign Subsidiary by the  Borrower\n==================================================================\n                           -71-\nor  such  Restricted Subsidiary for purposes  of  the  limitation\ncontained  in  the immediately preceding proviso; notwithstanding\nthe  foregoing, no Investments in Foreign Subsidiaries  shall  be\nmade  upon the occurrence and during the continuance of an  Event\nof Default;\n\n           (e)Investments  in  joint ventures  (in  the  form  of\ncorporations,   partnerships  or  otherwise)   and   Unrestricted\nSubsidiaries in a maximum amount not exceeding $15,000,000 at any\none  time  outstanding;  provided that no  Investments  in  joint\n                         --------\nventures  and  Unrestricted Subsidiaries shall be made  upon  the\noccurrence and during the continuation of an Event of Default;\n\n\n          (f)Investments not exceeding $5,000,000 at any one time\noutstanding  in  respect of loans to senior  executives  and  key\nemployees  of  ATSC,  the Borrower or any Restricted  Subsidiary;\nprovided  that  no  such  Investments  shall  be  made  upon  the\n--------\noccurrence and during the continuation of an Event of Default;\n\n\n           (g)Investments  in  the form of  advance  payments  to\nsuppliers  not  in excess of an aggregate amount  of  $10,000,000\noutstanding at any one time;\n\n           (h)Investments  by  ATSC  in AnnTaylor  Finance  Trust\narising out of payments under the ATSC Guarantee Agreements; and\n\n\n           (i)other Investments by the Borrower or any Restricted\nSubsidiary  not  in  excess of an aggregate  amount  of  $500,000\noutstanding at any one time.\n\n           8.04.  Accommodation Obligations.  The Borrower  shall\n                  -------------------------\nnot,  and shall not permit ATSC or any Restricted Subsidiary  to,\ncreate  or  become  or  be liable, directly or  indirectly,  with\nrespect to any Accommodation Obligation except:\n\n           (a)guaranties resulting from endorsement of negotiable\ninstruments for collection in the ordinary course of business;\n\n\n            (b)obligations,   warranties  and  indemnities,   not\nrelating  to Indebtedness of any Person, which have been  or  are\nundertaken or made in the ordinary course of business and not for\nthe  benefit or in favor of an Affiliate of the Borrower or  such\nSubsidiary;\n\n           (c)guaranties of obligations of the Borrower or any of\nits  Restricted  Subsidiaries in connection with the  leasing  or\nfinancing  of  materials handling equipment, computer  equipment,\nfurniture and fixtures in the ordinary course of business;\n\n          (d)Accommodation Obligations arising in connection with\nthe Borrower's agreement to provide one or more Letters of Credit\nissued  for  the  benefit  of any joint  venture  to  the  extent\npermitted by Section 8.03(e);\n             --------------\n\n           (e)with  respect  to  ATSC, Accommodation  Obligations\narising  in connection with (i) the ATSC Guaranty (ii)  the  ATSC\nPledge  Agreement,  (iii) the ATSC Guarantee Agreements  or  (iv)\nAccommodation Obligations for Indebtedness of the Borrower or its\nwholly-owned  Restricted Subsidiaries permitted  to  be  incurred\nunder Section 8.01; and\n      ------------\n=================================================================\n                            -72-\n\n            (f)Accommodation  Obligations  under  the  Subsidiary\nGuaranty and Collateral Agreement.\n\n           8.05.   Restricted Payments.  The Borrower shall  not,\n                   -------------------\nand  shall not permit any of its Restricted Subsidiaries or ATSC,\nto declare or make any Restricted Payment except:\n\n          (a)scheduled payments (but not prepayments) of interest\ndue  on the Subordinated Notes or any Subordinated Debt, if  such\nscheduled payments are permitted to be made pursuant to the terms\nof such Subordinated Notes or Subordinated Debt;\n\n           (b)dividends paid and declared in any Fiscal  Year  by\nthe  Borrower  to  ATSC to fund (i) income  and  franchise  taxes\npayable  in  such Fiscal Year owed by ATSC pursuant  to  the  Tax\nSharing Agreement dated as of July 12, 1989 between ATSC and  the\nBorrower; (ii) other ordinary operating expenses of ATSC  not  in\nexcess  of  $500,000 in any Fiscal Year; (iii)  ATSC's  share  of\nexpenses  incurred  in connection with, any  public  offering  of\nCommon Stock; and (iv) payments permitted under Section 8.05(e);\n                                                ---------------\n\n          (c)any Restricted Payment made by any Subsidiary on its\ncapital stock;\n\n           (d)payments by ATSC to the Investor Group of its share\nof  expenses  incurred in connection with any public offering  of\nthe Common Stock held by the Investor Group;\n\n           (e)payments by ATSC or the Borrower to acquire  shares\nof  Common  Stock  from employees of ATSC, the  Borrower  or  any\nRestricted  Subsidiary  in  an  aggregate  amount  not  exceeding\n$100,000 in any Fiscal Year;\n\n           (f)scheduled  payments of dividends on  the  Preferred\nSecurities;  provided  that  the Borrower  will  cause  AnnTaylor\nFinance  Trust  to  exercise  its  right  to  defer  payments  of\ndividends at any time when an Event of Default or Potential Event\nof  Default shall have occurred and be continuing or would result\ntherefrom;\n\n           (g)(i) dividends paid and declared by the Borrower  to\nATSC   to  the  extent  necessary  to  pay  interest  under   the\nConvertible Debentures and (ii) interest paid by ATSC in  respect\nof  the  Convertible  Debentures financed  with  such  dividends;\nprovided that (i) no such dividend shall be declared or paid  and\n--------\nno  such  interest  shall be paid at any time when  an  Event  of\nDefault or Potential Event of Default shall have occurred and  be\ncontinuing or would result therefrom, and at any such  time,  the\nBorrower  will cause ATSC to exercise its right to defer  payment\nof  such interest and (ii) no such dividends shall be paid  prior\nto  the  due  date of the corresponding interest payment  on  the\nConvertible Debentures;\n\n           (h)  repurchases of the Subordinated Notes pursuant to\nSection 2.01(f); and\n---------------\n\n          (i)  a one-time dividend in the form of an intercompany\nnote  in an amount of up to $100,625,000 by the Borrower to  ATSC\nand  interest  payments on such intercompany note, provided  that\n                                                   --------\n(i)  such  intercompany note is pledged by ATSC pursuant  to  the\nATSC   Pledge   Agreement,  (ii)  such   intercompany   note   is\nsubordinated   to  the  Obligations  on  terms   and   conditions\nsatisfactory  to  the Administrative Agent,  (iii)  no  principal\n=================================================================\n                          -73-\n\npayments  are  made in respect of such intercompany note  without\nthe  consent of the Requisite Lenders and (iv) interest  payments\nshall  be made only to the extent necessary to provide funds  for\nthe payment of interest on the Convertible Debentures (ATSC shall\nbe  permitted  to  pay  interest in respect  of  the  Convertible\nDebentures  financed  with  such  interest  payments);   provided\n                                                         --------\nfurther  that  (A)  no  such  interest  shall  be  paid  on  such\n-------\nintercompany  note  at  any time when  an  Event  of  Default  or\nPotential  Event of Default shall have occurred and be continuing\nor  would  result therefrom, and at any such time,  the  Borrower\nwill  cause  ATSC  to  exercise its right  to  defer  payment  of\ninterest  on the Convertible Debentures, and (B) no such interest\nshall be paid on such intercompany note prior to the due date  of\nthe corresponding interest payment on the Convertible Debentures.\n\n\n           8.06.   Conduct of Business.  The Borrower shall  not,\n                   -------------------\nand  shall  not  permit  any of its Restricted  Subsidiaries  to,\nengage in any business other than (a) the business engaged in  by\nthe  Borrower or such Subsidiary on the date hereof; and (b)  any\nbusiness activities substantially similar or related thereto.\n\n\n           8.07.   Transactions  with Affiliates.   The  Borrower\n                   -----------------------------\nshall not, and shall not permit ATSC or any Restricted Subsidiary\nto,  at  any  time  after the Initial Funding  Date  directly  or\nindirectly   enter  into  or  permit  to  exist  any  transaction\n(including the purchase, sale, lease or exchange of any  property\nor  the  rendering of any service) with any of its Affiliates  on\nterms  that  are  less  favorable  to  it  than  those  fair  and\nreasonable  terms  that might be obtained in a  comparable  arms-\nlength  transaction  at  the time; provided  that  the  foregoing\n                                   --------\nrestriction  shall  not  apply to transactions  among  ATSC,  the\nBorrower  and its wholly-owned Restricted Subsidiaries, customary\nfees paid to members of the Board of Directors of the Borrower or\nATSC  or payments permitted under Section 8.03(g) or the business\n                                  ---------------\ncontemplated  by  the  joint  ventures  permitted  under  Section\n                                                          -------\n8.03(e).\n-------\n\n          8.08.  Restriction on Fundamental Changes.\n                 ----------------------------------\n\n           (a)The  Borrower shall not, and shall not  permit  any\nRestricted Subsidiary to, enter into any merger or consolidation,\nor  liquidate, wind-up or dissolve (or suffer any liquidation  or\ndissolution),  discontinue its business or convey,  lease,  sell,\ntransfer or otherwise dispose of, in one transaction or series of\ntransactions,  all  or any substantial part of  its  business  or\nProperty,  whether  now  or hereafter  acquired,  except  (i)  as\notherwise  permitted  under  Section  8.02(a),  (ii)   that   any\n                             ----------------\nRestricted  Subsidiary may merge into or convey, sell,  lease  or\ntransfer  all or substantially all of its assets to, the Borrower\nor  any  other Restricted Subsidiary (provided that if  any  such\nRestricted  Subsidiary is a Subsidiary Guarantor,  the  surviving\nentity of any such merger or the entity to which such assets  are\nconveyed, sold, leased or transferred must be the Borrower  or  a\nSubsidiary  Guarantor)  and (iii) that nothing  contained  herein\nshall  prohibit  the Borrower from dissolving or liquidating  any\nSubsidiary if in the reasonable opinion of the Borrower's  senior\nmanagement  such  dissolution or liquidation  has  no  reasonable\nlikelihood of having a Material Adverse Effect.\n\n           (b)The Borrower shall not and shall not permit ATSC or\nany   Restricted   Subsidiary  to,  amend  its   Certificate   of\nIncorporation or By-Laws in a manner that is in any  way  adverse\nto  the  rights  of  the  Administrative Agent  and  the  Lenders\nhereunder.\n================================================================\n                           -74-\n\n           8.09.   ERISA.  The Borrower shall not, and shall  not\n                   -----\npermit any of its ERISA Affiliates to, do any of the following to\nthe  extent  that  such  act  or failure  to  act  would  in  the\naggregate,  after  taking into account any  other  such  acts  or\nfailures to act, have a Material Adverse Effect.\n\n\n           (a)Engage, or permit any ERISA Affiliate to engage, in\nany prohibited transaction described in Sections 406 of ERISA  or\n4975 of the Code for which a statutory or class exemption is  not\navailable or a private exemption has not been previously obtained\nfrom the DOL;\n\n           (b)permit  to exist any accumulated funding deficiency\n(as  defined  in  Sections 302 of ERISA and  412  of  the  Code),\nwhether or not waived;\n\n            (c)terminate,  or  permit  any  ERISA  Affiliate   to\nterminate,  any Benefit Plan which would result in any  liability\nof the Borrower or any ERISA Affiliate under Title IV of ERISA;\n\n\n          (d)fail, or permit any ERISA Affiliate to fail, to make\nany  contribution or payment to any Multiemployer Plan which  the\nBorrower or any ERISA Affiliate may be required to make under any\nagreement  relating  to  such  Multiemployer  Plan,  or  any  law\npertaining thereto;\n\n           (e)fail, or permit any ERISA Affiliate to fail, to pay\nany  required  installment or any other  payment  required  under\nSection  412  of  the Code on or before the  due  date  for  such\ninstallment or other payment; or\n\n           (f)amend,  or permit any ERISA Affiliate to  amend,  a\nPlan  resulting in an increase in current liability for the  plan\nyear such that the Borrower or any ERISA Affiliate is required to\nprovide  security  to such Plan under Section 401(a)(29)  of  the\nCode.\n\n           8.10.  Sales and Leasebacks.  The Borrower shall  not,\n                  --------------------\nand shall not permit any Restricted Subsidiary to, become liable,\ndirectly or by way of any Accommodation Obligation, with  respect\nto  any lease, whether an Operating Lease or a Capital Lease,  of\nany  Property whether now owned or hereafter acquired, (a)  which\nthe Borrower or any Restricted Subsidiary has sold or transferred\nor  is to sell or transfer to any other Person, or (b) which  the\nBorrower  or any such Restricted Subsidiary intends  to  use  for\nsubstantially the same purposes as any other Property  which  has\nbeen  or is to be sold or transferred by that entity to any other\nPerson in connection with such lease.\n\n             8.11.     Subordinated   Indebtedness   and    other\n                       ------------------------------------------\nIndebtedness.\n------------\n\n           (a)No  Change.  The Borrower shall not, and shall  not\n              ----------\npermit  ATSC  to, amend, supplement or modify the  terms  of  the\nSubordinated  Notes,  any  Subordinated  Debt,  the   Convertible\nDebentures,  the Preferred Securities or the ATSC Guarantees  (i)\nwhich relate to subordination, interest (including options to pay\nin  kind),  principal, tenor, extension of maturity, payments  in\nrespect  of  redemptions, repurchases, sinking  fund,  principal,\ninterest  or other payments, or the acceleration thereof  or  any\nrescission of acceleration or (ii) except if necessary to  comply\nwith  the provisions of the Trust Indenture Act of 1939 or  (iii)\nby  making  more  restrictive,  or adding,  covenants,  breaches,\ndefaults,  or  events  of  default, or (iv)  by  shortening  cure\n=================================================================\n                          -75-\n\nperiods,  or  (v)  if  the  benefits  to  the  Borrower  or   the\nAdministrative  Agent  or the Lenders would  thereby  be  in  any\nmaterial respect limited, restricted or diminished.\n\n\n           (b)  Notices.   The  Borrower  shall  deliver  to  the\n                -------\nAdministrative Agent (i) a copy of each notice or  other  written\ncommunication  delivered by or on behalf of the Borrower  to  any\ntrustee  under the Subordinated Note Indenture, any  Subordinated\nDebt Indenture or the Convertible Debentures, such delivery to be\nmade  at  the same time and by the same means as such  notice  or\nother written communication is delivered to such Person, and (ii)\na  copy of each notice or other written communication received by\nthe  Borrower  from  the  trustee  under  the  Subordinated  Note\nIndenture,  any  Subordinated Debt Indenture or  the  Convertible\nDebentures,  such delivery to be made promptly after such  notice\nor other written communication is received by the Borrower.\n\n\n           (c)   Designated  Senior Indebtedness.   The  Borrower\n                 -------------------------------\nshall not (i) borrow $20,000,000 or more in respect of any single\nissue  of  \"Senior  Indebtedness\" under and  as  defined  in  the\nSubordinated Note Indenture or any Subordinated Debt Indenture or\n(ii) designate any Indebtedness (other than the Obligations)  as,\nor  cause  any  such  Indebtedness to become, \"Designated  Senior\nIndebtedness\"  under  and  as defined in  the  Subordinated  Note\nIndenture or any Subordinated Debt Indenture.\n\n\n           8.12.  Margin Regulations.  No portion of the proceeds\n                  ------------------\nof  any credit extended under this Agreement shall be used in any\nmanner  which  might  cause  the  extension  of  credit  or   the\napplication of such proceeds to violate Regulation T,  Regulation\nU  or Regulation X or any other regulation of the Federal Reserve\nBoard or to violate the Securities Exchange Act or the Securities\nAct,  in  each  case as in effect on the date or  dates  of  such\nBorrowing and such use of proceeds.\n\n           8.13.  Change of Fiscal Year.  The Borrower shall  not\n                  ---------------------\nchange its Fiscal Year.\n\n           8.14.   Subsidiaries.   (a)  The  Borrower  shall  not\n                   ------------\npermit,  without  the  consent of the Administrative  Agent,  any\nUnrestricted   Subsidiary  to  enter   into   any   Accommodation\nObligation with respect to any Indebtedness of ATSC, the Borrower\nor  any Restricted Subsidiary or to grant or permit to exist  any\nLien on its Property to secure any such Indebtedness.\n\n\n           (b)The  Borrower shall not, and shall not  permit  any\nRestricted  Subsidiary to, create or otherwise  become  effective\nany  consensual  encumbrance or restriction of any  kind  on  the\nability of any Restricted Subsidiary to pay dividends or make any\nother  distribution, in respect of its stock or  make  any  other\nRestricted Payment, pay any Indebtedness or other Obligation owed\nto the Borrower or any other Restricted Subsidiary, make loans or\nadvances  or  other  Investments in the  Borrower  or  any  other\nRestricted  Subsidiary or sell, transfer or otherwise convey  any\nof   its  Property  to  the  Borrower  or  any  other  Restricted\nSubsidiary.\n\n           8.15.   Capital Expenditures.  The Borrower shall  not\n                   --------------------\nmake  Capital  Expenditures in any Fiscal Year,  commencing  with\nFiscal  Year  1998,  exceeding  (a)  during  Fiscal  Year   1998,\n$52,000,000,  (b)  during Fiscal Year 1999,  the  lesser  of  (1)\n$55,000,000  and  (b)  the sum of (A) $35,000,000  plus  (B)  the\nAvailable  Cash for Fiscal Year 1998 and (c) during  Fiscal  Year\n2000,  the  lesser of (i) $73,000,000 and (ii)  the  sum  of  (A)\n$35,000,000  and  (B) the Available Cash for  Fiscal  Year  1999,\n================================================================\n                           -76-\nprovided that in the event that comparable store sales growth for\n--------\nFiscal  Year  1998 is 0.0%, Capital Expenditures in  Fiscal  Year\n1999  may  not  exceed the sum of (x) $25,000,000  plus  (y)  the\nAvailable Cash Amount for Fiscal Year 1998.\n\nThe  Borrower will not, at any time when it is not in  compliance\nwith  Section 9.03, commit to make any Capital Expenditures,  and\n      ------------\nduring  such  time  as  the Borrower is not  in  compliance  with\nSection   9.03,  the  Borrower  will  make  only   such   Capital\n--------------\nExpenditures  as  were  legally committed  at  a  time  when  the\nBorrower  was  in  compliance with Section  9.03.   For  purposes\n                                   -------------\nhereof,  it  is  agreed that the Borrower shall be in  compliance\nwith  Section 9.03 at any time that a breach thereunder has  been\n      ------------\neffectively waived or cured.\n\n\n          8.16.   Consignment of Title Documents.  At any time at\n                  ------------------------------\nthe  request of the Administrative Agent or the Requisite Lenders\nafter  the occurrence and during the continuation of an Event  of\nDefault,  the Borrower shall deliver or cause to be delivered  to\nthe Administrative Agent for the benefit of the Lenders any title\nor  similar  documents (including, without limitation,  warehouse\nreceipts) in respect of goods covered or originally covered by  a\nLetter of Credit (including any Existing Letter of Credit).\n\n\n                           ARTICLE IX\n\n                      Financial Covenants\n                      -------------------\n\n           The  Borrower covenants and agrees that, on and  after\nthe  date  hereof  and so long as any Lender has  any  Commitment\nhereunder  or any Letter of Credit shall be outstanding hereunder\nand until payment in full of all the Obligations:\n\n           9.01.   Minimum  Net  Worth.  The Borrower  shall  not\n                   -------------------\npermit Net Worth at the end of any fiscal quarter to be less than\nthe  sum of (a) $350,000,000 plus (b) 50% of Net Income for  each\nfiscal  quarter  ending after April 30, 1998  (without  deducting\nfrom  such cumulative amount the amount of any net loss  incurred\nin any such fiscal quarter except extraordinary losses associated\nwith the redemption or repurchase of Indebtedness).\n\n           9.02.   Leverage Ratio.  The Borrower shall not permit\n                   --------------\nthe  ratio of (a) the sum of (i) Total Debt plus (ii) the product\nof  (A)  Rental  Expense  for  the most  recent  period  of  four\nconsecutive fiscal quarters times (B) six to (b) the sum  of  (i)\nTotal  Capitalization plus (ii) the product of (A) Rental Expense\n                      ----\nfor  the  most recent period of four consecutive fiscal  quarters\ntimes  (B)  six  to  exceed .60 to 1 at the  end  of  any  fiscal\nquarter.\n\n           9.03.   Minimum  Fixed  Charge  Coverage  Ratio.   The\n                   ---------------------------------------\nBorrower  shall  not permit the Fixed Charge Coverage  Ratio,  as\ndetermined  at  the end of any fiscal quarter for  the  preceding\nfour  fiscal  quarters,  to  be less than  the  ratio  set  forth\nopposite the month in which such fiscal quarter ends:\n\n\n          Quarter Ended            Minimum Ratio\n          -------------            -------------\n          July 1998                1.15 to 1.00\n\n=================================================================\n                          -77-\n\n          October 1998             1.20 to 1.00\n          January 1999             1.25 to 1.00\n          April 1999               1.30 to 1.00\n          July 1999 through\n             January 2000          1.35 to 1.00\n          Thereafter               1.40 to 1.00\n\n           9.04.  Minimum Current Ratio.  The Borrower shall  not\n                  ---------------------\npermit  the  ratio  of  Current Assets to  the  sum  of,  without\nduplication,  (a)  Current Liabilities  plus  (b)  the  aggregate\noutstanding  principal amount of Loans to be less than  2.00:1.00\nat the end of any fiscal quarter.\n\n\n           9.05.   Minimum EBITDA.  The Borrower shall not permit\n                   --------------\nEBITDA to be less than $100,000,000 for Fiscal Year 1998.\n\n\n                           ARTICLE X\n\n             Events of Default; Right and Remedies\n             -------------------------------------\n\n           10.01.   Events  of Default.  Each  of  the  following\n                    ------------------\noccurrences  shall  constitute an Event  of  Default  under  this\nAgreement:\n\n           (a)        Failure to Make Payments When Due. (i)  The\nBorrower shall fail to pay when due any principal of any Loan  or\nReimbursement Obligation, or\n\n             (ii)  the Borrower shall fail to pay any interest on\nany  Loan or Reimbursement Obligation, or any fee or other amount\npayable  under  this Agreement, within the earlier  of  (A)  five\nBusiness Days after the same shall become due in accordance  with\nterms  hereof  or (B) in the event that a principal  or  interest\npayment shall be due under the terms of the Subordinated Notes or\nany  Subordinated Debt within such five Business Day period,  one\nBusiness  Day  prior  to  such payment date  in  respect  of  the\nSubordinated Notes or such Subordinated Debt if the payments  are\ndue on the same date.\n\n\n           (b)         Breach of Certain Covenants.  The Borrower\n                       ---------------------------\nshall  fail duly and punctually to perform or observe  (or  cause\nATSC  or  any  Restricted Subsidiary to perform or  observe)  any\nagreement,  covenant or obligation binding on the Borrower,  ATSC\nor  any  Restricted Subsidiary under Section 6.01(e)(A),  Article\n                                     -----------------    -------\nVIII  or  Article  IX  or binding on the Borrower,  ATSC  or  any\n----      -----------\nSubsidiary   Guarantor  under  any  section  of  the   Collateral\nDocuments  for  which a grace period is provided  (which  failure\ncontinues  after  the  expiration of any grace  period  specified\nunder such section of the Collateral Documents).\n\n\n           (c)        Breach of Representation or Warranty.   Any\n                      ------------------------------------\nrepresentation or warranty made or deemed made by  the  Borrower,\nATSC or any Subsidiary Guarantor to the Administrative Agent, any\nIssuing  Bank  or any Lender herein or in any of the  other  Loan\nDocuments or in any written statement or certificate at any  time\ngiven  by the Borrower, ATSC or any Subsidiary Guarantor pursuant\nto  any of the Loan Documents shall be false or misleading in any\nmaterial respect on the date as of which made or deemed made.\n\n==================================================================\n                         -78-\n\n           (d)         Other Defaults.  Either the Borrower, ATSC\n                       --------------\nor  any  Restricted Subsidiary shall fail duly and punctually  to\nperform  or observe any agreement, covenant or obligation arising\nunder  this  Agreement or under any of the other  Loan  Documents\n(except  those described in Sections 10.01(a), (b) and (c)),  and\n                            -----------------  ---     ----\nsuch  failure shall continue for 20 days (or, in the case of Loan\nDocuments other than this Agreement, any longer period  of  grace\nexpressly set forth therein).\n\n          (e)        Default as to Other Indebtedness.  ATSC, the\n                     --------------------------------\nBorrower  or  any Restricted Subsidiary shall fail  to  make  any\npayment when due (whether by scheduled maturity, required  prepay\nment,  acceleration, demand or otherwise) on any Indebtedness  of\nATSC,  the Borrower or any such Subsidiary, other than an  Obliga\ntion,  if  the  aggregate  amount of  all  such  Indebtedness  is\n$5,000,000  or more; or any breach, default or event  of  default\nshall  occur,  or any other event shall occur or condition  shall\nexist,  under  any instrument, agreement or indenture  pertaining\nthereto,  if the effect thereof is to accelerate, or  permit  the\nholder(s) of such Indebtedness to accelerate, the maturity of any\nsuch Indebtedness; or any such Indebtedness shall be declared  to\nbe  due  and payable or required to be prepaid (other than  by  a\nregularly  scheduled  required prepayment  prior  to  the  stated\nmaturity  thereof); or the holder of any Lien (other  than  Liens\nupon  property  leased to ATSC, the Borrower or  such  Restricted\nSubsidiary  which  were  created by the  landlord  prior  to  the\ncommencement  of  the  lease),  in  any  amount,  shall  commence\nforeclosure  of such Lien upon property of ATSC, the Borrower  or\nany  Restricted Subsidiary having a value in excess of $5,000,000\nin the aggregate.\n\n            (f)         Involuntary  Bankruptcy;  Appointment  of\n                        -----------------------------------------\nReceiver,  Etc.   (i)  An  involuntary case  shall  be  commenced\n--------------\nagainst  the  Borrower or ATSC or any Restricted Subsidiary,  and\nthe  petition  shall  not  be  dismissed  within  60  days  after\ncommencement of the case, or a court having jurisdiction  in  the\npremises  shall enter a decree or order for relief in respect  of\nthe  Borrower  or  ATSC  or  any  Restricted  Subsidiary  in   an\ninvoluntary case, under any applicable bankruptcy, insolvency  or\nother  similar  law now or hereinafter in effect;  or  any  other\nsimilar  relief  shall be granted under any  applicable  federal,\nstate or foreign law.\n\n              (ii)  A  decree or order of a court having jurisdic\ntion   in  the  premises  for  the  appointment  of  a  receiver,\nliquidator,  sequestrator, trustee, custodian  or  other  officer\nhaving similar powers over the Borrower or ATSC or any Restricted\nSubsidiary, or over all or a substantial part of the property  of\nthe  Borrower  or  ATSC  or any Restricted Subsidiary,  shall  be\nentered;  or  an interim receiver, trustee or other custodian  of\nthe Borrower or ATSC or any Restricted Subsidiary, or of all or a\nsubstantial part of the property of the Borrower or ATSC  or  any\nRestricted  Subsidiary,  shall  be  appointed  or  a  warrant  of\nattachment,  execution or similar process against any substantial\npart  of  the property of the Borrower or ATSC or any  Restricted\nSubsidiary,  shall  be issued and any such  event  shall  not  be\nstayed,  vacated, dismissed, bonded or discharged within 60  days\nof entry, appointment or issuance.\n\n            (g)          Voluntary  Bankruptcy;  Appointment   of\n                         ----------------------------------------\nReceiver, Etc.  The Borrower or ATSC or any Restricted Subsidiary\n-------------\nshall  have  an order for relief entered with respect  to  it  or\ncommence  a  voluntary  case  under  any  applicable  bankruptcy,\ninsolvency  or other similar law now or hereafter in  effect,  or\nshall  consent  to  the  entry of  an  order  for  relief  in  an\ninvoluntary case, or to the conversion of an involuntary case  to\na  voluntary  case, under any such law, or shall consent  to  the\nappointment of or taking of possession by a receiver, trustee  or\n=================================================================\n                           -79-\n\nother  custodian for all or a substantial part of  its  property;\nthe  Borrower or ATSC or any Restricted Subsidiary shall make any\nassignment  for the benefit of creditors or shall  be  unable  or\ngenerally  fail, or admit in writing its inability,  to  pay  its\ndebts as such debts become due; or the Board of Directors (or any\ncommittee  thereof)  of the Borrower or ATSC  or  any  Restricted\nSubsidiary adopts any resolution to approve any of the foregoing.\n\n\n            (h)         Judgments  and  Attachments.   Any  money\n                        ---------------------------\njudgment  (other than a money judgment covered by insurance,  but\nonly  if the insurer has admitted liability with respect to  such\nmoney  judgment),  writ  or  warrant of  attachment,  or  similar\nprocess  involving in any case an amount in excess of  $5,000,000\nshall  be  entered or filed against the Borrower or ATSC  or  any\nRestricted Subsidiary or any of their Property, and shall  remain\nundischarged, unvacated, unbonded or unstayed for a period of  60\ndays.\n\n           (i)        Dissolution.  Any order, judgment or decree\n                      -----------\nshall  be  entered against the Borrower or ATSC or any Restricted\nSubsidiary decreeing its involuntary dissolution or split-up  and\nsuch order shall remain undischarged and unstayed for a period in\nexcess  of  60  days; or the Borrower or ATSC or  any  Restricted\nSubsidiary shall otherwise dissolve or cease to exist  except  as\npermitted by Section 8.08.\n\n          (j)        Collateral Documents; Failure of Security or\n                     --------------------------------------------\nSubordination.  For any reason other than a release of  Liens  or\n-------------\nthe  failure of the Administrative Agent and the Lenders to  take\nany  action  unilaterally  available  to  them  to  maintain  the\nperfection  of  the Liens created in favor of the  Administrative\nAgent  pursuant  to this Agreement and the Collateral  Documents,\nany Collateral Document ceases to be in full force and effect  or\nany  Lien intended to be created thereby ceases to be or  is  not\nvalid  and  perfected; or any Lien in favor of the Administrative\nAgent  contemplated by this Agreement or any Collateral Document,\nor  the subordination provisions of the Subordinated Notes or any\nSubordinated Debt shall, at any time, be invalidated or otherwise\ncease  to  be in full force and effect; or any such Lien  or  any\nObligation  shall be subordinated or shall not have the  priority\ncontemplated by this Agreement, the Collateral Documents or  such\nsubordination provisions, for any reason.\n\n           (k)         Change  in  Control.  (i)  Any  Change  in\n                       -------------------\nControl  shall occur or (ii) ATSC shall cease to own all  of  the\noutstanding equity Securities of the Borrower.\n\n\n           (l)         ERISA Liabilities.  Any Termination  Event\n                       -----------------\noccurs  which will or is reasonably likely to subject either  the\nBorrower  or an ERISA Affiliate to a liability which will  or  is\nreasonably expected to have a Material Adverse Effect.\n\n\n           An Event of Default shall be deemed \"continuing\" until\ncured or waived in writing in accordance with Section 12.08.\n                                              -------------\n\n          10.02.  Rights and Remedies.\n                  -------------------\n\n           (a)         Acceleration.  Upon the occurrence of  any\n                       ------------\nEvent  of Default described in Section 10.01(f) or 10.01(g)  with\n                               ----------------    --------\nrespect to the Borrower, the Commitments shall automatically  and\nimmediately terminate and the unpaid principal amount of and  any\nand  all  accrued interest on the Loans and all Letter of  Credit\nObligations  shall  automatically  become  immediately  due   and\n=================================================================\n                          -80-\n\npayable,  with all additional interest from time to time  accrued\nthereon  and  without presentment, demand, or  protest  or  other\nrequirements  of any kind (including valuation and  appraisement,\ndiligence,  presentment, notice of intent to demand or accelerate\nand of acceleration), all of which are hereby expressly waived by\nthe  Borrower, and the obligation of each Lender to make any Loan\nhereunder  and of any Issuing Bank to issue any Letter of  Credit\nshall thereupon terminate; and upon the occurrence and during the\ncontinuance  of  any  other Event of Default, the  Administrative\nAgent  shall  at  the request, or may with the  consent,  of  the\nRequisite Lenders, by written notice to the Borrower, (i) declare\nthat  the  Commitments are terminated, whereupon the  Commitments\nand  the obligation of each Lender to make any Loan hereunder and\nof  any  Issuing  Bank  to  issue  any  Letter  of  Credit  shall\nimmediately  terminate,  and (ii) declare  the  unpaid  principal\namount  of  and  any and all accrued and unpaid interest  on  the\nLoans  and all Letter of Credit Obligations to be, and  the  same\nshall  thereupon  be,  immediately  due  and  payable  with   all\nadditional interest from time to time accrued thereon and without\npresentment, demand, or protest or other requirements of any kind\n(including  valuation  and appraisement, diligence,  presentment,\nnotice  of  intent to demand or accelerate and of  acceleration),\nall of which are hereby expressly waived by the Borrower.\n\n\n          (b)        Deposit for Letters of Credit.  In addition,\n                     -----------------------------\nupon  demand  by  the Requisite Lenders after the occurrence  and\nduring  the  continuance of any Event of  Default,  the  Borrower\nshall  deposit with the Administrative Agent for the  benefit  of\nsuch Issuing Bank with respect to each Letter of Credit issued by\nit  then outstanding, cash or Cash Equivalents in an amount equal\nto  the  greatest amount for which such Letter of Credit  may  be\ndrawn.   Such  deposit shall be held by the Administrative  Agent\nfor  the  benefit of such Issuing Bank as security  for,  and  to\nprovide  for  the  payment  of,  the  Reimbursement  Obligations.\nPending  the  application  of such  deposit  to  payment  of  the\nReimbursement  Obligations, the Administrative Agent  may  invest\nsuch  deposit in an open account or similar immediately available\nsavings  deposit and all interest accrued thereon shall  be  held\nwith  such  deposit as additional security for the  Reimbursement\nObligations.\n\n\n            (c)          Rescission.   If  at  any   time   after\n                         ----------\nacceleration of the maturity of the Loans, the Borrower shall pay\nall  arrears of interest and all payments on account of principal\nof  the  Loans  and  Reimbursement Obligations which  shall  have\nbecome  due  otherwise  than by acceleration  (with  interest  on\nprincipal and on overdue interest, at the rates specified in this\nAgreement)  and  all  Events of Default and Potential  Events  of\nDefault  (other  than  nonpayment of  principal  of  and  accrued\ninterest  on  the  Loans  due and payable  solely  by  virtue  of\nacceleration)  shall  be remedied or waived pursuant  to  Section\n                                                          -------\n12.08,  then  by  written notice to the Borrower,  the  Requisite\n-----\nLenders  may  elect,  in the sole discretion  of  such  Requisite\nLenders,   to  rescind  and  annul  the  acceleration   and   its\nconsequences  and  thereupon  shall  release  any  deposit   made\npursuant  to  Section  10.02(b);  provided,  however,   that   no\n              ----------------    ------------------\nrescission  shall occur after the earlier of 30  days  after  the\ndate  of  acceleration  or  any Event  of  Default  specified  in\nparagraph  (f)  or (g) of Section 10.01.  No action  pursuant  to\n-------------      ---    -------------\nthis  paragraph (c) shall affect any subsequent Event of  Default\n      -------------\nor  Potential  Event  of Default or impair any  right  or  remedy\nconsequent thereon.  The provisions of the preceding sentence are\nintended  merely to bind the Lenders to a decision which  may  be\nmade  at  the  election of the Requisite Lenders;  they  are  not\nintended to benefit the Borrower and do not give the Borrower the\nright to require the Lenders to rescind or annul any acceleration\nhereunder, even if the conditions set forth herein are met.\n=================================================================\n                           -81-\n\n\n\n                           ARTICLE XI\n\n                    The Administrative Agent\n                    ------------------------\n\n          11.01.  Appointment and Authorization.  Each Lender and\n                  -----------------------------\nIssuing   Bank   hereby  irrevocably  appoints,  designates   and\nauthorizes  the Administrative Agent to take such action  on  its\nbehalf under the provisions of this Agreement and each other Loan\nDocument  and to exercise such powers and perform such duties  as\nare  expressly delegated to it by the terms of this Agreement  or\nany  other  Loan  Document, together  with  such  powers  as  are\nreasonably incidental thereto.  Notwithstanding any provision  to\nthe  contrary  contained elsewhere in this Agreement  or  in  any\nother Loan Document, the Administrative Agent shall not have  any\nduties  or  responsibilities, except those  expressly  set  forth\nherein,  nor shall the Administrative Agent have or be deemed  to\nhave  any fiduciary relationship with any Lender, and no  implied\ncovenants,  functions, responsibilities, duties,  obligations  or\nliabilities shall be read into this Agreement or any  other  Loan\nDocument or otherwise exist against the Administrative Agent.\n\n\n          11.02.  Delegation of Duties.  The Administrative Agent\n                  --------------------\nmay  execute any of its duties under this Agreement or any  other\nLoan    Document   by   or   through   agents,    employees    or\nattorneys-in-fact  and shall be entitled  to  advice  of  counsel\nconcerning   all   matters  pertaining  to  such   duties.    The\nAdministrative Agent shall not be responsible for the  negligence\nor  misconduct of any agent or attorney-in-fact that  it  selects\nwith reasonable care.\n\n          11.03.  Liability of Administrative Agent.  None of the\n                  ---------------------------------\nAgent-Related Persons shall (a) be liable for any action taken or\nomitted  to  be taken by any of them under or in connection  with\nthis  Agreement or any other Loan Document (except  for  its  own\ngross negligence or willful misconduct), or (b) be responsible in\nany  manner  to  any  of  the Lenders or Issuing  Banks  for  any\nrecital,  statement,  representation or warranty  made  by  ATSC,\nBorrower  or any Subsidiary or Affiliate of ATSC or the Borrower,\nor  any  officer thereof, contained in this Agreement or  in  any\nother Loan Document, or in any certificate, report, statement  or\nother document referred to or provided for in, or received by the\nAdministrative Agent under or in connection with, this  Agreement\nor  any  other  Loan  Document, or the  validity,  effectiveness,\ngenuineness,  enforceability or sufficiency of this Agreement  or\nany other Loan Document, or for any failure of ATSC, the Borrower\nor   any  other  party  to  any  Loan  Document  to  perform  its\nobligations  hereunder  or thereunder.  No  Agent-Related  Person\nshall  be under any obligation to any Lender or Issuing  Bank  to\nascertain  or  to inquire as to the observance or performance  of\nany  of  the  agreements  contained in, or  conditions  of,  this\nAgreement  or  any  other  Loan  Document,  or  to  inspect   the\nProperties, books or records of ATSC, the Borrower or any of  the\nSubsidiaries or Affiliates of ATSC or the Borrower.\n\n          11.04.  Reliance by Administrative Agent.\n                  --------------------------------\n\n           (a)         The Administrative Agent shall be entitled\nto  rely,  and  shall  be fully protected in  relying,  upon  any\nwriting,  resolution,  notice, consent,  certificate,  affidavit,\nletter, facsimile, telex or telephone message, statement or other\ndocument or conversation believed by it to be genuine and correct\nand  to  have been signed, sent or made by the proper  Person  or\nPersons,  and  upon  advice  and  statements  of  legal   counsel\n(including counsel to the Borrower), independent accountants  and\nother   experts  selected  by  the  Administrative  Agent.    The\n=================================================================\n                            -82-\n\nAdministrative  Agent  shall be fully  justified  in  failing  or\nrefusing  to  take any action under this Agreement or  any  other\nLoan  Document  unless  it shall first  receive  such  advice  or\nconcurrence of the Requisite Lenders as it deems appropriate and,\nif  it  so  requests,  it  shall  first  be  indemnified  to  its\nsatisfaction  by  the Lenders against any and all  liability  and\nexpense  which  may  be incurred by it by  reason  of  taking  or\ncontinuing  to  take  any such action.  The Administrative  Agent\nshall in all cases be fully protected in acting, or in refraining\nfrom  acting, under this Agreement or any other Loan Document  in\naccordance with a request or consent of the Requisite Lenders and\nsuch  request  and any action taken or failure  to  act  pursuant\nthereto  shall be binding upon all of the Lenders and the Issuing\nBanks.\n\n           (b)        For purposes of determining compliance with\nthe  conditions specified in Section 4.01, each Lender  that  has\n                             ------------\nexecuted  this  Agreement shall be deemed to have  consented  to,\napproved  or  accepted or to be satisfied with, each document  or\nother  matter  either sent by the Administrative  Agent  to  such\nLender  for  consent,  approval, acceptance or  satisfaction,  or\nrequired  thereunder  to  be  consented  to  or  approved  by  or\nacceptable or satisfactory to such Lender.\n\n\n           11.05.   Notice of Default.  The Administrative  Agent\n                    -----------------\nshall not be deemed to have knowledge or notice of the occurrence\nof  any  Potential Event of Default or Event of  Default,  except\nwith  respect  to defaults in the payment of principal,  interest\nand  fees required to be paid to the Administrative Agent for the\naccount  of  the Lenders, unless the Administrative  Agent  shall\nhave  received  written  notice from a  Lender  or  the  Borrower\nreferring to this Agreement, describing such Potential  Event  of\nDefault  or  Event of Default and stating that such notice  is  a\n\"notice of default\".  In the event that the Administrative  Agent\nreceives  such  a  notice, the Administrative  Agent  shall  give\nnotice  thereof to the Lenders.  The Administrative  Agent  shall\ntake  such action with respect to such Potential Event of Default\nor  Event  of  Default  as shall be requested  by  the  Requisite\nLenders;   provided,   however,  that  unless   and   until   the\n           --------    -------\nAdministrative  Agent shall have received any such  request,  the\nAdministrative  Agent may (but shall not be  obligated  to)  take\nsuch action, or refrain from taking such action, with respect  to\nsuch  Potential Event of Default or Event of Default as it  shall\ndeem advisable or in the best interest of the Lenders.\n\n\n            11.06.    Credit  Decision.   Each  Lender  expressly\n                      ----------------\nacknowledges that none of the Agent-Related Persons has made  any\nrepresentation  or  warranty  to  it  and  that  no  act  by  the\nAdministrative Agent hereinafter taken, including any  review  of\nthe  affairs of ATSC and the Borrower and its Subsidiaries  shall\nbe  deemed  to constitute any representation or warranty  by  the\nAdministrative  Agent to any Lender.  Each Lender  represents  to\nthe  Administrative Agent that it has, independently and  without\nreliance  upon  the  Administrative  Agent  and  based  on   such\ndocuments and information as it has deemed appropriate, made  its\nown  appraisal of and investigation into the business, prospects,\noperations,   property,  financial  and   other   condition   and\ncreditworthiness  of ATSC and the Borrower and its  Subsidiaries,\nand   all  applicable  bank  regulatory  laws  relating  to   the\ntransactions contemplated thereby, and made its own  decision  to\nenter  into  this  Agreement and extend credit  to  the  Borrower\nhereunder.    Each   Lender  also  represents   that   it   will,\nindependently and without reliance upon the Administrative  Agent\nand  based  on  such documents and information as it  shall  deem\nappropriate  at  the  time,  continue  to  make  its  own  credit\nanalysis, appraisals and decisions in taking or not taking action\nunder  this Agreement and the other Loan Documents, and  to  make\nsuch investigations as it deems necessary to inform itself as  to\nthe  business,  prospects, operations,  property,  financial  and\n\n==================================================================\n                          -83-\n\nother condition and creditworthiness of the Borrower.  Except for\nnotices, reports and other documents expressly herein required to\nbe  furnished  to  the Lenders by the Administrative  Agent,  the\nAdministrative Agent shall not have any duty or responsibility to\nprovide   any   Lender  with  any  credit  or  other  information\nconcerning   the   business,  prospects,  operations,   property,\nfinancial and other condition or creditworthiness of the Borrower\nwhich  may  come into the possession of any of the  Agent-Related\nPersons.\n\n\n            11.07.    Indemnification.   Whether   or   not   the\n                      ---------------\ntransactions  contemplated  hereby  shall  be  consummated,   the\nLenders shall indemnify upon demand the Agent-Related Persons (to\nthe  extent  not reimbursed by or on behalf of the  Borrower  and\nwithout  limiting  the  obligation of the  Borrower  to  do  so),\nratably  from  and against any and all liabilities,  obligations,\nlosses,  damages,  penalties, actions, judgments,  suits,  costs,\nexpenses  and disbursements of any kind whatsoever which  may  at\nany  time (including at any time following the repayment  of  the\nLoans   and  the  termination  or  resignation  of  the   related\nAdministrative  Agent)  be imposed on, incurred  by  or  asserted\nagainst  any  such Person any way relating to or arising  out  of\nthis  Agreement  or any document contemplated by or  referred  to\nherein  or  therein  or the transactions contemplated  hereby  or\nthereby  or any action taken or omitted by any such Person  under\nor  in  connection with any of the foregoing; provided,  however,\n                                              --------   -------\nthat   no  Lender  shall  be  liable  for  the  payment  to   the\nAgent-Related  Persons  of  any  portion  of  such   liabilities,\nobligations,  losses,  damages,  penalties,  actions,  judgments,\nsuits,  costs,  expenses  or disbursements  resulting  from  such\nPerson's   gross  negligence  or  willful  misconduct.    Without\nlimitation  of  the  foregoing, each Lender shall  reimburse  the\nAdministrative  Agent upon demand for its ratable  share  of  any\ncosts  or  out-of-pocket expenses (including legal fees  and  the\nallocated  cost  of staff counsel) incurred by the Administrative\nAgent  in  connection with the preparation, execution,  delivery,\nadministration,  modification, amendment or enforcement  (whether\nthrough  negotiations, legal proceedings  or  otherwise)  of,  or\nlegal advice in respect of rights or responsibilities under, this\nAgreement,  any other Loan Document, or any document contemplated\nby  or  referred  to herein to the extent that the Administrative\nAgent is not reimbursed for such expenses by or on behalf of  the\nBorrower.   Without limiting the generality of the foregoing,  if\nthe  IRS or any other Governmental Authority of the United States\nof  America  or  other  jurisdiction asserts  a  claim  that  the\nAdministrative Agent did not properly withhold tax  from  amounts\npaid to or for the account of any Lender (because the appropriate\nform  was  not delivered, was not properly executed,  or  because\nsuch Lender failed to notify the Administrative Agent of a change\nin  circumstances which rendered the exemption from, or reduction\nof,  withholding tax ineffective, or for any other  reason)  such\nLender  shall  indemnify the Administrative Agent fully  for  all\namounts paid, directly or indirectly, by the Administrative Agent\nas  tax  or  otherwise,  including penalties  and  interest,  and\nincluding  any taxes imposed by any jurisdiction on  the  amounts\npayable  to  the  Administrative Agent under this Section  11.07,\ntogether  with  all  costs  and  expenses  and  attorneys'   fees\n(including  legal fees and the allocated cost of staff  counsel).\nThe  obligation of the Lenders in this Section shall survive  the\npayment of all Obligations hereunder.\n\n           11.08.   Administrative Agent in Individual  Capacity.\n                    --------------------------------------------\nBank  of  America  and its Affiliates may make  loans  to,  issue\nletters  of  credit  for  the account of, accept  deposits  from,\nacquire  equity interests in and generally engage in any kind  of\nbanking,  trust, financial advisory or other business  with  ATSC\nand  the  Borrower and its Subsidiaries and Affiliates as  though\nBank  of America were not the Administrative Agent hereunder  and\nwithout notice to or consent of the Lenders.  With respect to its\nLoans,  Bank  of  America shall have the same rights  and  powers\n=================================================================\n                              -84-\n\nunder  this  Agreement as any other Lender and may  exercise  the\nsame  as  though  it were not the Administrative Agent,  and  the\nterms \"Lender\" and \"Lenders\" shall include Bank of America in its\nindividual capacity.\n\n             11.09.    Successor   Administrative   Agent.    The\n                       ----------------------------------\nAdministrative Agent may resign as Administrative Agent  upon  30\ndays'  notice to the Lenders.  If the Administrative Agent  shall\nresign   as  Administrative  Agent  under  this  Agreement,   the\nRequisite  Lenders  shall  appoint  from  among  the  Lenders   a\nsuccessor  agent for the Lenders which successor agent  shall  be\napproved  by  the Borrower.  If no successor agent  is  appointed\nprior   to  the  effective  date  of  the  resignation   of   the\nAdministrative Agent, the Administrative Agent may appoint, after\nconsulting  with the Lenders and the Borrower, a successor  agent\nfrom  among  the Lenders.  Upon the acceptance of its appointment\nas  successor agent hereunder, such successor agent shall succeed\nto   all   the   rights,  powers  and  duties  of  the   retiring\nAdministrative  Agent and the term \"Administrative  Agent\"  shall\nmean such successor agent and the retiring Administrative Agent's\nappointment, powers and  duties as Administrative Agent shall  be\nterminated.    After   any   retiring   Administrative    Agent's\nresignation hereunder as Administrative Agent, the provisions  of\nthis  Article XI and Sections 12.03 and 12.04 shall inure to  its\n      ----------     --------------     -----\nbenefit  as  to any actions taken or omitted to be  taken  by  it\nwhile  it was Administrative Agent under this Agreement.   If  no\nsuccessor agent has accepted appointment as Administrative  Agent\nby  the date which is 30 days following a retiring Administrative\nAgent's   notice  of  resignation,  the  retiring  Administrative\nAgent's resignation shall nevertheless thereupon become effective\nand   the  Lenders  shall  perform  all  of  the  duties  of  the\nAdministrative Agent hereunder until such time, if  any,  as  the\nRequisite  Lenders  appoint a successor  agent  as  provided  for\nabove.\n\n           11.10.   The  Arranger.  The Arranger  shall  have  no\n                    -------------\nright, power, obligation, liability, responsibility or duty under\nthis  Agreement other than the right to receive the fee  referred\nto  in  Section 2.03(a) and the right to indemnity under  Section\n        --------------                                    -------\n12.04\n-----\n\n           11.11.   Syndication  Agents.   None  of  the  Lenders\n                    -------------------\nidentified  on  the  facing  page  or  signature  pages  of  this\nAgreement as a \"Syndication Agent\" shall have any right or power,\n                -----------------\nobligations,  liability,  responsibility  or  duty   under   this\nAgreement  other  than those applicable to all Lenders  as  such.\nEach  Lender  acknowledges that it has not relied, and  will  not\nrely,  on  any of the Lenders so identified in deciding to  enter\ninto this Agreement or in taking or not taking action hereunder.\n\n\n          11.12.  Collateral Matters.\n                  ------------------\n\n           (a)        Each Lender and Issuing Bank authorizes and\ndirects  the  Administrative Agent to enter into  the  Collateral\nDocuments  for the benefit of the Lenders and the Issuing  Banks.\nEach Lender and Issuing Bank agrees that any action taken by  the\nAdministrative Agent or the Requisite Lenders in accordance  with\nthe provisions of this Agreement or the Collateral Documents, and\nthe exercise by the Administrative Agent or the Requisite Lenders\nof  the  powers set forth herein or therein, together  with  such\nother  powers  as  are reasonably incidental  thereto,  shall  be\nauthorized  and binding upon all of the Lenders and  the  Issuing\nBanks.\n\n            (b)          The   Administrative  Agent  is   hereby\nauthorized on behalf of all of the Lenders and the Issuing Banks,\nwithout  the  necessity of any notice to or further consent  from\n=================================================================\n                        -85-\n\nany Lender or Issuing Bank from time to time prior to an Event of\nDefault,  to  take any action with respect to any  Collateral  or\nCollateral  Documents  which  may be  necessary  to  perfect  and\nmaintain perfected the Liens upon the Collateral granted pursuant\nto the Collateral Documents.\n\n\n          (c)        Each Lender and Issuing Bank hereby irrevoca\nbly  authorize  the  Administrative Agent  to  release  any  Lien\ngranted  to  or  held  by  the  Administrative  Agent  upon   any\nCollateral  upon (i) any sale of such Collateral permitted  under\nthis Agreement (or any waiver hereof) and (ii) termination of the\nCommitments and payment and satisfaction of all Loans,  Reimburse\nment Obligations, other Letter of Credit Obligations (whether  or\nnot  due) and all other Obligations which have matured and  which\nthe  Administrative Agent has been notified in writing  are  then\ndue and payable.\n\n\n          11.13.  Relations Among Lenders.\n                  -----------------------\n\n          (a)        Each Lender agrees that it will not take any\naction,  nor  institute any actions or proceedings,  against  the\nBorrower  or  any  other  obligor hereunder  or  any  other  Loan\nDocument  or  with respect to any Collateral, without  the  prior\nwritten consent of the Requisite Lenders.\n\n\n            (b)          The   Lenders  are   not   partners   or\nco-venturers,  and  no Lender shall be liable  for  the  acts  or\nomissions of, or (except as otherwise set forth herein in case of\nthe  Administrative  Agent) authorized  to  act  for,  any  other\nLender.\n\n\n                          ARTICLE XII\n\n                         Miscellaneous\n                         -------------\n\n          12.01.  Assignments and Participations.\n                  ------------------------------\n\n           (a)        At any time after the Initial Funding Date,\neach Lender may assign to one or more Eligible Assignees all or a\nportion  of  its  rights  and obligations  under  this  Agreement\n(including all or a portion of its Commitment, Loans or  interest\nin   the  Letters  of  Credit);  provided,  that  (i)  each  such\nassignment  in  respect of Commitments or Loans shall  cover  the\nsame percentage of such Lender's Commitment, Loans and Letter  of\nCredit Obligations, (ii) unless the Administrative Agent and  the\nBorrower   otherwise  consent,  the  aggregate  amount   of   the\nCommitment  of  the assigning Lender being assigned  pursuant  to\neach such assignment (determined as of the date of the Assignment\nand Acceptance with respect to such assignment) shall in no event\nbe  less  than  $5,000,000 and shall be an integral  multiple  of\n$100,000  (unless  the assigning Lender's Commitment,  Loans  and\nLetter  of Credit Obligations are less than $5,000,000, in  which\ncase  the  assignment  may be in the amount of  such  Commitment,\nLoans and Letter of Credit Obligations) provided that assignments\nbetween  Lenders  shall have no minimum amount, (iii)  except  in\nrespect  of  assignments between Lenders and their Affiliates  or\nany assignment by a Lender in connection with the sale of all  or\nsubstantially  all  of  its assets, the  Borrower  shall  consent\n(which  consent  shall  not  be unreasonably  withheld)  and  the\nAdministrative Agent and the Issuing Banks shall consent to  such\nassignment  (which shall not be unreasonably withheld)  and  (iv)\nthe parties to each such assignment shall execute and deliver  to\nthe  Administrative Agent an Assignment and Acceptance,  together\n=================================================================\n                         -86-\n\nwith  processing and recordation fee of $3,000.  From  and  after\nthe  effective date specified in each Assignment and  Acceptance,\n(A)  the assignee thereunder shall be a party hereto and, to  the\nextent  that rights and obligations hereunder have been  assigned\nto it pursuant to such Assignment and Acceptance, have the rights\nand  obligations  of  a Lender hereunder  as  fully  as  if  such\nassignee had been named as a Lender in accordance with the  terms\nof  this Agreement and (B) the Lender assignor thereunder  shall,\nto  the  extent that rights and obligations hereunder  have  been\nassigned  by  it  pursuant  to  such Assignment  and  Acceptance,\nrelinquish its rights and be released from its obligations  under\nthis  Agreement.  Notwithstanding any provision of  this  Section\n                                                          -------\n12.01, the consent of the Borrower shall not be required for  any\n-----\nassignment  that  occurs  when an Event of  Default  pursuant  to\nSection  10.01(f)  or  10.01(g)  shall  have  occurred   and   be\n-----------------      --------\ncontinuing with respect to the Borrower.\n\n           (b)         By  executing and delivering an Assignment\nand  Acceptance, the Lender assignor thereunder and the  assignee\nthereunder  confirm to and agree with each other  and  the  other\nparties  hereto  as follows: (i) the assignment made  under  such\nAssignment  and  Acceptance is made without recourse  and,  other\nthan   as  provided  in  such  Assignment  and  Acceptance,  such\nassigning Lender makes no representation or warranty and  assumes\nno  responsibility with respect to any statements, warranties  or\nrepresentations made in or in connection with this  Agreement  or\nany  other  Loan  Document or the execution, legality,  validity,\nenforceability,  genuineness,  sufficiency  or  value   of   this\nAgreement  or any other Loan Document or any other instrument  or\ndocument  furnished pursuant hereto; (ii) such  assigning  Lender\nmakes no representation or warranty and assumes no responsibility\nwith  respect to the financial condition of the Borrower  or  the\nperformance  or  observance  by  the  Borrower  of  any  of   its\nobligations  under any Loan Document or any other  instrument  or\ndocument  furnished pursuant hereto; (iii) such assignee confirms\nthat  it  has  received a copy of this Agreement,  together  with\ncopies  of the financial statements delivered pursuant to Article\n                                                          -------\nVI  and  such  other  Loan  Documents  and  other  documents  and\n--\ninformation as it has deemed appropriate to make its  own  credit\nanalysis   and  decision  to  enter  into  such  Assignment   and\nAcceptance;  (iv) such assignee will, independently  and  without\nreliance upon the Administrative Agent, such assigning Lender  or\nany  other Lender and based on such documents and information  as\nit  shall deem appropriate at the time, continue to make its  own\ncredit  decisions  in  taking or not  taking  action  under  this\nAgreement;   (v)  such  assignee  appoints  and  authorizes   the\nAdministrative Agent to take such action as agent on  its  behalf\nand  to  exercise such powers under this Agreement and the  other\nLoan  Documents as are delegated to the Administrative  Agent  by\nthe  terms hereof and thereof, together with such powers  as  are\nreasonably incidental thereto; and (vi) such assignee agrees that\nit  will  perform  in  accordance with their  terms  all  of  the\nobligations which by the terms of this Agreement are required  to\nbe  performed by it as a Lender; and (vii) such an assignee is an\nEligible Assignee.\n\n           (c)        The Administrative Agent, on behalf of  the\nBorrower,  shall  maintain at the address of  the  Administrative\nAgent referred to in Section 12.10 a copy of each Assignment  and\n                     -------------\nAcceptance  delivered to it and a register (the  \"Register\")  for\n                                                  --------\nthe recordation of the names and addresses of the Lenders and the\nCommitments of, and principal amounts of the Loans owing to, each\nLender from time to time whether or not evidenced by a Note.  The\nentries  in  the Register shall be conclusive, in the absence  of\nmanifest  error, and the Borrower, the Administrative  Agent  and\nthe Lenders shall treat each Person whose name is recorded in the\nRegister as the owner of a Loan or other obligation hereunder for\nall  purposes  of  this Agreement and the other  Loan  Documents,\nnotwithstanding  any notice to the contrary.  Any  assignment  of\nany  Loan  or other obligation hereunder shall be effective  only\nupon  appropriate entries with respect thereto being made in  the\n=================================================================\n                          -87-\n\nRegister.   Any assignment or transfer of all or part of  a  Loan\nevidenced by a Note shall be registered on the Register only upon\nsurrender for registration of assignment or transfer of the  Note\nevidencing  such Loan, accompanied by a duly executed  Assignment\nand  Acceptance, and thereupon one or more new Notes in the  same\naggregate  principal  amount shall be issued  to  the  designated\nassignee   and   the  old  Notes  shall  be   returned   by   the\nAdministrative  Agent  to the Borrower marked  \"cancelled.\"   The\nRegister shall be available for inspection by the Borrower or any\nLender  at  any  reasonable  time and  from  time  to  time  upon\nreasonable prior notice.\n\n\n           (d)         Upon  its  receipt of  an  Assignment  and\nAcceptance  executed by an assigning Lender,  the  Administrative\nAgent  shall, if such Assignment and Acceptance has been properly\ncompleted  and is in substantially the form of Exhibit 12.01  and\n                                               -------------\nif   the  conditions  for  the  assignment  referred  to  in  the\nAssignment and Acceptance set forth in Section 12.01(a) have been\n                                       ----------------\nmet,  (i) accept such Assignment and Acceptance, (ii) record  the\ninformation   contained  therein  in   the   Register   and   the\nAdministrative Agent's Loan Account and (iii) give prompt  notice\nthereof to the Borrower and the other Lenders.\n\n\n           (e)        Each Lender may sell participations to  one\nor  more  banks or other entities as to all or a portion  of  its\nrights and obligations under this Agreement (including all  or  a\nportion of its Commitment, the Loans owing to it, and the  Letter\nof   Credit  Obligations);  provided,  that  (i)  such   Lender's\n                            --------\nobligations under this Agreement (including its Commitment) shall\nremain   unchanged,   (ii)  such  Lender  shall   remain   solely\nresponsible  to  the other parties hereto for the performance  of\nsuch  obligations,  (iii) the Borrower, the Administrative  Agent\nand  the other Lenders shall continue to deal solely and directly\nwith  such  Lender  in connection with such Lender's  rights  and\nobligations under this Agreement and with regard to any  and  all\npayments to be made under this Agreement, (iv) the holder of  any\nsuch  participation shall not be entitled to voting rights  under\nthis   Agreement;  provided,  however,  that  the   participation\n                   --------   -------\nagreement  between  a  Lender and any  of  its  participants  may\nprovide  that  such  Lender  will obtain  the  approval  of  such\nparticipant prior to any amendment or waiver of any provisions of\nthis Agreement which would (A) extend the Final Maturity Date  of\nany  Loan,  (B)  reduce the interest rate or any  fees  hereunder\npayable in respect of any Loan or Commitment, or (C) increase the\nCommitment  of  the  Lender granting the  participation  if  such\nincrease  affects such participant, and (v) the sale of any  such\nparticipations which require the Borrower to file a  registration\nstatement  with the Commission or under the securities regulation\nlaws of any state shall not be permitted.\n\n           (f)         The  holder of any participation shall  be\nentitled  to the benefits of Sections 2.02(f), 2.07(d), 2.08  and\n2.09 as though it were also a Lender hereunder; provided that  no\n                                                --------\nparticipant  shall  be  entitled  to  receive  any   payment   or\ncompensation  in  excess  of  that to  which  such  participant's\nselling  Lender  would have been entitled  with  respect  to  the\namount  of  the  participation if such Lender had not  sold  such\nparticipation.\n\n\n           (g)         Each  Lender  agrees to  take  normal  and\nreasonable  precautions and exercise due  care  to  maintain  the\nconfidentiality of all information provided to it by ATSC or  the\nBorrower   or  any  Subsidiary  of  the  Borrower,  or   by   the\nAdministrative  Agent  on  ATSC's  or  the  Borrower's  or   such\nSubsidiary's  behalf, in connection with this  Agreement  or  any\nother  Loan  Document, and neither it nor any of  its  Affiliates\nshall  use any such information for any purpose or in any  manner\nother  than pursuant to the terms contemplated by this Agreement;\nexcept  to  the  extent  such  information  (i)  was  or  becomes\ngenerally  available to the public other than as a  result  of  a\n=================================================================\n                            -88-\n\ndisclosure by such Lender, or (ii) was or becomes available on  a\nnon-confidential  basis from a source other  than  the  Borrower,\nprovided  such  source  is  not bound  by  fiduciary  duty  or  a\n--------\nconfidentiality agreement with the Borrower known to such Lender;\nprovided  further,  however, that any Lender  may  disclose  such\n--------  -------\ninformation (A) at the request or pursuant to any requirement  of\nany Governmental Authority to which such Lender is subject or  in\nconnection  with  an  examination of  such  Lender  by  any  such\nauthority;  (B) pursuant to subpoena or other court process;  (C)\nwhen  required to do so in accordance with the provisions of  any\napplicable  Requirement  of Law; (D)  to  the  extent  reasonably\nrequired in connection with any litigation or proceeding to which\nthe   Administrative  Agent,  any  Lender  or  their   respective\nAffiliates may be party, (E) to the extent reasonably required in\nconnection with the exercise of any remedy hereunder or under any\nother  Loan  Document,  and  (F)  to  such  Lender's  independent\nauditors  and other professional advisors which are  required  to\nkeep  such  information  confidential.   If  any  Lender  becomes\ncompelled to disclose any information pursuant to clause (B), (C)\nor  (D) of the immediately preceding sentence, such Lender  shall\nprovide  prior  written notice thereof to  the  Borrower  to  the\nextent practicable and permitted by law and shall cooperate  with\nthe  Borrower to take, at the Borrower's expense, all  reasonably\navailable actions to limit disclosure to the extent permitted  by\nlaw.  Notwithstanding the foregoing, the Borrower authorizes each\nLender  to  disclose to any participant or assignee  and  to  any\nprospective  participant or assignee, such  financial  and  other\ninformation  in such Lender's possession concerning ATSC  or  the\nBorrower  or  its  Subsidiaries  which  has  been  delivered   to\nAdministrative Agent or the Lenders pursuant to this Agreement or\nwhich  has  been  delivered to the Administrative  Agent  or  the\nLenders  by  the Borrower in connection with the Lenders'  credit\nevaluation of the Borrower prior to entering into this Agreement;\nprovided  that,  unless otherwise agreed by  the  Borrower,  such\n--------\nparticipant or assignee agrees in writing to such Lender to  keep\nsuch information confidential to the same extent required of  the\nLenders hereunder.\n\n           12.02.  Assignments to Federal Reserve Banks.  Nothing\n                   ------------------------------------\nherein  shall prohibit any Lender from pledging or assigning  all\nor  any  portion  of  its Loans to any Federal  Reserve  Bank  in\naccordance  with  applicable law.  In order  to  facilitate  such\npledge  or  assignment,  the Borrower hereby  agrees  that,  upon\nrequest of any Lender at any time and from time to time after the\nBorrower  has made its initial borrowing hereunder, the  Borrower\nshall  provide to such Lender, at the Borrower's own  expense,  a\npromissory note evidencing the Loans owing to such Lender.\n\n\n          12.03.  Expenses.\n                  --------\n\n           (a)        Generally.  Whether or not any Funding Date\n                      ---------\nshall  have occurred, the Borrower agrees upon demand to pay,  or\nreimburse  the  Administrative Agent for, all the  Administrative\nAgent's  and any of its Affiliates' costs and expenses  of  every\ntype  and  nature  (including the reasonable fees,  expenses  and\ndisbursements  of counsel to the Administrative Agent  (including\nthe  costs  and  expenses  of one outside  counsel  and,  without\nduplication,  the allocated costs of in-house counsel))  and  all\nfees, taxes (except income and franchise taxes), assessments  and\nduties incurred by the Administrative Agent or its Affiliates  in\nconnection with (i) the negotiation, preparation and execution of\nthis   Agreement   (including  the  satisfaction   or   attempted\nsatisfaction  of any of the conditions set forth in Article  IV),\n                                                    ------------\nthe  Collateral  Documents and the other Loan Documents  and  the\nmaking  of the Loans hereunder; (ii) the administration  of  this\nAgreement, the Loan Documents, the Loans and the Collateral;  and\n(iii)  the  protection, collection or enforcement of any  of  the\nObligations or the Collateral.\n\n=================================================================\n                           -89-\n\n           (b)        After Default.  The Borrower further agrees\n                      -------------\nto  pay, or reimburse the Administrative Agent, the Issuing Banks\nand  the  Lenders  for,  all out-of-pocket  costs  and  expenses,\nincluding the reasonable fees and disbursements of counsel to the\nAdministrative   Agent,  the  Lenders  and  the   Issuing   Banks\n(including,  without  duplication, the allocated  cost  of  staff\ncounsel)  and  also including all costs of settlement  after  the\noccurrence  of  an  Event  of  Default,  (i)  in  enforcing   any\nObligation or in foreclosing against the Collateral or exercising\nor  enforcing  any other right or remedy available by  reason  of\nsuch Event of Default; (ii) in connection with any refinancing or\nrestructuring  of  the credit arrangements  provided  under  this\nAgreement  in the nature of a \"work-out\" or in any insolvency  or\nbankruptcy proceeding, including any costs related to the  hiring\nof  consultants  or  experts; (iii) in commencing,  defending  or\nintervening in any litigation or in filing a petition, complaint,\nanswer,  motion  or  other  pleadings  in  any  legal  proceeding\nrelating  to the Borrower and related to or arising  out  of  the\ntransactions contemplated hereby or by any of the Loan  Documents\n(other  than, with respect to any Lender, to the extent resulting\nfrom  or  arising  out of any litigation by the Borrower  against\nsuch  Lender  in  respect  of a breach  by  such  Lender  of  its\nobligations  under this Agreement if such Lender is  found  by  a\ncourt  of competent jurisdiction to have breached its obligations\nunder  this  Agreement (it being agreed that, to the extent  that\nthe Borrower shall have paid any fees and expenses of such Lender\nrelating  to any such litigation, such amounts shall be  refunded\nto the Borrower upon such decision of such court); (iv) in taking\nany  other  action in or with respect to any suit  or  proceeding\n(whether   in   bankruptcy  or  otherwise);  (v)  in  protecting,\npreserving,  collecting, leasing, selling, taking possession  of,\nor  liquidating  any  of the Collateral; or  (vi)  attempting  to\nenforce  or  enforcing  any  security  interest  in  any  of  the\nCollateral  or  any other rights under the Collateral  Documents.\nAny   payments   made  by  the  Borrower  or  received   by   the\nAdministrative Agent and applied as reimbursements for costs  and\nexpenses  under this Section 12.03(b) shall be apportioned  among\n                     ----------------\nthe  Administrative Agent, the Issuing Banks and the  Lenders  in\nthe order of priority set forth in Section 2.05(b).\n                                   ---------------\n\n           12.04.   Indemnity.  The Borrower  further  agrees  to\n                    ---------\ndefend,  protect, indemnify, and hold harmless the Administrative\nAgent,  the Arranger, the Issuing Banks and each and all  of  the\nLenders,  each  of their respective Affiliates and  each  of  the\nrespective officers, directors, employees and agents of  each  of\nthe  foregoing (collectively, the \"Indemnified Parties\") from and\n                                   -------------------\nagainst  any  and all liabilities, obligations, losses,  damages,\npenalties, actions, judgments, suits, claims, costs, expenses and\ndisbursements  of  any kind or nature whatsoever  (including  the\nfees   and  disbursements  of  one  counsel  (including,  without\nduplication,  the  allocated  cost of  staff  counsel)  for  such\nIndemnified Parties (except that, in the event of any  actual  or\napparent  conflicts of interest between or among any  Indemnified\nParties,  such  Indemnified Parties shall be entitled  to  retain\nseparate counsel the fees and disbursements of which will be paid\nby   the   Borrower)   in  connection  with  any   investigative,\nadministrative  or  judicial  proceeding,  whether  or  not  such\nIndemnified Parties shall be designated a party thereto), imposed\non, incurred by, or asserted against such Indemnified Parties  in\nany  manner relating to or arising out of the Commitment  Letter,\nthe    transactions   contemplated   hereby   (whether   or   not\nconsummated),   the   capitalization   of   the   Borrower,   the\nSubordinated  Notes,  any  Subordinated  Debt,  the   Convertible\nDebentures, this Agreement, the Collateral Documents  or  any  of\nthe  other  Loan Documents, the Commitments, the  making  of  the\nLoans  and  the  making of and participation in  the  Letters  of\nCredit,  or the use or intended use of the Letters of Credit  and\nthe   proceeds   of   the  Loans  hereunder  (collectively,   the\n\"Indemnified Matters\"); provided, that the Borrower shall have no\n -------------------    --------\nobligation to an Indemnified Party hereunder with respect to  (a)\nmatters  for  which such Indemnified Party has  been  compensated\n=================================================================\n                          -90-\n\npursuant  to  or  for which an exemption is provided  in  Section\n                                                          -------\n2.02(f), 2.07(d) or any other provision of this Agreement and (b)\n-------  -------\nIndemnified  Matters  caused  by  or  resulting  from  the  gross\nnegligence or willful misconduct of that Indemnified Party or  an\nAffiliate  of such Indemnified Party, as determined  by  a  final\njudgment  of  a court of competent jurisdiction.  To  the  extent\nthat  the  undertaking to indemnify, pay and  hold  harmless  set\nforth  in the preceding sentence may be unenforceable because  it\nis  violative  of  any law or public policy, the  Borrower  shall\ncontribute the maximum portion which it is permitted to  pay  and\nsatisfy under applicable law, to the payment and satisfaction  of\nall Indemnified Matters incurred by the Indemnified Parties.\n\n\n           12.05.   Change in Accounting Principles.   Except  as\n                    -------------------------------\notherwise  provided  herein and except for the  change  from  the\nretail  method  of  accounting to the cost method  of  accounting\nadopted  by  the  Borrower in February 1998, if  any  changes  in\naccounting principles from those used by ATSC or the Borrower  in\nthe  preparation of the financial statements dated as of  January\n31,  1998  are  hereafter  required or permitted  by  the  rules,\nregulations,   pronouncements  and  opinions  of  the   Financial\nAccounting Standards Board of the American Institute of Certified\nPublic  Accountants  (or  successors  thereto  or  agencies  with\nsimilar  functions) and are adopted by ATSC or the Borrower  with\nthe agreement of its independent certified public accountants and\nsuch  changes result in a change in the method of calculation  of\nany  of  the  financial covenants, standards or  terms  found  in\nArticles  VIII and IX hereof, the parties hereto agree  to  enter\n--------------     --\ninto  negotiations  in order to amend such provisions  so  as  to\nreflect  equitably such changes with the desired result that  the\ncriteria  for  evaluating  ATSC's  or  the  Borrower's  financial\ncondition shall be the same after such changes as if such changes\nhad not been made; provided, however, that no change in generally\n                   --------  -------\naccepted  accounting principles that would affect the  method  of\ncalculation of any of the financial covenants, standards or terms\nshall  be given effect in such calculations until such provisions\nare  amended, in a manner satisfactory to the Requisite  Lenders,\nto so reflect such change in accounting principles.\n\n           12.06.   Setoff.  In addition to any Liens granted  to\n                    ------\nthe  Administrative Agent, the Issuing Banks or the  Lenders  and\nany  rights now or hereafter granted under applicable law and not\nby  way  of  limitation  of any such Lien  or  rights,  upon  the\noccurrence  and during the continuance of any Event  of  Default,\neach Lender and Issuing Bank is hereby authorized by the Borrower\nat any time or from time to time, without notice to the Borrower,\nor  to  any  other Person (any such notice being hereby expressly\nwaived)  to set off and to appropriate and to apply any  and  all\ndeposits (general or special, including indebtedness evidenced by\ncertificates  of  deposit, whether matured or unmatured  but  not\nincluding trust accounts) and any other Indebtedness at any  time\nheld or owing by that Lender or Issuing Bank to or for the credit\nor  the  account  of the Borrower against and on account  of  the\nObligations  of  the  Borrower to that  Lender  or  Issuing  Bank\nincluding,  but  not limited to, all Loans and Letter  of  Credit\nObligations  and all claims of any nature or description  arising\nout  of or connected with this Agreement or any of the other Loan\nDocuments,  irrespective of whether or not  (a)  that  Lender  or\nIssuing  Bank  shall have made any demand hereunder  or  (b)  the\nAdministrative  Agent shall have declared the  principal  of  and\ninterest on the Loans and other amounts due hereunder to  be  due\nand   payable  as  permitted  by  Article  X  and  although  said\n                                  ----------\nobligations and liabilities, or any of them, may be contingent or\nunmatured.   Each Lender and Issuing Bank agrees  that  it  shall\nnot, without the express consent of the Administrative Agent, and\nthat  it  shall, to the extent it is lawfully entitled to  do  so\nduring  the continuation of an Event of Default, upon the request\nof   the   Administrative  Agent,  exercise  its  set-off  rights\n=================================================================\n                           -91-\n\nhereunder  against any accounts of the Borrower now or  hereafter\nmaintained with such Lender or Issuing Bank.\n\n\n           12.07.   Ratable Sharing.  Subject to Section 2.05(b),\n                    ---------------              ---------------\nthe  Lenders agree among themselves that (a) with respect to  all\namounts  received by them which are applicable to the payment  of\nthe  Obligations (excluding the fees described or referred to  in\nSection  2.03),  equitable adjustment will be made  so  that,  in\n-------------\neffect,  all  such amounts will be shared among them  ratably  in\naccordance  with  their  Pro  Rata Shares,  whether  received  by\nvoluntary  payment, by the exercise of the right  of  set-off  or\nbanker's  lien,  by  counterclaim  or  cross  action  or  by  the\nenforcement of any or all of the Obligations (excluding the  fees\ndescribed or referred to in Section 2.03) or the Collateral,  (b)\n                            ------------\nif  any of them shall by voluntary payment or by the exercise  of\nany  right  of counterclaim, setoff, banker's lien or  otherwise,\nreceive  payment of a proportion of the aggregate amount  of  the\nObligations held by it which is greater than its Pro  Rata  Share\nof the payments on account of the Obligations (excluding the fees\ndescribed or referred to in Section 2.03), the one receiving such\n                            ------------\nexcess  payment shall purchase, without recourse or warranty,  an\nundivided interest and participation (which it shall be deemed to\nhave  done  simultaneously upon the receipt of such  payment)  in\nsuch  Obligations owed to the others so that all such  recoveries\nwith  respect  to  such Obligations shall be applied  ratably  in\naccordance with their Pro Rata Shares; provided, however, that if\n                                       --------  -------\nall  or  part  of such excess payment received by the  purchasing\nparty  is thereafter recovered from it, those purchases shall  be\nrescinded  and  the purchase prices paid for such  participations\nshall be returned to that party to the extent necessary to adjust\nfor  such recovery, but without interest except to the extent the\npurchasing  party is required to pay interest in connection  with\nsuch recovery.  The Borrower agrees that any Lender so purchasing\na  participation  from another Lender pursuant  to  this  Section\n                                                          -------\n12.07  may, to the fullest extent permitted by law, exercise  all\n-----\nits  rights of payment (including, subject to Section 12.06,  the\n                                              -------------\nright  of setoff) with respect to such participation as fully  as\nif  such Lender were the direct creditor of the Borrower  in  the\namount of such participation.\n\n           12.08.   Amendments and Waivers.  (a) No amendment  or\n                    ----------------------\nmodification  of  any  provision  of  this  Agreement  shall   be\neffective without the written agreement of the Requisite  Lenders\nand  the  Borrower, and no termination or waiver of any provision\nof  this Agreement or any other Loan Document, or consent to  any\ndeparture  by  the  Borrower therefrom, shall  in  any  event  be\neffective  without  the  written  concurrence  of  the  Requisite\nLenders,  which  the Requisite Lenders shall have  the  right  to\ngrant  or  withhold  at their sole discretion provided,  however,\n                                              --------   -------\nthat no amendment, modification or waiver shall, unless evidenced\nby a writing signed by or on behalf of all the Lenders, do any of\nthe  following: (i) increase the Commitment of any Lender  (other\nthan  by  assignment); (ii) reduce the principal of, or  rate  of\ninterest  on,  the  Loans  or  the amount  of  any  fees  payable\nhereunder; (iii) extend the Final Maturity Date or the expiration\ndate of any Letter of Credit beyond the Final Maturity Date; (iv)\nrelease the ATSC Guaranty or release all or substantially all  of\nthe  Collateral  under the Collateral Documents  (other  than  as\nspecifically  provided hereunder); (v) change the definitions  of\n\"Pro  Rata Shares\" or \"Requisite Lenders\"; (vi) increase  any  of\nthe percentages set forth in the definition of \"Advance Rate\"; or\n(vii)  amend this Section 12.08(a), Section 2.01(f)(i) or Section\n                  ----------------  ------------------    -------\n9.05.\n----\n\n           (b)        No amendment, modification, termination, or\nwaiver  of  any provision of this Agreement or any Loan Documents\nshall,  unless in writing and signed by the Administrative  Agent\nor  the  Issuing  Banks, as the case may be, in addition  to  the\nRequisite  Lenders  or Lenders, as the case may  be,  affect  the\n=================================================================\n                          -92-\n\nrights  or  duties  of the Administrative Agent  or  the  Issuing\nBanks,  as  the  case may be, under this Agreement  or  any  Loan\nDocuments.   The  Administrative Agent may,  but  shall  have  no\nobligation  to,  with the concurrence of any  Lender  or  Issuing\nBank,  execute amendments, modifications, waivers or consents  on\nbehalf of such Lender or Issuing Bank.\n\n\n           (c)         Any  waiver or consent shall be  effective\nonly  in  the specific instance and for the specific purpose  for\nwhich  it  was given.  No notice to or demand on the Borrower  in\nany  case  shall  entitle the Borrower to any  other  or  further\nnotice or demand in similar or other circumstances.\n\n           (d)         Any  amendment, modification, termination,\nwaiver or consent effected in accordance with this Section  12.08\n                                                   --------------\nshall  be  binding on each assignee, transferee, recipient  of  a\nLender's  Commitment or Loans, each future assignee,  transferee,\nrecipient of a Lender's Commitment or Loans and, if signed by the\nBorrower, on the Borrower.\n\n      12.09.  Independence of Covenants.  All covenants hereunder\n              -------------------------\nshall  be given independent effect so that if a particular action\nor  condition is not permitted by any of such covenants, the fact\nthat  it  would be permitted by an exception to, or be  otherwise\nwithin  the limitations of, another covenant shall not avoid  the\noccurrence  of an Event of Default or Potential Event of  Default\nif such action is taken or condition exists.\n\n\n          12.10.  Notices.\n                  -------\n            (a)         Unless  otherwise  specifically  provided\nherein,  all notices, requests and other communications  provided\nfor  hereunder  shall  be  in  writing  (including  by  facsimile\ntransmission),  provided  that  any  matter  transmitted  by  the\n                --------\nBorrower  by  facsimile  shall  be  immediately  confirmed  by  a\ntelephone  call  to  the  recipient at the  number  specified  in\nSchedule  1.01(a)  and  mailed, faxed or  delivered:  if  to  the\n----------------\nBorrower or the Administrative Agent, to the address or facsimile\nnumber  specified on the signature pages hereof and,  if  to  any\nLender,  to the address or facsimile number specified for notices\nin   Schedule  1.01(a)  or  in  the  applicable  Assignment   and\n     ----------------\nAcceptance or, as to the Borrower or the Administrative Agent, to\nsuch  other  address as shall be designated by such  party  in  a\nwritten notice to the other parties, and as to each other  party,\nat  such other address as shall be designated by such party in  a\nwritten notice to the Borrower and the Administrative Agent.\n\n\n             (b)          All   such   notices,   requests    and\ncommunications  shall, when transmitted by  overnight  (next-day)\ndelivery  or  faxed,  be  effective  on  the  next  day  or  when\ntransmitted  by facsimile machine, respectively;  if  mailed,  be\neffective  upon  the third Business Day after the date  deposited\ninto  the U.S. mail, or if delivered, be effective upon delivery;\nexcept  that  notices pursuant to Article II or XI shall  not  be\n                                  ----------    --\neffective until actually received by the Administrative Agent.\n\n\n            (c)          Any  notice,  request  or  communication\npermitted to be given by telephone shall be confirmed immediately\nin writing, including by facsimile.\n=================================================================\n                             -93-\n\n\n           (d)         The Borrower acknowledges and agrees  that\nany  agreement  of the Administrative Agent and  the  Lenders  to\nreceive certain notices by telephone and facsimile is solely  for\nthe  convenience  and  at  the  request  of  the  Borrower.   The\nAdministrative Agent and the Lenders shall be entitled to rely on\nthe  authority of any Person purporting to be a Person authorized\nby  the Borrower to give such notice and the Administrative Agent\nand  the Lenders shall not have any liability to the Borrower  or\nany  other Person on account of any action taken or not taken  by\nthe  Administrative  Agent or the Lenders in reliance  upon  such\ntelephonic  or facsimile notice.  The obligation of the  Borrower\nto  repay  the Loans shall not be affected in any way or  to  any\nextent by any failure by the Administrative Agent and the Lenders\nto  receive  written confirmation of any telephonic or  facsimile\nnotice or the receipt by the Administrative Agent and the Lenders\nof  a confirmation which is at variance with the terms understood\nby  the  Administrative Agent and the Lenders to be contained  in\nthe telephonic or facsimile notice.\n\n\n           12.11.   Survival of Warranties and  Agreements.   All\n                    --------------------------------------\nagreements,  representations  and warranties  made  herein  shall\nsurvive  the  execution and delivery of this  Agreement  and  the\nother Loan Documents and the making of the Loans hereunder.\n\n\n           12.12.   Failure  or Indulgence Not  Waiver;  Remedies\n                    ----------------------------------\nCumulative.    No   failure  or  delay  on  the   part   of   the\nAdministrative  Agent, any Issuing Bank  or  any  Lender  in  the\nexercise  of any power, right or privilege under any of the  Loan\nDocuments  shall  impair such power, right  or  privilege  or  be\nconstrued to be a waiver of any default or acquiescence  therein,\nnor shall any single or partial exercise of any such power, right\nor privilege preclude any other or further exercise thereof or of\nany  other  right, power or privilege.  All rights  and  remedies\nexisting  under  the  Loan Documents are cumulative  to  and  not\nexclusive of any rights or remedies otherwise available.\n\n\n          12.13.  Marshalling; Recourse to Security; Payments Set\n                  -----------------------------------------------\nAside.  Neither any Lender nor the Administrative Agent shall  be\n-----\nunder  any  obligation  to marshal any assets  in  favor  of  the\nBorrower  or any other party or against or in payment of  any  or\nall  of  the  Obligations.  Recourse to  security  shall  not  be\nrequired  at any time.  To the extent that the Borrower  makes  a\npayment  or payments to the Administrative Agent or the  Lenders,\nor the Administrative Agent or the Lenders enforce their security\ninterests or exercise their rights of setoff, and such payment or\npayments  or  the proceeds of such enforcement or setoff  or  any\npart  thereof  are  subsequently  invalidated,  declared  to   be\nfraudulent  or  preferential, set aside  and\/or  required  to  be\nrepaid  to  a  trustee,  receiver or any other  party  under  any\nbankruptcy  law,  state or federal law, common law  or  equitable\ncause,  then  to the extent of such recovery, the  obligation  or\npart  thereof originally intended to be satisfied, and all Liens,\nright  and  remedies therefor, shall be revived and continued  in\nfull  force  and effect as if such payment had not been  made  or\nsuch enforcement or setoff had not occurred.\n\n           12.14.   Severability.  In case any  provision  in  or\n                    ------------\nobligation under this Agreement or the other Loan Documents shall\nbe  invalid,  illegal or unenforceable in any  jurisdiction,  the\nvalidity, legality and enforceability of the remaining provisions\nor  obligations, or of such provision or obligation in any  other\njurisdiction,  shall  not  in any way  be  affected  or  impaired\nthereby.\n\n=================================================================\n                           -94-\n\n\n          12.15.  Headings.  Article and Section headings in this\n                  --------\nAgreement  are included herein for convenience of reference  only\nand  shall not constitute a part of this Agreement for any  other\npurpose or be given any substantive effect.\n\n            12.16.   Governing  Law.   THIS  AGREEMENT  SHALL  BE\n                     --------------\nGOVERNED  BY,  AND SHALL BE CONSTRUED AND ENFORCED IN  ACCORDANCE\nWITH, THE LAWS OF THE STATE OF NEW YORK.\n\n\n          12.17.  Successors and Assigns.  This Agreement and the\n                  ----------------------\nother Loan Documents shall be binding upon the parties hereto and\ntheir respective successors and permitted assigns and shall inure\nto  the  benefit  of  the parties hereto and the  successors  and\npermitted  assigns of the Lenders.  The terms and  provisions  of\nthis  Agreement  shall  inure to the  benefit  of  any  permitted\nassignee  or transferee of the Loans and the Commitments  of  any\nLender (to the extent such assignment or transfer is effected  in\naccordance with Section 12.01), and in the event of such transfer\n                -------------\nor  assignment,  the rights and privileges herein conferred  upon\nLenders  shall  automatically extend to and  be  vested  in  such\ntransferee  or assignee, all subject to the terms and  conditions\nhereof.  The Borrower's rights or any interest therein hereunder,\nand  the Borrower's duties and Obligations hereunder, may not  be\nassigned without the written consent of all the Lenders.\n\n\n          12.18.  Consent to Jurisdiction and Service of Process;\n                  ----------------------------------------------\nWaiver  of Jury Trial.  ALL JUDICIAL PROCEEDINGS BROUGHT  AGAINST\n---------------------\nTHE  BORROWER, THE ADMINISTRATIVE AGENT, THE ISSUING  BANKS,  THE\nARRANGER, THE SYNDICATION AGENTS AND THE LENDERS WITH RESPECT  TO\nTHIS  AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN  ANY\nSTATE OR FEDERAL COURT OF COMPETENT JURISDICTION IN THE STATE  OF\nNEW  YORK,  AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT,  THE\nBORROWER,  THE  ADMINISTRATIVE  AGENT,  THE  ISSUING  BANKS,  THE\nARRANGER, THE SYNDICATION AGENTS AND THE LENDERS EACH ACCEPT, FOR\nITSELF  AND  IN  CONNECTION  WITH ITS PROPERTIES,  GENERALLY  AND\nUNCONDITIONALLY, THE NONEXCLUSIVE JURISDICTION OF  THE  AFORESAID\nCOURTS,  AND IRREVOCABLY AGREES TO BE BOUND BY ANY FINAL JUDGMENT\nRENDERED THEREBY IN CONNECTION WITH THIS AGREEMENT OR ANY OF  THE\nOTHER  LOAN DOCUMENTS FROM WHICH NO APPEAL HAS BEEN TAKEN  OR  IS\nAVAILABLE.   EACH OF THE BORROWER, THE ADMINISTRATIVE AGENT,  THE\nISSUING  BANKS,  THE  ARRANGER, THE SYNDICATION  AGENTS  AND  THE\nLENDERS IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OF ANY  OF\nTHE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE\nMAILING  OF  COPIES  THEREOF  BY REGISTERED  OR  CERTIFIED  MAIL,\nPOSTAGE PREPAID, TO ITS RESPECTIVE NOTICE ADDRESSES SPECIFIED  ON\nTHE  SIGNATURE PAGES HEREOF, SUCH SERVICE TO BECOME EFFECTIVE TEN\nDAYS   AFTER   SUCH   MAILING.   EACH  OF   THE   BORROWER,   THE\nADMINISTRATIVE  AGENT,  THE  ISSUING  BANKS,  THE  ARRANGER,  THE\nSYNDICATION AGENTS AND THE LENDERS IRREVOCABLY WAIVES  (A)  TRIAL\nBY  JURY  IN  ANY  ACTION  OR PROCEEDING  WITH  RESPECT  TO  THIS\nAGREEMENT  OR  ANY  OTHER LOAN DOCUMENT, AND  (B)  ANY  OBJECTION\n(INCLUDING ANY OBJECTION OF THE LAYING OF VENUE OR BASED  ON  THE\nGROUNDS  OF  FORUM NON CONVENIENS) WHICH IT MAY NOW OR  HEREAFTER\n             --------------------\nHAVE  TO  THE  BRINGING  OF ANY SUCH ACTION  OR  PROCEEDING  WITH\n================================================================\n                             -95-\n\nRESPECT  TO  THIS  AGREEMENT OR ANY OTHER LOAN  DOCUMENT  IN  ANY\nJURISDICTION  SET FORTH ABOVE.  NOTHING HEREIN SHALL  AFFECT  THE\nRIGHT  TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY  LAW  OR\nSHALL  LIMIT  THE RIGHT OF ANY PARTY HERETO TO BRING  PROCEEDINGS\nAGAINST  ANY  OTHER  PARTY  HERETO IN THE  COURTS  OF  ANY  OTHER\nJURISDICTION.\n\n           12.19.   Counterparts; Effectiveness; Inconsistencies.\n                    --------------------------------------------\n(a)  This  Agreement  and any amendments, waivers,  consents,  or\nsupplements may be executed in counterparts, each of  which  when\nso  executed and delivered shall be deemed an original,  but  all\nsuch  counterparts together shall constitute but one and the same\ninstrument.\n\n\n            (b)         This  Agreement  shall  become  effective\nagainst each of the Borrower, each Lender, each Issuing Bank, the\nArranger,  the  Syndication Agents and the  Administrative  Agent\nhereto  on  the  date (the \"Effective Date\")  when  all  of  such\n                            --------------\nparties  have duly executed and delivered this Agreement to  each\nother  (delivery by the Borrower to the Syndication  Agents,  the\nIssuing  Banks  and  the  Lenders and by any  Syndication  Agent,\nIssuing Bank or Lender to the Borrower being deemed to have  been\nmade by delivery to the Administrative Agent).\n\n\n           (c)         This Agreement and each of the other  Loan\nDocuments  shall  be  construed to the extent  reasonable  to  be\nconsistent one with the other, but to the extent that  the  terms\nand  conditions of this Agreement are actually inconsistent  with\nthe  terms  and  conditions  of any  other  Loan  Document,  this\nAgreement shall govern.\n\n==================================================================\n           IN  WITNESS  WHEREOF,  this Agreement  has  been  duly\nexecuted on the date set forth above.\n\n\n\n                              ANNTAYLOR, INC., as Borrower\n\n\n                              By:   \/s\/ Walter J. Parks\n                                   ---------------------\n                              Name:     Walter J. Parks\n                              Title:    Senior Vice President-\n                                        Chief Financial Officer\n\n\n                              Address for Notices:\n\n                              142 West 57th Street\n                              New York, New York 10019\n                              Attention:  Senior Vice  President\n                                          and General Counsel\n                              Facsimile No.: (212) 541-3299\n                              Telephone No.: (212) 541-3318\n\n\n                              With a copy to:\n\n                              AnnTaylor, Inc.\n                              414 Chapel Street\n                              New Haven, CT 06511\n                              Attention:  Senior Vice President -\n                                          Chief Financial Officer\n                              Facsimile No.: (203) 865-2756\n                              Telephone No.: (203) 865-0811\n\n===================================================================\n\n\n\n                              BANK OF AMERICA NATIONAL TRUST\n                              AND SAVINGS ASSOCIATION,\n                              as Administrative Agent\n\n\n                             By:  \/s\/ Dietmar    Schiel\n                                  ---------------------\n                             Name:    Dietmar Schiel\n                             Title:   Vice President\n\n\n                              Address  for notices of borrowing,\n                              prepayments and\n                              other administrative matters:\n\n                              1850 Gateway Boulevard, 5th Floor\n                              Concord, CA 94520\n                              Attn: Agency Administrative Services #5596\n                                    Josephine    T.    Flores,\n                                    Assistance Vice President\n                              Facsimile No.:  (510) 675-8500\n                              Telephone No.:  (510) 675-8374\n\n\n                              Address  for  all  other  notices\n                              (including with respect\n                              to amendments and waivers):\n\n                              1455 Market Street, 12th Floor\n                              San Francisco, CA  94103\n                              Attention: Agency Management #10831\n                              Dietmar  Schiel,   Vice President\n                              Facsimile No.:  (415) 436-3425\n                              Telephone No.:  (415) 436-2769\n\n\n                              Payment Instructions:\n\n                              ABA #1210-0035-8\n                              Credit  to Account Number:  12333-15386\n\n                             Reference:  AnnTaylor\n\n=======================================================================\n\n\n                                BANCAMERICA ROBERTSON STEPHENS,\n                                As Arranger\n\n                                By:  \/s\/ Catherine Drake\n                                     -------------------\n                                Name:    Catherine Drake\n                                Title:   Vice President\n\n=======================================================================\n\n                                CITICORP USA,\n                                as Syndication Agent\n\n                                By:  \/s\/ Brenda Cotsen\n                                     ------------------\n                                Name:    Brenda Cotsen\n                                Title:   Vice President\n\n=====================================================================\n\n                                FIRST UNION CAPITAL MARKETS,\n                                as Syndication Agent\n\n                                By:  \/s\/ Paul Hogan\n                                     --------------------\n                                Name:    Paul Hogan\n                                Title:   Director\n\n=====================================================================\n\n                                CITIBANK, N.A.\n                                as an Issuing Bank\n\n                                By:  \/s\/ Brenda Cotsen\n                                     ---------------------\n                                Name:    Brenda Cotsen\n                                Title:   Vice President\n\n\n=====================================================================\n\n                                FIRST UNION NATIONAL BANK\n                                as an Issuing Bank\n\n                                By:  \/s\/ Irene Rosen Marks\n                                    ----------------------\n                                Name:    Irene Rosen Marks\n                                Title:   Vice President\n\n\n=====================================================================\n\n                                BANK OF AMERICA NATIONAL TRUST\n                                AND SAVINGS ASSOCIATION, as a Lender\n\n                                By:  \/s\/ Jody A. Pritchard\n                                     ---------------------\n                                Name:    Jody A. Pritchard\n                                Title:   Vice President\n\n====================================================================\n\n                                CITICORP USA\n                                as a Lender\n\n\n                                By:  \/s\/ Brenda Cotsen\n                                    ---------------------\n                                Name:    Brenda Cotsen\n                                Title:   Vice President\n\n===================================================================\n\n                                FIRST UNION NATIONAL BANK\n                                as a Lender\n\n                                By:  \/s\/ Irene Rosen Marks\n                                     ---------------------\n                                Name:    Irene Rosen Marks\n                                Title:   Vice President\n\n\n=====================================================================\n\n                                TRANSAMERICA BUSINESS CREDIT\n                                CORPORATION, as a Lender\n\n\n\n                                By:  \/s\/ Steven R. Fischer\n                                     ---------------------\n                                Name:    Steven R. Fischer\n                                Title:   Executive Vice President\n\n=====================================================================\n\n\n                                LASALLE NATIONAL BANK,\n                                as a Lender\n\n\n                                By:  \/s\/ Robert Corsentino\n                                     ----------------------\n                                Name:    Robert Corsentino\n                                Title:   Senior Vice President\n\n\n======================================================================\n\n                                HELLER FINANCIAL, INC.\n                                as a Lender\n\n\n\n                                By:  \/s\/ George Grieco\n                                    --------------------\n                                Name:    George Grieco\n                                Title:   Vice President\n\n=====================================================================\n\n                                AT&amp;T COMMERCIAL FINANCE\n                                CORPORATION, as a Lender\n\n                                By:  \/s\/ Paul Seidenwar\n                                    --------------------\n                                Name:    Paul Seidenwar\n                                Title:   Vice President\n\n=====================================================================\n\n                                AMSOUTH BANK,\n                                as a Lender\n\n                                By:  \/s\/ Emmanuel Darmanin\n                                    -----------------------\n                                Name:    Emmanuel Darmanin\n                                Title:   Attorney in Fact\n\n=====================================================================\n\n                                FREEMONT FINANCIAL CORPORATION,\n                                as a Lender\n\n                                By:  \/s\/ John Neher\n                                     ------------------\n                                Name:    John Neher\n                                Title:   Senior Vice President\n\n\n=====================================================================\n\n                                NATIONAL CITY COMMERCIAL FINANCE, INC.\n                                as a Lender\n\n\n                                By:  \/s\/ Elizabeth M. Lynch\n                                     -----------------------\n                                Name:    Elizabeth M. Lynch\n                                Title:   Vice President\n\n=====================================================================\n\n                                SUMMIT BANK,\n                                as a Lender\n\n\n                                By:  \/s\/ William V. Burian\n                                    ----------------------\n                                Name:    William V. Burian\n                                Title:   Vice President\n\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[6710,7104,9279],"corporate_contracts_industries":[9415,9494],"corporate_contracts_types":[9561,9560],"class_list":["post-40863","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-anntaylor-stores-corp","corporate_contracts_companies-citigroup-inc","corporate_contracts_companies-wachovia-corp","corporate_contracts_industries-financial__banks","corporate_contracts_industries-retail__clothing","corporate_contracts_types-finance__credit","corporate_contracts_types-finance"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/40863","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=40863"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=40863"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=40863"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=40863"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}